Darlington Borough Council could be investigated by a Government body over allegations that it is being anti-competitive.
A businessman who runs the Property Search Group (PSG), which carries out local information searches for house buyers, made a complaint to the Office of Fair Trading over his claims the council only allowed him limited access to public records.
But last night the council said the issue was a national one, with many local authorities acting in the same manner.
Paul Milliken, who operates the PSG covering Darlington, Durham, Teesside and part of North Yorkshire, said the council was restricting his access to information needed to conduct his business on behalf of home buyers.
A spokesman for the Office of Fair Trading said: "We have received a complaint from PSG.
"We are currently considering the complaint, but at this stage you cannot make an assumption that there has been a breach of competition legislation."
Mr Milliken said he was finding it difficult to meet the demand for the service he provides because he was not being allowed reasonable access to view public records and the information that he requires to conduct searches.
The council also offers the property search service, but PSG says it offers a cheaper service.
Mr Milliken said: "The council is trying to create a competitive advantage by abusing its dominant position.
"Now it seems the council is promoting its speedy service while it restricts my fair competition."
Now the PSG has sought legal advice from a barrister who is an expert in local government to start challenging the councils involved.
A spokeswoman for Darlington council said: "The points raised by Mr Milliken are part of a national issue being looked into by the Office of Fair Trading and are in no way just particular to Darlington.
"It is therefore difficult to comment on some of the legal points made by him.
"In Darlington, we have tried to work fairly to accommodate the needs of those who wish to carry out personal land searches with us.
"We have to work within the resources available to us and ensure that all aspects of the services we provide are carried out professionally and within Government guidelines."
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