Security chief vows his task force will root out bid-rigging in Hong Kong

Hong Kong’s security chief has expressed confidence that a new joint task force led by him will eradicate the decades-long problem of bid-rigging, while denying that the reforms came too late after the deadly Tai Po fire.

Secretary for Security Chris Tang Ping-keung also said on Friday that law enforcement officers would attend meetings of owners’ corporations where the risk of bid-rigging was deemed high to gather frontline intelligence and intervene early.

Authorities also hope to pass new legislation criminalising bid-rigging by April next year.

In response to the damning report by a judge-led independent committee investigating the fire at Wang Fuk Court last year, Tang’s task force will combine intelligence and enforcement powers from police, the Independent Commission Against Corruption and the Competition Commission to combat bid-rigging.

Representatives from the three bodies would strengthen their intelligence sharing about syndicates and cases, enhancing analysis to identify suspicious cases early, Tang said.

“The task force will set up a dedicated operational mechanism targeting bid-rigging syndicates to enhance intelligence gathering and exchange, joint enforcement operations and risk alerts to safeguard fair competition in the market and protect the public interest,” he said.

The intelligence sharing would allow the three agencies to engage at an earlier stage of investigations, with each bringing its own database to increase efficiency and uncover the masterminds behind bid-rigging syndicates, Tang explained.

“The government is determined, confident and capable of combating bid-rigging, which is an act that seriously hurts the public’s and homeowners’ interests,” the minister said.

Tang said that following the fire, the government had concluded a comprehensive review of what the panel called a “legacy of poor practice”.

“We realise some of these companies might reach out to homeowners when they know the buildings are going to undergo major renovations, purchase flats to become owners and send their staff to become owners’ corporation members,” he said.

“Sometimes directors of companies are the same among contractors and consultants. With the task force, we will share intelligence more efficiently and combat bid-rigging.”

The proposed legislative amendments, law enforcement coordination and frontline prevention would plug loopholes enabling bid-rigging and the criminal activities of syndicates, he said.

“The aim is to eradicate these malpractices and remove the chance for them to exist,” he said.

Tang added that the task force would review its effectiveness in a year, noting that the government worked on problems and sought solutions “every single day”.

Asked whether efforts to crack down on bid-rigging came too late given how long residents had complained about it, Tang stressed that authorities had always been working on this front but the task force – which allows intelligence sharing – would help.

To those involved in bid-rigging, he vowed that the task force would hunt them down, warning: “You no longer have a chance.”

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Secretary for Commerce and Economic Development Algernon Yau Ying-wah said the government would amend the Competition Ordinance to criminalise anticompetitive conduct in building maintenance tenders, including bid-rigging.

Authorities would also bring the new offence under the Organised and Serious Crimes Ordinance and the Independent Commission Against Corruption Ordinance to strengthen the powers of enforcement agencies.

The proposed amendments target bid-rigging, price fixing, market exploitation and output restrictions. Both individuals and companies could be held criminally liable.

The proposed maximum penalty is 10 years’ imprisonment and a fine of HK$10 million (US$1.3 million), or alternatively three times the gains derived from the contravention or 50 per cent of a company’s local turnover for each year of the offence.

Rasul Butt, CEO of the Competition Commission, said he hoped the new legislation would be discussed in the Legislative Council “very soon”.

“In terms of going to Legco to seek approval to pass the new amendments, the aim right now is April next year,” he said.