HONG KONG: The High Court ordered yesterday the Housing Authority to review immediately the rents of public housing flats in Hong Kong.

In response, the authority decided to apply for a deferral of the implementation of the court's order pending its appeal to the Court of Appeal.

A hearing will be conducted on August 26 on the deferral application.

The order follows the court's ruling a month ago that the authority has overcharged tenants for years.

Representatives of public housing tenants have demanded that the authority follow the court order and adjust their rents and refund the overcharged sums.

About 600,000 tenants could benefit from the court's decision.

The court's decree, however, did not specify a timetable for the review.

Tenant representatives said that if the housing body does not do so soon, they would call upon tenants to delay rental payment.

The authority has said that the court's verdict would mean a rent reduction of close to 30 per cent and an income shrinkage of almost HK$50 billion for the housing body in the next 10 years.

According to the Housing Ordinance, public housing flat rentals shall not go beyond a proportion of the median household income by more than 10 per cent, and that the rent levels should be reviewed every three years.

On July 11, the Court of First Instance ruled in a judicial review of public housing rentals that the authority had violated these provisions.

The current rent level is 13.8 per cent above median household income due to the freezing of rentals since 1998 and the housing body has not conducted any rental review since then.

As a result of the court's order to review the rents, the authority will now appeal the decision.

It originally planned to appeal directly to the Court of Final Appeal. But due to an objection by tenants, it will appeal to the Court of Appeal instead.

The decision last month to appeal came after considering all aspects involved, including the far-reaching impact of the court's verdict, the authority's financial conditions, and the sustained development of public housing.

(HK Edition 08/13/2003 page1)