Hong Kong halts sweeping overhaul of privacy law over concerns of impact on businesses

A long-awaited legislative reform to empower Hong Kong authorities to penalize companies for data breaches has been put on hold over concerns it could slow down the local business environment, according to lawmakers.

Constitutional and Mainland Affairs Secretary Erick Tsang Kwok-wai said on Monday the government could consider a “piecemeal approach” by introducing minor improvements first to minimize the impact on small businesses.

Tsang made the remarks while appearing alongside Privacy Commissioner Ada Chung Lai-ling at a meeting of the Legislative Council’s constitutional affairs panel.

Chung said his office had been studying amending the Personal Data (Privacy) Ordinance to give the watchdog more teeth.

Major proposed changes include enabling privacy watchdogs to impose administrative fines, making reporting of data leakage incidents mandatory, requiring companies to draw up data retention policies, and also increasing penalties.

“The law has been in place for 28 years and there has been no change in the penalties,” Chung said.