They own your supermarket chains, your offices, your apartments. They drive you to work on their streets through their tunnels, serve you their food for lunch, fly you in and out, make sure your stove is hot and your air con is cold.

Hong Kong’s famous tycoons make billions of dollars a year in every niche in the world’s freest economy. Free in this case means free from regulation, but that does not mean free market.
Nowhere else in the world are so many areas of the economy up for grabs. The public transportation system is private, so are most of the tunnels, bridges and highways. Businesses are lowly regulated and the only relevant tax heard of is a 16% income tax.

In a market in which entry is legally so easy, how are the tycoons able to accumulate so much wealth and keep their positions? Is it endemic to a free market that few rule? Or are there other forces at play?

How do they make money? The key to this question lies in collusion and vertical integration. If you look at the owned businesses by selected tycoons below you will see that each conglomerate tries to control the entire production chain. Someone who owns a lot of buildings also wants to own construction companies, quarries and cement factories.
A company like Swire that focuses strongly on aviation (Cathay, Air Hong Kong and Dragonair) will also try to dominate the mechanics, engineering and catering industry. Or not just bottle Coca-Cola, but produce the sugar as well.
If you own a lot of malls, you want to own a lot of restaurant and retail shops as well, and if you already own the power plants, why not have the electric company as well.
What’s true in the game Monopoly is true in real life as well. If you have the entire street it is much easier to milk your customers, and more importantly, keep potential competitors out. It is very difficult to enter the real estate market if all the construction companies and cement mines are owned by your competitors. And entering the market by entering the entire vertical construction chain is even more difficult.

You will furthermore notice below that usually not more than two tycoons serve one industry (with the exception being land, more on this later). The reason for this is that monopolists usually tolerate some competition, as it keeps away suspicion and public anger. Regarding anti-trust laws, it also helps immensely to create the illusion of competition, as Peter Thiel brilliantly explains here. This is for example true of Li Ka Shing’s Watson’s holding, which spreads out the supermarket business into many distinguishable brands.
Tycoon’s also seem to respect each other’s core markets, quite likely because of their mutual understanding that competition hurts.

Land however, also play a big role. Land in Hong Kong is given out by the government at a slow but steady rate. The high income from selling land helps keeping taxes low and that keeps citizens happy, not realizing that through high property values and rent, they are taxed too.
For prices to stay high however the supply of apartments needs to stay low. That is seen to be the reason behind the government’s recent indecision on what to do with the newly (or not so newly) acclaimed land around Kowloon West, Kai Tak and Central. Why not chop it up in little pieces and sell it to the highest bidder?
The answer lies in the monopolistic market of apartments. The highest bidder would very likely be someone who plans to build new apartment blocks, and a heavy increase in the city’s apartments would likely bring down prices by as much as 30% percent (The Economist finds Hong Kongs housing prices to be roughly 50% above market value) .
As Time Out Hong Kong puts it, there are about 200,000 empty apartments in Hong Kong.
If these apartments were owned by individuals, they clearly had an incentive to rent these out, as every penny from rent would increase their overall income. The tycoons however do not have that incentive. For them, renting out the additional 200,000 apartments could lead to an overall drop in the market value which in total lowers the income form rent.

This on the contrary would lead to future drop in income for the government, and a desperate need to either increase taxes, or cut programs such as the scheme 6,000, which guarantees every permanent resident a 6,000 HK$ check.
And so the government colludes, it prefers the production of a cultural district in Kowloon West, new hotels and parks in Kowloon City and a waterfront promenade in Central. The rest remains tropical rain forest.
In addition the government tends to give out land in very large chunks to disincentivize smaller investors to bid. Some smell corruption not only in this practice, as the recent detainment of all three Kwok brothers showed.

So how do break the duopolies of the tycoons?
First of all, relax. Maybe it is not all so bad. Apart from the real estate business all markets seem to work fine, or at least better as in their socialized counterparts in Europe and the United States. Prices for goods in supermarkets, meals in restaurants or rides in buses are far below the standards in other rich nations, and nothing will transform Hong Kong into a place in which anyone can own a single family home and a double garage.
However, taking control away from land might be necessary and just. It may be okay for the government to own and distribute land, but when it comes to deciding what that land is supposed to used for, why not allow the highest bidder to make that choice? After all, the prices show them perfectly what Hong Kong needs the most, may it be apartments, offices or hotels.
Hong Kong’s art scene has suffered enough from unaffordable places to display art or play music in, while thousands of square meters of industrial space lays around unused, as the example of Hidden Agenda shows.
Third of all, even if the government is incapable of restoring their laissez-faire politics that made this city rich, let’s face it: Hong Kong’s tycoons are old, dying, their heirs are all fighting with each other and seem incompetent to carry on their fathers and grandfathers empires.
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The below overview is far from complete and may not always be 100% accurate.
It serves mainly to give you an idea about Hong Kong’s tycoons and mega corporations.
Few of the mentioned companies are in 100% posession of the mentioned families. Some family members may be in complete denial about their alliances. Some constructs are entirely complex and impossible to see through even as an insider. As this is Hong Kong, this may not always be to reduce taxes but rather to cover control and power.
Please correct me however when you see a mistake or tell me if I should make amendments!
Enjoy your day as a small fish in the shark pool!

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李嘉誠 Li Ka Shing (*1928)

His wealth is quite spread around the world. He controls 10% of the world’s container traffic through ports. In addition to the companies listed below he owns various subsidies and brands in Europe, Australia and Northern America. Also not listed are residential properties.

children: Victor Li Tzar-kuoi *1964 and Richard Li *1966
US$ 25.5 billion
Key businesses:
Associated businesses:
telecommunications/media: (PCCW) (Hutchison) (Three) (TOM)
retail: (Watson’s) (Park’n’Shop) (Fortress) (Savers) (Kruidvat) (Trekpleister) (Superdrug) (Rossmann) (International) (Taste) (Fusion) (Gourmet Food Hall) (Great Food Hall)
hotels: (Harbour Plaza Hotels)
office buildings: (The Center) (Cheung Kong Center) (World Wide House) (Shun Tak Centre) (Cyberport)
infrastructure: (Hong Kong Electric) (The Panama Canal, yes, THE Panama Canal) (Hong Kong International Terminals) (Asia Port Services (APS)) (COSCO-HIT Terminals (CHT)) (Hongkong International Terminals (HIT)) (River Trade Terminal (RTT)) (HK – Macao Ferry Terminal) (Lamma Coal Plant) (various projects in Commonwealth Nations) (various container/cruise ship ports, airports and wharfs around the world)
construction: (Alliance Construction Materials) (Anderson Asphalt) (Green Island Cement)
health: (CK Life Sciences) (various pharmaceutical companies)

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郭得勝 Kwok Tak-Seng (1911-1990)

children: Kwok brothers (Raymond *1949, Thomas *1947, Walter *1950)
US $ 17 billion
Key businesses: Sun Hung Kai Properties
Associated Businesses:
finance: (UA Finance)
hotels:  (Four Seasons) (The Ritz-Carlton) (W Hong Kong) (Royal Garden) (Royal Plaza) (Royal Park) (Royal View)
entertainment: (Noah’s Ark) (Sky100 Hong Kong Observation Deck)
malls: Hong Kong (IFC Mall with Lee Shau-kee) (WTC More) (New Jade Shopping Arcade) Kowloon (APM) (Grand Century Place) (The Sun Arcade) (Mikiki) New Territories (New Town Plaza) (Metroplaza) (Tai Po Mega Mall) (East Point City) (Landmark North) (Tsuen Wan Plaza) (Park Central) (HomeSquare) (Sun Yuen Long Centre) (Uptown Plaza) (Yuen Long Plaza) (Chelsea Heights) (V City (Upcoming))
office buildings: (BIZ) (Kowloon Commerce Centre Tower B) (Excel Centre) (Elite Centre) (Sun Hung Kai Center)
infrastructure/mobility/logistics: (Tsing Ma Bridge) (Autotoll) (Kowloon Motorbus) (Wilson Parking) (Mack Carpark) (Long Win Bus) (Route 3) (River Trade Terminal) (Hoi Kong Container Services) (Sun Bus) (Airport Freight Forwarding Centre) (Sun Hung Kai Logistics) (Expresslink Logistics) (Hong Kong Business Aviation Centre)  (Hong Kong School of Motoring) (New Hong Kong Bus)  (SUNeVision) (Road Show Holdings) (SmarTone)
various: (Kai Shing Management) (Hong Yip) (Allied Cement Holdings Limited)
(Allied Kajima Limited) (Tian An China Investments Company Limited)  (Green Valley Landfill Limited, Wastemanagement) (South China Transfer Limited, Wastemanagement)

fun fact: Thomas Kwok is an evangelical Christian who takes the bible very literally. He built “Noah’s Ark on Ma Wan to educate Hong Kongers about the biblican version of the origin of men. When Sun Hai Kung Properties built “The Central Plaza” together with Sino Group, he built “The Sky City Church“, the world’s highest church inside a skyscraper.

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李兆基 Lee Shau-kee (*1928)

One of the very few fourth born children in the world to become a billionaire. Develops together with Sun Hun Kai and MTR the waterfront around IFC.

children: Martin Lee Ka-kit *1971 and Peter Lee Ka-kit *1963 and Margaret Lee
US$ 19 billion
Key Businesses: Henderson Land Development
Associated Businesses:
hotels: (The Mira) (Mira Moon) (Pinnacle Apartment) (Regal Hotels)
malls: (Miramar Shopping Center) (IFC Mall with Kwok Brothers) (Grand Waterfront Plaza) (La Cité Noble Shopping Arcade) (Metro City Plaza II) (Metro City Plaza III) (Metro Harbour Plaza) (Paradise Shopping Square) (Rightful Centre) (The Pinnacle) (Welland Plaza) (Citimall) (City Landmark I) (City Landmark II) (Dawning Views Shopping Plaza) (Fanling Centre Shopping Arcade) (Flora Plaza) (Hop Yick Plaza) (Manhattan Plaza) (Marina Cove Shopping Centre) (Shatin Centre & Shatin Plaza) (Skyline Plaza) (Sunshine Bazaar) (Sunshine City Phase 1-3 Shopping Arcade) (Sunshine City Plaza) (The Sherwood (Shops) (Trend Plaza)
restaurants: (Cuisine Cuisine) (The French Window) (Tsui Hang Village) (Yunyuan Sichuan Restaurant) (Union Hospital’s Cafeteria) (Hide-Chan Ramen) (Assagio Trattoria) (Saboten Japanese Cutlet)
travel: (Miramar Travel) (Miramar Express)
office buildings: (Miramar Tower) (AIA Tower) (Golden Center) (Goodview Centre) (ING Tower) (IFC) (Wai Wah Commercial Centre) (579 Nathan Road) (No 6 Knutsford Terrace) (AIA Financial Centre) (Kowloon Building) (Manulife Financial Centre) (Win Plaza) (City Landmark I & II)
industrial buildings: (78 Hung To Road) (Big Star Centre) (Dragon Centre) (Bamboos Centre) (Well Tech Centre) (Winning Centre)
infrastructure: (Towngas) (Hong Kong Ferry)

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Michael Kadoorie (*1941)

children: Bettina, Natalie and Philip Kadoorie
US$ 4.2 billion
Key Businesses: CIP Group
Associated Businesses:
power stations: (Black Point Power Station) (Castle Peak Power Station) (Penny’s Bay Power Station)

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鄭裕彤 Cheng Yu-tung (*1925)

US$ 16 billion
Key Businesses: Chow Tai Fook Enterprises, New World Development Company Limited
Associated Businesses:
transportation: (Citybus) (New World First Bus and New World First Ferry together with First Group from UK) (Rickshaw Bus)
infrastructure: (New World Communications) (Tate’s Cairn Tunnel) (Holt’s Wharf)
hotels: (Renaissance Hotel) (Ramada)
retail: (Chow Tai Fook) (CTF Watch)