CADE investigates price fixing in real estate sector

On 17 April, the Office of the Superintendent General at CADE (SG) launched an administrative proceeding against the Regional Council of Real Estate Agents (CRECI-PE) for the influence on concerted practice in the real estate sector, in the Brazilian state of Pernambuco. SG imposed an interim measure to suspend CRECI/PE’s anticompetitive practices.

The analysis started after a complaint filed against an individual linked to CRECI/PE. CADE issued a notice of violation based on a publication on Instagram. On the post, the real estate broker announced a discount on the price charged for the sale of a property.

Evidence showed that the Council had a contract template on its website, in which the commission paid to the broker for the sale of a property was set at larger amounts than those practiced by that professional. This contract resulted in a notice of violation and a post of a statement of condemnation on CRECI/PE’s Instagram page.

The SG also identified that the defendants’ website still provides the previous Code of Professional Ethics of Real State Agents. According to the Council, based on precedents involving the Brazilian Federal Council of Real Estate Brokers (COFECI), this code may potentially influence unilateral conducts in the market, specially in pricing for real state brokers’ services.

As a result of this conduct, CADE adopted an interim measure to determine that CRECI/PE removes all posts that associate discounts granted in real state services to anticompetitive practices. New posts related to this content are also forbidden. In addition, the authority determined that the entity discontinues any administrative proceedings against professionals that offered discounts or disregarded minimum fees. Within the same period, the documents that mention fee schedules have to be deleted.

The interim measure has legal provision and is adopted whenever there is an indication that the conduct under investigation may cause irreparable damage to the market, damage that is difficult to repair, or that will render the outcome of the proceedings ineffective.

The defendant was notified to file an answer. After the discovery phase, the SG is to issue a final opinion and submit it to the Tribunal of CADE. If convicted, the individuals involved are subject to fines ranging from BRL 50 thousand to BRL 2 billion.