Audiência Pública de Hongfu Yuan | Comissão da Concorrência: Comportamentos Anticoncorrenciais em Reparação de Edifícios Generalizados, Incluindo Conluio de Preços

Big Wave Bay Hong Fuk Court Fire Independent Committee holds its third hearing today. Competition Commission representative Li Xiaoliang delivered an opening statement, stating that the Competition Commission has indeed observed long-term, widespread, systemic, and serious anti-competitive conduct across all of Hong Kong, Kowloon, and the New Territories, involving numerous engineering consultants.

Contractors agree “I do Kowloon, you do New Territories”

Li Xiaoliang pointed out that it is not limited to bid-rigging; it usually involves other serious anti-competitive behaviors, including collusive pricing and market division. Market participants may engage in bid-rigging through collusive pricing, such as agreements not to bid below a certain price, allowing any winner to make excessive profits, or some contractors may divide the market by agreeing “I do Kowloon, you do New Territories,” without further discussion during the bidding process.

Li Xiaoliang stated that some contractors provide their bidding documents to a friendly contractor, using these templates to create a false impression of competition. Another common practice is the so-called “phantom bid,” where only one business entity exists, and other bidders are shell companies.

He further said that the Competition Commission has observed independent or seemingly independent engineering consultants secretly “watering the water,” allowing the contractor they support to persuade other bidders to withdraw, thereby suppressing competition. Instances of misconduct by independent or suspected independent engineering consultants have been observed.

Li Xiaoliang pointed out that leaders of bid-rigging groups, upon seeing a particular tender, will “assign tasks” and arrange for group-affiliated contractors to bid according to instructions, ensuring that the group’s designated contractor ultimately wins the bid.

Bid-rigging groups may cooperate to ensure winning

Additionally, when large building renovation tenders appear in the market, there are cases where bid-rigging groups cooperate with each other to secure winning chances. They may “borrow” contractors from other bid-rigging groups.

He emphasized that the Competition Commission understands and supports any legislative measures to deal with bid-rigging and anti-competitive participants, but urges caution. Focusing solely on bid-rigging is insufficient, as multiple issues arise.