Hong Kong watchdog’s legal action against property agency over alleged commission fixing making waves in other sectors
- Action launched by Competition Commission against Midland Holdings and two units has also created a strong deterrent effect in other industries, analysts say
- Commission’s Lester Lee says rival agency Centaline can still be held liable for allegedly conspiring with Midland to fix minimum net commission rates
Unprecedented legal action by Hong Kong’s antitrust watchdog over alleged sales-commission fixing in the property sector is also making waves in other industries with companies watching the implications of the case including the risk of being exposed by rivals.
Analysts on Wednesday said the action launched by the Competition Commission against property agency giant Midland Holdings and two subsidiaries had created a strong deterrent effect not only in that industry, but also in suspected cartel-prone sectors such as the oil business.
The watchdog, meanwhile, said rival property agency Centaline could still face private legal action for allegedly conspiring with Midland to fix minimum commission rates even though it had been granted leniency in exchange for providing evidence.
Lester Lee Hiu-leung, the commission’s executive director of legal services, said Centaline and its subsidiary Ricacorp Properties could still be held liable.
“Although they will be exempted from prosecution, affected consumers can still sue them for damages if the court eventually rules that they have committed the relevant anti-competitive practices,” Lee told a radio programme.
“The Competition Commission can ask Centaline and its subsidiary to admit legal liabilities based on their [alleged] price-fixing behaviour, so that affected consumers can make a claim against them.