Competition
watchdog accepts commitments by HDB lift parts suppliers after
public consultations
SINGAPORE: The Competition Commission of Singapore (CCS) has
accepted commitments by two lift parts suppliers - BNF Engineering
(BNF) and C&W Services Operations (CWO) - to sell lift spare
parts to third-party lift maintenance contractors.
CCS has been investigating alleged refusals by companies to supply
lift spare parts for the maintenance of lifts in HDB estates.
In a media release on Wednesday (Mar 28), CCS said there are
typically multiple brands of lifts installed in each HDB
estate.
For lift maintenance, town councils can either appoint the
companies that originally installed the lifts or engage contractors
to provide lift maintenance services for multiple brands within the
estate.
There could be cost savings in engaging a contractor for multiple
brands as compared to having to procure lift maintenance services
from each original lift installer, the competition watchdog
noted.
According to CCS, contractors bidding for lift maintenance projects
that include multiple brands would require brand-specific
spare parts.
However, if a company or distributor does not provide proprietary
but essential spare parts to contractors, they may be prevented
from effectively competing for contracts to maintain and service
lifts of that particular brand.
To address CCS' competition concerns, BNF and CWO had separately
proposed voluntary commitments to CCS relating to the supply of
parts to contractors.
Public consultations were held over the commitments last November,
with queries raised including the ability of contractors to
properly use the lift spare parts, the size of inventories that BNF
and CWO should hold to supply third-party maintenance contractors
and the protection of intellectual property rights.
Following the consultations, BNF and CWO amended and finalised
their commitments undertaking to sell lift spare parts of the
relevant brands to a purchaser on a fair, reasonable and
non-discriminatory basis, subject to certain terms and
conditions.
The final voluntary commitments provided by the two companies
"fully address" the competition concerns raised by CCS in relation
to the supply of their respective brand of lift spare parts,
according to the competition watchdog.
"CCS notes that lift owners should continue to exercise due care
that the lift maintenance contractors they engage are properly
trained and competent, and it would also be prudent for lift owners
to ensure that their appointed lift maintenance contractors
maintain sufficient inventories of spare parts to service and
maintain the lifts," it said in the media release.
"CCS also notes that competition law does not prevent the proper
exercise of intellectual property rights. However, competition
concerns may arise where a dominant firm attempts to extend its
market power into a related market, beyond the scope granted by
intellectual property laws."
The competition watchdog said it will continue its other
investigations regarding access to essential lift spare parts for
third-party lift maintenance contractors.
Lift maintenance has become an issue in recent years after a number
of breakdowns and accidents hit the headlines, with recent cases
including an elderly couple trapped for more than two hours in a
lift at an HDB block in Yishun on New Year's Day this year and a
lift in Jurong West that was closed for at least two months after
it fell from the 4th floor, injuring a woman last July.
Frequent lift breakdowns reported in Punggol West also prompted
Member of Parliament Sun Xueling to urge HDB to take tougher action
against the lift contractor, while the People’s Action Party (PAP)
announced a centralised system to monitor lift and contractor
performance across all 15 PAP town councils last January.
Source: CNA/mz(db)