COMPANY; HOCHTIET, A GERMAN COMPANY.
WOULD YOU LIKE ME TO GO ON?
OF THE FOUR KEY
NO, IT'S OKAY. MAREHOLDERS.
I WANTED THE BREAKDOWN
Q: IS THERE A POSSIBILITY THAT THE ANGLO-JAPANESE CONSORTIUM CANNOT FINISH THE PROJECT AND THE CONSORTIUM DISSOLVED? IS THERE ANY FORM OF GUARANTEE THAT WAS PROVIDED?
MR YEUNG: YES, THERE ARE A NUMBER OF GUARANTEES BY WHICH WE MAKE SURE THAT THE CONTRACTOR, THE CONSORTIUM AWARDED THE CONTRACT, WILL PERFORM AND THESE ARE SAFEGUARDS. FIRST OF ALL, UNLIKE OTHER CONTRACTS WHERE WE REQUIRE PERFORMANCE BONDS, WE REQUIRE A VERY HEAVY PERFORMANCE BOND AMOUNTING TO 10% OF THE VALUE OF THE CONTRACT. WE ARE TALKING ABOUT HUNDREDS OF MILLIONS OF DOLLARS HERE, IN THIS CASE. THE NORMAL PERFORMANCE BOND IS 2-1/2% OF THE CONTRACT VALUE. IN THIS CASE, IT IS 10%. THEN SECONDLY, THE WORKS GROUP DEPARTMENTS WILL HAVE A STRONG TEAM OF ENGINEERS MONITORING PROGRESS AS THE CONTRACT PROCEEDS, SO WE HAVE PEOPLE WATCHING AND MONITORING THE PERFORMANCE OF THE CONTRACTOR. THIRDLY, THERE IS THE MECHANISM OF LIQUIDATED DAMAGES BECAUSE THE CONTRACT PROVIDES THAT IF THE CONTRACTOR IS SLOW OR HAS NOT PERFORMED BY A CERTAIN TARGET DATES THEY ARE RESPONSIBLE FOR PAYING US LIQUIDATED DAMAGES.
BUT FOURTHLY, WE HAVE ALSO TAKEN THE STEP OF COVERING THE PROJECT WITH ADEQUATE INSURANCE. THIS PROJECT IS SO CRITICAL TO THE AIRPORT CORE PROGRAMME IN TERMS OF TIMING OF COMPLETION THAT WE ARE NOT TAKING ANY RISKS, ANY SERIOUS RISKS WITH THE CONTRACTORS PERFORMANCE AND I AM SURE MR. BLAKE HAS OTHER POINTS TO ADD.
MR BLAKE: I WAS JUST GOING TO UNDERLINE I THINK THE POINT ON BOND IS THE IMPORTANT THING TO RECOGNISE; THAT FOR THIS CONTRACT WE HAVE APPLIED A 10% BOND WHICH IS RATHER HIGH AND CERTAINLY MUCH HIGHER THAN THE HONG KONG GOVERNMENT NORMALLY APPLIES BUT IT HAS BEEN APPLIED AT THAT LEVEL TO MAKE SURE THAT
SURE THAT WE HAVE THIS GUARANTEE TOWARDS PERFORMANCE.
Q: CAN YOU ANSWER THE FIRST PART OF MY QUESTION, IS THERE A POSSIBILITY THAT THE ANGLO-JAPANESE CONSORTIUM CANNOT FINISH THE PROJECT, AND THE CONSORTIUM DISSOLVED?
MR BLAKE: CAN I PERHAPS REPLY TO THAT, CHAIRMAN. THE ANGLO-JAPANESE EXPERTISE INCLUDES CLEVELAND ENGINEERING AND DORMAN LONG; THESE ARE INTERNATIONAL NAMES IN THE FIELD OF BUILDING MAJOR SUSPENSION BRIDGES. FOR EXAMPLE, THEY HAVE BUILT THE HUMBER BRIDGE WHICH IS CURRENTLY THE LARGEST SINGLE-SPAN SUSPENSION BRIDGE IN THE WORLD. THEY WERE ALSO QUITE RECENTLY RESPONSIBLE FOR THE DARTFORD BRIDGE. THESE TWO BRIDGES INDICATE TWO ASPECTS OF THEIR STRENGTH. FIRST OF ALL, THEY HAVE GOT EXPERTISE IN THE LARGEST SUSPENSION BRIDGE IN THE WORLD, BUT CERTAINLY ALSO THAT EXPERTISE IN TERMS OF PEOPLE HAS BEEN RETAINED WITHIN THEIR COMPANIES BY THEIR INVOLVEMENT IN THE RECENT DARTFORD BRIDGE.
Q: BUT IF THE CONSORTIUM DISSOLVED, CAN HONG KONG GOVERNMENT CLAIM THESE INDIVIDUAL COMPANIES?
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A: ALL OF THE COMPANIES ARE BOUND THE MAIN COMPANIES ARE BOUND UNDER A JOINT AND SEVERAL ARRANGEMENT.
30'd
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