Deterrent measures needed to clean up building maintenance market: Paul Lam

The government must implement tough new measures to eliminate corruption and monopolistic practices in the city’s building maintenance market, Secretary for Justice Paul Lam Ting-kwok said on Sunday. Lam said that lucrative maintenance contracts have long been dominated by unscrupulous contractors, resulting in a “bad money drives out good” situation.

Lam’s remarks came after the government announced a series of reforms to address institutional shortcomings exposed by last year’s deadly Wang Fuk Court fire. The measures include criminalizing bid-rigging in building maintenance projects and amending the Competition Ordinance and the Buildings Ordinance.

Speaking on a radio program, Lam described the initiatives as a revolutionary overhaul of the building maintenance sector. He emphasized that the legislative amendments and related measures are designed to raise industry standards and strengthen oversight.

Lam said unscrupulous operators had monopolized lucrative maintenance projects, creating a “bad money drives out good” dynamic. He stressed that bad actors must be driven out of the market to encourage honest, reputable professionals to return.

The government must also ensure that property owners can make informed, genuine choices when selecting contractors, and that maintenance work is carried out lawfully, in compliance with regulations and safely, he added.

Lam noted that under the existing civil liability system, fines alone were not a sufficient deterrent to bid-rigging. If the practice is criminalized, convicted offenders could face up to 10 years in prison and a fine of up to HK$10 million, three times the commercial gain from the offense, or 50 percent of their local turnover for each year of the violation.

Secretary for Commerce and Economic Development Algernon Yau Ying-wah said on the same program that bid-rigging is a complex issue involving tendering, price-fixing and market allocation. He said the Competition Commission had consistently tackled bid-rigging in collaboration with the police and the Independent Commission Against Corruption.

Yau said the government planned to designate related offenses as specified crimes under the Organized and Serious Crimes Ordinance. He said he hoped criminalization would give authorities greater enforcement powers, adding that the legislative amendments were expected to be passed around April next year.

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