Fitness and discipline go together

As the Physical Fitness fiasco continues to unfold, will the tally of victims get longer and the service pre-payments mount even higher in the days to come after the Consumer Council revealed it has so far received more than 4,000 complaints involving HK$135 million?

Fingers crossed.

Physical Fitness was probably the most popular gym chain in Hong Kong before its sudden closure left its employees and customers in a state of shock.

The incident is bound to revive the long-standing issue of pre-paid services.

Physical Fitness was not the first commercial operator to close, stranding hundreds of customers.

There have been similar incidents over the years in which operators reportedly continued to aggressively enrol new students or members even on the eve of closure. Private tutorial schools and beauty salon customers were also victims on occasion.

If the watchdog's estimates were accurate, the value of outstanding pre-paid services would be about HK$135 million - or HK$33,000 per head - on average.

That's a huge sum.

Before the pandemic, the Consumer Council had proposed that cooling-off periods be legislated to accord better protection to consumers signing new service contracts. The government at that time accepted the recommendation but the legislative work was put aside after the eruption of the pandemic.

In light of the large number of consumers involved in the current gym fiasco, as well as reports of aggressive sales practices prior to closure, the authority must review the situation with a sense of urgency.

While the collapse of Physical Fitness was not the first of its kind, it is believed that it will not be the last of its kind. Unless the economy picks up strongly, more operators dependent on pre-payment and credit lines are likely to collapse.

Time is running short for Financial Secretary Paul Chan Mo-po to reverse the trend and he must act quickly to improve the situation.

It may be ironic that it is not always desirable in a free economy to legislate to mandate certain commercial behaviors, including the provision of a cooling-off period. Rather, it is preferable for sectors to display a level of responsibility as they operate in order to keep government intervention to the minimum.

As Consumer Council chief executive Gilly Wong said, nothing can stop the industries - not limited to gyms - from acting immediately to turn cooling-off periods free of tricky small print into industry-wide practice. Otherwise, the administration may have to consider legislating measures to enhance consumer protection.

Once the course of legislation is in place, everything could become possible. Will the new measures be tougher than thought as lawmakers try to score high?

In addition to a longer-than-expected cooling-off period, will money pre-paid be required to be put in a regulated separate account?

If nothing is new under the sun, nothing is impossible when it comes to politics. It is in the industries' own interest to exercise self-discipline before someone acts for them.