Judgment in medical aid price-fixing case due in March

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Windhoek

The High Court will only deliver its judgment in March next year on whether or not the Namibian Competition Commission (NaCC) overstepped the boundaries of its authority by pronouncing that the Namibia Association of Medical Aid Funds (Namaf) conducts its affairs in an anti-competitive manner that involves downright collusion and price-fixing.

Through its own investigation in 2014 the NaCC said it established a clear infringement of the Competition Act in that Namaf and its member medical aid funds had conspired to fix prices.
Namaf has challenged the NaCC’s jurisdiction over the medical aid industry, saying the commission has no power to investigate Namaf’s conduct. Judgment in the matter is expected on March 24, 2016.

Namaf contends that the medical aid funds, whose objectives are described as defraying medical costs and being “non-profit entities”, do not qualify as undertakings in terms of the Competition Act. Namaf’s legal representatives, therefore, argue that the association’s operations can be styled as non-commercial socio-economic activities.
Namaf’s stance is that where different regulatory authorities have jurisdiction over an entity established by law, that regulatory authority and the NaCC must negotiate the manner in which they will deal with overlapping issues and they must reach an agreement in this regard. Once they have agreed on this in writing, such agreement must be published in the Government Gazette.

“The publication in the Government Gazette is clearly required. It is submitted, so as to indicate to the relevant statutory bodies as to who will regulate them in respect of such issues. Failing such notice, we submit, such entities can accept that the statutes governing them and the regulating authority relevant to such statutes will continue to govern them and their conduct.

“It is thus submitted that – barring such notice in the Government Gazette – the NaCC has no jurisdiction to investigate the operations of a fund and this is a matter between the funds and the Minister of Finance and the Registrar (of Pension Funds), whom has the say over how the funds must conduct their operations,” reads Namaf’s heads of argument.

NaCC chief executive officer Mihe Gaomab II recently confirmed that the commission concluded an investigation into anti-competitive practices in the country’s healthcare sector and that the matter concerned the conduct of Namaf and its relevant members.

“The Commission found that there was clear infringement of Section 23 of the Competition Act, in that Namaf and its member medical aid funds had conspired to fix prices in respect of benchmark tariffs. This was a matter that was ripe to proceed to determination before the High Court, to have appropriate remedies determined and to bring this conduct to an end,” Gaomab said during a media briefing at the end of November.

At the same event NaCC corporate secretary Nangosora Tjipitua explained that Section 23 of the Competition Act prohibits collusive behaviour, or the formation of cartels among firms.

Namaf is represented by Advocate Theo Frank, assisted by Advocate Natasha Bassingthwaighte on instructions of EnsAfrica Namibia, incorporated as Lorentz Angula Inc. The NaCC is represented by Advocate David Unterhalter, assisted by George Colemen as instructed by Du Plessis, De Wet & Co.

 

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