Hong Kong antitrust regulator has started raids as probes deepen, Wu says

21st September 2016. By Yonnex Li

Hong Kong’s Competition Commission has begun surprise searches of premises as the regulator presses forward its investigations of the city’s very first antitrust cases, Chairwoman Anna Wu said.

“We now have exercised the gamut of our investigation powers, raids, search and seize,” the antitrust chief said in a conference in Washington, DC on Tuesday, without elaborating on the details of the enforcement actions.

But she noted that the regulator is now “working extensively” on bid-rigging cases, particularly after it launched a campaign against such cartels in May.

“We are complaints-driven, and the complaints are directing us to cartels, in particular bid rigging, at this point,” Wu said. The regulator has also received leniency applications, she added.

It is understood by MLex that the regulator’s first raid took place around late July or early August. Unlike some other local enforcers that provide a certain degree of publicity for such actions, the agency chose to conduct the search in a low-profile manner, even after it happened.

A spokeswoman from the commission confirmed that the regulator “has conducted a number of searches of premises.” The agency declined to comment further, citing the need to “conduct effective investigations and to protect the interests of all persons involved.”

One of the sectors rife with bid-rigging activities in Hong Kong has been the building management industry. In May, the commission said its market study confirms public suspicions of bid manipulation based on 500 residential building-renovation and maintenance projects that it examined.

The Competition Ordinance only started to take full effect on Dec. 14 last year.

Wu also discussed the regulator’s Sept. 14 proposal to issue a block exemption order for vessel sharing agreements, or VSAs, among shipping liners while rejecting their request for immunity for voluntary discussion agreements, or VDAs.

“[We are] very consistent with the rest of the world in many ways and that helps us with collaboration,” the official said. “However, this regulatory alignment did not work for us in one particular case and that was over the shipping liners’ application for block exemption.”

“We didn’t have much trouble with the VSAs, [yet] we did have an awful lot of trouble with the VDAs,” she said.

Wu said she ran into “difficulty with a lot of people” for not following other jurisdictions where VDAs are also exempted, but noted that a lot of research elsewhere has helped the regulator in justifying its position.

	Eliot Gao