COMPETITION TRIBUNAL
REPUBLIC OF SOUTH AFRICA
Case Number: 41/AM/Jun02(2)
In the matter between :
The Competition Commission Applicant
and
Digital Healthcare Solutions (Pty) Ltd Respondent
In re :
Digital Healthcare Solutions (Pty) Ltd Applicant
and
The Competition Commission 1st Respondent
Healthbridge (Pty) Ltd 2nd
Respondent
Decision on application to vary an order of the Competition Commission
Introduction
In this application the Competition Commission (‘the Commission”) seeks an
amendment of an order it made when conditionally approving a merger
involving the respondent, Digital Healthcare Solutions (Pty) Ltd (“DHS”).
DHS opposes the application.
Background
On 4 February 2004 the Competition Tribunal ruled in Digital Healthcare
Solutions (Pty) Ltd v The Competition Commission and Healthbridge (Pty) Ltd
(“the breach case”) 1 that DHS had breached the conditions imposed by the
Commission in its order approving the small merger between DHS’ subsidiary,
Mediswitch, and a company named QEDI, which was at that time a subsidiary
of a company named Persetel. The conditions that were breached by DHS
read as follows:
For a period of three (3) years after the approval of this transaction by the
Commission:
1. The merged entity shall, on reasonable written request by
any healthcare switch entity, integrate the applicable latest
versions of PMS packages which it owns or controls, with
an API which enables an interface with the switching
technology of the healthcare switch entity requesting such
integration, in accordance with an agreement referred to in
paragraph 2 below.
2. Pursuant to such a reasonable written request, the merged
entity shall use all reasonable endeavours to conclude a
written agreement with the requesting healthcare switch
entity concerned, within a period of 60 days after receiving
such request, containing commercially, financially and
technically reasonable terms.
3. The merged entity shall provide a quarterly report to the
Commission, for a period of 12 months after the date of
approval, detailing all requests by third party healthcare
1 See Tribunal Case No: 41/AM/Jun04
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switch entities to integrate their API and functionality with
the PMS packages owned or controlled by the merged
entity, as well as detailing the agreements and time frames
concluded with such third party healthcare switch entities in
respect of the integration process.”
After the Tribunal had issued its abovementioned decision in the ’breach
case’, DHS filed a remedial plan with the Commission in terms of rule 39(2)(a)
of the Commission’s rules. The remedial plan was filed on 20 February 2004.
The Commission and DHS then engaged in negotiations regarding the
proposed remedial plan.
The Commission considers that these negotiations may not be completed by
8 April 2004, when the threeyear period stipulated in the abovestated
conditions will expire. Because of this, the Commission has approached the
Tribunal with this application to extend that period by one year, namely until 8
April 2005. DHS, in opposing the application, submits that the Tribunal does
not have jurisdiction to make such an order.
Jurisdiction
The Commission submits that the Tribunal has jurisdiction to grant the
application in terms of Rule 42 of the Tribunal’s rules. This rule lays down the
procedure for the bringing of an application not otherwise provided for in
terms of those rules.
We pointed out in our decision in the ‘breach case’ that Rule 42 is essentially
procedural in nature and does not confer general powers on the Tribunal to
review the Commission’s decisions. 2 Similarly, that rule does not vest the
Tribunal with general powers to vary the Commission’s decisions.
The Commission was unable to refer us to any other provision in the
Competition Act (“the Act”) or the rules that would give the Tribunal powers to
amend a condition imposed by the Commission when approving a small
amend a condition imposed by the Commission when approving a small
2 See footnote 10 on page 7 of the decision in case no. 41/AMJun04.
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merger in terms of s. 13(5)(b) of the Act.
We point out that the Tribunal’s power to amend its own orders is expressly
granted in terms of s. 66 of the Act. This power is limited to the
circumstances referred to in that section, essentially cases of error or
ambiguity.3
The Act does not give the Tribunal express power to vary orders of the
Commission made under s. 13(5)(b) of the Act. Nor is it possible to infer such
power from s. 27, the general provision setting out the Tribunal’s functions
and powers.
The Commission seems to regard the amendment as merely an extension of
a time period. Whilst that might be the effect of the amendment, it does not
alter its character – it amounts to a variation of an order of the Commission.
Even if we assume in the Commission’s favour that what is sought is not the
variation of an order but a mere extension, it does not assist the Commission.
Whilst in terms of s. 58(1)(c) we have powers to extend certain time periods
which might otherwise apply, these are limited to time periods set out in the
Act. In this application we are dealing with a time period set out in an order
made by the Commission.
We have the power, in terms of s. 14A(2), to extend the period in which the
Commission may investigate a large merger, but here too the power is
expressly granted and for a specific and limited purpose.
In our view, given the Tribunal’s express powers of extension (ss. 14A(2) and
58(1)(c)) and variation (s. 66) it follow that if the legislature had intended the
Tribunal to have the power to amend an order of the Commission made under
s. 13(5)(b), it would have provided for this expressly in the Act.
In our view DHS is correct in contending that we have no jurisdiction to grant
the order sought. Accordingly, the application is dismissed.
There is no order as to costs.
16 April 2004
3 See Astral Foods Ltd v Competition Commission and Others , Competition Tribunal Case
3 See Astral Foods Ltd v Competition Commission and Others , Competition Tribunal Case
No: 69/AM/Dec01 and Mike’s Chicken (Pty) Ltd and Others v Astral Foods Ltd and the
Competition Commission, Competition Appeal Court Case No. 32/CAC/Sep03.
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N. Manoim Date
Concurring: D. Lewis and L Reyburn
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