Replies to LegCo questions

LCQ16: Lunar New Year Fair stalls

Following is a question by the Hon Choy so-yuk and a written reply by the Secretary for Health, Welfare and Food, Dr York Chow, in the Legislative Council today (January 11):

Question:

It has been reported that although the Food and Environmental Hygiene Department had increased the minimum rental prices of the stalls for the Lunar New Year Fairs this year by 20%, the rental income from the stalls for the Victoria Park Lunar New Year Fair, instead of increasing, actually decreased substantially by more than 30%, from about $10.6 million last year to about $7.2 million this year, with many stalls being let out at their opening prices. In addition, there were bidders who, after having negotiated openly among themselves, won the bids for their stalls at the opening prices, and some bidders were even dissuaded from participating in the auction. In this connection, will the Government inform this Council whether:

(a) it has investigated the above breaches in which bidders allegedly joined hands to force a reduction in prices; if it has, of the details and the results; if not, the reasons for that; and

(b) it will consider conducting the auction of the stalls for the Lunar New Year Fairs by way of sealed bids?

Reply:

Madam President,

(a) The open auction for the 2006 Victoria Park Lunar New Year Fair (LNYF) stalls was conducted on November 14 and 15, 2005. Staff of the Food and Environmental Hygiene Department (FEHD) and police officers were present to maintain the order during the open auction. In the afternoon of November 14, despite that bidding for certain stalls was rather competitive, persons found attempting to interfere with the bids of others were warned by FEHD staff immediately on the spot. No one was found to jointly induce a reduction in prices throughout the whole auction process.

(b) FEHD has adopted the long standing practise of the two former Municipal Councils to let out LNYF stalls by open auctions. We consider it impracticable to let out LNYF stalls by tender given the large number of stalls involved. Putting such stalls to tender in one go will prolong the processing time, and it will require a period of time before tenderers will know if their bids are successful, thus causing inconvenience to them. In addition, if several tenderers offer the same price for a stall, they will have to go through a second tendering exercise, which is time consuming.

In our view, open auction should continue as it is an open and fair system. Moreover, bidders in an auction may know at once whether their bids are successful and proceed to make arrangements for purchase of the merchandise. Taking into account the experience in the auction for the Victoria Park LNYF stalls, FEHD has implemented some improvement measures at the auctions for other LNYF stalls. Such measures include video recording of the auctions and informing entrants of such arrangement, and use of identification cardboards by floor staff for easy identification of bidders by staff on the stage. We will keep the LNYF auction arrangements under review and introduce improvement measures as necessary.


Ends/Wednesday, January 11, 2006
Issued at HKT 14:30

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