Competition Authority intervenes to protect tenants
21 December 2011
The Competition Authority is pleased that, following an intervention by the Authority, the Irish Property Owners Association (IPOA) has agreed to withdraw its recent recommendation to its members that they should pass on the Household and NPPR Charges to tenants.
On 15 December the IPOA issued a press release stating that landlords in the private rental sector would be levying the new Government household charge on their tenants. The Competition Authority contacted the IPOA to inform them that this type of concerted action by their members in relation to pricing may be in breach of competition law. The IPOA have since issued a clarification stating that pricing is a matter for individual landlords and their tenants and have withdrawn their earlier recommendation to their members.
Competition law does not allow a trade organisation to co-ordinate the pricing policies of its members. To do so is a serious offence.
Commenting, Gerald FitzGerald, Director of the Monopolies Division, said: This is good news for tenants. Tenants must be allowed to negotiate their arrangements with landlords individually without interference from a landlords’ trade association. Today’s development reinforces this message.
NOTES TO THE EDITOR
Timeline:
15 December: IPOA issued a press release stating that their members would be levying tenants with the new household charge.
19 December: Competition Authority wrote to the IPOA informing them that their actions were potentially in breach of Irish and European competition law and that it would seek an injunction if the ‘advice’ to members was not withdrawn.
21 December: IPOA confirmed they would withdraw their advice and issue a public clarification in relation to their position on the matter.
Private residential landlords are undertakings within the meaning of section 3 of the Competition Act 2002 and under EU competition law. Section 4 of the Act states that: all agreements between undertakings, decisions by associations and concerted practices which have as their object or effect the prevention, restriction or distortion of competition in trade in any goods or services in the State or any part of the State are prohibited and void.
The IPOA is an association of undertakings. When an association of undertakings advises its members to raise the fees its members charge or pass on costs to its customers, this constitutes a decision of undertakings and is likely to involve an infringement of competition law.
The Competition Authority enforces Irish and European competition law in Ireland. We can, amongst other things, apply to the Court under section 14 of the Act for an injunction to bring a stop to anti-competitive behaviour.
The NPPR charge, introduced by the Local Government (Charges) Act 2009, is an annual charge of €200, payable by property owners, in respect of all residential property not used as the owner’s sole or main residence.
The Household charge, introduced by the Local Government (Household Charge) Act 2011, is an annual charge of €100 payable by property owners.
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Contact Information
Clodagh Coffey, Communications Manager, The Competition Authority
Tel: 01 804 5406 Mobile: 087 915 5406 email: cc@tca.ie
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