CMA fines estate agents for anti-competitive conduct

CMA fines estate agents for anti-competitive conduct

Published:

Author: Simon Barnes

Applies to: UK wide

An association of estate and lettings agents in Hampshire, three of its members and a newspaper publisher, have agreed to pay penalties totalling more than £775,000 after they admitted breaching competition law.

The settlement (dated 19 March 2015) follows a statement of objections issued by the Competition and Markets Authority (CMA) in December 2014.

The CMA alleged that the companies had entered into an agreement which prevented members of the association, including themselves, from advertising their fees or discounts in the local newspaper, the 'Surrey & Hants Star Courier'.

The settling parties consist of the association, Three Counties Estate Agents Limited (Three Counties); three of its members, namely Castles Property Services Limited (Castles), Hamptons Estates Limited (Hamptons) and Waterfords Estate Agents Limited (Waterfords); and the publisher of the 'Surrey & Hants Star Courier, Trinity Mirror Southern Limited (Trinity Mirror).

Following receipt of the statement of objections the companies admitted that at various times between July 2005 and January 2014, Castles, Hamptons and Waterfords entered into an agreement which prevented members of the association (including themselves) from advertising their fees or discounts in the newspaper.

The scope of this agreement was extended when Trinity Mirror agreed with Waterfords and Hamptons to prevent any agents (whether members or non-members of the association), the CMA says, from advertising their fees or discounts in the paper.

Furthermore, the membership rules for Three Counties' prohibited the association's members from advertising their fees or discounts in paper.

Following the companies' admissions, the CMA intends to issue an infringement decision around the end of April 2015.

This case further reinforces the CMA's message to businesses, both big and small, that it has the power to investigate and punish anti-competitive conduct. In particular, the CMA does not limit itself to reviewing conduct in large, national markets. Indeed, this case involved a relatively small, localised market, relating to advertising arrangements in a single local newspaper. In that context, the magnitude of the fines is significant.

Interestingly, the CMA says it has received complaints of potentially similar conduct concerning alliances in other parts of the UK. This may result in further investigations into similar restrictions, regardless of the size of company involved, particularly if they take no steps to remove such restrictions and ensure compliance in light of the present investigation.

Disclaimer

This document is for informational purposes only and does not constitute legal advice. It is recommended that specific professional advice is sought before acting on any of the information given.