CompCom targets GE, Siemens and Philips over medical equipment servicing

The Competition Commission (CompCom) has referred GE South Africa, GE Medical Systems South Africa, Siemens Healthcare and Philips South Africa Commercial to the Competition Tribunal over alleged anti-competitive conduct in the servicing, repair and maintenance of diagnostic medical imaging equipment.

CompCom alleges that the companies restricted independent clinical engineers’ access to spare parts, diagnostic software, service keys, technical information and specialised training needed to compete in the aftermarket for medical imaging equipment.

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Siyabulela Makunga, spokesperson for the Competition Commission, confirmed to Moneyweb that the matter has been referred to the Tribunal.

“This matter will, on a date determined by the tribunal, be heard to establish whether the respondents contravened the Competition Act. If found guilty, the respondents may be individually or severally liable to pay an administrative penalty of up to 10% of their total revenue for the period of the contravention,” he says.

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The companies operate nationwide and supply and service equipment including X-ray, ultrasound, magnetic resonance imaging (MRI), computed tomography (CT) scanners and PET/CT systems.

According to CompCom, restricting access to parts, software and technical information weakens competition in the servicing and repair market.

This could leave healthcare facilities with fewer service options and higher costs.

The issue has wider economic implications because diagnostic imaging equipment can cost millions of rand and typically remains in service for 10 to 15 years.

Reliable access to spare parts, software updates, maintenance and repairs is therefore essential to keeping equipment operational and limiting costly downtime.

The commission says the impact “can be particularly significant at public and rural healthcare facilities, where limited access to service providers and equipment downtime can delay diagnosis and treatment”.

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The referral alleges contraventions of section 8(1)(c), alternatively section 8(1)(d)(ii), of the Competition Act 89 of 1998, as amended.

The tribunal will determine whether the respondents contravened the act and, if so, impose appropriate remedies. The allegations have not yet been proven and remain subject to the tribunal’s determination.

* Phenyo Selinda is a Moneyweb Intern.

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