The barrister representing Agents’ Mutual, Alan Maclean QC, yesterday claimed that OnTheMarket’s market entry represented an injection of competition into the property portal market. His argument was rejected by the other side (see following story).

Alan Maclean stressed that the burden was on Gascoigne Halman to prove it had had competitive damage as a result of the ‘one other portal’ rule.

Mr Maclean yesterday made his final arguments in the case, heard this month by the Competition Appeal Tribunal, which has been looking into possible competition issues.

Mr Maclean said that Zoopla was ‘calling the shots’ behind Gascoigne Halman’s case. The claim was emphatically denied by Paul Harris, the QC for Connells’ brand Gascoigne Halman.

Mr Maclean said that Gascoigne Halman had “abandoned the allegation that the OOP rule has the effect of restricting competition in local estate agency markets and the Tribunal won’t have forgotten what we call the concession letter which also abandons the effect case on one of the other restrictions as well, namely the bricks and mortar restriction”.

He noted that “Gascoigne Halman [still] continues to allege the OOP rule has the object of restricting competition.

“That is on the basis that OOP restricts one key parameter of competition, namely the freedom to choose which portals [they use].”

He added that the tribunal had to “have regard to the economic context” where there were “two very large portals, Rightmove and Zoopla” that were used by most estate agencies.

Mr Maclean argued that, prior to OTM’s entry into the market, that freedom to choose was not an important parameter, because of the relative lack of choice.

“The truth is there were only two portals, the rest were little and insignificant. We know, it’s common ground, that most agents felt compelled to list on both of them.

“My client’s launch has not reduced the opportunities for agents to differentiate themselves or in any way limit their output. On the contrary, it has increased the  opportunities for differentiation.”

“It has enabled agents to offer a wider array of choices to customers.”

He added that “[Agents’ Mutual] members who were listing on one of the incumbents can still do so in combination with OTM”.

He said OTM’s entry “demonstrates an injection of competition into the market”.

Mr Maclean noted that the “burden is on Gascoigne Halman” to show an adverse effect on competition in an relevant market..

He also dismissed expert witness David Parker’s analysis, saying it did not take account of other factors behind increases in cost-per-lead, such as the design of a particular portal. [David Parker was expert witness for Gascoigne Halman.]

He said the tribunal must be satisfied there were no other factors which could have “led to a change in cost-per-lead”.

He also pointed out that Mr Parker’s analysis was not based on a level of statistical significance “usually employed by economists”.

He said: “In short, Mr Parker’s empirical analysis simply does not demonstrate the required causal link between OTM entering the market with the OOP rule and the alleged increase in Rightmove’s prices to make good Gascoigne Halman’s allegation of adverse effects on the portal market.”

He added: “We know Zoopla is really calling the shots [behind GH’s case].”

Addressing the alleged boycott of Zoopla, Mr Maclean said: ‘

Addressing the alleged boycott of Zoopla, Mr Maclean said: “They have put forward no witness evidence whatsoever from member firms of a boycott.”

He said Gascoigne Halman had made allegations that “agents had coordinated to join OTM, but joining doesn’t involve a collective boycott”.

He said that any property portal needs a critical mass of agents.

He said: ‘That’s true of Rightmove, Propertylive, and is key to the growth of Zoopla.”

Mr Maclean noted that one of the emails Gascoigne Halman sought to rely on as evidence of a boycott had actually proposed dropping Rightmove, and not Zoopla.

He also noted that Mr Springett reminded representatives of other agencies that they should be “careful about getting involved in any potential boycott of any other portals”.

Mr Maclean addressed a comment by Mr Springett that “We must avoid any evidence of Agents’ Mutual leading any collective boycott”, which he said Mr Harris had taken to have a sinister meaning.

But Mr Maclean asked: “How else is he supposed to express himself?”

He noted that Mr Springett had previously “given a warning against collective conduct”.

He said Mr Springett was simply expressing the view that Agents’ Mutual should not get involved in any such discussions.

He concluded that Gascoigne Halman’s case had not been “made good. There is not collective boycott.”

He said: When Connells came along to buy Gascoigne Halman, it should have spotted this clause as it did, as Mr Livesey confirmed that it did, and it should have known that the clause was there, and it should have been able to take such advice as it wanted as to what the implications would be of proceeding with the purchase on that basis.

What they appear to have done is proceeded on the basis either — well, we know that they proceeded on the basis that they believed Mr Springett wouldn’t stand and fight — you remember the email exchange that I took Mr Livesey to. They wanted to get Gascoigne Halman on to Zoopla. That was the first thing, they wanted him on to Zoopla,
and they didn’t think that Mr Springett would stand and fight.

In reply, Mr Harris said that Mr Maclean’s remark that Zoopla was “calling the shots” should be withdrawn or dismissed by the tribunal.

Mr Justice Marcus Smith said that the tribunal would attempt to deliver its judgement as soon as possible, but gave no indication as to a specific time-frame.