Wednesday, July 29, 2009

Shanghai Apartment Collapse: Investigation Results and Punishment

闵行倒楼:6人被拘 7人取 保候审 副区长遭行政警告

Minhang Collapsed Building: 6 arrested, 7 out on bail, vice district chief given administrative warning

In yesterday’s Oriental Morning Post, the results of a government investigation into the collapse of an apartment building in the Minhang district of Shanghai were unveiled. While earlier articles, including the English-language Shanghai Daily, reported that both the development company and the construction company were partially owned by officials of Minhang and of Meilong Town (a town within Minhang, located near the real estate development), yesterday’s investigation announced that those links did not exist (at least now).

Investigation of Developer Meidu Company Shareholder Situation

* Founded in 1995, was originally Minhang District Meilong Town Collective Enterprise
* In 2001, changed system to an enterprise run by individuals [minying] with 24 shareholders registered with Bureau of Industry and Commerce; it is an employee of the Meilong Town Land Requisition Service Office and Xun Hao Properties Limited
* From founding to present 6 shareholders have withdrawn

Shanghai Meidu Real Estate Company

* There are 18 actual shareholders currently
* The 8 shareholders who are town public service personnel have unhooked themselves from their original work unit
* The head of the Meilong Town Land Requisition Service Office, Zhang Jinliang, who is an enterprise employee has already unhooked himself from the town Land Requisition Service Office work. Recently, the organizational system of the Meilong Town Land Requisition Service Office was dissolved and it is in the process of auditing and liquidating assets
6 shareholders are employees of Xun Hao Company will either give up their shares or unhook themselves from Xun Hao Company
* The remaining 3 shareholders are an employee of Zhongxin Construction Company, a sole proprietor, and a retiree.
* The company’s former chairman, Que Jingde, is currently the second-largest shareholder with 15% of the shares
* The company’s former board member and current chairman, Zhang Zhiqin, is the top shareholder, and once was a top executive in Xun Hao Company, holds 64.275% of the shares

July 29, 2009
OMP reporter, Li Meng
At the city government news conference yesterday, the head of the group assigned to investigate the “6 [June] 27” accident and director general of the municipal safety supervisory bureau Xie Liming explained the actions to be taken after investigating the “6-27” accidental collapse of Lotus Riverside building 7. Six people from developer Meidu Real Estate Company and project contractor Zhongxin Construction Company who are suspected of negligence leading to a serious accident have been arrested and are in custody; seven people have been released on bail. The company responsible for the accident, Meidu Real Estate Company, has been fined 1.5 million yuan.

Xie Liming said that, because of his leadership responsibility in ensuring district construction engineering safety, Lian Zhenghua, vice warden of Minhang District, was given an administrative warning. The town chief of Meilong Town, Minhang District, Shi Baoqi and the vice-town chief, Zhou Liang, separately received an administrative demerit and a large administrative demerit.

Xie Liming expressed that the collapse of the Shanghai “Lotus Riverside” building during apartment construction has had a bad effect on society and it is of a very serious nature—an accident with major responsibility by those involved. Currently, the certifications of the developer of the collapsed building, Meidu Real Estate Company, the project contractor, Zhongxin Construction Company, and the supervisory unit, Guangqi Inspection Company, have all been revoked.

According to sources, after the collapse of building 7 of “Lotus Riverside” on June 27, member of the Political Bureau of the CPC Central Committee and Shanghai Municipal Party Secretary Yu Zhengsheng and mayor Han Zheng immediately demanded a full investigation of the reasons for the accident and an accounting of the parties responsible—they pledged to use this as a experiential guide, make it a precedent, and clarify responsibility.

The accident investigation team looked at 21 crucial sections of the engineering process and engineering activities, using surveys of the scene, technical appraisals, investigation of approval process, and close research and analysis.

The investigative team was in Minhang District of over 20 days, interviewed 293 people, and produced close to 300 records. Analysis of the investigation made clear the direct and indirect reasons for the accident, identified the nature and responsibility for the accident, advanced opinions on how to dispose of those responsible for the accident, and improvement guidelines on how to avoid the accident.

The investigative group made clear that the second-largest shareholder of the Meidu Real Estate Company, Que Jingde, is not a civil servant of a state organ, and his role as assistant to the town chief of Meilong Town is the result of Meilong Town party secretary Cai Jianzhong overstepping his authority and instituted after an irregular nomination, nor was it reported to the District Organization Department. The Minhang District Committee has now certified that the institution of Que Jingde as assistant to the town chief was invalid and relevant departments are investigating whether to indict Que Jingde. Cai Jianzhong has been suspended from his duties pending the group’s investigation into overstepping authority and irregular nomination of Que Jingde as assistant to the town chief.

After the investigation and identification of responsibility by the investigative group, it was found that 7 people including Meidu Real Estate legal representative Zhang Zhiqin and Zhongxin Construction Company legal representative Zhang Yaojie have direct responsibility for the accident. They are suspected of committing the crime of negligence leading to a serious accident and the determination of criminal responsibility will be decided by the court. Six of the people are in custody. Eight others have been determined to be negligent, including supervisory unit Guangqi Inspection Company legal representative Wang Jinquan, and they will be fined and lose their labor contracts. Finally, the engineering supervisory unit Xieli Survey Company had a nonzero responsibility in causing the accident, and will be publicly criticized.

Xie Liming expressed at the news conference that other problems and leads related to the collapse of building are valued by the Shanghai municipal council and the municipal government, and will be investigated by the relevant city departments and the Minhang District council and government. After investigation, the results will be evaluated and made public through legal means.