Internet auction trader warned over alleged price fixing

File photo / Nigel Marple

The Commerce Commission has warned an internet auction trader over what it says was an attempt to fix prices for bicycle lights, saying even online traders need to be aware of competition rules.

The formal warning was issued to Auckland's Ernie Travers, whose Trade Me user name is POP0071 and who the commission said attempted to fix prices for LED bicycle lights with another online seller.

Price fixing means buyers are likely to pay more than they otherwise would in a competitive market.

In September the commission received a complaint about an email Mr Travers had allegedly sent, suggesting he and a competitor both agree to sell the lights at a set price.

The email said: "Hey, how about instead of continually discounting these lights we agree to one price. $189 and stick to it. Post a question as a reply on one of my auctions if you like then no buyers will know about this. I am sure we will both get a share of the market if we are both consistent on the price."

Mr Travers denied he sent the email but could not satisfactorily explain who had sent the comment, the commission said. The other seller did not respond to the email, so no price fixing agreement was entered into.

Even online sellers should be mindful of the Commerce Act, said Kate Morrison, the commission's general manager of enforcement.

"No one selling online should attempt to agree prices with other people who are selling the same or similar products. This means that each online seller should decide on the reserve price and the 'buy now' price themselves.

"Competition then exists between the sellers. Any attempt to lessen competition will be viewed seriously, no matter what the forum."

- NZPA