Victory for Vexall against BCX

The Competition Tribunal has ruled in favour of DisChem-backed technology company Vexall to stop Telkom subsidiary Business Connexion (BCX) from abusing its dominant position in the pharmacy software industry.

The Competition Tribunal has ruled in favour of Dis-Chembacked technology company Vexall to stop Telkom subsidiary Business Connexion (BCX) from abusing its dominant position in the pharmacy software industry.

On Wednesday, the tribunal said BCX was prohibited from selling or offering a licence for its “Unisolv” software on condition that a customer purchased value-added services from BCX.

The ruling follows submissions made by both companies last Wednesday.

Vexall had accused BCX, which holds the copyright to Unisolv — considered to be the industry-standard software for use by private retail pharmacies — of forcing its customers to purchase value-added services together with the software licence.

The Competition Act prohibits a dominant company from selling goods or services on condition that the buyer must purchase unrelated products.

About 70% of all scripts processed in SA are dispensed using Unisolv, which BCX first developed in 1993.

In the second half of 2019, Dis-Chem, a shareholder in Vexall, and a number of other pharmacies gave notice to BCX that they would no longer purchase “value-added services” from the company.

These comprise a wide range of ICT services, such as hardware and software installation, central patient profile hosting and inventory management services.

The pharmacies planned to get these services from other providers such as Vexall.

BCX countered this, saying users would not receive full software support for Unisolv if they acquired the additional services elsewhere.

The company said some of these services were integral to the functioning of Unisolv as a whole and it would not be viable to unbundle these.

However, BCX said it did not object to Vexall providing nonintegral services. Vexall, in turn, argued that it should be able to provide all value-added services to Unisolv users.

It also said that BCX’s terms forced customers not to deal with Vexall, which threatened their business.

While the Competition Commission investigates the allegations, Vexall had asked the tribunal to stop BCX from its alleged uncompetitive behaviour. Vexall said that if it could not get this relief then it would likely have to exit the market and shut down as its customers went to BCX.

This week’s ruling would remain in force for six months, the tribunal said, adding that BCX had to pay Vexall’s costs of the legal action.