10 modelling agencies fined $360,000 for price-fixing
[2011] 24 Nov_ST

Title: 10 modelling agencies fined $360,000 for price-fixing
Source: Straits Times
Author:

Legal News Archive

THE Competition Commission of Singapore (CCS) yesterday took action against 11 modelling agencies for collectively fixing the rates of its services.

Ten of the agencies, which include established ones, were fined a total of $361,596.

Ave Management, a decade-old agency which groomed well-known local model Charmaine Harn, was given the heaviest fine of $132,315.

Mannequin Studio, another big-name agency, was spared a fine because it had stopped its involvement with the group before a grace period for companies to comply with the Competition Act lapsed in June 2006.

The announcement comes on the heels of the CCS' decision last month to fine 16 maid agencies more than $150,000 for fixing the salary of new Indonesian maids.

Acting on a complaint, the competition watchdog launched a probe into the modelling agencies' practices in 2009.

These agencies, which formed the Association of Modelling Industry Professionals (AMIP) in 2005, said they wanted to fight for better terms for local models and promote Singapore as a fashion hub.

But CCS investigations showed that 'one of the main objectives of the AMIP was to collectively raise the rates for modelling services charged by the agencies', the watchdog said at a press conference yesterday.

For example, the agencies, under the guise of the association, raised the rates for models from $250 to $400 each per fashion show between 2005 and 2009.

Such a practice in turn affected 'business consumers', including bridal salons, fashion brands and show choreographers, the CCS said.

The 11 agencies account for about 40 per cent of the market share here.

They continued to meet, discuss and agree on the rates until the CCS conducted inspections in July 2009.

By doing so, they had infringed the Competition Act which came into force in January 2006. The Act prohibits companies from meeting to discuss and agree on prices for their services.

The agencies were informed of the findings in May this year and were given time to submit their arguments.

Said Mr Toh Han Li, CCS' acting chief executive: 'The reason the agencies gave is that a lot of models don't come here to work because the rates were too low.

'But the point we are trying to make is that if the rates are high because you collectively fix them, that's not the way to do it.'

While the CCS' job is not to regulate the prices charged by these agencies, he said, any increase should be implemented independently.

The fines handed out yesterday vary, as they are pegged to the yearly turnover of each company, among other factors. The maximum fine allowed is not more than 10 per cent of the company's annual turnover for up to three years.

The agencies are given two months to appeal against the decision, or pay the fine by Jan 25 next year.

When contacted, Ave Management declined to say whether it plans to appeal.

Mr Chris Swee, general manager of Looque Models, which was fined $31,241, said it is 'not happy with CCS' decision'. It is discussing with its lawyers whether to file an appeal, he said. The other agencies were either uncontactable or had listed phone numbers that were not in use.

Ms Linda Teo, owner of Carrie Models which is not involved in the case, said there is 'no need to fix prices' given the small scale of the modelling industry here. 'With the CCS' decision, agencies here will have to be more careful and not form a cartel to fix the rates,' she said.

The CCS has also gone after pest control companies for rigging bids and coach operators for fixing the prices of Singapore-to-Malaysia bus tickets.

Last year, it imposed a $989,000 fine on Sistic for abusing its dominant position. The ticketing agency has appealed against its fine and the case is pending.

wenjian@sph.com.sg

COLLUSION NOT THE WAY

'The reason the agencies gave is that a lot of models don't come here to work because the rates were too low.

'But the point we are trying to make is that if the rates are high because you collectively fix them, that's not the way to do it.'

Mr Toh Han Li, CCS' acting chief executive

How much the agencies were fined
  • Ave Management: $132,315
  • Diva Models: $72,891
  • Phantom Management: $53,827
  • Bees Work Casting: $44,112
  • Looque Models Singapore: $31,241
  • Impact Models Studio: $10,508
  • Electra Management: $5,351
  • Linsan Models: $5,351
  • Catworkz International: $3,000
  • Quest Model Management: $3,000
  • Mannequin Studio: Not fined*
*Mannequin Studio was not fined because it left the Association of Modelling Industry Professionals on June 2, 2006.

This was within the transitional six-month grace period after the Competition Act came into force in January 2006.

Source: Straits Times © Singapore Press Holdings Ltd.