The Competitions and Marketing Authority has released details of its findings in relation to an infringement by Romans, Prospect, Michael Hardy and Richard Worth. Having had an opportunity to fully review the findings and make representation to the CMA Michael Hardy estate agents accept the Statement as an accurate reflection of events. A very poor decision was made and it is difficult not to conclude that a line that should not have been crossed was.
The events are historic and since that time robust procedures have been put in place to ensure that all staff are fully aware of the rules surrounding cartels and the fixing of fees. All staff have signed a Competition law code of practice document, a copy of which is on our website.
Some will be disappointed by these revelations. I offer my sincere apologies to you. Anybody who has dealt with Michael Hardy will know that we were not in 2008 nor are we today the cheapest Estate Agents. But we have always believed, a belief that is borne out by numerous comments from our clients on Feefo, that we have offered good value for money. We take pride in going the “extra mile” and will continue to work tirelessly to sell the properties that our clients ask us to sell on their behalf.
CODE OF PRACTICE
Compliance with competition law
This Code of Practice (“the Code”) is applicable to all members of staff working in a sales or managerial capacity for any company in the Michael Hardy group (“Michael Hardy”). Members of staff include directors, employees, agency workers and self-employed contractors. The Code sets out important obligations relating to competition law and compliance is compulsory. It is therefore important that you are fully conversant with the provisions set out in the Code.
Purpose of the Code
In common with all businesses operating in the United Kingdom, Michael Hardy is required to comply with important laws designed to promote competition and to outlaw any practices which restrict or distort competition. The relevant law is contained in the Competition Act 1998. For estate agents (including letting agents) the most serious risk of non-compliance with competition law relates to cartels. A cartel is an agreement where two or more businesses agree not to compete with one another. Such agreements may take many forms but the most obvious example in the context of an estate agency is where two or more businesses agree to fix their commissions in order to eliminate competition on price. Such conduct is illegal and may be punishable by substantial fines and the disqualification of directors.
Competition Law Compliance Officer
Michael Hardy has appointed a Competition Law Compliance Officer (“CLCO”) to monitor compliance with the provisions of the Competition Act 1998 and to oversee the operation of the Code. There may be occasions where you will need to seek guidance from the CLCO and these are mentioned further in the Code. The current CLCO is Neal Mackenzie and you will be notified of any future appointments of new CLCOs.
Your duties under the Code
Your general duty is of course to avoid any actions which involve or may lead to any breach of competition law, in particular to take active steps to avoid any possibility of creating a cartel with another business. This means that you must comply with the following do’s and don’ts:
- Never discuss commission levels with any other estate agency or lettings business. The commissions applied by Michael Hardy to individual property sales or lettings is a matter to be determined entirely at the discretion of its directors and should at all times be treated as confidential.
- Never enter into any discussions with any other estate agency or lettings business which relate to any issue which could have the effect of restricting or distorting competition between Michael Hardy and that other business or any other business. If you have any doubts about what might constitute anti-competitive practices please seek immediate advice from the CLCO.
- If you are approached by another business – and such an approach might appear to be casual and not premeditated – and any of the matters referred to above are mentioned you must immediately explain that you are not at liberty to discuss such matters and you should report the event to the CLCO.
- You must strictly observe the duty of confidentiality owed to all clients of Michael Hardy and ensure that you do not release or misuse any confidential information.
- You must actively promote and maintain a culture of confidentiality and discretion within the business and refrain from discussing anything relating to the business and its clients outside the office environment. Commercially sensitive information must never be discussed in a social setting.
- If you are ever in doubt as to what constitutes confidential or commercially sensitive information you must ask the CLCO for guidance and then follow such guidance.
Consequences of non-compliance with the Code
Compliance with the Code is mandatory and any breach is likely to have serious consequences. Any involvement by any member of staff in a competition law infringement and/or any breach of the Code will be viewed as gross misconduct and could be subject to disciplinary consequences which might include dismissal.
Michael Hardy requires that every member of staff involved in sales and management shall sign the Code to confirm that they have read and understood its terms and requirements and that they will comply fully with the Code at all times.