Hong Kong proposes bill for unified regulation of new mass transit projects

Hong Kong plans to table a bill by year-end to standardise regulation of future mass transit projects, including Kai Tak and East Kowloon, the transport chief has said, as lawmakers raise concerns over fares and long-term service quality. Secretary for Transport and Logistics Mable Chan told lawmakers on Monday that the government was pursuing policy innovation by adopting open tenders for future projects, with the aim of enhancing service quality and identifying the most effective operators for emerging collective transport systems. “Our existing frameworks for regulating land-based public transport services and operators have been tailored to specific modes of transport or individual operators. Moving forward, we propose establishing a technology-neutral, versatile and standardised regulatory framework,” she said. “This will ensure compatibility across different systems and operators, allowing us to not only advance in terms of hardware but also, through our policy and regulatory procedures, to swiftly and fully seize the opportunities brought about by technological advancements.” The proposed framework would establish an oversight regime empowering the Executive Council to grant franchises while allowing the government to penalise operators, revoke licences or seize assets for non-compliance. In addition to primary legislation governing corporate governance and safety, tailored subsidiary legislation would regulate specific operations and passenger conduct. Detailed agreements would set out technical standards, construction timelines and mandatory fare adjustment mechanisms, taking into account the consumer price index, wage index and productivity factors, with a capping mechanism in place. The bureau said it planned to submit the bill to the Legislative Council in the fourth quarter of 2026. Subject to approval by early 2027, authorities expect to begin granting franchises for various systems. The Kai Tak project is expected to be the first, in early 2027, followed by the East Kowloon and Hung Shui Kiu/Ha Tsuen systems, as well as the cross-border Hong Kong-Shenzhen Western Rail Link. Lawmakers raised concerns about the fare adjustment mechanism, suggesting that pricing changes be linked to service performance rather than inflation alone, and urged the government to impose strict contractual penalties to ensure safety standards and reliable operations. “In our past observations of the MTR Corporation’s fare increase mechanism, even when the economic cycle was at a low point, the fare mechanism did not actually allow for any significant reductions. I wonder if we will consider GDP factors in this new mechanism,” lawmaker Kitson Yang Wing-kit said. Chan said the government would ensure the fare adjustment mechanism was strictly regulated, stressing the need to balance public affordability and acceptance with the financial sustainability of operators. On service quality and safety, she added that authorities could, under the framework, consider the temporary suspension or revocation of a franchise based on an operator’s performance.