In the framework of an investigation into alleged anticompetitive conducts initiated in mid-January of this year, the National Commission for the Defence of Competition (CNDC, for its acronym in Spanish) determined that there are multiple indications of a collusive agreement between the main prepaid medicine companies in the country.

As a result of the above, the CNDC issued an opinion advising the Secretary of Industry and Commerce of the Ministry of Economy to adopt a precautionary measure under the terms of Section 44 of Act No. 27.442 on the Defence of Competition (LDC, for its acronym in Spanish), so that certain prepaid medicine companies, the confederation that groups them together and the person that presided over the business association, comply with the requirements detailed below.

Firstly, to adjust the values of the medical care plan fees to be charged, which may not exceed the following calculation: the medical care plan fee for the month of December 2023 multiplied by (1 + the percentage variation between the general level Consumer Price Index with national coverage established by the National Institute of Statistics and Censuses in force at the time of the corresponding billing, and the same Index corresponding to December 2023). The measure clarifies that, for those members registered after December 2023, the adjustment must be made on the basis of a plan similar to the one contracted.

Secondly, to cease any exchange of information, whether in the framework of meetings of the Confederación Unión Argentina de Salud (UAS) or other meeting environments, involving prices, services to be provided, costs and any other commercial information.

In addition, the interim measure orders prepaid medicine companies to submit information to the CNDC on nominal prices of each health plan offered, revenues earned by each health plan and number of members in each of the plans. Companies will have to provide data from December 2023 onwards, and report updates on a monthly basis. In turn, the companies and the UAS are obliged to publish, within a maximum period of 10 working days from the notification of the preventive measure, the full text of the measure on their respective websites.

The persons investigated by the CNDC and covered by the aforementioned precautionary measure are the prepaid medicine companies Galeno Argentina S.A., Hospital Británico de Buenos Aires Asociación Civil, Hospital Alemán Asociación Civil, Medifé Asociación Civil, Swiss Medical S.A., Omint S.A. de Servicios, OSDE Organización de Servicios Directos Empresarios; the confederation that groups them together, Unión Argentina de Salud (UAS); and Mr. Claudio Fernando Belocopitt, in his capacity as current president of Swiss Medical S.A. and former president of the UAS.

The proceedings of the ongoing investigation have its origins in a complaint to the CNDC for cartelisation under the terms of Section 2, paragraph a), of the LDC, due to the coordinated increase in the prices of the prepaid medicine plans of the companies listed above.

Section 44 of the LDC provides that the enforcement authority, currently the CNDC together with the Secretariat of Industry and Commerce, may, at any stage of an investigation, impose the fulfilment of conditions or order the cessation of certain practices in order to prevent the occurrence of damage, or to reduce the magnitude of such damage, its continuation or aggravation. The LDC provides that these preventive measures, although they may be appealed by the affected parties, must be complied with from the moment they are issued.

The CNDC recalls that agreements between competitors or concerted practices, commonly known as cartels, constitute a serious infringement of competition law, which can lead to fines of up to 30 % of the turnover of the offending companies in Argentina.

In particular, Section 2 of the LDC classifies hard core cartels as practices that are absolutely restrictive of competition, which consist of an agreement between two or more competitors to fix prices, restrict output, divide or share the market or coordinate bids in tenders, or auctions.

To learn more about what constitutes an anticompetitive conduct, see the following infographic.

Best practice guidelines for chambers and business associations and professional associations are also available at the following link.

Anticompetitive conducts can be reported virtually through the Trámites a Distancia (TaD) system, as described here.