ACCC Probes REA Group Over Alleged Price Hikes, Shares Slip

Highlights:

• REA Group Ltd (ASX: REA) shares dropped 3.52% to $242.10 after news of an ACCC investigation into alleged misuse of market dominance.
• The ACCC is probing whether REA unfairly increased advertising prices for its real estate listing services.
• The investigation raises potential legal and reputational risks, prompting investor caution and immediate market reaction.

Regulator Investigates Potential Market Misuse

REA Group Ltd (ASX: REA) saw its shares fall as news broke that the Australian Competition and Consumer Commission (ACCC) is examining whether the property listings platform has exploited its dominant market position to impose unreasonable price increases. The company, which is majority-owned by News Corp, has long been a key player in Australia’s online real estate advertising market. At the time of writing, REA Group’s share price had declined by 3.52% to $242.10, marking a sharp intraday drop of $8.84.

Concerns About Market Power and Pricing Practices

The ACCC’s inquiry is reportedly focused on whether REA Group has used its influence in the market to push up advertising prices to the detriment of real estate agents and consumers. The investigation comes amid broader scrutiny of digital platforms and their pricing strategies in highly concentrated sectors. REA Group has not yet publicly responded to the ACCC’s review, but the development could lead to increased regulatory pressure if the competition watchdog finds evidence of anti-competitive behavior.

Investors React Swiftly to Regulatory Risk

The news has triggered immediate market reaction, with investors cautious about the potential for legal and reputational risks if the ACCC pursues formal action. Regulatory probes of this nature can often lead to financial penalties, forced pricing reviews, or mandated structural changes. REA Group has enjoyed strong market power through its flagship platform realestate.com.au, which remains the most visited real estate site in the country. However, the ACCC’s intervention suggests a growing appetite to regulate platforms that dominate their sectors. More details are expected as the ACCC continues its assessment. For now, investor sentiment remains cautious.

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