Court annuls fines running into millions for homecare institutes

Tuesday, 29 May 2012

The court of Rotterdam has annulled several decisions of the Dutch competition authority (‘NMa’) in which fines running into millions were imposed on homecare institutes. According to the court the NMa did not proper motivate her decisions. As a result the NMa needs to judge again the objections made by the homecare institutes concerning the fines the NMa imposed. 

Course of the proceeding

In September 2008 the NMa fined homecare institutes in Kennermerland and ‘t Gooi for cartel infringements. The fines varied between EUR 611,000 and more than EUR 4,000,000. In the opinion of the NMa the freedom of choice was limited by the behaviour of the homecare institutes. The homecare institutes in Kennemerland would have divided the market geographically. In addition they would have referred patients to each other. The homecare institutes in ‘t Gooi would have handed over activities to each other, by which a market division was created. These institutes would also have referred patients to each other.

The homecare institutes registered notices of objection. This resulted in only a minimal reduction of the fines. Thereafter the homecare institutes lodged appeals with the court of Rotterdam.

Judgement court of Rotterdam

The court judged that the NMa did not proof infringements of the Dutch competition law by the homecare institutes in ‘t Gooi. The court is of the opinion that the NMa needs to perform further investigation to the situation on the market. The court thereby points to the meaning of the guarantee budgets, the role of the care office, the presence of waiting lists and the opportunities to develop competition. It is not clear what influence these aspects have had on the possibilities of the homecare institutes to compete. As a result thereof the court is not able to establish whether the arrangements mentioned above were appropriate to limit competition. According to the court this does not become clear from the investigation the NMa performed.

Regarding the homecare institutes in Kennemerland the court also judged that the NMa did not perform sufficient investigation to the situation on the market. Here again the court points to the guarantee budgets, the waiting lists and the role of the care office. Moreover the court is of the opinion that there was no competition between the homecare institutes on the market of the care office of the region Kennemerland. The court therefore comes to the conclusion that no decision needs to be taken about the precise intention and meaning of the arrangements between the homecare institutes.

The court annuls in both cases the decisions of the NMa. The NMa did not succeed in proper motivating her decisions. The court ordered the NMa to take new decisions. The judgements of the court of Rotterdam show that it is important that the NMa takes the situation of the market into consideration.

This week it became clear the NMa will not appeal against the judgement of the court. The NMa is working on a new motivated decision.