Secretary: Buildings Dept impartial

Chan pledges full compliance with rules to avoid conflicts of interest

Secretary for Development Paul Chan said the Buildings Department will take enforcement action impartially, in accordance with prevailing practices and policies, and will not make special arrangements due to an owner's identity.

Speaking to the media on Friday, Chan said the Buildings Department will not report to him about works on sub-divided flat cases that involve his family members.

The department is responsible for investigation and enforcement, and the Development Bureau will not give it any instruction, he said.

He reiterated that he would fully comply with strict regulations for appointed officials and practices to avoid conflicts of interest.

The two flats in question are owned by a company called Harvest Charm Development, Chan said. Though his wife, Frieda Hui, is a shareholder, she did not hold controlling interest in the company and was not aware the flats had been subdivided and sublet.

But in order to alleviate public concern, Chan said, Hui will contact the other shareholders with the intention of selling all her shares in the company.

Chan could not answer questions about the couple's connection with Harvest Charm, nor could he explain why his wife had signed government rent documents on behalf of the company, saying he would refer the questions to his wife.

The Buildings Department will investigate and enforce the law impartially, he stressed. Given the case involves him, the department will not report the case to him, nor will the Development Bureau give any instruction to the Buildings Department.

Chan spoke on the incident in person for the first time on Friday, about the alleged subdivided units.

Chan's previous response since the allegation was raised in the media a few days ago was only through prepared statements.

"My wife has not approved the alleged unauthorized subdivision of the flats, not to mention operating the subdivided units," he told the press conference at the government office arranged at short notice on Friday.

"It is stated in the two lease agreements the two flats should not be subdivided or sublet. Since Harvest Charm's tenancy matters are handled by another shareholder, she knows nothing at all about the violations. She will take action to recover the two units and handle the unauthorized subdivided units appropriately in accordance with the law."

Chan further said he was never a shareholder in Harvest Charm, adding he was a company director in the early years but resigned in 1997 and so knew nothing about the tenancy matters of the company.

Chan also denied the company has evaded taxation.

As to why his wife holds a 75 percent shareholding of Harvest Charm through an offshore company, Chan, who is an accountant by training, said it is common for people to hold local companies through offshore companies for estates and privacy reasons.

According to the Companies Registry records, Frieda Hui has been a director of Harvest Charm for 10 consecutive years and she also signed government rent documents for the company.

Asked at a press conference to explain this and if the two units are owned by his wife's family business, Chan said: "I will relay your two questions to my wife."

joseph@chinadailyhk.com

(HK Edition 08/04/2012 page1)