Hong Kong to trial electronic proxy voting platform to curb bid-rigging at estates

Hong Kong will launch a trial scheme next year to handle proxy voting via an electronic platform, a move designed to pave the way for a cap on proxies and curb rampant bid-rigging in private housing estates.

Announcing the plan on Saturday, Secretary for Home and Youth Affairs Alice Mak Mei-kuen said the government had decided against an immediate limit on proxy votes under proposed amendments to the Building Management Ordinance.

The reforms follow the deadly Tai Po fire almost a year ago, which killed 168 people and exposed vulnerabilities relating to building maintenance and renovation projects of private residential estates.

“In our earlier consultation, over half of the respondents considered the proposal to have practical operational difficulties for imposing a ceiling on proxy votes during an owners’ meeting,” Mak told a radio programme.

“If, during vote counting, someone has received more proxies than the permitted limit, it is difficult to distinguish which were authorised earlier and are therefore valid, nor can the remaining proxy votes simply be ignored.”

To solve this, Mak said the government would launch a pilot scheme by the end of next year to test handling proxy voting through an electronic platform.

The first phase will be rolled out across various building types – including large housing estates and single-block buildings – to streamline how proxies are submitted and tallied for major maintenance projects.

“We could make good use of the technology to set a cap on proxy votes,” she added.

Under the proposed amendments, property management companies would be required to randomly inspect at least 20 per cent of proxy votes, verify owners’ identities, and launch comprehensive checks if suspicious ballots are uncovered.

The format of proxy forms will be revised to require signatures and declarations from both the person granting the proxy and the proxy holder confirming they are aware of the meeting’s content, helping to prevent forged signatures and fake votes.

Owners’ corporations would be required to hold an introductory briefing session seven days before a general meeting concerning major renovation works, thoroughly presenting bidders’ details and backgrounds to aid decision-making.

In August the government rolled out a month-long public consultation on amendments to the Building Management Ordinance, part of proposed reforms after the Wang Fuk Court inferno.

An independent inquiry into the inferno found that “numerous features” of the HK$336 million (US$43 million) renovation project under way at the estate at the time of the tragedy “bore the hallmarks of bid-rigging and anti-competitive conduct”.

Investigators noted an aggressively low consultancy bid and concentrated proxy votes over critical project appointments.

Although the independent committee backed capping the number of proxies held by a single individual, more than 50 per cent of consultation respondents objected, citing a lack of consensus on how to identify and invalidate conflicting proxies when multiple owners chose the same proxy holder.