The Australian Competition and Consumer Commission has accepted a court enforceable undertaking from ResMed Asia Pacific Pty Limited following concerns that ResMed had engaged in resale price maintenance.
ResMed sells and distributes a range of products designed to treat and manage sleep disordered breathing conditions. ResMed distributes these products through a network of resellers referred to as 'Accredited Partners'.
The ACCC is concerned that between March and June 2009 ResMed is likely to have engaged in resale price maintenance by making it known to its Accredited Partners that ResMed would not supply to them unless they agreed not to advertise ResMed products at a price less than the price specified by ResMed.
Resale price maintenance, which is prohibited under section 48 of the Trade Practices Act 1974, occurs when suppliers prevent independent retailers or distributors from advertising or selling products below a specified price.
"Resale price maintenance can take many forms," ACCC chairman Graeme Samuel said today. "Requiring independent resellers not to advertise below a specified price is one such form.
"Businesses must allow independent distributors of their products the freedom to determine the prices at which they both advertise and sell. Ultimately, it is the consumer who benefits from such freedom in the market."
"These particular products, which can range in price from around $700 to $2500, are directed at consumers with serious medical conditions. The often urgent need to treat these conditions can potentially reduce their ability to bargain for a lower price, increasing the importance of ensuring that retailers are able to offer competitive prices."
As part of the undertaking ResMed will write to all its Accredited Partners advising them of the ACCC's concerns and informing them they are free to set the minimum price at which they advertise or sell ResMed products. In addition, ResMed has undertaken to review and amend its existing trade practices law compliance program to minimise the risk of any future breaches and to ensure that ResMed employees, and other people involved in the business, are aware of their obligations under the Act, in particular the resale price maintenance provisions.