The Competition Policy Advisory Group has ruled the Food & Environmental Hygiene Department's award of a contract to the Universal Funeral Parlour would not lead to market monopoly.

In its 2007-08 annual report published today, the group said the department awarded a contract to Universal in November 2006 to manage the Hung Hom Public Funeral Parlour.

In view of comments alleging this would affect competition and lead to higher rents for funeral service halls, the Food & Health Bureau assessed the situation and found Universal does not have a monopoly as there are five funeral halls in Hong Kong operated by other service providers.

The Hung Hom Public Funeral Parlour operator is also required under contract to provide services at reasonable standards commensurate with the level of charges, and to provide low-cost funeral services to underprivileged people.

The Government is empowered to remove an operator who is in material breach or has repeatedly breached this undertaking, or has failed to rectify a breach which is capable of being remedied within reasonable time.

The bureau considered the contract awarding has not given Universal a dominant position in the market which in turn might create the potential for monopoly pricing, predatory pricing or other anti-competitive conduct. The group agreed.

The group also found two other complaints unsubstantiated, involving the supply of bitumen materials for Highways Department maintenance contracts, and the provision of marine pilotage services.

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