Hong Kong Bid-Rigging Plan Targets Renovation Tenders. Criminal Law Has Not Changed

Hong Kong’s government proposed a new criminal offense on Friday, October 30, for collusion in building-maintenance and renovation tenders. The Hong Kong bid-rigging plan has no force of law yet.

The proposed offense would cover four forms of serious anti-competitive conduct in those tenders: bid rigging, price fixing, market sharing and output restrictions. It would reach both individuals and businesses, according to the joint government announcement. The scope matters because the government also wants to cover preliminary arrangements, including the appointment of consultants before a works contractor is chosen. A tender can be shaped before the final bids arrive.

The proposal followed the Independent Committee’s report on the Wang Fuk Court fire. The government said the report described bid rigging in major building works as a serious problem. The committee’s findings, covered in TockHK’s October 29 report, are not criminal verdicts. Friday’s announcement is a separate policy response, not a finding that any particular owner, consultant or contractor committed the newly proposed offense.

Hong Kong bid-rigging law would have a narrow criminal scope

At present, the Competition Ordinance’s First Conduct Rule prohibits anti-competitive agreements, and the Competition Commission’s guidance expressly lists bid rigging among the conduct it addresses. The Commission brings enforcement proceedings before the Competition Tribunal under the existing regime. The government describes bid rigging as primarily a civil competition-law matter now, but says criminal enforcement can already address other offenses arising during a scheme. That distinction matters: this is a proposed new competition offense, not a claim that fraud or corruption connected with a rigged tender is currently beyond criminal law.

If enacted in the form announced, the new offense would target tenders for building maintenance and renovation, not every tender in Hong Kong’s economy. The government proposes a maximum of 10 years’ imprisonment and a fine. It says the maximum fine would be the highest of HK$10 million, three times the commercial gain from the contravention, or 50 percent of the undertaking’s local turnover for each year of contravention. These are proposed ceilings, not penalties already available under the new offense or a prediction of what any court would impose.

The proposed reach into consultant appointments is particularly relevant to an owners’ corporation planning major repairs. An early appointment may affect the specifications and tender process that follow, though the announcement does not say every flawed appointment would be criminal. The eventual bill would have to define the elements of an offense, and investigators and courts would still have to apply those elements to evidence in a specific case.

Broader civil changes, separate from the criminal proposal

The government also plans to strengthen the Competition Ordinance’s civil regime beyond building maintenance and renovation. Its October 30 announcement proposes extending the maximum duration of director disqualification orders from five to 15 years and the relevant statutory application periods for pecuniary penalties and other Tribunal orders from five to 10 years. It also proposes an express civil standard of proof and a statutory presumption concerning concerted practices and subsequent market conduct. None of those proposed amendments is described in the announcement as already enacted.

The split between the two tracks is easily missed. A contractor competing for a housing-estate renovation tender could face the proposed criminal regime if the Legislative Council passes it in the proposed form, while businesses in other markets could still be affected by the broader civil amendments. The Commission’s overview of the present Ordinance describes the First Conduct Rule as applying across sectors of Hong Kong’s economy. Friday’s package would change sanctions and enforcement tools, not create the first rule against collusion.

Task force first, legislation still ahead

Chief Executive John Lee has tasked Security Secretary Chris Tang with leading a joint task force involving police, the Independent Commission Against Corruption and the Competition Commission, the government said. It plans intelligence sharing, joint operations and risk-based attendance at owners’ corporation meetings, coordinated through the Home Affairs Department. The release also proposes putting the new offense within the scope of the Organized and Serious Crimes Ordinance and the ICAC Ordinance to expand the tools available for relevant investigations. Those statutory changes depend on legislation; the task force’s announced coordination does not itself enact them.

RTHK’s report from Friday’s briefing quoted Competition Commission chief executive Rasul Butt as saying the aim was to seek Legislative Council approval for the amendments by April 2027. He said officials would consult lawmakers and stakeholders. RTHK also reported Tang’s statement that forming the task force would require no additional resources. The April date is an official target reported at the briefing, not a passage guarantee, commencement date or deadline in a bill.

For residents paying for large repairs, the practical question is whether the planned powers reach collusion early enough to protect a tender, not merely whether the eventual penalty looks severe. The government has outlined the architecture but has not yet published an enacted offense, an operational record for the task force or evidence that its proposed changes will reduce rigging. The bill and its application will supply the harder test.