The Santa Casa da Misericordia de Lisboa (SCML) defended this Thursday that it had not breached any obligation to notify the AdC of the acquisition of the management company of the Portuguese Red Cross Hospital and will appeal to the Court of Competition, Regulation and Supervision.
“SCML did not violate any obligation to notify the Competition Authority (AdC) of the acquisition of the management company of the Hospital da Cruz Vermelha Portuguesa,” said an official SCML source in a statement sent to Lusa.
At stake is the decision announced this Wednesday by the AdC to fine SCML 2.5 million euros for having carried out a concentration operation, the acquisition of CVP -Sociedad de Gestión Hospitalaria-, without notifying the entity.
SCML refutes the idea, arguing that “the decision of the AdC is based on the erroneous and unusual interpretation that the income attributed by the State to the Santa Casa, as well as to many other entities, for the achievement of public purposes (“good causes”), are “invoicing” of the Holy House”.
According to this logic of the AdC, any assistance matrix institution, IPSS or non-governmental organization that receives contributions from the State to promote social works, would have to include those same amounts in its ‘invoicing’”, he adds.
Santa Casa also argues that in its decision “the AdC also ignored that it is State income generated by an activity carried out on behalf of that State and that it implies the exercise of powers of public authority.”
In this way, it indicates that “to defend its rights, Santa Casa has no other option than to appeal to the Court of Competition, Regulation and Supervision, convinced that justice will be done and that this decision will be annulled.”
“We are faced with a decision not supported by any judicial or administrative precedent and aggravated by the disproportionate amount of the finemuch higher than what the AdC has applied in similar situations”, he says.
According to the AdC, “the concentration operation in question consisted of the acquisition of exclusive control of CVP — Sociedade de Gestão Hospitalar, SA (SG CVP), the management company of the Hospital da Cruz Vermelha Portuguesa”, and “the operation was carried out on December 14, 2020 and recently notified to the AdC, after its completion, on May 28, 2021”.
The regulator pointed out that “these operations must be notified to the AdC no later than after the conclusion of the agreement between the companies, but even before they are carried out.”
The AdC further explained that “carrying out a concentration operation without prior notification to the AdC is a serious practice, punishable by a fine of up to 10% of the invoicing made by the offending company, in the year immediately prior to the final conviction.” dictated by the AdC”.
According to the regulator, “the Competition Law establishes the obligation to notify the AdC in advance of mergers that meet certain criteria relating to market share and/or turnover of the companies involved in the operation and imposes the obligation to suspend its execution until the final decision of no opposition is obtained”.
The entity also said that, “if companies have doubts about whether an operation they are designing meets the requirements that imply a notification, they can go to the prior evaluation of the AdC before the concentration is carried out, a confidential procedure without associated costs”. ”.
According to the same note, “the lack of notification of a concentration operation limits the power of intervention of the AdC in order to guarantee that barriers to competition in the market are not created or reinforced, with potentially harmful effects and, sometimes, adverse. eliminate”, reiterating that “the prior notification obligation is a fundamental pillar of the entire merger control system and its infringement is considered serious”.
The Contest noted that “SCML demonstrated adequate collaboration with AdCeither during the analysis phase of the notified concentration operation or, still, during the administrative infringement process”.
When setting the specific amount of the fine, the AdC “took into account this collaboration and the fact that the operation was, although a posteriori, voluntarily notified, as well as the fact that the company had suspended the exercise of voting rights derivatives of the operation and having submitted with the notification an exception request, in accordance with article 40 of the Competition Law”.
Source: Observadora
