The Competition and Markets Authority has sent out warning letters to a number of estate and lettings agents saying that they may be breaking competition law.
The move follows the recent fines, totalling over £735,000, imposed on a local free newspaper, a local association of estate agents and three of its members – one a Countrywide firm and the others independents – in Fleet, Hampshire.
The CMA says that in the light of this case, it has written to a number of estate and letting agents that it suspects have been involved in anti-competitive agreements to restrict the advertising of fees.
Separately, the CMA has received complaints that other associations of estate agents and local newspapers may be engaging in similar practices, and it is considering whether to take further action.
Today, the CMA also published an open letter to agents and newspapers.
It warns that agreeing with competitors to restrict the advertising of fees is likely to be unlawful; that trade associations can break competition law; and that the consequences for breaking the law can be severe.
Businesses can be fined up to 10% of their annual worldwide turnover, and company directors can be disqualified for up to 15 years.
In addition, individuals involved in certain very serious cartel activity, such as price-fixing, may be found guilty of the criminal cartel offence and could go to prison for up to five years and/or have to pay an unlimited fine.
The letter tells agents that if they think they have been involved in illegal activity, they should volunteer that information and may benefit from more lenient treatment.
The CMA is working with a number of industry bodies, including the National Association of Estate Agents and The Property Ombudsman, to help publicise the lessons to be learned from this case and encourage best practice.
Ann Pope, CMA acting executive director of enforcement, said: “The CMA is keen to work with businesses across the property and newspaper publishing industries to explain the implications of this case and ensure they understand what they need to do to comply with competition law and can recognise where they may be at risk of breaking it.”
The CMA’s investigation into the Fleet case has been closed. However, the full decision has yet to be published due to the redaction of commercially sensitive information.
Today’s letter from the CMA is here