Summary of Commerce Act Issues
for Medical Practitioners
Introduction
The NZMA wishes for all medical practitioners to develop an understanding of competition law within New Zealand and how it may apply to the practice of medicine so that medical practitioners are able to practise safely within the confines of the law.
The NZMA has produced a member resource on the Commerce Act:
Competition Law in New Zealand and the Medical Profession
This summary is designed to highlight issues that are covered in greater detail in the resource. Readers however should be aware that neither this summary nor the NZMA's Commerce Act resource is designed as a substitute for legal advice. If you think you have a Commerce Act issue we advise you to seek specialist legal advice.
The Commerce Act 1986
The Commerce Act 1986 states that the purpose of the Act is "to promote competition in markets for the long-term benefit of consumers within New Zealand'. Essentially the Act seeks to promote competition by prohibiting activities which restrict competition i.e. price fixing, and by controlling the structure of market players through the Mergers and Acquisitions provisions. The restrictive practices which may apply to medical practitioners include entering into agreements which substantially lessen competition, price fixing, exclusionary arrangements and taking advantage of a market power.
Key Points
Medical practitioners should not engage in the following without first seeking legal advice:
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Do not discuss past, present or future prices with your competitors. Remember that the law considers medical practitioners to be in competition with other medical practitioners unless they are practising in a legal partnership or company structure.
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Do not participate in arrangements with competitors which restrict the patients you can see or the providers you can contract with to provide your services.
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Do not enter into arrangements (these need not be written or formal) with your competitors to exclude, deter or prevent a competitor from competing in the market.
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Avoid being drawn into discussing prices or exclusionary arrangements such as boycotts. If you attend meetings with health providers, other competitors, or belong to a society of practitioners where prices or anti-competitive conduct is being discussed ensure you formally voice your dissent and/or leave any meeting if necessary. Request that this be formally recorded.
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If involved in a roster with other competitors, ensure the roster allows its members to practise outside of the times specified i.e. the roster must provide a minimum practise time not a maximum.
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Do not enter into exclusive or long-term contracts without first taking legal advice.
Need to Know More? The complete resource can be found here.