Hong Kong cleaning companies settles cartel case with multi-million dollar penalties

The Competition Commission announced on Monday that Hong Kong Commercial Cleaning Services Limited (HKC) and its directors have admitted to cartel conduct in the supply of cleansing services, agreeing to a penalty of HK$10.96 million.

The legal proceedings, initiated on 14 December 2021, involved HKC and Man Shun Hong Kong & Kln Cleaning Company Limited (MS), along with their directors, following a complaint from cleaning workers alleging collusion in bids for Hong Kong Housing Authority contracts.

The investigation revealed that HKC and MS exchanged sensitive information, fixing prices for 17 contracts worth about HK$180 million between May 2016 and August 2018. This contravened the Competition Ordinance's First Conduct Rule. Both companies and their directors, Chan Ming-chu and Cheng Yip-chiu from HKC and Cheng Hok-kuen from MS, have acknowledged their roles in this anti-competitive behavior.

On 6 December 2024, HKC and its directors signed a Statement of Agreed Facts to settle the case. The comission is now seeking declarations of contravention, pecuniary penalties, and director disqualification orders against the involved parties. MS and Cheng Hok-kuen admitted their liability on 30 January 2024, with the tribunal ordering declarations of contravention and considering further penalties and disqualification orders.

Rasul Butt, CEO of the Commission, emphasized the significance of this case in curbing anti-competitive practices in public procurement and reminded company directors of their legal responsibilities to prevent such conduct. The Commission has expressed gratitude towards the Housing Authority for its assistance in the investigation and prosecution.

The Commission also reiterated the necessity for all Hong Kong businesses to comply with competition laws and avoid anti-competitive practices, urging those involved in cartels to seek leniency or cooperate with the authorities.