(A) Introduction
Competition authorities in Hong Kong and Mainland China commenced the second half of 2025 with two notable enforcement actions, underscoring their continued focus on sectors critical to people's livelihood.
On 8 July 2025, the Hong Kong Competition Commission (the “Commission”) initiated its enforcement activity for the year with an unexpected investigation into a suspected cartel within the swimming pool services sector.[1] While targeting this industry is unusual, swimming is highly popular in Hong Kong, especially during summer, driving significant demand for these services. As reiterated by the Commission, combating cartels affecting people's livelihood remains a key enforcement priority.[2] This action clearly demonstrates the Commission's commitment to tackling such conduct.
Meanwhile, on 7 July 2025, the State Administration for Market Regulation (the “SAMR”) published decisions issued by the Heilongjiang Provincial Administration for Market Regulation (the “HPAMR”) concerning monopoly agreements involving the Daqing City Vehicle Inspection Industry Association (the “Association”) and 31 vehicle inspection institutions.[3] These decisions reaffirm that vehicle inspection sector, which affects people’s livelihood, has consistently been a key enforcement target for the SAMR.
This article examines the above enforcement actions, highlighting the broader trend of intensified scrutiny on sectors which directly impact people’s livelihood by competition authorities in Hong Kong and the Mainland China.
(B) Hong Kong: The Commission’s First 2025 Raid Targets Swimming Pool Cartel
On 8 July 2025, the Commission executed search warrants at 12 premises, including the offices of swimming pool service providers and residences of seven individuals.[4] The companies were suspected of bid-rigging, price fixing, market sharing and exchanging competitively sensitive information when submitting quotations for services for private swimming pools, in contravention of the First Conduct Rule under the Competition Ordinance (the “Ordinance”).[5]
There are four key features of this case:
(1) Expanding Scope of Violations: This case marks the first Commission raid of 2025. Unlike the two 2024 enforcement actions, namely, the funeral service case on 17 January 2024 targeting suspected price-fixing,[6] and the government subsidy scheme case involving alleged bid-rigging, price-fixing, customer allocation, and information exchange,[7] the 2025 swimming pool case introduces “market sharing” as a newly alleged violation alongside bid-rigging, price-fixing, and information exchange. This demonstrates the expanding scope of conduct under scrutiny in the Commission's cartel investigations.
(2) Multi-Pronged Investigation Tactics: Apart from executing the search warrants, the Commission exercised its compulsory powers under Sections 41 and 42 of the Ordinance to request relevant parties to produce documents and information, and to attend before the Commission to provide information relating to the case.[8] This demonstrates a comprehensive and multi-tool approach to evidence gathering.
(3) Direct Impact on Residential Communities: The alleged cartel targeted private housing estates' swimming pools, directly affecting residents' living costs and recreational access. This “livelihood-focused” nature significantly amplifies the case's public significance.
(4) Unusual Target: There are divergent views on whether a swimming pool cartel is common. Mr Chan Chi Kau, former president of the Hong Kong Association of Property Management Companies Limited, commented that there were over 10 large-scale swimming pool service providers in Hong Kong, and competition was fierce. He highlighted the “high investment, low profit” nature of the sector (contracts typically HK$10,000s-100,000s/month) and stated that he had not heard of any bid-rigging cases, suggesting the alleged risks seem disproportionate.[9] In contrast, the lifeguard industry stated that there were around 30 swimming pool service providers in Hong Kong. About 10 of these focus on serving pools in just one or two locations, while another 20 actively compete for business.[10] There were reports of companies deliberately bidding at lower prices to win contracts, then hiring unqualified lifeguards to cut costs and boost profits.
(C) Mainland China: HPAMR Penalized Daqing Vehicle Inspection Association and 31 Institutions for Monopoly Agreements
On 7 July 2025, the SAMR published the decisions made by the HPAMR against the Association and 31 vehicle inspection institutions for reaching and implementing monopoly agreements.[11]
Facts
From March to December 2024, the Association orchestrated price-fixing and market manipulation among 31 institutions through coordinated meetings and WeChat groups.[12] Specifically, on 3 March 2024, the Association mandated a uniform inspection price of ¥310 per vehicle and established a “support fund” mechanism which redistributed income based on daily volume deviations from the group average. Higher-volume operators subsidized lower-volume ones.[13] On 31 March 2024, the Association imposed a minimum price of ¥220 per vehicle, prohibiting transactions below purported “cost-based prices”.[14] To monitor compliance, the Association created a “market supervision team”, penalized deviations through compulsory “voluntary donations”, deployed data auditors to verify daily inspection volumes, and publicly reported violations in WeChat groups.[15]
Decision
The HPMRA found the Association violated Article 21 of Anti-Monopoly Law (2022 Amendment)(the “AML”), which prohibits trade associations from organizing operators to implement the monopolistic conduct.[16] As such, the Association was fined ¥300,000. This penalty amount considered mitigating factors under Article 59 of the Anti-Monopoly Law, including the relatively short duration of the violation (around 9 months), the Association's cooperation during the investigation, its cessation of the conduct, submission of a compliance pledge, and corrective actions.[17] The 31 institutions were fined 2% of their respective sales revenue from the previous year pursuant to Article 56 of the AML for reaching and implementing monopoly agreements.
This case highlights the following key features:
(1) Sector-Wide Regulatory Focus: This case aligns with heightened antitrust scrutiny of Mainland China’s vehicle inspection sector in 2024. Three of six monopoly agreement cases resolved that year involved this sector.[18] The SAMR explicitly prioritizes combating anti-competitive behavior in this sector, as reinforced by (1) penalties against Jingtian Vehicle Inspection Co., Ltd. and 12 other vehicle inspection institutions by the Hunan Provincial Administration for Market Regulation (July 2024);[19] (2) penalties against 10 vehicle inspection companies by the Tianjin Administration for Market Regulation (October 2024);[20] (3) penalties against 23 vehicle inspection enterprises by the Guizhou Administration for Market Regulation (November 2024);[21] and (4) an Anti-Monopoly Compliance Lecture for the Vehicle Inspection Industry conducted by the SAMR (September 2024).[22]
(2) Unprecedented Scale of Involved Entities with Trade Association Dominance: This case imposed penalties on the Associations and 31 vehicle inspection institutions, covering most major inspection service providers in Daqing City. This reveals systemic collusion rather than isolated misconduct. The Association act as the organizer of the monopoly agreements, which coordinated institutions through meetings and WeChat groups.
(3) Direct Impact on People’s Livelihood: Vehicle inspection services are mandatory for all private vehicles in China, making them an essential public service affecting nearly all vehicle owners. The collusion inflated costs for this mandatory service, affecting low-income households and small businesses and undermining fair access to affordable transportation.
(D) Key Takeaways
In conclusion, the above actions reflect regulators’ zero-tolerance stance toward cartels harming public welfare, with heightened scrutiny of livelihood sectors.
Trade associations play a vital role in educating members about competition law and fostering a strong compliance culture. To achieve this, they should focus on three core pillars: “Adopt”, “Agenda” and “Audit”.
(1) Adopt: Trade associations should proactively establish clear written guidelines prohibiting anti-competitive discussions. These guidelines must explicitly cover pricing, market allocation, bid-rigging, and sensitive information sharing. They must ensure all members fully understand and acknowledge these rules.
(2) Agenda: Trade associations should ensure meeting transparency and focus. Trade associations should circulate detailed agendas to all participants at least 24 hours in advance. Discussions must strictly adhere to the pre-published agenda. If sensitive topics (like pricing complaints) arise unexpectedly, attendees must immediately leave the meeting, and their departure must be formally recorded in the minutes. Trade associations should actively prevent meetings where collusion is likely to occur.
(3) Audit: Trade associations should implement robust oversight mechanisms. They should conduct immediate internal investigations if collusion is suspected and report findings to the relevant competition authorities.
[1] https://www.compcomm.hk/en/media/press/files/Swimming_pool_PR_EN.pdf
[2] Ibid
[3]
https://www.samr.gov.cn/zw/xzcfjd/art/2025/art_10cea6574f454ede8d60bc122173515b.html
[4] https://www.compcomm.hk/en/media/press/files/Swimming_pool_PR_EN.pdf
[5] Ibid
[6] https://www.compcomm.hk/en/media/press/files/Funeral_Service_PR_EN.pdf
[7] https://www.compcomm.hk/en/media/press/files/subsidy_search_PR_EN.pdf
[8] https://www.compcomm.hk/en/media/press/files/Swimming_pool_PR_EN.pdf
[9] https://hk.on.cc/hk/bkn/cnt/news/20250708/bkn-20250708153000691-0708_00822_001.html
[10] Ibid
[11]
https://www.samr.gov.cn/zw/xzcfjd/art/2025/art_10cea6574f454ede8d60bc122173515b.html
[12] Paragraph 3, 黑龙江省市场监督管理局行政处罚决定书（黑市监垄罚〔2025〕1号）
[13] Paragraph
3.2.1, Ibid
[14] Paragraph
3.2.2, Ibid
[15] Paragraph 3.3, Ibid
[16] Section 5, Ibid
[17] Ibid
[18] Page 11, 中国反垄断执法年度报告 (2024) published by SAMR: https://www.gov.cn/lianbo/bumen/202506/P020250607293554751833.pdf
[19] Page 11-12, Ibid
[20] Page 12, Ibid
[21] Page 12, Ibid
[22]
https://www.samr.gov.cn/xw/zj/art/2024/art_d13d964223e04581b707a464759b4f78.html
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