chosen is litigation or judicial mediation. The amount of compensation awarded in the Anhui milk powder scandal (discussed earlier) was atypically large, and was most likely due to the national media coverage and attention from high level political leaders.
F. Conclusion China’s consumer legislation is relatively sophisticated but remains at the mercy of the government’s power to enforce the laws and provide an effective system to legislate claims.
This creates problems not only ex post for consumers seeking
compensation for injuries caused by faulty products but also ex ante since producers might not expect to have to pay for harm caused by shoddy goods. In part, this is a reflection of China’s transition from a simple market system where consumer expectations relied on things like local reputation but it also reflects a fundamental problem that must be resolved for effective market regulation of product quality. Only when producers must consider the consequences of harming consumers will the incentive to make money through the easiest and cheapest methods disappear. Therefore, reform of the legal system and the development of modern consumer protection organizations should remain a high priority for the Chinese government going forward.
IV: HONG KONG’S CONSUMER PROTECTION REGIME Hong Kong has a reputation for maintaining an extremely business-friendly environment, and this is reflected to some extent in the consumer law. Unlike China, which officially places great emphasis on protecting consumers through legislation—
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