Social affairs ministry to investigate Linnamäes' position in pharma market

Pharmacy. Photo is illustrative.
Pharmacy. Photo is illustrative. Source: Siim Lõvi/ERR

Maris Jesse, undersecretary at the Ministry of Social Affairs, has asked the Competition Authority (Konkurentsiamet) to investigate the dealings of businessmen Margus and Aivar Linnamäe in the Estonian pharmaceutical wholesale market to assess if they have an unproportional dominant position in the market place, daily newspaper Õhtuleht writes.

"The Ministry of Social Affairs has assessed that considering the number of employees, Apteekide Koostöö Hulgimüük OÜ (belonging to the Linnamäe brothers - ed.) has acquired an unproportional share of the pharmaceutical market in comparison to other companies on the market", Jesse wrote to the Competition Authority on September 11, asking the board to assess the company's involvement with other wholesale companies in order to assess if products are bought at competitive prices, Õhtuleht reported (link in Estonian).

Jesse is asking the Competition Authority to assess if there is a risk of noncompetitiveness on the market in terms of the purchase of services between companies and if the entrepreneurs are dominating the market because of their tight connections and agreements.

47 percent of Apteekide Koostöö Hulgimüük OÜ shares are owned by Aivar Linnamäe, brother of influential businessman Margus Linnamäe, who among many things also owns pharma wholesaler Magnum Medical OÜ. The Estonian Competition Act sees abuse of dominant position on the market as a finable offense of up to €400,000.

A dominant position on the market, according to the Competition Act, is an "undertaking or several undertakings operating in the same market whose position enables it/them to operate in the market to an appreciable extent independently of competitors, suppliers and buyers. The dominant position is presumed if an undertaking accounts for at least 40 per cent of the turnover in the market or several undertakings operating in the same market account for at least 40 per cent of the turnover in the market."


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Editor: Kristjan Kallaste

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