https://www.msn.com/en-sg/news/othe...t-firms/ar-BBumg4Q?li=AAaGavh&ocid=spartandhp
The Middle Ground 6 hrs ago
by Andrea Wang
TODAY (July 15) news broke about five lift companies which are under investigation for anti-competitive practices concerning the supply of spare lift parts. While reports had a lot to say about the investigation into their “restrictive” practices, what was more remarkable is what was not said.
In June 2014, Shenyang Brilliant Elevator (BLT) filed a complaint to the Competition Commission Singapore (CCS) claiming that E M Services refused to supply vital lift parts such as motherboards for BLT lifts to third-party contractors. It was suspected that this may have been done to “prevent other lift maintenance contractors from effectively competing for contracts to maintain and service lifts of that particular brand in Singapore”, CSS said.
The results of the investigation implicated E M Services, but the CSS decided not to take action against it as it had agreed to sell the spare parts to third-party contractors in May 12.
BLT’s complaint sparked an investigation into other lift contractors, and the CCS said that it discovered that five other companies were engaging in similar practices and they are currently under probe. It did not name them, citing its pending cases.
A lack of competition in the industry may lead to concerning repercussions. Marine Parade Town Council chairman Lim Biow Chuan told TODAY: “Without competition, there is a limit as to how we can negotiate with the lift companies to keep the maintenance costs lower.”
“Without competition, there is a limit as to how we can negotiate with the lift companies to keep the maintenance costs lower.”
– Marine Parade Town Council chairman Lim Biow Chuan
TODAY also spoke to Ang Wei Neng, Jurong-Clementi Town Council chairman, who expressed concerns that withholding lift parts could cause delays in repairs, and may even compromise safety.
Questions for CCS
CCS’s press release and its decision to not take action against EM Services raises more questions than it answers.
What the CCS does is that it works to enforce provisions under The Competition Act which serves to “protect consumers and businesses from anti-competitive practices of private entities”. This includes cracking down on anti-competitive practices, abuse of dominant positions and mergers that lessen competition.
The real question is why did it take two years for a result to come out from the complaint?
We had a look at CCS’s procedures to see if a two-year period was justifiable.
Its complaint processing procedure does not seem to be a lengthy one. It involves determining if the complaint is one that the CCS can deal with, if the claim can be substantiated and if the behaviour complained about is likely to have an “appreciable adverse effect on competition”. If these requirements are satisfied, a formal investigation will be launched.
The formal investigation procedure itself requires CCS to look into company documents, and if necessary, it will seize equipment for analysis. Following this, the CCS will make an Infringement Decision that sets out why the CCS has decided if the Act has been infringed, and the penalties to be imposed. The concerned parties will be notified before the final Decision is issued. The CCS said that “the investigation duration depends on a number of factors, including the complexity of each case and the extent to which the companies concerned cooperate with CCS.”
Questions for MND
Looking at Minister of National Development Lawrence Wong’s speech in Parliament on Monday (July 11) in light of these reports also raises some interesting questions.
Mr Wong was strangely specific regarding the importance of competition in the lift industry, saying it was one of the key aspects in the Ministry’s strategy to improve the safety of lifts. This was not in response to a particular question.
He put emphasis on increasing competition to benefit residents, pointing out that eight lift contractors maintain 70 per cent of lifts. The G wants to “ensure that third party lift maintenance contractors have access to essential lift spare parts,” he told MPs. “This will promote more effective competition and enable Town Councils to chose the best contractors to do the job.”
“This will promote more effective competition and enable Town Councils to chose the best contractors to do the job.”
-Minister of National Development, Lawrence Wong
Town Councils managed by E M Services
East Coast-Fengshan
Holland-Bukit Panjang
Jalan Besar
Marsiling-Yew Tee
Nee Soon
Pasir Ris-Punggol
Sembawang
Tanjong Pagar
West Coast.
But what he failed to say in Parliament was that this suggestion may not have been not borne out of discussion, but rather due to existing issues with competition in the industry. E M Services serves seven (all PAP) out of 16 Town Councils, including Mr Wong’s own constituency, Marsiling-Yew Tee; surely MPs are aware of complaints filed against their contractors?
To give Mr Wong the benefit of the doubt, perhaps he thought he shouldn’t say anything to jeopardise the CCS investigations – even though Parliament is a privileged forum.
Questions for E M Services
E M Services have also had its say in the matter, but its statement is unconvincing at best, once more leaving us with unanswered questions. Claiming that it was “not (its) intention not to sell to a qualified third party”, it told TODAY that it was in the process of evaluating the third party contractor when the CCS began their investigations. Although it has installed around 2,000 lifts in HDB estates, only 100 are maintained by third-party maintenance companies.
“As we hardly received any query from third-party (contractors) to buy our parts, our staff took time to ascertain whether the request was genuine, the party was qualified and trained to maintain our lifts, etc. We needed to be sure that accountability was clear and safety standards were met before we would sell the parts.”
-E M Services spokesman
According to CCS, it was only in May this year that E M Services agreed to supply BLT spare parts to third-party contractors. This followed a string of widely publicised lift accidents involving yo-yoing lifts, lifts stopping before reaching the correct level and lifts that would move before the doors closed.
Was its decision spurred by the lift incidents as the timeline appears to suggest?
Worker’s Party’s Pritam Singh seems to think the idea is not an outlandish one. Earlier today (July 15) Mr Singh, who is an MP for Eunos, Aljunied GRC, posted a scathing Facebook post questioning the motivations behind CCS’s choice to not take action against EM Services, and called for them to release a detailed report to the public.
“What is not mentioned is that EM Services are 75 per cent owned by the HDB, and 25 per cent by Keppel, effectively making EM Services a HDB and government-owned company.”
“It would appear that a HDB-owned company essentially denied lift parts to other lift maintenance companies that serviced HDB lifts. Would it not be plausible that after a spate of public lift accidents, EM Services decided to change course to supply spare parts as a result of public concern about lift safety?”
“The Competition Commission, being a government statutory board and having decided not to take action against a government-owned company, should release a detailed report on this matter to the public. Or would such a report cause “undue panic”?”
Evidently, Mr Singh was taking a dig at Transport minister Khaw Boon Wan’s reason for not disclosing that MRT trains had been returned to China due to cracks in the car-body.
Political swipes aside, there is a case to be made for the CCS to be more forthcoming about why it allowed two years to lapse and then let EM Services off the hook because the firm decided to supply the third-party contractor. It is not good for the CCS to be seen as partial to a party, especially because of the perception that E M Services is an offshoot of the G, and a People’s Action Party tool.
Also, if the lift contractors have been indulging in such behaviour for some time and Town Councils are unaware of it, then residents will be wondering if their Town Councils have really got the best value for their service and conservancy charges. If the Town Councils and MPs are aware of the practice but have said nothing for so long, then the plot thickens.
Featured image by Najeer Yusof.
If you like this article, Like The Middle Ground ‘s Facebook Page as well!
For breaking news, you can talk to us via email .
The Middle Ground 6 hrs ago
by Andrea Wang
TODAY (July 15) news broke about five lift companies which are under investigation for anti-competitive practices concerning the supply of spare lift parts. While reports had a lot to say about the investigation into their “restrictive” practices, what was more remarkable is what was not said.
In June 2014, Shenyang Brilliant Elevator (BLT) filed a complaint to the Competition Commission Singapore (CCS) claiming that E M Services refused to supply vital lift parts such as motherboards for BLT lifts to third-party contractors. It was suspected that this may have been done to “prevent other lift maintenance contractors from effectively competing for contracts to maintain and service lifts of that particular brand in Singapore”, CSS said.
The results of the investigation implicated E M Services, but the CSS decided not to take action against it as it had agreed to sell the spare parts to third-party contractors in May 12.
BLT’s complaint sparked an investigation into other lift contractors, and the CCS said that it discovered that five other companies were engaging in similar practices and they are currently under probe. It did not name them, citing its pending cases.
A lack of competition in the industry may lead to concerning repercussions. Marine Parade Town Council chairman Lim Biow Chuan told TODAY: “Without competition, there is a limit as to how we can negotiate with the lift companies to keep the maintenance costs lower.”
“Without competition, there is a limit as to how we can negotiate with the lift companies to keep the maintenance costs lower.”
– Marine Parade Town Council chairman Lim Biow Chuan
TODAY also spoke to Ang Wei Neng, Jurong-Clementi Town Council chairman, who expressed concerns that withholding lift parts could cause delays in repairs, and may even compromise safety.
Questions for CCS
CCS’s press release and its decision to not take action against EM Services raises more questions than it answers.
What the CCS does is that it works to enforce provisions under The Competition Act which serves to “protect consumers and businesses from anti-competitive practices of private entities”. This includes cracking down on anti-competitive practices, abuse of dominant positions and mergers that lessen competition.
The real question is why did it take two years for a result to come out from the complaint?
We had a look at CCS’s procedures to see if a two-year period was justifiable.
Its complaint processing procedure does not seem to be a lengthy one. It involves determining if the complaint is one that the CCS can deal with, if the claim can be substantiated and if the behaviour complained about is likely to have an “appreciable adverse effect on competition”. If these requirements are satisfied, a formal investigation will be launched.
The formal investigation procedure itself requires CCS to look into company documents, and if necessary, it will seize equipment for analysis. Following this, the CCS will make an Infringement Decision that sets out why the CCS has decided if the Act has been infringed, and the penalties to be imposed. The concerned parties will be notified before the final Decision is issued. The CCS said that “the investigation duration depends on a number of factors, including the complexity of each case and the extent to which the companies concerned cooperate with CCS.”
Questions for MND
Looking at Minister of National Development Lawrence Wong’s speech in Parliament on Monday (July 11) in light of these reports also raises some interesting questions.
Mr Wong was strangely specific regarding the importance of competition in the lift industry, saying it was one of the key aspects in the Ministry’s strategy to improve the safety of lifts. This was not in response to a particular question.
He put emphasis on increasing competition to benefit residents, pointing out that eight lift contractors maintain 70 per cent of lifts. The G wants to “ensure that third party lift maintenance contractors have access to essential lift spare parts,” he told MPs. “This will promote more effective competition and enable Town Councils to chose the best contractors to do the job.”
“This will promote more effective competition and enable Town Councils to chose the best contractors to do the job.”
-Minister of National Development, Lawrence Wong
Town Councils managed by E M Services
East Coast-Fengshan
Holland-Bukit Panjang
Jalan Besar
Marsiling-Yew Tee
Nee Soon
Pasir Ris-Punggol
Sembawang
Tanjong Pagar
West Coast.
But what he failed to say in Parliament was that this suggestion may not have been not borne out of discussion, but rather due to existing issues with competition in the industry. E M Services serves seven (all PAP) out of 16 Town Councils, including Mr Wong’s own constituency, Marsiling-Yew Tee; surely MPs are aware of complaints filed against their contractors?
To give Mr Wong the benefit of the doubt, perhaps he thought he shouldn’t say anything to jeopardise the CCS investigations – even though Parliament is a privileged forum.
Questions for E M Services
E M Services have also had its say in the matter, but its statement is unconvincing at best, once more leaving us with unanswered questions. Claiming that it was “not (its) intention not to sell to a qualified third party”, it told TODAY that it was in the process of evaluating the third party contractor when the CCS began their investigations. Although it has installed around 2,000 lifts in HDB estates, only 100 are maintained by third-party maintenance companies.
“As we hardly received any query from third-party (contractors) to buy our parts, our staff took time to ascertain whether the request was genuine, the party was qualified and trained to maintain our lifts, etc. We needed to be sure that accountability was clear and safety standards were met before we would sell the parts.”
-E M Services spokesman
According to CCS, it was only in May this year that E M Services agreed to supply BLT spare parts to third-party contractors. This followed a string of widely publicised lift accidents involving yo-yoing lifts, lifts stopping before reaching the correct level and lifts that would move before the doors closed.
Was its decision spurred by the lift incidents as the timeline appears to suggest?
Worker’s Party’s Pritam Singh seems to think the idea is not an outlandish one. Earlier today (July 15) Mr Singh, who is an MP for Eunos, Aljunied GRC, posted a scathing Facebook post questioning the motivations behind CCS’s choice to not take action against EM Services, and called for them to release a detailed report to the public.
“What is not mentioned is that EM Services are 75 per cent owned by the HDB, and 25 per cent by Keppel, effectively making EM Services a HDB and government-owned company.”
“It would appear that a HDB-owned company essentially denied lift parts to other lift maintenance companies that serviced HDB lifts. Would it not be plausible that after a spate of public lift accidents, EM Services decided to change course to supply spare parts as a result of public concern about lift safety?”
“The Competition Commission, being a government statutory board and having decided not to take action against a government-owned company, should release a detailed report on this matter to the public. Or would such a report cause “undue panic”?”
Evidently, Mr Singh was taking a dig at Transport minister Khaw Boon Wan’s reason for not disclosing that MRT trains had been returned to China due to cracks in the car-body.
Political swipes aside, there is a case to be made for the CCS to be more forthcoming about why it allowed two years to lapse and then let EM Services off the hook because the firm decided to supply the third-party contractor. It is not good for the CCS to be seen as partial to a party, especially because of the perception that E M Services is an offshoot of the G, and a People’s Action Party tool.
Also, if the lift contractors have been indulging in such behaviour for some time and Town Councils are unaware of it, then residents will be wondering if their Town Councils have really got the best value for their service and conservancy charges. If the Town Councils and MPs are aware of the practice but have said nothing for so long, then the plot thickens.
Featured image by Najeer Yusof.
If you like this article, Like The Middle Ground ‘s Facebook Page as well!
For breaking news, you can talk to us via email .
