Competition and Markets Authority
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Latest property news
Second estate agent cartel investigation gets green light from CMA
The Competition and Markets Authority says it has enough information to proceed with a full investigation into a second estate agent cartel.
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Latest property news
Burnham-on-Sea cartel agent is expelled from RICS
A Burnham-on-Sea agent and partner in Greenslade Taylor Hunt has been expelled from RICS after helping organise a fee fixing cartel in the Dorset seaside town.
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Latest property news
Be careful what you discuss with competitors down the pub, warns CMA
The Competition and Markets Authority (CMA) has warned agents who attend informal and formal industry gatherings how careful they need to be when chatting with competitors. The hundreds, if not thousands of informal and formal property industry gatherings in pubs, hotels, golf courses and cafes up and down the country every year can lead agents to “fall foul of competition law”, the CMA warns in its latest guidance. It also highlights within the guidance somewhat ominously the combined £750,000 fine it slapped on a local trade association, three estate agents and a newspaper publisher for cartel activity in 2015. Even the most mundane conversation can cross the line and members of trade associations “must be mindful of their conduct in relation to other members of their trade association who are likely to be actual or potential competitors of theirs,” it says. “Trade associations and their members need to be alive to evolving risks of breaking competition law when discussing issues facing their industry. “Topics such as salary benchmarking or perhaps an industry ‘commercial response’ to economic or structural changes in the market may fall into this category.” Other types of conversation agents should be wary of include future pricing, discounts,…
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Latest property news
GoCompare board rejects offer by ZPG to buy company
ZPG has confirmed it has made an offer to buy insurance, mortgages and loans comparison site GoCompare.com but, after the deal was leaked yesterday, is now “considering its position”. Both ZPG, the parent company of Zoopla and PrimeLocation, and GoCompare have confirmed that ZPG made an unsolicited offer to buy the comparison website at £1.10 a share to be paid for in ZPG shares, valuing it at £460m. “This was unanimously and unequivocally rejected by the Board which believed that it fundamentally undervalued the business and its prospects,” a GoCompare statement says. “Since May, [we have] delivered H1-2017 results which were ahead of expectations.” GoCompare also says the offer, which was made last waeek, represented a discount on the value of the company based on its 11 October 2017 share price of £110.5p, although the offer was considerably higher than its later share price of 0.95p on 7th November. Opportunistic offer “ZPG’s Proposal is highly opportunistic and fundamentally undervalues the Company and its prospects,” says the comparison website’s Chairman Sir Peter Wood (pictured, below). GoCompare only recently demerged from motor and home insurance specialist Esure after which, in November 2016, its share price stood at 74.5p valuing the company at…
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Agencies & People
Competition watchdog reveals more details of Burnham agent cartel
The government’s competition watchdog has made the unusual move of publishing more details of its recent investigation into price-fixing in the seaside town of Burnham-on-Sea in Somerset. In March this year the Competition and Markets Authority fined a group of agents in the town a total of nearly £380,000 after its investigation uncovered that they had held a meeting at which they agreed to fix their minimum commission rates at 1.5%. But the CMA believes that, because this is the second time it has caught agents undertaking such anti-competitive behaviour in recent years, it’s concerned that agents still don’t realise how serious such conduct is – or its consequences. The earlier case involved an association of estate agent in Hampshire who in May 2015 were revealed to have colluded with a local newspaper over the publishing of fees and discounts in adverts. Burnham cartel To highlight this, the CMA has published details of how the Burnham cartel was set up, discussed and what was said at the clandestine meeting. The agents involved were Gary Berryman Estates Ltd, Abbot and Frost Limited, Greenslade Taylor Hunt and West Coast Property Services (UK). The CMA says the anti-competitive activity kicked off in 2014…
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Agencies & People
ZPG purchase of Expert Agent to be reviewed by competition watchdog
ZPG’s purchase of software company Expert Agent earlier this month has been called in by the Competition and Markets Authority (CMA) and is now under review, prompting shares in ZPG to drop this morning. The CMA has served an initial enforcement order to ZPG under section 72(2) of the Enterprise Act 2002. The announcement was made by ZPG this morning, saying that “having been informed of the review and the order ZPG is now engaging in a consultation with the CMA and will make a further announcement in due course”. The move has been widely anticipated within the industry after ZPG acquired Expert Agent – which trades under the name Websky Ltd – from private equity firm Metropolis. It in turn bought the company off founder Mike Griffiths in 2004. The ZPG acquisition of Expert Agent gave it a substantial slice of the UK agent software market, as it had already bought Property Software Group in April 2016. PSG at the time of acquisition by ZPG claimed to be used by over 40,000 estate agent letting agent branches across the UK, while Expert Agent is used by over 2,500 branches. The CMA has been in the warpath within the property…
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Latest property news
OnTheMarket is not going off, says CEO
One of last week’s noisier stories in the press and on social media was about OnTheMarket members and theo pen letter from the Competition and Markets Authority(CMA). Ian Springett (left), CEO, OnTheMarket (Agents Mutual)defended the portal’s position and its status with the CMA, asking Jungledrums to remind estate agents about their obligations under competition law when choosing online property portals to advertise their properties. “The CMA has been very clear in cautioning agents to act independently and not to collude. At OnTheMarket.com, we welcome that stance and have consistently given agents precisely the same advice to make any portal selection decisions independently. “For the record, there has been no suggestion from the CMA that OnTheMarket.com has acted improperly in any way. Indeed, in its reminder letter to agents, the CMA explicitly states that, “it has no reason to write to OnTheMarket in this connection at this time.” OnTheMarket certainly needs to defend its position, Mr Springett said, “Success attracts its detractors. The letter from the CMA triggered some predictably opportunistic attacks on us from some who are perhaps sensitive to the impact we are having by injecting competition and increasing choice in a portals market dominated by two big listed…
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Features
Closing the door on anti-competitive agreements
“Restricting where and how estate and lettings agents can advertise their fees could be breaking the law,” says the CMA.
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Agencies & People
Bad week for online agent
Online estate agent eMoov is under pressure for making unsubstantiated and misleading claims to home sellers over fees and asking prices, while their lodged complaint with the Competition and Markets Authority (CMA) against OnTheMarket (OTM) will not be followed up by the regulator. The CMA took over many of the functions of the Competition Commission and the Office of Fair Trading last year. Having investigated claims made by eMoov in an advert that its sales performance last year resulted in 99 per cent of the asking price being achieved for its clients compared to the national average of 96 per cent, the Advertising Standards Authority (ASA) concluded that that the statements were unsubstantiated. ASA said that sales data only covered the period of January to September 2014, while no comparable information relating to asking prices achieved by traditional estate agents in London was provided. The online estate agent also claimed that its customers had saved more than £11 million in fees by using its services because its business model depended on it selling a higher proportion of its inventory. But once again, this was panned by the ASA because it was based on the average fee its customers paid instead…
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