Competition Commission v Lancet Laboratories (COVCO141Dec21) [2021] ZACT 107 (12 December 2021)

Competition Commission v Lancet Laboratories (COVCO141Dec21) [2021] ZACT 107 (12 December 2021)

The Tribunal confirmed the consent agreements between the Competition Commission and Ampath and Lancet Laboratories as orders, capping the price of COVID-19 PCR tests at R500 inclusive of VAT for two years. The Tribunal found that the Commission's investigation established a prima facie case of excessive pricing, given the significant reduction in supplier costs and increased profitability of the laboratories. The voluntary price reductions and subsequent consent agreements were deemed appropriate to address the public interest in affordable COVID-19 testing during the pandemic. The laboratories are required to submit quarterly compliance reports and provide data on request, ensuring...

Citation
[2021] ZACT 107
Parties
Applicant: Competition Commission; Respondent: Drs Du Buisson, Kramer, Swart, Bouwer Incorporated t/a Ampath; Respondent: Drs Mauff AC & Partners t/a Lancet Laboratories
Court
Competition Tribunal
Jurisdiction
South Africa
Judgment Date
12 December 2021
Case Number
COVCO141Dec21
Procedural Posture
Urgent Application / Consent Agreements Confirmed as Tribunal Orders
Outcome
Consent agreements confirmed as orders of the Tribunal; price cap imposed for two years.
Legal Topics
Excessive Pricing, Consent Order, Covid 19 Regulation, Price Cap, Section 8 1 a, Consumer Protection Regulations
Competition Law Commercial and Corporate Excessive Pricing Consent Order Covid 19 Regulation Price Cap Section 8 1 a Consumer Protection Regulations

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Parties

Competition Commission

Applicant

Drs Du Buisson, Kramer, Swart, Bouwer Incorporated t/a Ampath

Respondent

Drs Mauff AC & Partners t/a Lancet Laboratories

Respondent

Procedural Posture

Urgent Application / Consent Agreements Confirmed as Tribunal Orders

Legal Issues

  1. 1 Whether Ampath and Lancet Laboratories charged excessive prices for COVID-19 PCR tests in contravention of section 8(1)(a) of the Competition Act.
  2. 2 Whether the consent agreements capping PCR test prices at R500 inclusive of VAT are appropriate and enforceable.
  3. 3 Whether the laboratories should submit compliance reports to the Commission.

Ratio Decidendi

The Tribunal confirmed the consent agreements between the Competition Commission and Ampath and Lancet Laboratories as orders, capping the price of COVID-19 PCR tests at R500 inclusive of VAT for two years. The Tribunal found that the Commission's investigation established a prima facie case of excessive pricing, given the significant reduction in supplier costs and increased profitability of the laboratories. The voluntary price reductions and subsequent consent agreements were deemed appropriate to address the public interest in affordable COVID-19 testing during the pandemic. The laboratories are required to submit quarterly compliance reports and provide data on request, ensuring...

Court Disposition

Consent agreements confirmed as orders of the Tribunal; price cap imposed for two years.

Orders

  • Ampath and Lancet Laboratories must reduce the price of COVID-19 PCR tests to no more than R500 inclusive of VAT for two years.
  • Both laboratories must submit compliance reports to the Competition Commission every three months detailing prices charged and material changes in costs.