l) Overcharging Fees and Charges

l) Overcharging Fees and Charges

Part IVA of the Landlord and Tenant (Consolidation) Ordinance (Cap. 7) prohibits landlords from charging non-permitted fees and overcharging tenants on certain utility charges such as water charges and electricity charges.

Prohibition on charging non-permitted fees

A landlord commits an offence if the landlord requires the tenant to pay, or the landlord otherwise receives from the tenant, any money in relation to the tenancy other than those falling within the following types:

1. rents;
2. rental deposits;
3. reimbursement of charges for any of the specified utilities and services payable by the tenant under the tenancy;
4. damages for the tenant’s breach of the tenancy.

On a person’s conviction, the magistrate may, in addition to imposing a fine, order the person to repay to the tenant any money received from the tenant other than that the person is entitled or permitted to receive.

Prohibition on overcharging specified utilities and services

In Part IVA of the Ordinance, “specified utilities and services” means water, electricity, gas and communication services.

Where the charges for any of the specified utilities and services for a subdivided unit incurred by a tenant are not independently billed by the relevant authorities or service providers, the landlord may require the tenant to pay for the reimbursement of the charges as a separate payment from the rent. In doing so, the landlord commits an offence unless the following are observed:

1. the landlord is the payer named in the bills covering the charges;
2. copies of the bills are produced by the landlord to the tenant when the landlord requires the payment; and
3. the landlord has provided an account in writing to the tenant showing:
   1. how the amounts under the bills (billed amount) are apportioned for the different parts (of which the subdivided unit is one) forming the premises to which the bills relate; and
   2. that the aggregate of the apportioned amounts does not exceed the billed amounts.

The landlord commits an offence if the landlord requires the tenant to pay for, or the landlord otherwise receives from the tenant, the reimbursement of the charges for any of the specified utilities and services for the subdivided unit at a sum exceeding the apportioned amount for the subdivided unit as shown in the account provided to the tenant.

Penalties

A person who commits any of the above offences is liable on a first conviction to a fine at level 3 (currently HK$10,000), and on a second or subsequent conviction to a fine at level 4 (currently HK$25,000). On a person’s conviction, the magistrate may also order the person to repay to the tenant any money received from the tenant other than that the person is entitled or permitted to receive.

The mistaken belief of the person charged with the offences above as to the amount the person is entitled or permitted to receive is not a defence.

Waterworks Regulations

Further, in light of the enactment of the Waterworks (Waterworks Regulations) (Amendment) Ordinance 2021, the amended Regulation 47 of the Waterworks Regulations only allows a registered consumer of the Water Supplies Department (“WSD”) (usually the landlords) to recover from the occupants of the premises (usually the tenants) the water charge paid to the WSD.

The amendment, which has taken effect, strengthens the protection of tenants of sub-divided units from being overcharged for water. If the amount recovered by the landlord exceeds the water charge paid to the WSD, the landlord shall be guilty of an offence. Offenders are liable to a maximum fine of HK$10,000.

The WSD encourages the public to report unscrupulous landlords for overcharging tenants of sub-divided units for water. A relevant option has been available under its enquiry hotline on 2824 5000. Meanwhile, the WSD will continue to conduct proactive patrols in suspected sub-divided units to investigate any situation of overcharging for the use of water. Prosecutions will be instituted should there be sufficient evidence.

The WSD website provides useful information about the avoidance of water overcharge situations for landlords and tenants of sub-divided units.