PRESS RELEASE

CONDOMINIUM ADMINISTRATORS: THE AUTHORITY STARTS AN INVESTIGATION INTO WHETHER THE FIXING OF MINIMUM RATES AND THE PROVISIONS OF THE CODE OF ETHICS AND DEONTOLOGY ARE ELIGIBLE TO RESTRICT COMPETITION

The Competition Authority, at a meeting on 12 March 2014, opened an investigation into the associations of CONFIAC - Italian Confederation of condominium associations - to cheque whether the standards of a Code of Ethics and Deontology and of a minimum fee for professional condominium administrators might substantially restrict competition in the field of services related to the administration of condo properties.

According to the Authority in fact the launch of a tariff analysis could incorporate the criteria of horizontal price-fixing, and then determine an appreciable restriction of competition among operators in the sector since the Confederation includes 75% of the Italian trade associations whose members are professional condominium managers.

It does not seem, however, to limit the effect of restricting competition, the fact that, on the website of CONFIAC, the tariff is introduced as "merely indicative". Certain provisions of the Code in fact suggest actually as binding the price indications on the basis of a complete system of sanctions that is activated in the event of non-compliance with the provisions of which the tariff is an integral part. In fact, the anti-competitive nature of the agreements relating to minimum tariffs should be deemed to exist independently from the binding nature or otherwise of price information contained therein, in so far as they are, however, likely to play an orientation role in the behaviour of operators and to determine, therefore, an artificial homogenization of market conditions.

The Code also has an additional element which restricts the normal competitive dynamics. In fact, the member recipient of an RFP to administer a building must inform the colleague in charge of his intention to run if the latter adheres to CONFIAC.

The investigation, initiated on the basis of the request for authorisation of the minimum fee for professional condominium administrators submitted to the Authority by the same CONFIAC, must be completed by 31 December 2014.

Rome, 1 April 2014