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Law amendments for Peak tramway operation long-term arrangements proposed

     The Government will gazette on Friday (April 24) the Peak Tramway (Amendment) Bill 2015 (the Bill). The Bill seeks to confer on the Chief Executive in Council the power to grant the operating right for the Peak tramway to any suitable operator after end-2015 and provide for the long-term arrangements of the Peak tramway.

     The current operating right for the Peak tramway will expire on December 31, 2015. The Peak Tramway Ordinance (Cap. 265) (the Ordinance) does not have any provisions for the granting of operating right commencing from January 1, 2016 onwards. To this end, the Bill seeks to empower the Chief Executive in Council to grant the operating right commencing on or after January 1, 2016 to any suitable operator in any manner that the Chief Executive in Council sees fit. Each operating right would be granted for not more than 10 years, amendable to an extension of up to 10 years subject to the operator's commitment and ability to implement an upgrading plan to enhance Peak tramway facilities and improve services. In other words, each operating right can last at most on a "10-plus-10-year" basis. The operating right will be subject to terms imposed by the Chief Executive in Council, following discussion between the Government and the operator. The Chief Executive in Council may exercise the power to grant a "10-plus-10-year" operating right repeatedly.  

     "The law, as it now stands, does not provide for a mechanism for an incumbent operator to exit and for a new operator to replace it as warranted. The Bill provides for this exit mechanism. To ensure that the new operator can take possession of the assets essential to the Peak tramway operation, the exit mechanism will provide the legal basis for the mandatory lease arrangements concerning land and related premises, and the mandatory sale arrangements concerning other assets. Reasonable compensation will be given to the owner of the assets," a Government spokesperson said today (April 22).

     As the Peak tramway has basically become a tourism and recreational facility since the 1980s, it would be more appropriate for the Commerce and Economic Development Bureau to be the policy bureau overseeing this facility. The Government will therefore take the opportunity to update the definition of the "Secretary" in the Ordinance from the "Secretary for Transport and Housing" to the "Secretary for Commerce and Economic Development".

     The Peak Tramways Company Limited (PTC) is the incumbent operator of the Peak tramway, and owns the two sites on which the two termini of the Peak tramway are located and the related premises as well as other assets essential to the Peak tramway operation. The PTC has a good service and safety track record in operating the Peak tramway, which has become one of the internationally recognised icons of Hong Kong.

     The spokesperson said, "The PTC has a $600-million upgrading plan under preparation to enhance Peak tramway facilities and improve services. Various government departments have studied the preliminary design proposal of the upgrading plan, and find the plan worthy of support and do not envisage any insurmountable difficulties in implementation."

     To avoid suspension of the Peak tramway service, the Government will discuss with the PTC the possibility of granting it a new 10-year operating right commencing January 1, 2016. The Panel of the Legislative Council (LegCo) did not raise any objection. This arrangement is subject to negotiation between the Government and the PTC about the terms of the operating right (including the arrangements relating to premium, commitments with respect to Peak tramway service, and the detailed arrangements of the exit mechanism), and the approval of the Chief Executive in Council for the agreement reached after the passage of the Bill.

     The Bill will be introduced into LegCo on May 6.

Ends/Wednesday, April 22, 2015
Issued at HKT 15:18


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