Tuesday, January 12, 2016

Exclusive tie-up of super specialty hospital with a stem-cell bank isn't ant-competitive

Private super specialty hospital's exclusive tie-up with a stem-cell bank for collection of stem-cells from patients availing maternity services in the hospital and not allowing other stem cell banks to collect the same, has no adverse effect on competition
Issue
Whether exclusive tie-up of a super specialty hospital with a stem cell bank for collection of stem-cells from patients availing maternity services in the hospital could be said to be an anti-competitive Act?


The Competition Appellate tribunal held as under-
1)  In the instant case, the lower authorities while pronouncing their judgments completely overlooked the fact that the exclusive agreement entered into between the hospital and stem-cell bank did not, in any manner, restrict the choice of the service provider in the relevant market, i.e., market for stem cell banking.
2)  By virtue of the agreement, though the hospital was bound to avail stem cell banking services from the stem-cell bank but the latter was free to enroll any patient(s) for such services to be availed in any other hospitals, maternity homes etc.
3)  That apart, there were 13 other players in the market of stem cell banking and the patients were free to avail services of any of these service providers according to their convenience and financial capacity.

4)  Hence, the agreement entered into with the stem cell bank could not be said to be an anti-competitive agreement- DR. L.H. Hiranandani Hospital, Hill Side Avenue v. Competition Commision of India [2015] 65 taxmann.com 65 (CAT - New Delhi)
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