The Government today announced a series of reform measures using a three-pronged approach to rigorously combat bid-rigging and other syndicate-led criminal activities in building maintenance and renovation projects.
Under existing legislation, bid-rigging is primarily addressed through the civil regime under the Competition Ordinance, while criminal enforcement can only target other offences arising during the process. To tackle this, the Government will introduce a series of legislative amendments, step up law enforcement co-ordination and enhance frontline prevention.
The Government proposes amending the Competition Ordinance to criminalise four types of serious anti-competitive conduct involving tenders for building maintenance and renovation projects, holding the individuals and undertakings concerned criminally liable. These four types of conduct comprise bid-rigging, price-fixing, market sharing and output restrictions.
To tackle collusion comprehensively across all stages, the proposed regulatory scope will cover tendering for works contractors as well as related preparatory arrangements, such as engaging consultants at the preliminary stage.
To enhance deterrence, the new criminal offence will carry a maximum penalty of 10 years’ imprisonment and a fine. The maximum fine will be the highest of $10 million, three times the total value of the commercial gains derived from the contravention, or an amount calculated at 50% of the undertaking’s local turnover for each year the contravention occurred.
The overall civil regime under the Competition Ordinance will be enhanced in parallel to strengthen penalties and improve enforcement effectiveness.
Additionally, the Government proposes designating the new criminal offence as a specified offence under the Organised & Serious Crimes Ordinance and the Independent Commission Against Corruption Ordinance. This will strengthen the investigative powers of the law enforcement agencies, enabling the Police Force, the Independent Commission Against Corruption (ICAC) and the Competition Commission to collaborate more effectively.
These agencies will be able to leverage specific powers to target syndicates.
Through a Witness Order, the Secretary for Justice may apply to the Court of First Instance for an order requiring a relevant person to answer questions or furnish information. Through a Production Order, the Secretary for Justice or an authorised officer may apply to the Court of First Instance to require a specified individual, entity or public officer to provide material or permit access to it within a specified period.
Furthermore, the prosecution may apply for an enhanced sentence, allowing the court to impose a substantially heavier penalty based on the seriousness of the case, the extent of harm inflicted on the community, or the prevalence of the offence. The court may also issue a confiscation order to recover money or property from convicted criminals, which covers all realisable property belonging to the defendant, including real property, stocks and vehicles.
The Government will also step up the co-ordination of law enforcement actions on all fronts. The Chief Executive has tasked the Secretary for Security to lead the establishment of a joint task force to combat bid-rigging in building maintenance and renovation projects.
Comprising representatives from the Police Force, the ICAC and the Competition Commission, the task force will combat syndicates through intelligence sharing, joint operations and preventive measures.
