Update on abolished tariffs



The Institute of Estate Agents has complied with the terms of the order issued by the Competition Commission which, last October, ruled that the IEA had contravened the Competition Act by publishing commission tariff guidelines. IEA president Bill Rawson says that he has submitted the required affidavit to confirm that the institute has destroyed all unsold copies of its old tariff books, and that it has advised its members in writing that the organisation no longer has any form of tariff. The IEA has also paid the first instalment of the R522 400 fine imposed by the Commission. But, says Rawson, there is more to the issue of estate agency industry tariff guidelines than that. "The Commission's investigation into our old tariff books, which we published between 1999 and 2002, has received a tremendous amount of media attention since last July, when we announced that we had abolished our recommended tariff. Through the internet the story has spread to property news media in some other countries too. "However, the focus was on the recommended 7.5% commission for selling residential properties, and little or nothing was mentioned about the other aspects of the IEA's tariff. Our tariff book also contained commission and fee guidelines for residential letting, commercial and industrial sales and letting, agricultural property sales, business broking, and sectional title management services. We would like to make it clear that those guidelines were also abolished last year, and are no longer recommended or endorsed by the Institute." Rawson also points out that the IEA is not the only professional organisation within the property industry. "Unfortunately, our industry is somewhat fragmented in this respect," he says. "In addition to the Institute of Estate Agents, there are several other voluntary associations of estate agents and brokers and property managers, and we presume that the Competition Commission will also be investigating whether or not any of them have issued commission tariff guidelines since 1999. If they find that any of them have done so, then no doubt we will learn about it in the media in due course. "In the meantime, we would like to urge all estate agencies whose printed mandate or contract documents, or websites, refer in any way to the IEA tariff to remove those references as soon as possible, because there has not been an IEA tariff for the past ten months and we can no longer back up any references to it." END