The Auckland High Court has ordered Lodge Real Estate Limited and Monarch Real Estate Limited to pay $2.1 million and $1.9 million, respectively, for engaging in price-fixing in breach of the Commerce Act.
In December 2015, the Commerce Commission filed court proceedings against 13 national and regional real estate agencies and three individuals for alleged price-fixing and anti-competitive behaviour involving Trade Me.
Now, the High Court has penalised Lodge and Monarch for their roles in coordinating the Hamilton regional response to Trade Me's pricing decision.
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However, the High Court did not require the director of Lodge and Monarch to pay the penalty despite the Court of Appeal confirming that they engaged in unlawful conduct, which was upheld by the Supreme Court.
“It is not unusual for industries to experience price increases from suppliers, and this case illustrates how important it is that companies avoid any discussions with their competitors on how they could or should respond to such a change,” said Commission Chair Anna Rawlings.
“Cartels can harm consumers and business, by raising prices, restricting supply and changing the competitive dynamic between businesses.”
The Commission urges businesses to familiarise themselves with the law and ensure that they have processes to guard against collusion with their competitors.
“The nearly $23 million in total penalties handed down, in this case, is substantial, and from April next year cartel conduct will also be a criminal offence subject to a maximum term of 7 years' imprisonment,” Rawlings said.