“Environmental court” essential for HK’s green finance role
In a city of shameless corporate polluters, talk of "sustainable finance" is a joke. A dedicated environmental court or tribunal is an innovative idea to restore Hong Kong's green credibility.
China Concrete’s massive illegal concrete complex is still running at full tilt, despite the latest move by the government to strip the Tung Yuen Street operation of its last operating licence.
On Wednesday night, the Environmental Protection Department (EPD) dismissed China Concrete’s appeal against the revocation of the licence at 20 Tung Yuen Street, meaning every ounce of concrete mixed at the whole 20-22 Tung Yuen Street complex is now produced illegally.
As a quick backgrounder, China Concrete had previously separated the Yau Tong plant, which supplies around 10% of Hong Kong’s construction concrete, into two entities, 20 and 22 Tung Yuen Street.
“22” is already operating flagrantly in breach of Hong Kong law: it lost its licence in April 2021, its subsequent appeal in January 2022, and, in January this year, despite being defended by a former Secretary for Justice, it also lost a high court injunction ordering it to close. Yet, unfathomably, it continues churning out concrete.
“20” was stripped of its licence in April 2022 but, under the rather favourable corporate conditions for polluters in Hong Kong, was allowed to keep operating for 18 months while owner China Concrete appealed. On Wednesday, “20” also lost its appeal which means the formerly “good” part of the plant is now also operating illegally.
Of course, when I visited on Friday morning both plants were running. The same lawless dirt, the same “snail wagons” careening around trying to keep up with Hong Kong’s breakneck construction schedule, the same pushy security guards who harass and cajole people on a public street, the plant literally oozing all manner of chemicals, dirt, dust, slime, illegal pipework and broken bits of equipment onto the pavement and road. Workers clamber around rusty scaffolding without safety lines, without hard hats, mostly smoking and without any of the hi-viz which might have helped prevent the death of a man at the gate last year. As I stand taking a photo a truck steams in without slowing down, airhorn blaring, its licence plate illegible under months of mud and concrete.
The separation of the whole disgusting complex into “20” and “22” is the sort of paper trickery Hong Kong’s corporate services folk might brag about at a corporate services convention cocktail party. Essentially this is one massive plant behind a facade of two entrances. They share the same mailbox, the same workers, the same vehicles and equipment, the same scaffolding curtain designed to keep prying drones away.
How they were ever granted separate licences is a historical issue and is surely not related to the number of former senior officials who are now on the company’s board, including a former police chief and a fire chief1.
The fake separation had previously muddied the illegal operation: when, for example, I caught Education Bureau purchasing concrete from the very plant its government colleagues were trying to shut down, the bureau had the plausible deniability to say, “well, OUR concrete came from the legal plant at 20 Tung Yuen Street”. This is like saying your tap water comes from the northern part of the reservoir.
Such distinction is now moot: with EPD’s Wednesday decision, the whole plant is now illegal. Not that China Concrete respects any of this: when EPD officials visited the plant on Thursday, the morning after they revoked the “20” plant licence, the operator paused some operations for an hour or so. Officials shook hands and waved goodbye. The plant started up again.
Luckily the EPD folk are not completely naive and returned the next day in a surprise visit to find, to nobody’s surprise, the whole plant in full operation.
It’s easy to point fingers at EPD and FEHD – we had a whole chant against them at the “Kill the Plant” protest, “EPD Do Your Job, FEHD Do Your Job”. And, in an interview with Hong Kong Free Press last week, I called on the heads of both departments to resign.
In the puffer-jacket chill of morning, this seems a bit harsh: EPD is at least trying to get the plants shut down legally2. They’ve installed a camera across the street which officials on the scene on Friday assured me was working and producing evidence.
But they’re fish out of water when it comes to aggressively shutting down a dangerous polluter. Their pristine white helmets, mismatching clothes and fearful deportment make them look like 10th graders on a school trip – probably because they have no support from senior government or the government’s prosecutor (DOJ) or indeed from Hong Kong’s sloppy and chaotic court system.
While EPD says it has brought 32 summonses against 22 Tung Yuen Street for its 680-day run of illegal operation3, not one case has actually been successfully prosecuted yet.
Time for an “environmental court”
In Hong Kong, environmental cases can take years to come in front of a judge and then the penalties for conviction are laughable. Global corporations pumping cooking oil into the harbour will receive around the same fine as someone throwing a cigarette from a car. Case in point: a company ignoring asbestos legislation came before a magistrate’s court in Fanling last month, seven months after two serious asbestos breaches, and was fined $5,000 for each offence, out of a maximum $200,000 fine and six months imprisonment for each offence. We don’t know how many of that firm’s asbestos offences went un-prosecuted: given EPD’s summons rate for China Concrete, 5% would be a generous guess.
Obviously none of this gels with the crisp clean “sustainable finance” hub our leaders paint at every Belt and Road summit or finance convention around town or globally. A city which can’t shut down an illegal concrete plant (and which has allowed a whole harbourside district to decay into a decrepit industrial no-go zone) or which hands down pocket-money fines for asbestos violations cannot claim any chops in sustainability. The very pillar of green finance is unimpeachable market faith in green credentials – without a trusted hallmark, the “green” is just a marketing buzzword, like “no added sugar” in kids’ cereals whose first listed ingredient is sugar.
Which brings me to a bold and innovative solution: an environmental court. A dedicated court with capacity to act fast on pollution and with expert judges capable of making the right calls.
It’s not such a crazy idea: there’s now over 2,000 environmental courts, tribunals or “green benches” in 67 countries around the world (including China). According to the UN, which put together a guide for territories4 wishing to explore the concept, such courts or tribunals “provide access to environmental justice and remedies, strengthen judicial systems to ensure accountability, and spur legal innovation and reforms”.
Scope and function can vary from a dedicated environmental court to designated trained or expert judges (green benches) in existing courts, as well as tribunals and green chambers.
I first put the idea to the then-Environment Bureau in 2019 during one of Carrie Lam’s “meet the community” conversations: at the time they said, contradictory to all observable evidence, that the court system was fine and rejected the concept outright.
But even the most cursory glance at the monthly “environmental prosecutions” will show green benches, at the very least, to be an idea worth revisiting.
Lawyers in the city will be familiar with specialist courts: we have “red benches”, as in dedicated National Security judges, within the existing court system; family court specialists within the district court; and labour tribunals for labour issues. These are perhaps not the greatest examples: the first is rather opaque while the latter two are under-resourced and overworked. A better precedent might be something like Hong Kong’s new global mediation platform, eBRAM, created out of nothing in just a couple of years5. If we can build an eBRAM in a few years we can create an environmental court and show the world how Belt and Road, sustainable finance, etc isn’t just a label, it’s a serious business with serious hallmarked standards observed and enforced for green projects.
Without any initiative in this direction, John Lee’s words on the environment and green finance remain transparently empty – and while he may enjoy making speeches about Hong Kong nightlife to finance professionals, nobody in that business is fooled for a minute. In my educated opinion as former Asia editor of Risk magazine, Hong Kong failed to become an Islamic finance hub partly for the very same reason: people didn’t trust, quite rightly, its ability to produce genuine shariah products. Our regulator allowed firms to stick a “shariah” label on all sorts of nonsense, making pretty speeches and looking the other way rather than doing the hard work of testing and regulating purity.
Given the opportunities for Hong Kong as the mainland bridge in sustainable and green finance, it would be criminal to repeat these mistakes. We can go forward on a solid foundation, with innovative institutional support, or we can choose the short-term profits of allowing bad actors like China Concrete to continue their wicked ways. To be a genuine green finance hub, we can’t do both.
Nothing dodgy about that, shame on you for even thinking that perhaps those responsible for approving the licences might have been swayed by the promise of a lush directorship.
No such leniency for the FEHD boss, who should resign at once: the state of Tung Yuen Street and indeed the fish market along the street, also under FEHD’s regulatory purview, is beyond belief.
I argued to Ombudsman that EPD had failed in their duty, given they should have proscuted every daily violation, not just selected days. Ombudsman disagreed and asked me why I thought the plant should be prosecuted every day. I didn’t really know how to respond to that, other than “rule of law?”.
Please click on the link. The UN records and displays the location and number of visits to key documents: some good interest from Hong Kong could be useful in lobbying later 🙏
An ascent helped, no doubt, by Teresa Cheng’s part ownership of the platform and her desire to see it fully implemented as a major Hong Kong institution before her term as Secretary for Justice expired, just sayin’…