law

antitrust

Antitrust laws, chiefly the federal Sherman Antitrust Act, prohibit agreements and practices that restrain free competition. In real estate, violations include price fixing (competing brokers agreeing on commission rates), group boycotts, market allocation (dividing territories or customers), and tie-in arrangements. Commissions must be set independently by each brokerage and negotiated with clients. Violations can bring civil damages, fines, and even criminal penalties including imprisonment.

Exam tip: Never say a commission rate is "standard" or set by law or the board. Even casual talk among competing brokers about rates can be evidence of price fixing.
Example: Two brokers agree over lunch that neither will list homes for less than 6% commission. That agreement is illegal price fixing.

1. Several brokers agree not to show listings from a discount brokerage. Which antitrust violation does this describe?

Answer & explanation

Answer: B. Competitors agreeing to refuse to deal with another competitor is a group boycott, a Sherman Act violation. Market allocation involves dividing customers or territories, not jointly refusing to deal.

Related terms & state variants

group boycott market allocation price fixing tie-in arrangement

Sources

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Last verified: 2026-10-23