The Competitions and Markets Authority is probing three estate agents for allegedly breaching competition law by agreeing to prevent estate and lettings agents from advertising their fees or discounts in the local property newspaper.
The agents are Waterfords (Estate Agents) Limited, Castles Property Services Limited and Hamptons International, which are members of the Three Counties Estate Agents Association.
The CMA's claim states that these companies 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. Waterfords and Hamptons International extended the scope of this arrangement, with the cooperation of Trinity Mirror Southern Limited, the publisher of the Surrey & Hants Star Courier, to prevent any agents (whether members or non-members of the association) from advertising their fees or discounts in this newspaper.
The CMA says its provisional view is that the arrangements reduced the competitive pressure on estate and lettings agents' fees in the local area.
In addition, the authority claims the alleged restrictions made it harder for potential competitors to enter the market by using the level of their fees to attract new customers.
A statement says the CMA provisionally considers that these practices limited consumers' choice and obstructed their ability to compare prices and assess value for money.
The ability of a company to advertise its fees or discounts freely plays an important role in stimulating price competition between competitors. If estate or lettings agents are prevented from advertising their fees or discounts in the local newspaper, property owners are likely to find it harder to assess which agents offer the best value for money says Ann Pope, CMA senior director of antitrust enforcement.
It could also make it harder for new entrants to enter the market and compete effectively with established estate and lettings agents.
The CMA says its findings are provisional and no assumption should be made at this stage that there has been a breach of competition law.
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Comments
Like for Like - yes.
Level Playing Field - yes.
But it very often isn't and that could be a valid reason for this
Agree with the sentiment from others that this is all a bit childish and pathetic. Aren't these people supposed to be professionals
Competition should be welcomed, not blocked. The best agencies will always rise to the top, so if you're providing a good enough service you really shouldn't have anything to worry about.
If a breach of competition law has occurred, the three estate agents being probed need to have strong words with themselves. How pathetic. Ganging up to prevent competitors from entering the market - what are they so scared of I thought competition was a good thing, making sure people don't get too complacent or set in their ways. These anti-competition agencies just look like they're frightened of something.
If true, it all sounds a bit petty and pathetic. If you're good enough, you should welcome the competition, not be running scared from it.
Sorry Mr Head, just could not resist :-)
A competitive 'restriction' takes place when more than one commercial organisation agree to it. So in the case of RM they are imposing their rule unilaterally
That's me, I will try to get therapy
Resident mentalist Simon Shinerock. He's here all day folks.
Oh Simon (yawn) Agents Mutual ARE the new entrant, so how can they be accused of anti competitive restrictions!!!
I think I'm correct in thinking that Rightmove do not allow any mention of fees or market position (ie number one in xxx area) in the Agents display adverts on their site.
'A statement says the CMA provisionally considers that these practices limited consumers choice and obstructed their ability to compare prices and assess value for money'
In 1991 a group of agents in Crawley got together to impose a similar restriction, no fee discounts in a Trinity Mirror paper. When we wouldn't join the paper told us the paper was 'fully booked' and we were excluded for about a month. I contacted the CMA and they sorted it out without legal action being necessary.
The obstruction of a consumers ability to 'assess value' as a result of an agreement entered into by commercial competitor's is anti competitive and therefore against the law.
In the case of Agents Mutual, sorry but I just have to draw this parallel, as I have already explained in my articles, at the very least members would need to explain the arrangement they have entered into before being instructed.