Legislation: Patel clarifies Covid-19-related pricing measures

Health sector regulations gazetted last week under the ‘new provisions of section 10(10)’ (exemptions) of the 1998 Competition Amendment Act’, as amended, ‘will permit private healthcare providers to co-ordinate their actions as part of National Department of Health efforts to ‘fight the (Covid-19) virus’, reports Pam Saxby for Legalbrief Policy Watch. This is according to an undated media statement issued by Trade & Industry Minister Ebrahim Patel and posted yesterday on his department’s website. Reference is made to ‘the sharing of facilities and beds, medical supplies, nurses and doctors between different companies and with government’. The regulations themselves describe the new measures as ‘block exemptions’ from sections 4 and 5 of the Competition Act, dealing with restrictive horizontal and vertical practices popularly known as price-fixing. According to Business Day, they are expected to facilitate collaboration between the public and private sectors on making the best possible use of the country’s healthcare resources.

The statement includes significantly more detail on separate regulations and ‘directions’ gazetted last week under the Competition Act and 2008 Consumer Protection Act, ‘dealing with pricing and supply matters during the national disaster’. Aimed at preventing ‘unjustified price hikes’ and ‘stock-piling’, the new measures ‘cover the full supply-chain’. They require retailers to ‘limit the quantity of goods sold to any individual consumer’; and ‘maintain adequate stocks’ of ‘basic goods’ listed in the regulations (taking account of the level of demand generally associated with weekend and month-end shopping). Wholesalers are required to ‘ensure’ there is ‘no stock-piling at the cash-and-carries’. The regulations themselves refer to ‘goods and services’ categorised as ‘basic food and consumer items’, emergency products and services, medical and hygiene supplies, and ‘emergency clean-up products and services’. Specific reference is made to ‘private medical services relating to the testing, prevention and treatment of Covid-19 and its associated diseases’.

Underpinned by ‘a partnership model’ on the ‘prudent and responsible steps’ retailers and wholesalers will be expected to take during the recently imposed national state of disaster, according to the statement the regulations and ‘directions’ give government the latitude to introduce ‘firmer measures’ should they become necessary. These could include ‘setting limits on individual products’. Breaches of the regulations will have ‘serious consequences’ given that their overarching purpose is to ‘protect consumers, … ensure fairness and promote social solidarity’ in the face of an anticipated epidemic. ‘The effect of Covid-19 on the economy is being closely watched,’ the Minister said, although government’s ‘key concern’ now is to ‘save lives’ while minimising the associated ‘economic costs’. Its position is apparently that, only ‘after we have defeated the virus’ will work begin on ‘rebuilding the economy’. Some of these remarks were echoed in President Cyril Ramaphosa’s statement yesterday evening on the escalation of measures to combat the anticipated epidemic.