Danish Competition Council: Falck abused its dominant position

By assistant attorney Emil Petri

Background

On 25 August 2014, BIOS won a tender to carry out part of the ambulance services in the Region of Southern Denmark for 10 years. Falck had been running the ambulance services in that region until then. From receipt of notice of the contract award, BIOS had one year to prepare for the job, which they were to take over from Falck on 1 September 2015.

On 27 May 2015, BIOS complained to the Danish Competition and Consumer Authority about Falck's conduct after Falck's loss of the contract. BIOS was convinced that Falck was trying to prevent BIOS from taking over the ambulance services in the Region of Southern Denmark. Following BIOS's complaint, the Authority conducted a dawn raid at Falck in December 2015.

BIOS took over the ambulance services on 1 September 2015 as planned, but was declared bankrupt on 27 July 2016. The Region of Southern Denmark then decided, via their newly established ambulance company Ambulance Syd, to take back the operation of the ambulance services in the areas awarded to BIOS in the 2014 tender.

The Danish Competition Council's decision

According to the Danish Competition Council, Falck built, after its loss of the contract, an overall strategy for excluding BIOS from the Danish ambulance services market. The purpose of the strategy was – according to the Council – particularly to prevent BIOS from recruiting ambulance paramedics in the Region of Southern Denmark by creating uncertainty and concern about BIOS as a supplier and employer. The Competition Council concluded that the strategy had been implemented in the form of various activities, including negative stories distributed about BIOS, social media campaigns, and targeted influence on ambulance paramedics in the Region of Southern Denmark.

In its assessment, the Council emphasized the special characteristics of the market, including the facts that ambulance paramedics are a necessary and essential input for ambulance service providers and that ambulance paramedics are a limited resource. In addition, the Council concluded that Falck's activities did not represent competition on the merits and were likely to harm competition. Against that background, the Council found that Falck had been abusing its dominant position in the Danish ambulance services market in the period from 25 August 2014 to October 2015.

Falck has decided not to appeal the decision to the Danish Competition Appeals Tribunal.

Read the Danish Competition and Consumer Authority's press release.