Baxter penalised for breach of Trade Practices Act

Justice Mansfield has ordered Baxter Healthcare Pty Ltd to pay a penalty of $4.9 million for contraventions of sections 46 and 47 of the Trade Practices Act 1974.

This followed a previous decision in 2008 by the Full Federal Court declaring that Baxter had breached the misuse of market power and the exclusive dealing provisions of the Act when it entered long term contracts with State health purchasing authorities.

The contracts related to bundling the supply of sterile fluids with peritoneal dialysis products used by people with kidney failure.

The Australian Competition and Consumer Commission had sought a penalty of $27.3 million and injunctions aimed at preventing similar future conduct. No injunctions were ordered.

In August 2007 the High Court had upheld the ACCC's appeal against findings by the Full Federal Court that Baxter was protected from the operation of the Trade Practices Act 1974 by Crown immunity. On the basis of this judgment, all transactions by companies are subject to prohibitions in the Act against anti-competitive conduct.

The ACCC is reviewing the penalty judgment which was given last Thursday.