OnTheMarket battles continue

Competition and Markets Authority restates its position on anti-competitive collusion.

Property portals imageIt’s been a tortuous few weeks in the property industry, fears about online agents, portal battles, tax hikes and the EU Referendum have combined to make many property people just a bit jittery.

Certain people are searching for a fall guy. And they’d like it to be a big one.

OnTheMarket is one of the current bookies’ favourites for the role, as disappointed members (some saying 200 disappointed members) attempt to get out of their contracts without paying their fees.

As if an internal ruck isn’t enough, coincidentally (or perhaps not) the Competition & Markets Authority, published a statement warning online property portals which prevent those listing homes on them from also listing on rival sites that they may be breaching competition law.

One of the founding principles behind it was that any agent wishing to list properties on OnTheMarket would have to choose between either one of its rivals – meaning either Zoopla or Rightmove would lose out.

Ann Pope, CMA, imageAnn Pope (left) Senior Director, Antitrust, at the Competition and Markets Authority who has a holy name and a worrying title, wrote in an Open Letter to all estate agents that “when an estate agent makes a commercial decision about its choice of online property portals, the law requires that it makes that decision without colluding with estate agents that are its competitors.”

“The CMA is taking this step after becoming aware that estate agents in some local areas may have made a collective decision to join the OnTheMarket portal and, at the same time, to remove their business from other portals that compete with OnTheMarket. The CMA has already been in contact with some agents and trade associations in this regard.

“However, given some evidence that such collusion may be happening between estate agents in more than one local area, we are issuing this open letter to all estate agents, advising them that this kind of conduct may break competition law and that agents engaging in it could therefore face significant fines.

“Separately, the CMA will be contacting individual estate agents it suspects may have been involved in this potentially anti-competitive collusion.”

This is a serious matter, not only for Agents Mutual, the organisation that owns OnTheMarket, but for every one of its members. The CMA stressed that “If an estate agent discusses with its competitors its commercial intentions or agrees to make joint decisions with them (such as which supplier or portal to go with), this may break competition law.”

Adding that the CMA ‘continues to monitor the conduct of estate agents’ and that “the sites on which homes are listed are “an important aspect of competition between estate agents,” she said that, “The choice of portal must be decided independently and not agreed with competitors.”

Competition & Marketing Authority logoJust in case the 6000 or so OnTheMarket customers hadn’t quite got the point, Ann Pope helpfully restated the consequences of breaching competition law. “Estate agents that are found to have breached competition law can be fined up to 10 per cent of their annual worldwide turnover, and directors of such companies can be disqualified from UK company directorships for up to 15 years where their conduct in relation to such a breach makes them unfit to be concerned in the management of a company. In addition, individuals involved in certain very serious cartel activity, such as agreements between estate agents to fix prices or allocate markets, may be prosecuted under the criminal cartel offence and, if convicted, could go to prison for up to five years and/or have to pay an unlimited fine.”

For eMoov.co.uk, Russell Quirk, commented, “The first thing that strikes me about this latest announcement is that it’s about time given that I submitted a complaint to the CMA over a year ago.

“The success of the online estate agency sector to date has been based on its consumer-first approach. But since day one OnTheMarket has moved against this consumer and has subjected its member agents and their customers to a dated, anti-consumer way approach that narrows choice. As a result, it’s downfall was bound to be a swift one and that is certainly playing out in front of us all now.

“Given the portal’s monumental failure, it’s beyond me why any agent would still be considering listing with OTM at the expense of either Zoopla or Rightmove, let alone conspire with other agents to do so in number.”


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