Legislative Council

LC Paper No. CB(1)1496/98-99
(These minutes have been
seen by the Administration)

Ref: CB1/PL/EA/1

LegCo Panel on Environmental Affairs

Members present :

Hon Christine LOH (Chairman)
Hon HUI Cheung-ching (Deputy Chairman)
Dr Hon Raymond HO Chung-tai, JP
Prof Hon NG Ching-fai
Hon Bernard CHAN
Hon CHAN Wing-chan
Hon WONG Yung-kan
Hon YEUNG Yiu-chung
Hon LAU Kong-wah
Hon Mrs Miriam LAU Kin-yee, JP
Hon LAW Chi-kwong, JP

Non-Panel members attending :

Hon Martin LEE Chu-ming, SC, JP
Hon Ronald ARCULLI, JP

Members absent :

Dr Hon LEONG Che-hung, JP
Hon Mrs Sophie LEUNG LAU Yau-fun, JP
Hon CHOY So-yuk

Public officers attending :

For all items

Mr Kim SALKELD, JP

Deputy Secretary for Planning, Environment and Lands (Environment)

For items IV and V

Mr Howard CHAN

Principal Assistant Secretary for Planning,

Environment and Lands (Environment)

For item IV

Ms Wendy KO

Assistant Secretary for Planning,

Environment and Lands (Environment)

Mr Elvis W K AU

Assistant Director (Environmental Assessment & Noise)

Environmental Protection Department

Mr K S CHAN

Principal Environmental Protection Officer

(Noise Management and Policy)

Environmental Protection Department

For item V

Miss Agnes KWAN

Assistant Secretary for Planning,

Environment and Lands (Environment)

Mr MOK Wai-chuen

Principal Environmental Protection Officer

(Motor Vehicle Emissions)

Environmental Protection Department

For item VI

Mr Steve BARCLAY

Principal Assistant Secretary for Planning,

Environment and Lands (Environment)

Clerk in attendance :

Miss Odelia LEUNG,

Chief Assistant Secretary (1)1

Staff in attendance :

Mrs Mary TANG,

Senior Assistant Secretary (1)2

As both the Chairman and the Deputy Chairman were held up by traffic, members elected Mr YEUNG Yiu-chung to chair the meeting.

I Confirmation of minutes of meeting
(LC Paper No. CB(1)988/98-99)

2. The minutes of meeting held on 8 January 1999 were confirmed.

II Date of next meeting and items for discussion

3. Members agreed to discuss the progress of Year 2000 Compliance in environment-related Government departments and non-government organisations funded or regulated by Government at the next Panel meeting scheduled for 7 May 1999 at 10:45 am.

(Post-meeting note: On the advice of the Chairman, the next regular Panel meeting was re-scheduled for 4 May 1999 at 3:30 pm.)

III Information papers issued since last meeting

4. Members noted that no information paper had been issued since the last meeting.

IV Proposed amendments to the Noise Control Ordinance, Cap. 400.
(LC Paper Nos. CB(1)937/98-99(02) and 1046/98-99(01))

5. At the invitation of the Chairman, the Principal Assistant Secretary for Planning, Environment and Lands (Environment 1) (PAS/PEL(E1)) said that pursuant to the discussion on the proposed amendments to the Noise Control Ordinance (NCO) at the Panel meeting on 5 March 1999, the Administration had provided additional information on the expected deterrent effect of the proposed amendments, level of fines, effect of noise on workers and the general community, extent of consultation with relevant bodies and the meaning of responsible persons of bodies corporate.

6. The Assistant Director of Environmental Protection (Environmental Assessment and Noise) (AD/EP) briefed members on the details of consultation. He advised that about 25 organizations which would likely be affected by the proposed amendments to NCO had been consulted. Four consultative forums were held in March 1999 to explain and gather comments on the proposed amendments. The comments received were detailed in Annex E to the Administration's paper. While some organizations were in support of the proposed amendments, others were concerned about the impact on the trade, in particular the legal effect on the top management who would be held liable for noise offences. The Administration had explained to these organizations that their top management would not be affected if they abided by the provisions of NCO. Furthermore, there would be clear guidelines on the compliance requirements of NCO. AD/EP said that the proposed amendments would be drafted in such a way as to address the concerns of the consultees.

Definition of top management

7. Mr LAU Kong-wah was of the view that the proposed amendments were unclear on the meaning of "top management" who would be held liable for offences under NCO and on their legal responsibility. Clarity was important given the complicated subcontracting system in the construction industry. AD/EP said that the proposed amendments merely sought to bring the provisions of NCO in line with other environmental legislation in that the management should be held liable for an offence committed by bodies corporate. The proposed amendments aimed to place the onus of complying with the law on those who had the ability and responsibility to improve the management, operation and supervision of bodies corporate. With the enactment of the proposed amendments, it was expected that the top management of a body corporate would work out an effective system to comply with the provisions of NCO. Except for an offence relating to the carrying out of construction works without a construction noise permit, statutory defence would be provided for all other offences under NCO such that the corporate management would not be held liable if they could prove that steps had been taken to prevent contravention through establishing and operating a proper management system. A Code of Practice (COP) to guide the industry in exercising due diligence to prevent violations under NCO would be issued by the Environmental Protection Department (EPD). AD/EP assured that there would be clear provisions on the environmental responsibility of the corporate management and how this would apply to a subcontracting system. He stressed that the proposed amendments would take account of members' views.

(The Chairman arrived at 11:10 am and took over the chair at this juncture.)

8. Mr Ronald ARCULLI sought clarification of the definition of top management, the extent of their responsibility, and whether only those persons who were actively involved in the management of the company would be held responsible for an offence. AD/EP said in response that the top management would be defined as "director, manager, secretary or other similar officer thereof, or who was purporting to act in any such capacity". This definition was meant to cover persons who were responsible for the management of the company, for example, the managing director. The Administration would need to look at the company structure and identify who should be held responsible on a case-by-case basis.

9. Mr Ronald ARCULLI pointed out that under the proposed wording, the entire corporate board might be charged with a noise offence. Mr CHAN Wing-chan expressed the same concern. The Chairman pointed out that the proposed amendments conferred power on the Administration to decide who should be held responsible for the commission of a noise offence. Mr Martin LEE enquired if non-executive directors would be held liable for noise offences.

10. PAS/PEL(E1) said that the proposed amendments for holding the management of bodies corporate liable for offences were modelled after a number of existing legislation. Similar provisions were found for example in the Import and Export Ordinance, Cap 60. AD/EP added that the Environmental Impact Assessment Ordinance, Cap. 499 and the Air Pollution Control Ordinance, Cap. 311 had similar provisions too.

11. Mr Ronald ARCULLI further enquired who should be held liable if an offence was committed because of failure on the part of workers to follow the contractor's or subcontractor's instruction. PAS/PEL(E1) said that where an offence was committed, the company would be held liable, irrespective of whether it was attributed to the negligence of workers, contractor or subcontractor. The top management would also be prosecuted if it was proved that they had failed to take steps to prevent contravention through establishing and operating a proper management system. AD/EP added that if the top management could prove that they had put in place a proper system to prevent the commission of an offence, they would have statutory defence.

12. Mr HUI Cheung-ching shared the view that the proposed definition of top management was unclear. Under the proposed definition, the director, manager and secretary or other similar officer could be held responsible for noise offences. He was concerned that upon commission of an offence, the top management could shift responsibility to the lower management. In response, AD/EP agreed that the proposed definition of top management could be improved.

13. Mr Ronald ARCULLI sought clarification of the legal status of the Code of Practice (COP), in particular whether it was intended to be statutory defence such that if the bodies corporate had complied with the COP, they would not be held liable for an offence. AD/EP said that the Department of Justice had suggested that a COP should be issued under NCO such that if the management did fulfil their responsibilities and duties under the COP, they would have statutory defence in court.

Consultation

14. Responding to Mr CHAN Wing-chan's enquiry about consultation with the restaurant trade, the Principal Environmental Protection Officer (Noise Management and Policy) (PEPO(NMP)) advised that representatives of restaurant associations had been invited to attend the consultative forums on the proposed amendments to NCO. The main concern of the restaurant trade was the need to provide guidelines on good environmental management and practical ways to abate noise. He said that the Administration would provide a clear delineation on the environmental responsibility of corporate management after consultation with members and the public.

15. As regards Mr CHAN Wing-chan's further enquiry on measures to mitigate noise nuisance caused by conditioners and water pumps, PEPO(NMP) advised that the noise limits were set out in a technical memorandum. Noise emitted by power-generated equipment could be lowered through installation of noise reducing devices and proper maintenance. Pamphlets on measures to reduce noise levels were made available to trade organizations. Noise abatement notices would be issued when the noise generated by air conditioners and water pumps was found to exceed the stipulated level.

16. Mrs Miriam LAU enquired whether the Administration would consider issuing smoke abatement notices to vehicle owners as a means to control the emission problem, similar to the existing mechanism for noise control. PAS/PEL(E1) said in response that a more effective means could be through education and EPD had issued guidelines to the transport trade on measures to reduce vehicle emissions.

17. Mr Ronald ARCULLI said that three of his constituent organizations, namely the Hong Kong Construction Association, the Hong Kong Real Estate Developers Association, and the Electrical and Mechanical Contractors Association were dissatisfied with the consultation. According to these organizations, the Administration only briefed but not consulted them on the proposed amendments. Apart from the brief response made by EPD which was set out in Annex F to the information paper, the Administration had not provided information on the way to address the concerns of the construction industry. Mr ARCULLI considered the way in which consultation was conducted unacceptable.

18. PAS/PEL(E1) said that consultation had just started and it would be an ongoing process. The Administration had undertaken to work closely with the Hong Kong Construction Association in formulating a COP for the construction industry for compliance with NCO.

19. Mr Martin LEE said that it was clear that consultation done so far by the Administration was inadequate. He considered that apart from the trade associations, unions of workers and the general public who were affected most by construction noise should also be consulted. He emphasized the need for more publicity on the proposed amendments. AD/EP reckoned the need for publicity. He said that through the consultation process, the public would be informed of the amendments and given an opportunity to express views. He assured that wide publicity would be made before the proposed amendments were put into operation.

Others

20. Mr Ronald ARCULLI noted with concern that the Administration briefed the judicial officers in 1993 and 1996 on the enforcement situation and the severity of the noise problem. He questioned whether it was appropriate on the part of the Administration to discuss with the Judiciary behind closed door. His view was shared by Mr Martin LEE who pointed out that should the Administration consider the penalty imposed by the court for conviction of a noise offence too light, it should seek a review of the sentence. PEPO(NMP) said in response that the two briefings for the Judiciary were meant to enhance their understanding of the severity of the noise problem. There had never been any intention on the part of the Administration to interfere with the decisions of the court.

21. Mr LAU Kong-wah said that he had reservations about the proposed amendments which, in his view, could not achieve the purpose of deterring repeated offences. He enquired if the Administration would consider imposing heavier penalties on repeated offenders to enhance the deterrent effect. As an additional deterrent measure, he suggested disqualifying contractors who had repeatedly violated NCO from bidding Government contracts.

22. In response, PAS/PEL(E1) said that the legislative intent of the proposed amendments was not to impose heavier penalties but to hold the management liable for offences committed by bodies corporate under NCO. This would create a level-playing field for top management of bodies corporate and individual proprietors in respect of their liability for offences under NCO. AD/EP added that the proposed amendments would help in achieving a deterrent effect since the management of bodies corporate would be held personally liable for offences under NCO. He shared members' view on the need for a package of measures to deter violations. Apart from increasing maximum fines under NCO in the past, the Administration had also briefed judicial officers on the enforcement situation and the importance of NCO in the control of noise. Through a series of publicity programmes and forums, the Administration aimed at educating the construction industry on ways to comply with the requirements of NCO. EPD had recently proposed that the works departments should have administrative mechanisms to assess the environmental performance of contractors and to disqualify the repeated offenders from bidding Government contracts. The aforesaid measures, coupled with the proposed amendments, would greatly deter the commission of noise offences.

23. Referring to Annex F to the Administration's paper, Mrs Miriam LAU supported the public utility companies' view that the proposed amendments should apply to repeated offenders only. PAS/PEL(E1) explained that this was not the case in other environmental legislation. However, the suggestion could be considered and public views were welcome in this aspect. The Administration would need to balance different considerations in the control of noise. Prosecution would be taken against a person for a breach of laws, albeit for the first time. The legislative intent of the proposed amendments was to prevent violations, not to penalise a particular group of persons.

24. Members requested the Administration -(a) to further clarify the meaning of top management as to who would be held responsible for the commission of an offence under NCO;(b) to provide a list of legislation which contained provisions for holding the top management of a body corporate liable for an offence, examples of prosecution cases, and the criteria used in these cases for deciding which one of the management should be prosecuted;(c) to explain the difficulties, if any, in enforcing the provisions referred to in (b) above;(d) to explain the operation of the proposed provisions under a sub-contracting system; and(e) to consider conducting further consultation with affected parties.

Admin.

25. PAS/PEL(E1) said that the Administration would provide for members' reference a copy of the draft amendment Bill and the draft COP when they were available. He said that the Administration was ready to further consult members, the trade and the public on the proposed amendments before introducing them into LegCo.

26. Mr Martin LEE said that the Democratic Party would be interested to study the proposed amendments closely and encouraged the Administration to take the matter forward. Mr Ronald ARCULLI said that the lack of clarity in the proposed amendments had created uncertainties in the law. The Administration should make clear all the uncertainties before introducing a law to impose criminal liabilities, otherwise it would not be fair to the affected parties. The Chairman said that she supported the Bill in principle but consider further information to clarify members' queries necessary. Members agreed that pending the provision of information by the Administration, the Panel would further discuss the matter.

V Proposed amendment to the Air Pollution Control (Vehicle Design Standards) (Emission) Regulation
(LC Paper No. CB(1)1046/98-99(02))

27. At the invitation of the Chairman, PAS/PEL(E1) briefly explained the background and justifications for the proposed amendments to the Air Pollution Control (Vehicle Design Standards) (Emission) Regulation, (Cap. 311, sub. leg.) as outlined in the Administration's information paper. He said that subject to members' agreement, the Administration would introduce the proposed amendment Regulation into LegCo in May 1999.

28. Responding to Mr CHAN Wing-chan's enquiry on the number of diesel taxis that would be affected by the proposed amendments, PAS/PEL(E1) explained that the proposed amendments would only apply to newly registered taxis and existing taxis in use would not be affected. As regards the latest requirements of the European Union and Japanese emission standards, the Principal Environmental Protection Officer (Motor Vehicle Emissions) (PEPO(MVE)) said that light duty diesel vehicles meeting the latest European Union and Japanese standards would emit 55% less particulates and 38% less hydrocarbons and nitrogen oxides than models complying with the preceding standards. Under the proposed amendments, all newly-registered motor vehicles below 3.5 tonnes would be required to comply with the tightened emission standards. The Motor Traders Association had been consulted on the availability of compliant vehicles and their prices. Car retailers confirmed that vehicles meeting the proposed requirements would be available in the local market. Some compliant models were already on sale and being used by the trade. The prices of compliant vehicles and those complying with preceding standards were comparable.

29. Mrs Miriam LAU welcomed the tightening of emission standards under the proposed amendments. Since the European Union standard was more stringent than the Japanese standard, she queried why the proposed amendments provided for the adoption of two standards instead of the more stringent one. The Chairman echoed the view and queried why the Administration did not adopt a unified standard. PEPO(MVE) said that the European Union standard would be adopted as the baseline standard. Vehicles imported into Hong Kong must meet this standard. The Japanese standard for vehicles below 2.5 tonnes was equivalent to the European Union standard. Vehicles over 2.5 tonnes would need to comply with the European Union standard. The adoption of all acceptable standards among the European Union, the USA and the Japanese standards was to facilitate car importers to assess whether a particular model complied with the emission requirements, given that the three countries' standards had different testing methods and numeric values for the emission limits.

30. The Deputy Secretary for Planning, Environment and Lands (DS/PEL) affirmed that the more stringent European Union standard would be adopted in Hong Kong. Vehicle importers would be provided with information on models of vehicles which had been subject to the Japanese testing standard and were in compliance with the European Union standard.

31. In response to members, PEPO(MVE) agreed to provide a paper explaining how the Administration set motor vehicle emission standards in Hong Kong.

32. Responding to Mr Martin LEE, PEPO(MVE) advised that vehicles below 3.5 tonnes would include light goods vans and public light buses. Vehicles with a capacity of 2,500 cc would be around 1.25 tonnes. The tightening of emission standards for public light buses exceeding 4 tonnes had been introduced in October 1998.

33. Mr Martin LEE sought information on the reasons held by the three taxi associations for objecting the proposed tightened emission standards. PAS/PEL(E1) said that some of the taxi associations had mistaken that the proposed amendments would apply to existing taxis in use. Others had objected because they considered that liquefied petroleum gas taxis would resolve the pollution problem and that there was no need for other measures. The Administration had explained to the taxi associations that diesel taxis which complied with new emission standards were available in the market and the prices were comparable to the current models in use. However, some taxi associations still maintained their objections against the proposed amendments. In this connection, Mrs Miriam LAU informed that the consultation paper provided by the Administration to the taxi associations was unclear on application of the new standards to newly registered taxis only. Upon clarification of this information, the trade raised no objection to the adoption of tightened emission standards.

34. Mr Martin LEE enquired if emission standards would be further tightened to keep in line with changing European Union standard. PEPO(MVE) said that the Administration intended to further tighten emission standards of vehicles over 3.5 tonnes in the year 2001 by introducing Euro III standards. Emission standards for vehicles below 3.5 tons would be further tightened in 2002. The tightening of emission standards had to be done by stages in line with the latest technological developments and availability of vehicles. DS/PEL added that vehicle suppliers were progressively developing new technologies to keep in line with the European Union standard. To enable members to have a better understanding of the subject, the Administration agreed to provide an information paper on the tightening of emission standards in the past and coming years.

VI Extension of Innovative Energy Efficient Equipment Pilot Programme for Government buildings
(LC Paper No. CB(1)1046/98-99(03))

35. At the invitation of the Chairman, the Principal Assistant Secretary for Planning, Environment and Lands (Environment 2) (PAS/PEL(E2)) briefly explained the need for phase 2 of the Innovative Energy Efficient Equipment Pilot Programme for Government buildings. He said that the results of Phase 1 Programme showed that considerable savings could be achieved by using energy-efficient building technologies. The experience gained was shared with the private sector to encourage the use of energy saving equipment, which in turn had led to a reduction in prices. In addition to financial and economic gains, the implementation of the pilot programme produced environmental gains as the levels of sulphur oxides, carbon dioxide and other pollutants in the air were reduced. The decrease in the level of carbon dioxide would slacken global warming.

36. Mr CHAN Wing-chan sought clarification of the draw down of the $6 million for phase 1 of the programme and the justification for spending another $6 million on phase 2 of the programme as only five buildings were involved, as against 20 in phase 1. PAS/PEL(E2) said that the approved estimates for the implementation of phase 1 programme had been used up. As regards phase 2, PAS/PEL(E2) said that the cost would be mainly for setting up new equipment as well as retrofitting existing offices of sample buildings. More buildings could be included but this would not produce significant gains in light of the results of the pilot programme. He further stressed that the purpose of the pilot programme was to try out new equipment. DS/PEL added that the buildings involved under phase 1 of the programme had regular working hours and the equipment tested was relatively simple. On the other hand, the buildings selected for phase 2 were unconventional and more complex equipment would be tested.

37. Dr Raymond HO questioned the cost-effectiveness of the Programme as annual savings of only $1.7 million was achieved out of an investment of $6 million in Phase 1. PAS/PEL(E2) said that direct savings were fairly modest and a pay-back period of four and a half years was considered reasonable. Indirect savings were not easy to quantify. Bigger savings would be achieved through the identified improvements in new Government buildings and planned renovations. The experience gained had been shared with the private sector in order to promote the wider use of energy-efficient technologies which could bring down prices of energy-saving equipment.

38. Dr Raymond HO agreed that it might not be appropriate to assess the merits of the programme from the perspective of direct savings only. Nevertheless, it was necessary to quantify the benefits of the programme. He considered that the following should be further studied -

1. the amount of direct savings from implementing Phase 2 Programme;
   
   
2. valuable experience gained from Phase 1 programme;
   
   
3. recommendations to be made to public funded corporations; and
   
   
4. guidelines on energy saving to be issued to the private sector.

The Administration agreed to provide further information on direct savings from Phase 2 Programme and the recommendations to be made to public funded bodies on energy saving.

39. DS/PEL advised that the Centre of Environmental Technology was assessing the savings of some buildings in Hong Kong which had benefited from the pilot programme. With the cost reductions, some buildings were able to have a payback period of one year only. A copy of these assessment results could be made available to members for reference. He stressed that phase 2 of the pilot programme would focus on research and development and aimed at trying out new equipment to be used in Government buildings.

Admin.

40. Mr Martin LEE said that he supported the pilot programme in general. Members of the public however might wish to be assured that the Government could make profits from the energy-saving programme. In this connection, he enquired if the Administration intended to "sell" the results of the pilot programme to the private sector. DS/PEL said that the Administration acted as a catalyst to bring new technologies to Hong Kong and it did not have the licence to sell the technologies. PAS/PEL(E2) then explained the equipment tried out in the pilot programme. He said that phase 1 involved the use of electronic ballasts and variable speed drives in conserving energy. Phase 2 would be testing out more innovative equipment, for example presence detectors to regulate lighting and air conditioning. Under phase 2 of the programme, where and how these detectors could be optimally used would be tested under local climatic conditions. The use of these detectors could then be applied to buildings with similar designs.

41. In response to Mr Martin LEE's question on whether consultants from the private sector would be employed in phase 2 of the pilot programme, PAS/PEL(E2) said that consultants would not be involved as staff of the Electrical and Mechanical Services Department (EMSD)would be carrying out the studies. He added that the circumstances in Hong Kong were unique because of its high building density and more needed to be done to achieve energy efficiency under local conditions.

42. As regards the use of energy efficient equipment in the private sector, PAS/PEL(E2) said that there was a general lack of innovation in the private sector in this field. DS/PEL added that there were few energy services companies which provided advice on how to conserve energy. EMSD would consider developing such services under its trading fund.

43. Noting that energy efficient equipment for air conditioning had achieved more savings than lighting equipment, Mr HUI Cheung-ching enquired if the Administration had plans to install such equipment in all Government buildings. DS/PEL affirmed that most of the electricity consumption was on air-conditioning. The Administration would be looking at measures to improve the efficiency of air-conditioning systems. The results of the pilot programme would be applied to new Government buildings and planned renovations of existing buildings. PAS/PEL(E2) added that controlling officers of Government departments had been advised to apply for funding under the "Invest to Save" programme in respect of air-conditioning systems. However, it rested with the heads of departments to decide on the priority. While the energy saving services could be out-sourced to the private sector, EMSD was willing and able to provide such services to Government departments.

VII Any other business

44. There being no other business, the meeting ended at 12:45 pm.


Legislative Council Secretariat
10 June 1999