Hong Kong proposed prison terms of up to 10 years for collusion in building maintenance and renovation tenders after a deadly fire inquiry, while reserving public funds to support property owners. The government announced the legal proposals on Oct. 30, following publication of the Independent Committee’s report the previous day.
The proposed offense would include coordinated bids, fixed prices, market division and restrictions on output in maintenance and renovation tenders. It would also cover steps arranged in advance, such as hiring consultants, and could apply to individuals as well as businesses. For criminal fines, the government proposed using whichever amount is largest: HK$10 million, three times the commercial gains or 50% of an undertaking’s local turnover for each year of the offense. The civil penalty formula would use HK$8 million, twice the gains or 30% of local turnover per year, with the turnover calculation capped at three years. The proposals require amendments to the Competition Ordinance; the new offense would also fall within the Organized and Serious Crimes Ordinance and the Independent Commission Against Corruption Ordinance.
The Security Secretary would lead a task force with the Hong Kong Police Force, the Independent Commission Against Corruption (ICAC) and the Competition Commission. The government plans for the group to share intelligence and coordinate operations, with attendance at owners’ corporation meetings guided by risk assessments. A government reply to lawmakers recorded 73 ICAC complaints involving suspected building-maintenance bid-rigging from 2021 through 2025.
Financial Secretary Paul Chan Mo-po said HK$300 million in public money had been reserved for a proposed Building Maintenance Support and Services Council. The allocation includes HK$100 million in start-up capital and HK$200 million for fee subsidies. The council would help property owners with maintenance and renovation, and officials aim to have it operating by the end of 2026.
The Independent Committee made 120 recommendations after the Wang Fuk Court fire in Tai Po killed 168 people. The government’s summary of the report says maintenance checks depended on professionals and contractors acting with integrity and carrying out their assigned supervision; some were suspected of neglecting those duties, leaving controls ineffective.
A steering committee led by the Chief Secretary for Administration is to review the recommendations and oversee implementation. The government has not set a date to submit the legislation to the Legislative Council. A separate Public Service Commission inquiry into civil servants’ responsibilities is expected to finish within three months of its Oct. 29 announcement.
