NewsHong Kong

Planned rally to urge for crackdown on bid-rigging in renovation projects

PUBLISHED : Monday, 10 March, 2014, 7:34pm
UPDATED : Tuesday, 11 March, 2014, 4:52am

Bid-rigging is so widespread in contracts for building maintenance and renovation that flat owners fear honest companies are being left out.

The Democratic and Labour parties and owners from nine housing estates have formed a body which will press the government to smash bid-rigging syndicates. They say tackling the problem is vital as estates built in the 1980s reach an age where they need renovation and contracts worth more than HK$10 billion per year go up for grabs.

The Property Owners Anti-Bid Rigging Alliance will march from Chater Garden in Central to the Chief Executive's Office in Admiralty on Sunday to make their point.

Syndicates typically involve building management companies and builders working together to ensure owners' corporations sign up to renovation and maintenance contracts with big mark-ups. Bid-rigging became an offence under the 2012 Competition Ordinance, although smaller companies are exempt.

"The way they [syndicates] rig the bid is close to perfect after having been in the business for so long," said Democratic Party chief executive Lam Cheuk-ting. "They know very well how the ICAC conducts investigations; they have lawyers to advise them on ways to avoid bearing any legal consequences and how they should rig the bid according to legal procedures."

Lam, a former Independent Commission Against Corruption investigator, said he failed to persuade fellow owners at his estate to take a closer look at a renovation contract last year. Owners faced bills of HK$300,000 per household and an independent consultant later estimated that the price had been marked up by at least 100 per cent.

Lam suggested his old ICAC colleagues launch high-profile raids on syndicates to deter them; fewer than 10 people were arrested for related offences last year.

Democratic Party lawmaker Wu Chi-wai suggested the government could help owners make informed decisions by publishing details of how much it paid for materials and work.

He also suggested raising the percentage of owners who must be at an owners' meeting for a decision to be legally binding on all households. The level is 10 per cent, but "no magic figure exists" to stop manipulation, Wu said.




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