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Chancellor of Justice challenged restrictions on the establishment of pharmacies in the Supreme Court

The Chancellor of Justice Mr. Indrek Teder turned to the Supreme Court with an application to declare the restrictions on the establishment of pharmacies enacted in the Medicinal Products Act [1] unconstitutional.

On the proposal of the Minister of Social Affairs the Riigikogu (parliament) discussed possibilities to declare the abovementioned provisions invalid already in 2010, but eventually the Social Affairs Committee of the Riigikogu decided not to revoke the restrictions. Then, in 2012 the Chancellor of Justice submitted himself a proposal to the Riigikogu to repeal the restrictions on the establishment of pharmacies enacted in the Medicinal Products Act. “Although the Riigikogu supported my proposal last year, they have not initiated a draft law to invalidate the restrictions that are distorting competition and failing to ensure its public health objectives,” said the Chancellor of Justice. “Therefore, I have no other option than turn to the Supreme Court and apply for a declaration of invalidity of the restrictions.”

The Chancellor of Justice said that the application to the Supreme Court is based on the fact that the pharmacy restrictions do not work as intended to. Furthermore, he is sure that the restrictions rather counteract against their initial objectives, in particular, damaging the interests of consumers and impeding the promotion of public health. “Mistakenly, the restrictions have been considered as low-cost tool for the state that should ensure the preservation of rural pharmacies. In practice, the restrictions have not ensured equality of distribution of pharmacy services across the state and availability of medicines has not improved,” he explained. “The restrictions on the establishment of pharmacies do not affect only freedom of establishment, but are also ensuring economic power of the wholesalers of medicines who are controlling the biggest chains of pharmacies. This kind of advantage is contrary to the principle of fair competition that should regardless of economic sector ensure the supply and demand balance, and thus the best availability and price for final consumers.” 

“Assessing the legality of the restrictions, it is necessary to take into account the protection of the freedom of enterprise and potential competitors, but also the wider competition and consumers, whom free competition will ensure availability of the goods and services, better quality and lower price,” Mr. Teder added.



 


[1] Available in English at http://www.legaltext.ee/text/en/X90009K4.htm.