Home Expat Blogs Do Some Real Estate Agents Violate Anti-Trust or Anti-Monopoly Laws in Mexico?

Do Some Real Estate Agents Violate Anti-Trust or Anti-Monopoly Laws in Mexico?

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Do some real estate agents violate anti-trust or anti-monopoly laws in Mexico? Because real estate brokers and salespeople frequently cooperate with one another in the sale of properties, they have numerous opportunities to engage in conduct that might be considered to be violations of these laws.

First, let’s look at what fair market competition and fair treatment of consumers looks like.

1. When competition works well, consumers are empowered as well as informed.

2. Consumers can make sense of the information they receive and can take their business elsewhere if they are not happy.

3. Firms strive to win customers on the basis of service, quality, price and innovation.

4. These business principles help generate better outcomes for consumers.

5. Markets are open to entry and innovation. Successful, innovative firms thrive, while unsuccessful firms change or go out of business.

Now let’s look at unfair business practices and unfair competition.

Unfair business practices encompass fraud, misrepresentation and oppressive or unconscionable acts or practices by business, often against consumers and are prohibited by law in many countries.

Unfair competition is an unjust and often illegal attempt to gain unfair competitive advantage through false, fraudulent or unethical commercial conduct. Examples include below-cost selling, counterfeiting or imitation, dumping and misleading.

How can you tell the difference between what is fair and what is unfair? The following hypothetical examples illustrate the choices your broker or agent must make to ensure fairness in your real estate transaction.

1. Two competitors in my market ask you to cooperate with them in setting a “standard” commission for the area. You refuse, but subsequently start charging the same rate that your competitors suggested. True or false?

2. Brokers agree not to cooperate with another company by not showing that company’s listings. They do not violate antitrust laws if they enter into that agreement because they consider the company’s aggressive “high-tech” marketing techniques to be unethical. True or false?

3. If one of the salespeople participates in a price-fixing discussion, the associate and company can be held liable — even if the broker has no personal knowledge of the salesperson’s conduct. True or false?

4. If an agent entices buyers by offering them half his commission, is this bribing and preventing the use of a buy agent advocating for the buyer? True or false?

5. Agent A tries to convince buyers already working with another agent to drop agent B and get a better deal with a discount off the price of the property. Does this mean the buyer will only see the inventory of agent A´s company and not what is available in the market? True or false?

6. When an agent takes an overpriced listing, as a way to get calls from buyers to sell other properties that are realistically priced, is this harmful and misleading to the seller who has the overpriced listing? True or false?

7. There are two major brokerage firms in a small town divided by a river who decide that one will take properties north of the river, while the other stays to the south. Any such agreement violates the antitrust laws. True or false?

8. A broker responds to a customer inquiry about a commission, saying the price is standard or is what his real estate association suggests should be charged. Real-estate associations can collectively set commissions. True or false?

You can find out which examples are true and which are false by contacting me through my website.

This article is based upon legal opinions, current practices and my personal experiences. I recommend that each potential buyer or seller conduct his/her own due diligence and review.