The boss of eMoov says he believes last week's hefty fines imposed on three estate agencies by the Competitions and Markets Authority could set a principle which would apply also to agents behind OnTheMarket.
The CMA last week levied £775,000 in fines on Three Counties Estate Agents Ltd and publisher Trinity Mirror (Southern) in a case first reported last year on Estate Agent Today.
The offence by the three agents in TCEA Ltd - Waterfords (Estate Agents) Limited, Castles Property Services Ltd and Hamptons International - was to collude, cartel-style, to prevent the advertising of agents' fees in the Surrey and Hants Star Courier for up to nine years.
Now Russell Quirk - chief executive of eMoov, which has an outstanding complaint against OnTheMarket lodged with the Competitions and Markets Authority - says OTM is guilty of anti-competitive behaviour in banning online estate agents from its pages and imposing the one portal rule' on all its advertisers.
The CMA says it is still considering Quirk's submission.
He says the most interesting aspect of the CMA judgement last week was that its fines appear to have been decided on the basis of their company turnovers.
Castles has agreed to pay the CMA £19,275, reduced by 10 per cent under technical terms so making it £17,348. Waterfords has agreed to pay £51,693, reduced to £46,524.
Hamptons International has agreed to pay £690,317, also reduced by 10 per cent to £621,285. As the ultimate parent companies of Hamptons International, Countrywide plc and Countrywide Group plc have agreed that they are jointly and severally liable for a payment of £372,771.
Trinity Mirror Southern is paying £101,397, reduced to £91,257.
You'll notice that Hamptons paid by far the most. This, it seems, is likely due to the size of its Countrywide owner in revenue terms says Quirk.
So, fast forward a few months and imagine that the CMA finds that OnTheMarket is guilty of anti-competitive behaviour in banning online estate agents from its pages and imposing the one portal rule' on all its advertisers. It's evident that OTM themselves could then be in for a fine of something to a maximum of £2.3m at 10 per cent of what I've estimated to be its first year revenues claims Quirk.
He says that, if the same principle applies, even higher fines could be imposed on those agents who founded Agents' Mutual and established the online agency ban and the one other portal' rule.
In Savills' case that's a potential fine of £107m and Knight Frank £39m. Even the smaller Douglas and Gordon would see its profits wiped out with a charge of up to £2m Quirk claims.
He concludes by saying: I've calculated that the possible total fine that could be sought if the parties involved are proven as wanting as far as the Chapter One Competition Act provisions are concerned, is a whopping £177m.
Last night OnTheMarket's chief executive Ian Springett told Estate Agent Today that Quirk's speculative comments were noted and that OTM's would reiterate the statement it made last November.
That statement reads: "From recent public comment, we understand that a complaint may have been made with the Competition and Markets Authority, alleging that aspects of Agents' Mutual's agreements with its members are anti-competitive and illegal.
"At the outset, Agents' Mutual took appropriate legal advice as to the legality of its model and contractual terms. In the light of the advice received, the directors are satisfied that the Company is operating within the law."