$22m fine for two cleaning companies in cartel case

Cheng Wong

Two cleaning service companies have been ordered to pay more than HK$22 million in penalties, with three of their directors disqualified from their posts for two years, after being found guilty of breaching anti-competition laws, according to the Competition Commission.

The watchdog said the two firms colluded in bidding for approximately HK$180 million in contracts.

The case against Hong Kong Commercial Cleaning Services and Man Shun Hong Kong & Kln Cleaning Co was brought to the competition tribunal in December 2021.

They were accused of collusion in the bidding for 17 contracts to provide cleaning services in public estates for the Housing Authority as well as other buildings between May 2016 and August 2018.

"The case was discovered as a result of a complaint from a group [that included] several cleaning workers of a public estate," the commission said.

The tribunal ordered Man Shun and its director Cheng Hok-kuen to pay a penalty of HK$11.31 million and called for Cheng to be disqualified as director for 24 months.

Man Shun and Cheng were also ordered to cover the commission's legal and investigation costs. They admitted liability on January 30 last year.

Hong Kong Commercial and directors Chan Ming-chu and Cheng Yip-chiu were ordered to pay a HK$10.96 million pecuniary penalty as well as the commission's costs on December 9 last year.

Additionally, the tribunal disqualified the two directors for 24 months.

The commission described the cleaning service as a sector of "vital importance" for both public and private housing, particularly in light of the pandemic.

The penalty slapped on the two companies is the second-highest among cases investigated by the commission since its establishment in 2012.

In total, the commission has slapped over HK$200 million in penalties on anti-competitive companies, which engage in activities that include bid-rigging, with the highest penalty of HK$150 million ordered on two engineering companies in November 2022.

ATAL Building Services Engineering and Shun Hing Engineering Contracting Co admitted they fixed prices, shared markets or rigged bids as two competing providers of air-conditioning works.

cheng.wong@singtaonewscorp.com