Competition Bureau Canada is warning landlords and property managers against working with competitors to set rental prices. 

“The Competition Bureau is aware that some landlords and property managers may be engaging with their competitors, including through discussion groups on social media,” said the independent regulator in a recent press release.

The statement says that while some discussions between competitors may be justified, others may be illegal. 

“Landlords and property managers must understand the difference between conversations that are harmless and conversations that they should steer clear from.”

What isn’t allowed

Agreements between landlords to “make the most of the booming rental housing market” or “find ways to ensure that all players benefit from the strong demand equally” raise concerns under the law and could be illegal, says the Competition Bureau.

According to the notice, it is illegal for competitors to agree about:

• Rental prices, including any increases or surcharges.
• The terms of their leases, including amenities and services.
• Restricting the housing supply by artificially reducing the availability of rental units.

“Engaging in illegal agreements with competitors, such as price-fixing, market allocation, restricting supply, or wage-fixing and no-poaching agreements, is a criminal offence under the Competition Act, with potential prison sentences of up to 14 years and hefty fines at the discretion of the court.”

Best practices

The Competition Bureau says andlords and property managers are to:

• Decide on their own prices, price increases, surcharges and the terms of leases.
• Explain and negotiate the terms of leases with their tenants only.