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LCQ12: Unlicensed guesthouse

     Following is a question by the Hon Wong Kwok-hing and a written reply by the Secretary for Home Affairs, Mr Tsang Tak-sing, in the Legislative Council today (July 10):


     Some members of the public have relayed that there are a large number of unlicensed guesthouses in some districts, and that a fire which broke out earlier in an unlicensed guesthouse in Mong Kok has further raised concerns about the risks posed to the safety of the residents of the buildings in which unlicensed guesthouses operate.  These members of the public question that this problem persists because the Home Affairs Department has been ineffective in its law enforcement.  Moreover, according to the reply of the Government to my question on the Estimates of Expenditure 2013-14, the number of complaints in relation to unlicensed guesthouses increased significantly from 205 in 2008 to 1 418 in 2012, while in the same period, the number of prosecutions increased from 28 to 128 and that of convictions increased from 30 to 110.  In this connection, will the Government inform this Council:

(a) of the respective numbers of complaints, prosecutions and convictions in relation to unlicensed guesthouses in each of the past five years, broken down by District Council district;

(b) of a breakdown by District Council district of the number of inspections against unlicensed guesthouses conducted by the authorities in each of the past five years and, among such inspections, the number of those conducted by undercover officers posing as customers (commonly known as "covert operations");

(c) given that among the 1 418 complaints in 2012, only 128 (i.e. 9%) prosecutions were instituted, of the reasons for such a low prosecution rate;

(d) of the number of persons who were sentenced to imprisonment in each of the past five years for operating unlicensed guesthouses with a breakdown by term of imprisonment; whether the authorities will consider setting a heavier penalty in order to increase the deterrent effect; if they will, of the details; if not, the reasons for that; and

(e) whether the authorities will review the existing legislation and draw up relevant measures in order to combat the operation of unlicensed guesthouses; if they will, of the details; if not, the reasons for that?



     Operation of guesthouses in Hong Kong is regulated by the Hotel and Guesthouse Accommodation Ordinance (the Ordinance) (Cap. 349).  In accordance with the Ordinance, any premises providing sleeping accommodation at a fee shall obtain a guesthouse licence for operation unless all accommodation in the premises are provided with a tenancy period of 28 consecutive days or more for each letting.  The Office of the Licensing Authority (OLA) under the Home Affairs Department is responsible for implementation of the Ordinance, including issuing guesthouse licences and carrying out relevant enforcement work.

     My reply to Hon Wong's question is as follows:

(a) and (b) The OLA is committed to combating and raiding unlicensed guesthouses. To this end, the OLA has increased its manpower resources and recruited frontline officers with law enforcement experience in recent years.  It has also adjusted its enforcement strategies and adopted different enforcement approaches flexibly to increase the number of inspections significantly and enhance the effort to collect evidence.

     Upon identification of unlicensed guesthouse operation, or upon receipt of such a report, the OLA will, having regard to the specific circumstances of individual case, follow up and investigate the case in the most appropriate and effective manner, and collecting evidence through various specific means, such as conducting surprise inspections at different times (including outside office hours), launching large-scale and targeted inter-departmental operations, or posing as clients and visitors to Hong Kong (commonly known as "snaking"), etc.  Prosecution shall be instituted immediately if there is sufficient evidence that the premises concerned are involved in unlicensed guesthouse operation.

     The OLA's enforcement and prosecution figures against suspected unlicensed guesthouses over the past five years are at Annex I.  The intensity and effectiveness of the enhanced enforcement actions are vividly demonstrated by a substantial increase in the number of OLA's inspections to suspected unlicensed premises (from 2 430 to about 6 800), prosecutions (from 39 to 128) and convictions (from 36 to 110) over the period from 2009 to 2012, representing an increase of over 250%, over 300% and 300% respectively.  The OLA does not keep the breakdown of the specific tactics adopted during the law enforcement actions (including the number of "snaking").

(c) The reports on suspected unlicensed guesthouse operation usually involve repeated complaints against the same premises.  Upon investigation, some premises are found to be fallen beyond the purview of the Ordinance as they are leased on a monthly basis.  Given that unlicensed guesthouse operation is a criminal offence, the OLA shall take account of individual circumstances and launch multiple law enforcement actions with a view to gathering sufficient evidence for instituting a prosecution in the Court.  Therefore, figures of complaint received and prosecution cannot be compared directly.

(d) Operating an unlicensed guesthouse is a criminal offence and will lead to a criminal record.  Upon conviction, an offender is liable to imprisonment.  The maximum penalty is a fine of $200,000 and imprisonment for two years, and a fine of $20,000 for each day during which the offence continues.  We are of the view that the existing penalty level is sufficient to create a deterrent effect.

     In instituting a prosecution, prosecution officers will appeal to the Court to reflect the seriousness of the offence in its sentence taking into consideration the threat posed by unlicensed guesthouses to the safety of its lodgers, residents of the building and members of the public as well as previous conviction record(s) of a re-offender.  The OLA will also seek the Department of Justice's advice as to whether an appeal or a review should be filed to the Court against the sentence of an individual verdict.

     The number of persons sentenced to imprisonment and their term of imprisonment for operating an unlicensed guesthouse over the past five years is at Annex II.

(e) To ensure the safety of tourists and members of the public, the OLA has adopted a multi-pronged approach by strengthening law enforcement action, enhancing the deterrent effect and stepping up publicity to combat unlicensed guesthouses.

     As far as law enforcement action is concerned, the OLA will, in addition to increasing its manpower and adjusting its enforcement strategies and approaches as above-mentioned, step up inspection of buildings with a higher risk of fire hazards and spare no effort in raiding unlicensed guesthouses in such buildings.  The OLA has also strengthened its intelligence gathering work by deploying staff to conduct surprise inspections at districts from time to time in a bid to collect information of and investigate into the publicity material of suspected unlicensed guesthouses.  Recently, the OLA has set up a dedicated Internet enforcement team to browse web pages, discussion forums and blogs to search information and intelligence about suspected unlicensed guesthouses on one hand, and appealing to tourists to patronise licensed guesthouses on the other.

     The OLA has also set up a reporting hotline (Tel. no.: 2881 7498) and an email address ( for tourists and members of the public to report suspected illegal operation of guesthouses.  A report form has also been uploaded to OLA's website ( for members of the public to make reports by fax (Fax. No.: 2504 5805).

     To strengthen deterrent effect, the OLA will pass information on convicted records of successful prosecution cases and their relevant details to the Rating and Valuation Department, the Inland Revenue Department, mortgage banks or monetary institutions, property owners, owners' corporations and management offices of the buildings, so that they can take follow-up actions under their purview, such as prosecution of tax evasion and recovery of tax.  Should any property or insurance agent be convicted, the OLA will also pass the conviction records to the Estate Agents Authority or the Office of the Commissioner of Insurance for follow-up actions.

     The OLA has also implemented a stringent measure and targeting at those licensed guesthouses operators who operate guesthouses at other premises.  If a guesthouse licence holder is convicted of an offence involving operation of an unlicensed guesthouse, the OLA will consider cancelling all the licences being held by the licensee concerned or refusing to renew the licences pursuant to the Ordinance.  So far, the OLA has cancelled or refused to renew the licences of 13 guesthouses for this reason.

     Moreover, the OLA has established a communication mechanism with the Travel Industry Council (TIC) and the Consumer Council (CC).  If it is found during investigation that Mainland tour groups are received by unlicensed guesthouse operators, the OLA will inform TIC for appropriate follow-up actions in addition to notifying the Mainland tourism authorities.  The OLA will also take follow-up actions immediately upon receipt of complaints of suspected unlicensed guesthouse operation referred by the CC.

     As regards publicity, all licensed guesthouses are required by the OLA to display the guesthouse logos to the entrances and doors of each of the guest rooms to facilitate tourists' identification.  Besides, the Government has increased the frequency of Announcements in Public Interest (APIs) on television and radio, whilst posters/banners are displayed and publicity leaflets distributed at immigration checkpoints and districts with more suspected unlicensed guesthouses, urging tourists to Hong Kong to patronise licensed guesthouses.  Moreover, the OLA, in collaboration with the Tourism Commission and Hong Kong Tourism Board, encourages tourists to patronise licensed guesthouses and conveys relevant messages to the Mainland tourism authorities.  On its dedicated "Shopsmart" website for Mainland tourists, the CC also urges the visitors not to patronise unlicensed guesthouses.  The full list of licensed guesthouses has already been uploaded onto the OLA's webpage ( for easy reference by tourists.

     The OLA plans to launch a new round of large-scale publicity in Hong Kong and on the Internet later this year, appealing to tourists to patronise licensed guesthouses for the sake of their own safety and disseminating the message that operating an unlicensed guesthouse is a criminal offence and will lead to a criminal record.  The OLA will also launch a smartphone application for tourists to search information of licensed guesthouses anytime and anywhere.

     During the peak travel seasons and long holidays with more inbound tourists, the OLA will step up enforcement actions and strengthen publicity to tourists, appealing to the tourists to patronise licensed guesthouses.

     The Administration will review from time to time the implementation of the Ordinance and its enforcement strategies, with a view to combating unlicensed guesthouse operation as well as ensuring the safety of tourists and members of the public.

Ends/Wednesday, July 10, 2013
Issued at HKT 12:49


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