Section 9 of the Prevention of Bribery Ordinance
Corruption in the private sector, including that in owners’ corporations, is governed by Section 9 of the Prevention of Bribery Ordinance. According to the law, no agent shall solicit or accept any advantage without the permission of his principal for doing or forbearing to do any act in relation to his principal’s affairs. Corruption is a criminal offence. Both the receiver and offerer of the advantage shall be guilty of an offence and subject to a maximum penalty of seven years’ imprisonment and a fine of HK$500,000.
Section 9(3) of the Prevention of Bribery Ordinance
Section 9(3) of the Prevention of Bribery Ordinance stipulates that any agent (e.g. management committee members of owners’ corporations) uses any false, erroneous, or defective receipt, account or other document to deceive his principal (e.g. owners’ corporations) shall be guilty of an offence.
For building management organisations and contractors participating in Operation Building Bright (OBB) 2.0 and Fire Safety Improvement Works Subsidy Scheme (FSWS), who are the principals ? Who are the agents?

Principal: The owners’ corporation, as the legal entity representing all owners in managing the common areas of the building, is the principal. Property management company, consultant or contactor is also the principal in respect of its staff and agents.

Agent: The members of management committee of owners’ corporation, employees of owners’ corporation, property managers, etc. are agents of the owners’ corporation. Employees of a property management company, consultant or contractor are also agents# of property management company, consultant or contractor respectively.

Example: An owners’ corporation of a residential estate, formed in accordance with the Building Management Ordinance (BMO), represents all owners to manage the common areas in the estate. It, being the principal according to the law, applies for subsidies in the OBB 2.0. Normally, the powers and duties of an owners’ corporation are exercised by the management committee for effective building management of the estate as stipulated in the BMO. All members of management committee are agents of the owners’ corporation and abide by the Prevention of Bribery Ordinance. Without the approval of the owners’ corporation, members of management committee shall contravene the Prevention of Bribery Ordinance if they solicit or accept any advantage in relation to their official capacity.

# A manager or other professional trade or business firm or person retained and remunerated by the owners’ corporation and to carry out any of the duties or powers of the owners’ corporation under the Building Management Ordinance or the deed of mutual covenant (if any) pursuant to section 18(2)(c) of the Ordinance would be regarded as an agent.

What is “Advantage” and “Entertainment”?

"Advantage" includes money, gift, loan, fee, reward or commission, office, contract, service, favour, etc., but does not include entertainment. “Entertainment" means the provision of food or drink, for consumption on the occasion when it is provided, and of any other entertainment provided at the same time.

Although entertainment is not an advantage and is an acceptable form of social and business activity, agents of the owners’ corporation (such as members of management committee) should avoid accepting lavish or frequent entertainment from business associates of the owners’ corporation (e.g. consultants or contractors) so as not to put themselves in a position of obligation or affect their judgement which gives rise to the conflict of interest situations and violation of relevant laws.

Some Examples of Breaching the Prevention of Bribery Ordinance
  • A member of management committee accepts commission from a building consultant for recommending the latter for the consultancy.
  • A director of the project consultant solicits bribes from a contractor in return for favouring the latter in the tendering exercise for a renovation projects.
  • A director of a construction company offers bribes to the chairman of owners’ corporation in return for the latter to assist in securing the renovation project.
  • A manager of a consultant offers bribes to the employee of a property management company for assisting the consultant to exaggerate the scope or scale of a renovation project, so as to inflate the consultancy fees.
  • An inspector of a consultant solicits advantage from a contractor in return for connivance at the latter’s substandard works.
Smart Tips from iSir - Don’t Offer Bribe to Public Servants

Understanding the law and abiding by it is important in preventing one from breaking it. Under the OBB 2.0 and FSWS, the applicants have the opportunities to get in touch with public officers of various government departments and public bodies, who are processing applications and conducting inspections on completed works, etc. The applicants should not offer advantages to public officers in return for influencing their work. It is the duty of public officers to serve the general public and a simple “thank you” to them will do if their services are satisfactory. Never give tips or gifts to any public officers to avoid breaking the law inadvertently.

ICAC 24-hour Report Corruption Hotline: 25 266 366
Integrity Building Management Enquiry Hotline: 2929 4555
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