In Competition Commission v Wing Hing Construction Co Ltd  HKCT 6, the Competition Tribunal refused a respondent’s application to amend its Response and file new witness statements in substitution for a statement already filed.
In these proceedings, the respondents were contractors appointed from a reference list of the Hong Kong Housing Authority to perform decoration work for tenants of public housing units in three buildings in On Tat Estate in Kwun Tong. The applicant, the Competition Commission (the “Commission”), alleged, among other things, that between June and November 2016, the respondents made or gave effect to an agreement or engaged in a concerted practice among themselves to allocate various floors of each of the three buildings among themselves to carry out decoration work.
The Commission argued that the above arrangements (1) contravened the first conduct rule in the Competition Ordinance (Cap. 619) (the “Ordinance”), and (2) amounted to serious anti-competitive conduct in the form of market sharing and price-fixing. The Commission seeks a declaration accordingly and an order for pecuniary penalty against the respondents. The fourth respondent is a partnership named Tai Dou Building Contractor (“Tai Dou”).
Relevant Course of Proceedings
The action was brought in the Competition Tribunal by the Commission’s Originating Notice of Application on 14 August 2017. The solicitors for Tai Dou filed a Notice to Act and Response on 28 September 2017. The trial was targeted to take place from 12 November to 14 December 2018. Subsequently, Tai Dou filed a witness statement made by Mr KC Ho, its General Manager, on 19 April 2018 (“1st witness statement”). Between June and September 2018, Tai Dou changed its legal representatives two times.
Tai Dou made the present application on 24 September 2018, on the basis that Tai Dou did not authorise Mr KC Ho to undertake any work in relation to On Tat Estate, and Mr KC Ho had bore all the costs and retained all the revenues and profits arising from any decoration work performed. In essence, Tai Dou sought to completely overturn what was pleaded in the 1st witness statement and argued that its partners were kept completely in the dark of Tai Dou’s involvement in the proceedings.
When the present application was filed, the Commission and all other respondents were ready to proceed with the trial which would commence on 26 November 2018.
The Tribunal considered Tai Dou’s application to be made at a very late stage when other parties were under a tight schedule in preparation for the trial which had been scheduled over one year. Apart from delay in making application, the Court also took into account the procedural history of the case and the forthcoming trial dates. In addition, Tai Dou failed to produce compelling evidence in support of its present application. The partners only began to take an interest in the proceedings in around early September 2018 when they learnt that the maximum pecuniary penalty that could be imposed was referable to the turnover of the undertaking and not just the turnover of the estate project in question.
The Tribunal accepted the Commission’s argument that even though other respondents had also raised the “sub-contractor” argument, the Commission would require significant amount of time to analyse Tai Dou’s new arguments such that the trial dates would have to be vacated. There was no justification to force the Commission to squeeze its investigation, preparation and decision-making processes all into the coming few weeks.
The Tribunal concluded that an adjournment of the trial itself would cause serious prejudice to the parties involved in litigation. While the present proceedings is an enforcement action under the Ordinance that can be differentiated from an ordinary civil litigation, s. 144 of the Ordinance enables the Tribunal to follow “the practice and procedure of the Court of First Instance in the exercise of its civil jurisdiction”. The Competition Tribunal Rules (Cap. 619D) also provides that cases should be dealt with in an efficient and expedient manner. Thus, Tai Dou’s application was refused.
The judge stated in obiter that there is a public interest to maintain the integrity of the litigation process in the Competition Tribunal. Further, there is a broader public interest in these enforcement actions to see the proceedings being dealt with as expeditiously as is reasonably practicable. The outcome of these proceedings may well serve as guidance to other undertakings and persons in the regulation of their economic conduct.
The reasoning demonstrates that values upheld within enforcement actions correspond with those promoted in civil litigations. Efficiency in resolving legal proceedings without delay is no doubt an important consideration of the Tribunal in ruling last-minute applications in enforcement actions. Parties should therefore take note of milestone dates of the proceedings and avoid delayed applications to the Tribunal.