Following is a question by the Hon Kenneth Lau and a written reply by the Secretary for Commerce and Economic Development, Mr Edward Yau, in the Legislative Council today (May 13):
 
Question:
 
     With the coronavirus disease 2019 epidemic raging on in Hong Kong, surgical masks (masks) have all along been in short supply and their prices have surged. In view of this, the Government launched the Local Mask Production Subsidy Scheme (the Scheme) to provide subsidies for manufacturers to produce masks locally. The subsidy quota of 20 production lines has now been fully allocated. Under the Scheme, the first two million masks produced by each subsidised production line each month must be sold to the Government for a period of one year. If the monthly production exceeds two million, the manufacturers concerned may sell the surplus masks locally by themselves. However, it has been reported earlier on that a manufacturer which was granted subsidy has sold its masks on the market before signing any agreement with the Government and supplying masks to the Government. In this connection, will the Government inform this Council:

(1) whether it has signed an agreement with all of the manufacturers which were granted subsidies; if so, of the respective dates on which such agreements came into force; if not, the reasons for that; whether such agreements stipulate a partial or full refund of the subsidy by a subsidised manufacturer to the Government when the former has failed to supply the Government with the quantity of masks specified in the agreement;

(2) of the following information in respect of each subsidised production line: the (i) commencement date of production, (ii) date on which the masks were/will be first supplied to the Government, (iii) date on which the masks were/will be first sold on the market (if applicable), as well as (iv) the respective monthly quantities of masks for adults and those for children produced, supplied to the Government and sold on the market (if applicable) since the commencement of production;

(3) of the criteria or mechanism to be adopted by the Government for allocating the masks supplied to it under the Scheme, and whether it will make public the distribution of such masks;

(4) whether it will impose a restriction on the prices at which the subsidised manufacturers sell those locally produced masks on the market, so as to ensure that members of the public can acquire masks at reasonable prices; and

(5) whether it will put in place a regulatory mechanism for the Scheme to ensure the proper use of public funds?
 
Reply:
 
President,
 
     My consolidated reply to the various parts of the question raised by the Hon Kenneth Lau is as follows:
      
     The Government launched the Local Mask Production Subsidy Scheme (the Scheme) under the Anti-epidemic Fund to facilitate local production of masks in order to stabilise supply and to build up stock. The Government announced on May 4 that it allocated all the quota of 20 production lines under the Scheme. It is estimated that, when all the production lines are in full production, every month they would collectively supply 33.85 million masks to the Government. Further details are tabulated at Annex.
      
     Given the global shortage of masks, enterprises in many places have flocked to establish mask production facilities and have recently sent their mask samples to accredited laboratories outside Hong Kong for certification, resulting in a longer-than-normal lead time for certification. Taking this bona fide situation into consideration and in accordance with the application guide, the Government would allow approved applicants who are still waiting for such certification and are unable to begin supplying masks to the Government by the target commencement date to apply for an extension of up to one month. Any extension beyond one month without exceptional reasons and full justifications would result in revocation of the subsidy.
      
     The Government has, through the Hong Kong Productivity Council (HKPC), provided all approved applicants with a copy of the funding agreement and have been signing the agreement with individual companies successively. Once the approved applicants secure the relevant certification and meet other relevant requirements, they would gradually begin to supply masks to the Government. As mentioned above, obtaining certification for masks is taking longer than usual recently, and this also impacts on the timing of supplying masks by approved applicants.
      
     The masks procured by the Government under the Scheme are mainly for addressing the needs of the public sector, particularly those of frontline health care workers and other frontline staff. After the masks produced by a subsidised production line have obtained the relevant certification, the production line must supply two million masks to the Government each month before it could sell the excess to the local market. Under no circumstances could the masks be exported. As the global supply of surgical masks continues to be tight in the near term, this restriction has the effect of increasing local mask supply and is more pragmatic than regulating the price of masks.
      
     As the Chief Executive announced earlier, the Government will share the first batch of 30 million masks procured under the Scheme with the public. Depending on the certification and production progress of the subsidised production lines, the Government estimates that a pack of 10 masks would be distributed to each household starting around end June. Further details will be announced later.
      
     To ensure proper use of public funds, the Government and the HKPC will regularly monitor the operations of the subsidised production lines during the one-year subsidy period. This includes ensuring that the production lines meet their targeted outputs and monitoring whether masks produced in excess of those supplied to the Government are distributed locally etc. The subsidy will be disbursed in phases which hinge on the progress of establishing the subsidised production line as well as its production output. Funds are disbursed only if the production line meets specified targets, such as obtaining certification for its masks, reaching a certain level of production output etc. The funding agreement also stipulates that, if a production line's actual output falls short of the committed output as stated in its application, the total subsidy amount would also be reduced proportionally. Where a production line ultimately fails to meet the Scheme's requirements, the Government may also recover from the concerned company any funds already disbursed.

     Following is a question by the Hon Yung Hoi-yan and a written reply by the Secretary for Commerce and Economic Development, Mr Edward Yau, in the Legislative Council today (May 13):
 
Question:
 
     It has been reported that some lawbreakers in South Korea set up an instant messaging group (known as the Nth room) for persons who paid to join the group to watch video clips that featured females being sexually abused. The group had as many as 260 000 members, and there were at least 74 victims. In April this year, the media uncovered that a similar incident had occurred in Hong Kong, in which some people created an instant messaging group (known as the Hong Kong version of Nth room) for members to exchange video clips that featured their sexual activities with partners. In this connection, will the Government inform this Council:
 
(1) of the existing legislation targeting the crime of disseminating obscene and indecent articles through social media or instant messaging groups;
 
(2) of the number of reports received by the Police in each of the past five years involving the crime mentioned in (1); in respect of each of the groups concerned, the number of victims (with a breakdown by gender and age (each group covering 10 years of age)), the number of members, the offences involved, as well as the respective numbers of persons arrested, prosecuted and convicted; the respective maximum and minimum penalties imposed on those convicted;

(3) whether the Police have initiated investigation after the Hong Kong version of Nth room was reported; if so, of the details, including the investigation targets, the evidence-gathering work (including whether they have demanded other government departments, organisations or Internet service providers to provide information) and the progress made, as well as the number of persons arrested to date; and
 
(4) whether it has comprehensively reviewed if the existing legislation is capable of combating such crimes; if it has reviewed and the outcome is in the negative, whether it will amend the existing legislation or enact new legislation; if it has not, of the reasons for that?
 
Reply:
 
President,
 
     Our reply to the various parts of the question raised by the Member, prepared in consultation with the Security Bureau, is as follows:
 
(1) and (2) According to section 21 of the Control of Obscene and Indecent Articles Ordinance (Cap 390), any person who publishes any obscene article in Hong Kong, whether or not he knows that it is an obscene article, commits an offence and is liable to a fine of $1,000,000 and to imprisonment for three years. If the servers of the relevant social media and instant messaging groups are hosted in Hong Kong, they would also be subject to regulation.
 
     Moreover, according to section 3 of the Prevention of Child Pornography Ordinance (Cap 579), any person who publishes any child pornography commits an offence and is liable on conviction to a maximum fine of $2,000,000 and to imprisonment for eight years.
      
     The figures of arrest, prosecution, conviction and sentencing of the above offences in the past five years are at Annex. The Government does not maintain the other breakdown of figures requested in the question.
 
(3) Regarding the incident of distribution of pornography and obscene articles in online social media groups in recent months, the Cyber Security and Technology Crime Bureau of the Police has followed up and conducted investigation, and made requests to the relevant social media to remove the group and content. The investigation is ongoing and no one has been arrested at this stage.
 
     The Internet is a public platform filled with a huge amount of information, and can be exploited by criminals as a medium and tool for committing crimes. To effectively prevent, detect, fight and solve these crimes, the Police conduct "cyber patrol" to collect intelligence, and exchange intelligence with Mainland and overseas law enforcement agencies to conduct joint operations as appropriate.
 
(4) In view of the rapid developments of information technology, computers and the Internet, as well as the potential for them to be exploited for carrying out criminal activities, a sub-committee under the Law Reform Commission (LRC) has commenced a study on cybercrime in January 2019. The work of the sub-committee includes studying the challenges arising from the rapid developments of computers and the internet, reviewing existing legislation and other relevant measures, examining relevant developments in other jurisdictions, and recommending law reforms as necessary. The Security Bureau will pay close attention to the progress of the sub-committee's review.
 
     The LRC also published in April 2019 a report on "Voyeurism and Non-consensual Upskirt-photography" recommending the introduction of a new offence of voyeurism to deal with an act of non-consensual observation or visual recording of another person for a sexual purpose; and a new offence in respect of non-consensual upskirt-photography.

     In this regard, the Security Bureau is planning to consult the Legislative Council Panel on Security on amending Crimes Ordinance (Cap 200) to introduce the relevant offences, to be followed by a public consultation. With regard to public views, the Security Bureau will draft the relevant legislative amendment proposal with a view to introducing a bill for the Legislative Council's scrutiny.

     As regards the Control of Obscene and Indecent Articles Ordinance, the Commerce and Economic Development Bureau will continue to listen to the views and suggestions of different sectors of the community, and review the existing legislative requirements in a timely manner.

     Police are investigating a fatal traffic accident in Tsuen Wan in the small hours today (May 13) in which a 38-year-old man died.

     At 3.58am, a medium goods vehicle (MGV) driven by the 38-year-old man was travelling along Cheung Pei Shan Road towards Tsuen Wan. When approaching Tsuen Kam Interchange, it reportedly lost control, rammed into crash cushions and then side-turned.

     The MGV driver was trapped inside the compartment and was rescued by firemen. Sustaining multiple injuries, he was certified dead at scene.

     Investigation by the Special Investigation Team of Traffic, New Territories South is underway.

     Anyone who witnessed the accident or has any information to offer is urged to contact the investigating officers on 3661 1300 or 3661 1346.
     

     The Labour Department (LD) is investigating a fatal work accident in MTR Hong Kong Station this morning (May 13) in which a man died.
 
     The LD immediately deployed staff to the scene upon receiving a report of the accident, and is now conducting an investigation to look into its cause.

     The Government announced earlier the launch of the Employment Support Scheme (ESS) of $81 billion to provide time-limited financial support to employers to retain their employees, hence maintaining the strength for Hong Kong. The Chief Executive, Mrs Carrie Lam, announced today (May 12) the first tranche of the ESS will receive application from May 25.
 
      "In the past month, we have carried out intensive research, discussed with stakeholders, and listened to the views of different sectors. We have largely finalised the details of the ESS. The first tranche of the ESS will provide wage subsidies for three months from June to August 2020. The application will commence on May 25 and last for three weeks," said Mrs Lam.
 
     Mrs Lam at the same time announced four improvement measures in respect of the ESS:
 
1. Extending the coverage of the ESS to employees aged 65 or above under the Mandatory Provident Fund (MPF) schemes. At present, around 60 000 employees aged 65 or above are having MPF accounts. If employers have made voluntary MPF contribution for these employees, they may apply for wage subsidies for them;
 
2. Extending the coverage of the ESS to two MPF Industry Schemes (tailor-made for the construction industry and catering industry) which were previously excluded. Employers may apply for wage subsidies for "regular employees" (i.e. employees who are 18 – 64 years of age and have been employed for a continuous period of 60 days or more) if employers have made MPF contributions for them;
 
3. Relaxing the eligibility of self-employed persons (SEPs) that they should have made MPF contributions between January 1, 2019 and March 31, 2020. After the relaxation, SEPs who have set up an MPF account on or before March 31, 2020 and with that account remaining opened as of the same date may apply for a one-off subsidy of $7,500; and
 
4. The amount of wage subsidies provided by the Government will be calculated based on 50 per cent of the actual wages paid to each employee in the "specified month" at the choice of the employers based on the situation of the enterprises, with a wage cap at $18,000 per month. After listening to the views of some of the sectors hard hit by the epidemic, the Government decided to allow the employers to choose December 2019 as the "specified month". In other words, the "specified month" for the purpose of applying for the first tranche of wage subsidy can be any one month between December 2019 and March 2020, instead of between January and March 2020 as previously proposed.
 
      The measures under the Anti-epidemic Fund should fulfill the following five principles: first, simple to understand; second, easy to access; third, quick to disburse funds; fourth, sufficiently broad-based benefitting large numbers of individuals and businesses; and fifth, paving the way for economic recovery.
 
      "The ESS, after refinements and revisions, will better fulfill these five principles," Mrs Lam said.  
 
      Generally speaking, with the exception of ineligible employers (mainly organisations whose employees' salaries are not affected by the epidemic, for example, the HKSAR Government, statutory bodies, subvented organisations with employees' salaries subsidised by the Government), all employers who have been making MPF contributions for employees (including Master Trust Schemes and Industry Schemes) or who have set up MPF-exempted Occupational Retirement Schemes Ordinance (ORSO) schemes, may apply for ESS.
 
      To further clarify eligibility and to prevent people from applying for wage subsidy by establishing a new company and opening MPF accounts, the MPF accounts of the relevant employers and employees applying for the wage subsidy should have been set up on or before March 31, 2020 (i.e. cannot be backdated to that date or any earlier dates). In other words, employers with the MPF accounts set up on or after April 1, 2020 will not be eligible for the first tranche of wage subsidy.
 
      Employers participating in the ESS must provide an undertaking not to make redundancies during the subsidy period, and to spend all the wage subsidies on paying wages to the employees. If an employer fails to comply with the undertaking, the Government will claw back the unspent balance of the wage subsidy or/and impose other penalty. Details will be announced early next week.
 
      Application for the first tranche of wage subsidy under the ESS can be made starting from May 25. Eligible employers and SEPs may submit online application from May 25 to June 14. The wage subsidy is expected to be disbursed to the majority of employers in three to four weeks after submitting application.
 
      In order to disburse the wage subsidy to employers as early as possible and hence prevent employers making redundancies, the Government will ensure the application procedures under the ESS are simple and easy to understand. Employers and SEPs applying for the ESS are required to authorise the ESS processing agent (appointed by the Government) to receive MPF record certificates directly from the MPF trustees, in order to confirm the information related to MPF contributions. Employers are not required to submit such information at the time of application, and MPF trustees will not charge employers and SEPs any fees on the issue of the certificates.
 
      The Government will announce next week other detailed arrangements about the ESS including the online application procedures, monitoring mechanism and calculation of penalty. A dedicated website on the ESS will commence operation by then. 
 
      For enquiries, please email to enquiry@employmentsupport.hk or call our hotline at 183 6122 starting from 9am tomorrow (May 13). The service hours of the hotline is from 9am to 6pm, Monday to Friday (closed on Saturday, Sunday and public holidays), and the service hours will be from 9am to 6pm, Monday to Sunday during the application period (i.e. May 25 to June 14).
 
      More information about the ESS is attached.