The lands chief says the government has no problem when developers form a consortium to bid for land at public auctions, and it has no right to stop people from talking among themselves.

Lands Department Director Patrick Lau Lai-chiu also brushed aside worries that this behaviour could suppress prices. He said yesterday it was possible for land to fetch a higher price if the smaller developers were allowed to join forces in bidding against bigger companies. His was the first official response to concerns that developers might have broken the law when they allegedly joined forces while bidding at a land auction last Tuesday.

Mr Lau said it was be difficult to say if developers worked together at the auction. 'The government cannot ban people from talking and talking over mobile phones,' he said. 'Indeed, private auctions encourage anonymous buyers to bid over the telephone. When we discuss auction rules, we must consider if we can execute them considering modern technology.' He said private auctions encourage people to 'join hands' and that 'government auctions should try to be as close to private ones as possible'.