HONG KONG: Competition watchdog publishes revised non-collusion clauses to account for beneficial ownership.

As published on thestandard.com.hk, Tuesday 17 January, 2023.

The Competition Commission published a revised set of model "Non-collusion Clauses", with newly added clauses requiring bidders to disclose information on their beneficial ownership, to provide procurers with greater clarity on the competitiveness of the procurement process.

To reduce procurers' exposure to anti-competitive conduct during procurement exercises, the Commission published the original "Non-collusion Clauses" in 2017 for procurers to add to their bid documents and contracts.

The clauses comprised model non-collusion wordings that may be included in an invitation to bid, a model certificate for bidders to declare that the bid was developed independently, and a user's guide on such documents.

The revised model "Non-collusion Clauses" published on Tuesday requires bidders to mention their beneficial owners to let procurers see whether there are common ownership links between companies acting as if they are not coordinated.

While common ownership links don't necessarily violate Competition Ordinance, it might mislead the procures about the level of competition in a bidding process. That led the Commission to readjust the Non-collusion Clauses to give the procurers an option when dealing with such scenarios.

A spokesman for the Commission said an increasing number of procurers have been using the "Non-collusion Clauses" models to safeguard their procurement since its creation, and the new revised model will provide procurers with a crucial piece of information when assessing the potential competitiveness of a procurement process.

The Commission encourages all procurers to adapt and incorporate the revised model 'Non-collusion Clauses' in their invitations to bid and formal contracts.

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