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Matthew Cheng

The Hong Kong Bar Association has proposed criminalising bid-rigging by introducing a “double-track” approach to the Competition Ordinance, describing it as a quick fix to increase deterrence and encourage more whistle-blowers to expose industry malpractice following the city’s deadliest fire in decades.
Under the current civil regime established in 2015, the ordinance only punishes individuals involved in serious anticompetitive acts, such as bid-rigging, with fines.
But the new proposal calls for creating a separate “criminal track” to tackle such acts and suggested a maximum penalty of seven years in prison, association chairman Jose-Antonio Maurellet told the South China Morning Post.
An association task force reviewed the local legislation and studied practices in other jurisdictions, following last November’s Tai Po fire, which claimed 168 lives and displaced nearly 5,000 residents.
In 2008, a government consultation document on competition laws described the proposal for the existing ordinance as a new step for Hong Kong, with authorities deciding to impose only civil sanctions rather than criminal penalties.
Maurellet said that introducing a criminal track for prosecuting “persons involved in contravention of competition rules” under the ordinance would work alongside the “civil track” to increase deterrence.

“You also create, sometimes having what we call the ‘Sword of Damocles’ hanging over people’s heads,” he said, referring to an ancient Greek idiom that signifies a looming catastrophic threat.
“Or if they know there’s a criminal track, that in itself we think would dissuade a lot of this sort of terrible behaviour which has gone on.”
Maurellet described the new track – which should cover bid-rigging, price-fixing, market division and other serious anticompetitive conduct – as a quick fix that would require less consultation than an overhaul of the ordinance.
“Obviously, there are things you can do which are much more comprehensive, but those would take much more time,” he said.
The task force studied other criminal regimes that punished such acts, noting that the maximum jail term in the United Kingdom is five years and 14 years in Canada.
Maurellet said that a seven-year jail term for Hong Kong would offer a “balanced approach”.
He added that the new track should apply the criminal standard of proof “beyond a reasonable doubt”.
While proving collusion and agreements among parties in bid-rigging cases could pose a challenge, courts could proceed by inference when direct evidence was absent, he said.




Maurellet also said he hoped that stiffer penalties could encourage more whistle-blowers to come forward.
“Hopefully, if people feel that action will be taken, then they are more likely to report it,” he said.
“If citizens have the confidence that the executive authorities will take their complaints seriously, they are much more likely to also make more complaints and refer to information.”
The task force planned to put forward its proposals to the government after the independent committee examining the blaze concluded its work, he added.
The ongoing evidential hearings have pointed to alleged malpractice in the HK$336 million (US$43 million) renovation tender for Wang Fuk Court and revealed that at least two bid-rigging syndicates were linked to the project.
Lawmakers, barristers and the POD Research Institute think tank have also called for the criminalisation of bid-rigging.
In a reply to a lawmaker in February, the Commerce and Economic Development Bureau said it would review the competition regime, taking into account the implementation of the ordinance and the experience of other jurisdictions, with a view to strengthening deterrence against bid-rigging.
The hearings by the judge-led independent committee also saw several key witnesses refusing to testify, including the director of Wang Fuk Court’s renovation contractor, Prestige Construction and Engineering, and the consultant, Will Power Architects.
On whether the government should turn the panel into a commission of inquiry, Maurellet cautioned that doing so could lengthen the process.
“Sometimes we have to strike a balance between including everything and everyone, and it lasts for years and years, and you won’t get any answers for those years,” he said.
“Or you have a more targeted approach. So there are pros and cons to everything.”


Separately, homeowners at Wang Fuk Court face an August deadline to decide whether to accept the government’s acquisition offer. Authorities have not ruled out using legislation to acquire all property titles if necessary.
Maurellet described the situation at the estate as highly unusual, citing both safety and economic considerations. He also noted that if only a small number of owners refused to sell their flats, they could face disproportionate management and upkeep fees.
Drawing parallels with existing legislation, such as the Urban Renewal Authority’s power to acquire minority ownership in certain circumstances, he emphasised that any dedicated legislation must guarantee fair compensation value in line with the Basic Law, the city’s mini-constitution.
“It’s got to ensure that it’s fair, [that] owners have an opportunity to air their opposition and grievances,” Maurellet said.
As for whether the acquisition of the flats would affect potential civil actions against responsible parties, he said the complex question hinged on the contract or the settlement agreement.
Maurellet noted that personal claims, such as injuries, would be unaffected by the sale of the flats, but rights tied to the property could be transferred as long as ownership was passed.
“That’s certainly something I think those who decide to sell should bear in mind and get their own advice,” he cautioned.
During the interview, Maurellet also raised concerns about the March amendment to the implementation rules of the Beijing-enacted national security law, which laid out procedures for handling materials protected by legal professional privilege.
He pointed to the short time frame for defendants to challenge authorities, particularly whether those without legal representatives who needed to apply for legal aid could file the application in a timely manner.
He called on the Legal Aid Department to ensure such applications could move at the required pace under the rules.
“We want to ensure that a defendant is not caught unawares,” he said.


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Bar Association proposes ‘double-track’ approach to criminalising bid-rigging

The Hong Kong Bar Association has proposed criminalising bid-rigging by introducing a “double track” approach to the Competition Ordinance. Photo: Jelly Tse

Bar Association chairman Jose-Antonio Maurellet has described the proposed track as a quick fix that would require less consultation than an overhaul of the ordinance. Photo: Karma Lo

Heroism and grief: 6 residents’ stories from Wang Fuk Court fire hearings

The fire at Wang Fuk Court began on November 26 last year, killing 168 people, including a firefighter, and displacing about 5,000 residents. Photo: Eugene Lee

Sdanni Yip left his flat to investigate the fire at a neighbouring building. His wife, who remained behind, died in the blaze. Photo: Sam Tsang

Lee Chun-ho (centre) contacted his family via video call but could only look on helplessly as his relatives and helper struggled till the end. Photo: Edmond So

Well before the fire, So Hiu-fung had alerted authorities on the contractor’s use of flammable polyfoam boards, but his warnings fell on deaf ears. Photo: Jelly Tse

Chau Chi-wai was one of just three residents who escaped using a fire department turntable ladder. The equipment later malfunctioned and could not be used to evacuate others. Photo: Jelly Tse

Danny Fung, whose mother died in the disaster, had complained repeatedly about suspected bid-rigging in the renovation project. Photo: Edmond So

Kong Cheung-fat (left) has alleged that his bid to be elected as vice-chairman of the estate’s management committee was thwarted by vote-rigging. Photo: Elson Li

Tai Po probe: housing checking unit admits ‘blind spots’ amid ‘robotic’ workflow criticism - as it happened

Wang Fuk Court in Tai Po. Photo: Jelly Tse

Tai Po fire: tendering system can’t stop firms manipulating market, inquiry hears

Peter Wong (centre), the URA’s director of building rehabilitation, was among those who testified at the hearing on Thursday. Photo: Edmond So

Matthew Chan leaves City Gallery in Central after testifying at the hearing. Photo: Edmond So

The fire at Wang Fuk Court resulted in 168 deaths and left nearly 5,000 people displaced. Photo: Karma Lo

News

Hong Kong

Law and Crime

Chairman Jose-Antonio Maurellet says implementing ‘criminal track’ alongside ‘civil track’ to encourage whistle-blowing will increase deterrence


Chairman Jose-Antonio Maurellet says implementing ‘criminal track’ alongside ‘civil track’ to encourage whistle-blowing will increase deterrence.


Hong Kong Bar Association (HKBA)

Jose-Antonio Maurellet

Bar Association proposes ‘double-track’ approach to criminalising bid-rigging

.css-1c6uqr6{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;overflow-wrap:break-word;}Chairman Jose-Antonio Maurellet says implementing ‘criminal track’ alongside ‘civil track’ to encourage whistle-blowing will increase deterrence

Chairman Jose-Antonio Maurellet says implementing ‘criminal track’ alongside ‘civil track’ to encourage whistle-blowing will increase deterrence