Thursday, 22 July 2021 03:34

NZ loan provider Moola, Commerce Commission face off in court over cartel conduct in online advertising on Googe Ads Featured

By Staff Writer

New Zealand regulator and competition enforcement agency The Commerce Commission has filed proceedings at the High Court in Christchurch seeking declarations that consumer loan provider Moola engaged in cartel conduct relating to online advertising on Google Ads.

The Commission alleges Moola reached agreements with other consumer loan providers that they would not bid on each other’s brand names on Google Ads.

The Commission also alleges agreements were reached that the companies would negatively match certain keywords - meaning that consumers searching for a consumer loan provider on Google may not see ads for other loan providers.

The Commission said in a statement issued on Wednesday that it considers these agreements fixed, controlled or maintained the price paid by Moola for its online advertising on Google Ads and “prevented, restricted or limited the purchase of online advertising on Google Ads.

“As a result, the Commission alleges, entering into and giving effect to the agreements breached the Commerce Act.

“The Commission is not seeking a pecuniary penalty in this proceeding. As this case is before the Court, the Commission cannot comment further at this time.”

Moola is a consumer finance company providing high-cost short term loans up to $5,000 and it operates through its websites moola.co.nz and needcashtoday.co.nz.

The Commerce Commission notes that Google Ads is an online advertising platform offered through the Google search platform and companies can pay to display their products and services as an advertisement in response to a search for a particular word or phrase - with the display ranking of an advertisement and the amount paid by the advertiser to Google Ads determined by a live second-price auction or spot market.

“Negatively matching keywords prevents certain ads from being triggered by a certain word of phrase, meaning certain ads will not display to anyone who is searching for that word of phrase,” the Commerce Commission concludes.


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