To Settle FTC Charges, Professional Associations of Property Managers and Vocal Arts Teachers Agree to Eliminate Rules That Restrict Competition among Their Members

Journal of Singing, January/February 2015 | Go to article overview

To Settle FTC Charges, Professional Associations of Property Managers and Vocal Arts Teachers Agree to Eliminate Rules That Restrict Competition among Their Members


August 22, 2014

The National Association of Residential Property Managers, Inc. (NARPM) and the National Association of Teachers of Singing, Inc. (NATS) have agreed to eliminate provisions in their respective codes of ethics that limit competition among their members, according to the FTC. These settlements are the latest FTC enforcement actions challenging restraints on competition that are incorporated into the ethics codes of professional associations.

The FTC's complaint against NARPM, which represents more than 4,000 real estate managers, brokers, and agents, alleges that NARPM and its members restrained competition in violation of the FTC Act through provisions in its code of ethics that restrict comparative advertising and solicitation of competitor's clients. The provisions read, "The Property Manager shall not knowingly solicit competitor's clients," and "NARPM Professional Members shall refrain from criticizing other property managers or their business practices."

The proposed consent order settling the FTC's charges requires NARPM to stop restraining its members from soliciting property management work, and from making statements that are not false or deceptive about a competitor's products, services, or business or commercial practices. NARPM also must implement an antitrust compliance program, among other things.

In a separate complaint, the FTC charged that NATS, which represents more than 7,300 vocal arts teachers in the United States, restrained competition in violation of the FTC Act through a code of ethics provision that prohibits members from soliciting students from other members. The provision reads, "members will not, either by inducements, innuendos, or other acts, proselytize students of other teachers."

The proposed order settling the FTC's complaint against NATS requires that it stop restraining members from seeking teaching work, and stop telling its members that soliciting students is unethical. Among other things, the order also requires NATS to obtain a certification from each of its chapters that the chapter is not restricting solicitation, advertising, or price-related competition by its members, and to sever its ties with any chapter that NATS learns is restraining solicitation, advertising, or price-related competition by its members. …

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