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Berkshire Hathaway Specialty Insurance

Roofers caught in ACCC hailstorm enforcement

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The Australian Competition and Consumer Commission (ACCC) has taken action against two Sydney roofers over Facebook messages about raising prices after tennis-ball sized hailstorms caused widespread property damage last year.

ANZ Roofing, Ivy Contractors and directors Mark Lee Burtenshaw and Brent Cameron Callan-Kerkenezov have given enforceable undertakings to the ACCC after acknowledging the price-fixing implications of their social media discussions.

A message on one Facebook group from Mr Burtenshaw showed an image of a large hailstone and read: “I think this latest storm is the perfect opportunity for the roofers of Sydney to increase pricing across the board as a standard that doesn’t decrease!”

The ACCC says Mr Kerkenezov says on one of the Facebook groups: “Let’s agree that we start from $65 and go up”, apparently referring to the price per linear metre to install new quad guttering.

In a previous message he says: “I got contacted by insurance company saying they want us to remove, supply and install for $55/sqm…aaah no thanks…if any roofers go in and do this work for that kind of SQM rate you need an uppercut!”

The two Facebook sites are used by roofing providers in the greater Sydney area to advertise jobs and discuss industry issues. The messages appeared soon after the December hailstorm, which hit multiple metro and rural NSW regions.

The roofers agreed the messages could in some circumstances raise concerns under laws banning “concerted practices which have an anti-competitive purpose or effect”.

Chairman Rod Sims said today that “attempts to take advantage of people whose homes were damaged in natural disasters like hailstorms is something the ACCC takes very seriously”.

“The community will not just find this outrageous, it is also anti-competitive and illegal under Australian competition laws.”

The ACCC decided not to take court action due to factors including the small size of the traders and their co-operation with the investigation.

The enforceable undertakings involve commitments not to repeat the behaviour and for Mr Burtenshaw and Mr Kerkenezov to receive compliance training in competition and consumer law.

ANZ Roofing will publish a post on one of the Facebook groups about prohibited anti-competitive conduct.

More than 141,000 claims with a total value of $1.32 billion have been lodged from last December’s storms as of last month, according to the Insurance Council of Australia (ICA).

“Insurers and customers have historically experienced a sharp rise in the cost of skilled labour following natural disasters, a factor that has placed significant upwards pressure on insurance premiums in some regions,” ICA spokesman Campbell Fuller said.

“To combat this issue many insurers have established commercial – typically national – relationships with builders and repairers to provide services at agreed prices.”

The roofing case is the ACCC’s first enforcement related to anti-competitive concerted practices since laws were introduced in November 2017.