Competition Commission of Pakistan (CCP) on Thursday issued show cause notices to Gulf Corporation Council (GCC) Approved Medical Centres Administrative Offices (GAMCA) and GCC Approved Medical Centres in Pakistan (GCC medical centres) for prima facie cartelisation. A CCP statement said the show cause were issued on alleged cartelisation to distribute customers on equal basis, fix the medical fee and also exploiting customers by restricting their choice and imposing unfair terms and conditions thereby, violating Section 3 and 4 of the Competition Act, 2010. The show cause notices were issued by the Director General Legal, Registrar of the Commission. GAMCAs and GCC medical centrs have been given fourteen days to show cause in writing and to avail the opportunity of being heard before CCP.
A formal complaint was filed by Pakistan Overseas Employment Promoters Association (POEPA) before CCP against GAMCA and GCC medical centres in Pakistan that GCC medical centres working under their respective GAMCA have been cartelised to allocate the customers among themselves on equal basis. The commission initiated an enquiry and appointed Senior Joint Director, Nadia Nabi and Joint Director, Noman A Farooqi as enquiry officers to conduct a detailed enquiry on the complaint. They completed their enquiry and submitted the enquiry report on January 31, 2012. The report says in last 3 years (2008-2010), medical centres only in the region of Peshawar, Karachi and Islamabad/Rawalpindi earned Rs1.8 billion excluding repeat tests whereas, medical centres in the region of Lahore and Multan earned Rs144 million in one year (2010-2011).
In terms of enquiry report, to procure visa for GCC countries except UAE, every intended immigrant is required to go through a pre departure medical test which is conducted only by GCC approved medical. Currently there are 20 GCC medical centres divided in to five regions of Islamabad/Rawalpindi, Lahore, Peshawar, Karachi and Multan along with their adjoining cities. In each region, there is one GAMCA established to oversee the working of GCC medical centres in its region. Each GAMCA is also engaged in issuing the registration numbers to the intended immigrants and referring them to GCC medical centres for tests to ensure equal distribution system amongst GCC medical centres.
The equal distribution system was introduced in 1999 when the GCC medical centres started complaining to executive board of GCC health ministers council about uncertainty in distribution of medical slips. Fear that one GCC medical centre is getting more business by paying commission to recruiting agents to refer customers to its medical centre apparently resulted into formation of GAMCA and equal distribution system in the region of each GAMCA.
The report also highlights that no disciplinary action was taken against that particular medical centre involved in mal-practices and it still continues to work. Further, the report concludes that prima facie, GCC medical centres are charging the same fee for the pre-departure medical tests which under the auspices of GAMCA is decided and fixed and also proposed to the executive board for approval. These practices of territorial division and equal distribution of customers and fixing the fee prima facie restrict the choice of customers and competition among medical centres for price and quality of services and therefore, are in contravention of Section 4(1) and 4 (2)(a),(b) and (c) of the Act.
The report says it appears that this particular case involves a captive market as the intended immigrants for GCC countries except UAE have to get their mandatory medical test conducted by only GCC medial centres. Further, their choice is restricted to a particular medical centre allocated by GAMCA. Therefore, prima facie, GCC medical centres severally and jointly, under the auspices of GAMCAs have the ability to behave to an appreciable extent independently of competitors, customers and thus, hold dominant position in the relevant market.
The report also reveals instances whereby, it appears that GCC medical centers are conducting pre departure tests of intended immigrants on their own terms and conditions including; repeat medical tests conducted to charge extra fee; customer declared unfit once has no choice, customers required to go through a repeat test are forced to come back to same medical centre; and refusal to conduct medical test on the basis of city of origin. Such practices, prima facie, amount to unfair trading conditions imposed on customers and are in contravention of Section 3(1), in particular, Section 3(3) (a) of the Act. Under the given facts and circumstances in the report, it appears that GCC medical centres and GAMCAs are subjecting a vulnerable segment of society to unfair conditions. Most of the intended immigrants to GCC countries are those people who procure visa for manual labour in these countries. In fact, these immigrants bring a significant amount of remittance from GCC countries to Pakistan which is $6 to 8 billion in a year. On the other hand, GCC medical centres are earning a huge amount through pre-departure medical tests.
