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CMA accepts commitments to address auction concerns

Friday 14 July 2017

An investigation by the Competition and Markets Authority (CMA) into online auction practices has now been terminated following acceptance of binding commitments from ATG media in relation to what the CMA described as suspected exclusionary and restrictive pricing practices.

The case/background

On 22 November 2016, the CMA opened an investigation over concerns that ATG Media's practices were anti-competitive and may exclude rivals from the market by:

  • requiring exclusivity from its auction house customers (that is, stopping them from also using competing platforms)
  • preventing its auction house customers from allowing bidders to use rival platforms at lower cost (a form of ‘most favoured nation’ or ‘parity’ provision)
  • preventing auction houses from advertising and promoting the services of competitors to ATG Media

The law

The case was bought because of suspected breeches of the following laws:

Chapter I of the Competition Act 1998, which prohibits anti-competitive agreements and concerted practices between businesses which have as their object or effect the prevention, restriction or distortion of competition within the UK. 

Chapter II of the Competition Act 1998, which prohibits the abuse of a dominant position by one or more companies which may affect trade within the UK or a part of it. 

Articles 101 and 102 of the Treaty on the Functioning of the European Union (TFEU) contain equivalent provisions applicable where there may be an appreciable effect on trade between EU Member States.

A short consultation period followed which ran from 30 May to 19 June, during which time, affected parties could make representations on the CMA's intended course of action. The CMA would have then had to have taken any such representations into account before making a final decision on the case.

Action by ATG media halts investigation

Before the CMA had finalised its investigation and reached a verdict, ATG Media, which is the largest provider of online bidding platforms in the UK, offered legally binding assurances (known as commitments) to remove the restrictions noted above.

Following formal acceptance of these commitments, the CMA closed its investigation into whether ATG Media has abused a dominant position or entered into anti-competitive agreements.

Michael Grenfell, Executive Director of Enforcement at the CMA, said:

"We are pleased that ATG Media has given commitments which address all our concerns. Now these previous restrictions have been removed, we believe alternative platforms or new entrants will be able to compete more easily and offer cheaper commission rates to bidders."

"Online and digital markets represent a large and growing part of the economy and we must ensure that these often fast-moving markets do not evolve in ways which may harm consumers."

"Reaching a swift outcome in this case demonstrates our ability to ensure that potentially anti-competitive practices are ended quickly."

Guidance Documents 

The two guidance documents below explain what business practices ATG Media has agreed to change and what this means for auction houses.

60 second summary: advice on online bidding services

Online auction services – guidance to auction houses