MSG competition law fine reduced

The case against the MSG relates to how it prevented staff from working for competitors after leaving the firm

Guernsey's Medical Specialist Group (MSG) will have to pay a reduced fine of £96,635 for breaking the islands' competition law.

The MSG successfully appealed an initial fine of £1.5m in 2023, for its use of non-compete clauses, which banned consultants from practising privately for 18 months, two years or five years, after leaving the organisation.

The bailiff referred it back to the Guernsey Competition and Regulatory Authority (GCRA), which decided the MSG's use of five-year non-compete clauses still broke competition law and imposed the lower fine.

MSG chair Dr Steve Evans said: "After a process which has gone on for almost six years, we welcome the fact that the matter is now closed."

'Provide to the people'

The MSG stopped using five-year non-compete clauses voluntarily in 2018, before the GCRA began its investigation.

"Although we take issue with significant parts of the GCRA's decision-making process, the legal and management costs of an appeal, together with the fact that the GCRA has reduced the fine to £96,635, mean that it is not economic to expend more time and resources on an appeal," said Mr Evans.

He added: "Our motivation throughout this time has been to protect the emergency and elective healthcare services that we provide to the people of Guernsey under our contract with the States.

"We are pleased that we can now focus all our efforts on our primary purpose as doctors of improving the health of the community we serve."

'Freedom to innovate'

The GCRA said the MSG's past use of five year non-compete clauses "unfairly restricted competition and therefore violated the law".

The closure of the case comes with a ruling from the GCRA that restrictive non-compete clauses in partnership agreements can break Guernsey competition law.

"This decision aims to support fair competition, innovation, and choice for local consumers," it said.

"While non-compete clauses can be legitimate in some cases, they often harm economies by limiting job options, suppressing new ideas, and making it harder for start-ups to succeed. This also keeps wages low and slows economic growth."

"The decision ensures professionals in Guernsey have the freedom to innovate and contribute to a thriving local economy."

In a recent case, a complaint from a former MSG doctor highlighted how a non-compete clause prevented him from setting up First Contact Health, a new business offering services like physiotherapy and MRI scanning.

Following the ruling, a spokesperson from First Contact Health said: "We hope this ruling encourages greater collaboration between all healthcare professionals across both private and public sectors to create better pathways and options that ultimately lead to the best possible outcomes for the people of Guernsey."

Correction Wednesday, 22 January, 2025: An earlier version of this story stated MSG had lost its appeal. The story has been amended to make it clear the appeal was successful.