An investigation by the Competition and Markets Authority (CMA) has found that four Somerset estate agents colluded to set minimum commission rates for residential property sales at 1.5%, with a view to denying local homeowners selling their properties the chance of securing a better deal.
The businesses – Abbott and Frost Limited, Gary Berryman Estate Agents Ltd (and its parent company Warne Investments Limited), Greenslade Taylor Hunt and West Coast Property Services (UK) Limited – have admitted breaking competition law by taking part in a price-fixing cartel in the Burnham-on-Sea area,
The four estate agents have agreed to pay maximum fines totalling £372,233.
Senior Director of Cartel Enforcement at the CMA, Stephen Blake, said:
“Moving home is expensive and this shouldn’t be made worse by estate agents conspiring to deny their customers the best possible deal, by agreeing not to compete on fees. Price fixing cheats customers – and we are committed to tackling it, regardless of the size of the businesses involved. We have taken action against estate agents before, and will do so again if firms break the law.”
The businesses involved agreed to settle with the Competition and Markets Authority (CMA) after a year-long investigation. Another company, Annagram Estate Agents Limited (trading as C J Hole), will not be fined provided it continues to co-operate, as it was the first company to confess its participation in the cartel.
This policy is designed to encourage companies to self-report wrongdoing and so aid the CMA in enforcing the law.
This is the second case brought by the CMA against estate agents in recent years. The previous case saw members of the Three Counties Estate Agent Association fined £735,000 in 2015 – and resulted in the CMA launching a campaign designed to improve understanding of the law within that sector and compliance with it. It was this campaign that resulted in the current case being brought to the CMA’s attention.
The Competition Act 1998 prohibits agreements, practices and conduct that may have a damaging effect on competition in the UK – Chapter I prohibition covers anti-competitive agreements and concerted practices between businesses (undertakings), which have as their object or effect the prevention, restriction or distortion of competition within the UK or a part of it and which may affect trade within the UK or a part of it.
Any business found to have infringed the Competition Act 1998 can be fined up to 10% of its annual worldwide group turnover.
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