On 30 May 2017, the Competition and Markets Authority (CMA) announced that it was consulting on proposals from an online bidding platform to change its terms, following concerns from the CMA that the platform was engaged in anti-competitive practices.
The CMA had accused ATG Media, the largest provider of live online bidding platforms in the UK, of carrying out practices which harmed its rivals in the online bidding platform market. These platforms are used by auction houses to allow people to bid online, whilst an auction is on-going.
The CMA’s investigation is under both Chapters I&II of the Competition Act 1998, meaning it is scrutinizing the company both for anti-competitive agreements but also a possible abuse of dominance.
The CMA’s specific concerns were that ATG were requiring exclusivity from its customers and was therefore preventing rivals from entering the market or competing effectively if already on it. Once an auction house was signed up, it also had a provision which stopped the auction houses’ customers using a rival at lower cost, a so called most favoured nation or price parity clause. Lastly, it prevented the auction houses from advertising or promoting rival services to ATG.
However, rather than continue its investigation and possibly issue a fine, the CMA is consulting proposed commitments from ATG to address the concerns.
The 19 June 2017 is the last day when interested parties can comment on the proposals, a final decision from the CMA to close the investigation, re-negotiate or continue the investigation will be reached after that.
This development in the auction services market follows long-running investigations into similar price parity clauses in the hotel booking sector and the online car insurance comparison markets. The central themes in each case would be a platform in a dominant or powerful position, insisting on price parity fees that were likely to raise prices for consumers. More industries and platforms will likely be investigated in the near future.