Hong Kong jewellery chain store Chow Sang Sang Jewellery Group has scrapped the 2 per cent commission it levies on customers buying gold and platinum.
But rivals Luk Fook and Chow Tai Fook say they are not planning to follow suit.
Chow Sang Sang’s move, according to the store’s website, was timed in response to the full implementation of the Competition Ordinance, but not as a direct consequence of it.
In Hong Kong, the price of gold jewellery is made up of the daily gold price, a handicraft fee and commission. Nearly all jewellery retailers charge a commission that is 2 per cent of the gold price. The Competition Ordinance, which came into effect last month, forbids anti-competitive behaviour such as price fixing, sharing market information, bid rigging or restricting output.
A Chow Sang Sang spokesperson says the commission was scrapped to simplify purchasing, enabling customers to calculate prices easily, therefore boosting the company’s competitiveness. The company had planned the cancellation for a long time, and the implementation of the
Competition Ordinance provided an appropriate time to make the change.
As an example, a gold necklace with a basic gold price of HK$39,780 and a handicraft fee of HK$3740 would, with the 2 per cent commission, cost HK$44,316 – HK796 more than under the Chow Sang Sang’s new pricing structure, reports the Apple Daily.
Meanwhile, under the new law, trade associations issuing suggested pricing could violate regulations on price collusion, reports AM730. This has led to the Hong Kong Jewellers’ & Goldsmiths’ Association and the Kowloon Pearls, Precious Stones, Jade, Gold & Silver Ornament Merchants Association both stopping their daily listings of jewellery gold prices for goldsmiths.