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Capio S:t Göran’s hospital wins competition law case

The Swedish Patent and Market Court of Appeal has announced its judgment in a case concerning a subcontracting agreement, related to a public procurement of clinical physiology services.

The Patent and Market Court of Appeal dismissed the Swedish Competition Authority’s request for fines and acquits Capio S:t Göran’s Hospital (CStG). The judgment sets aside a previous District Court judgment from 2015.

The procurement at issue, for clinical physiology services such as physiological tests for sleep apnea and stress echocardiography, took place during 2008 and was completely separate from the hospital’s main contract with the Stockholm County Council (SCC).

At the relevant time, CStG’s primary aim was to secure the direct award of a contract for physiological services from SCC, in the same way as the other emergency hospitals in the Stockholm area, in order to ensure expertise and availability for medical examinations of this kind. Since SCC deemed this not to be possible, CStG was instead encouraged to participate in the tender and enter into the subcontract that was later contested in this case.

In order to provide a competitive and separate tender in full competition, and to ensure good availability for our patients, CStG entered into a subcontracting agreement with Aleris. The agreement was expressly mentioned in CStG’s tender, and was also approved by SCC in connection with the award of the contract. In November 2012, this agreement was also extended by SCC to June 2014.

In 2013 the Swedish Competition Authority filed a claim with the Stockholm District Court to contest the subcontract. The District Court’s judgment was delivered in December 2015. The court partially upheld the Competition Authority’s claim and ordered Capio S:t Görans Sjukhus to pay a fine of 1.1 MSEK.

CStG did not share the views of the District Court and appealed the judgment. Hearings in the Patent and Market Court of Appeal took place during 2017.

The Patent and Market Court of Appeal’s judgment means that the court does not share the Competition Authority’s view that the subcontracting agreement could restrict competition. This ruling cannot be appealed, and thus the case is closed.

“We entered into this agreement with the patients’ best interests in mind, and with the conviction that the agreement was in accordance with applicable laws and regulations. Now the court has dismissed the Competition Authority’s request for fines. Naturally, we consider it positive that this issue has finally been settled,” says Sofia Palmquist, CEO of Capio S:t Göran’s Hospital.