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The Swedish Board of Agriculture - unhealthy competition and dual roles. The European Commission Directorate General for Competition 2012 Slide 2 Lars-Hkan Hkansson, DVM, president Agneta Johnsson, DVM Per Arvidsson, DVM Mikael Flth, DVM Slide 3 ViS Veterinarians in Sweden (Veterinrer i Sverige) ViS, Veterinrer i Sverige, (Veterinarians in Sweden) is an organisation that consists of private practitioners It was founded in 2002 It has about 250 members The purpose of the organisation is to try to create a situation of sound competition and an independent supervisory authority in Sweden Slide 4 The District Veterinary Organisation, (DVO), (Distriktsveterinrorganisationen), (Distriktsveterinrerna) The state-owned district veterinary organisation was founded in 1931 with the only purpose to fight tuberculosis and some other contagious diseases amongst animals in Sweden. In the 1980s the approximately 300 district veterinarians still worked almost exclusively with farm animals. In the 90s they started treating more and more small animals and sport horses due to the decresing numbers of farm animals. In 1995 the Swedish government decided to create a new organisation. This made the organisation to fall apart and nearly half of the district veterinarians resigned and became private practitioners. This created major disagreements beetween the state and private practitioners which still exixts and tends to increase Slide 5 Official Reports of the Swedish Government (Statens Offentliga Utredningar, SOU) 1993 SOU 1992:88 Brkenhjelmska utredningen Veterinr verksamhet 2004 SOU 2004:100 Tillsynsutredningen Tillsyn Frslag om offentlig tillsyn 2005 SOU 2005:74 Nytt djurhlsoregister bttre nytta och kad skerhet 2007 SOU 2007:24 Veterinrutredningen Veterinr fltverksamhet i nya former 2009 SOU 2008:118 Styra och stlla frslag till en effektivare frvaltning 2009 SOU 2009:08 Trygg med vad du ter - nya myndigheter fr skra livsmedel och hllbar produktion 2011 SOU 2010:106 Folkhlsa Djurhlsa. Ny ansvarsfrdelning mellan stat och nring Slide 6 Official Reports of the Swedish Government (Statens Offentliga Utredningar, SOU) 2007 Veterinrutredningen, SOU 2007:24, Veterinr fltverksamhet i nya former, (About the District Veterinary Organisation) One of the most comprehensive and expensive investigations SOU ever has put through. The report proposes that the state district veterinary organization is privatized in two stages in the southern and in the animal- dense parts of Sweden. Later the clinical veterinary activities of state management may be privatized in all of Sweden. The BoAs dual roles, with both clinical veterinary services and supervision of the overall veterinary profession in the country, has contributed to market malfunctioning. It damages the credibility of the Authority and leads to an inefficient market surveillance and enforcement. Slide 7 Official Reports of the Swedish Government (Statens Offentliga Utredningar, SOU) 2009 Trygg med vad du ter - nya myndigheter fr skra livsmedel och hllbar produktion, SOU 2009:08, (About the Authorities in the rural sector) Also one of the most comprehensive investigations SOU ever has put through. Slide 8 The BoA should be closed and a new authority should be established solely engaged in regulatory activities because it is undesirable that the authority that has to control the Agricultural sector in Sweden at the same time has the role to support this. Slide 9 The reports analysis of the present authorities show that there is a need for reform to justify a more radical government reform. It recreates a clear national responsibilities by adapting to the new responsibilities at European level and the EU Commission's organization of the DGs and an application of the principle of a central legislation, a central authority. This will facilitate the national implementation of the EU common regulatory framework and the basis for a more effective Swedish EU work. Slide 10 It represents a refinement of the State's commitment to meet societal needs while minimizing government intrusion on the operation of private markets based on the principle that authorities should only engage in competitive activity if special circumstances exist Slide 11 The proposed new agency structure clearly defines the roles in the veterinary field. Today the BoA is responsible the both for management in veterinary matters and for the State veterinary organization. This means that the authority now is Sweden's largest single employer of clinically active veterinarians and also responsible for supervision of of all vets, both the authority's own employees and competing veterinarians. This scheme is fundamentally inappropriate and could undermine confidence for the veterinary management tasks Slide 12 The BoAs dual roles, with both clinical veterinary services and supervision of the overall veterinary profession in the country, has contributed to market malfunctioning. It damages the credibility of the Authority and leads to inefficient market surveillance and enforcement Slide 13 Other reports 2000 the Swedish Authority for Administrative Development, (Statskontoret) Authorities engaging in commercial activities 2002 The Parliamentary Auditors (2002/03: 4). The study "The terms of the veterinary services 2006 Swedish Trade and Industri, (Svenskt Nringsliv): Unhealthy competition knocks out private enterprise. Slide 14 Swedish Competition Authority Konkurrensverket 2011-06-14 The market for animal health care is characterized by competition problems and conflicts between DVO and private veterinarians. The market lacks of important conditions for efficient competition and efficient use of resources for the benefit of the community, the owners or consumers. This can particularly be unfair to smaller businesses in the animal health care market. The Competition Authority consider it unsuitable to combine the business and customer relationship with that of exercising of authority where the customers are the regulated persons. Slide 15 Furthermore, the Competition Authority regards that the Board of Agriculture has dual roles, ie. both a producer- and regulatory role, including its role of exercising of authority. It is important to distinguish between exercising of authority, as the Board of Authority regards should be operated under public management, and other tasks, which in some cases could justify a spin-off. The Competition Authority has previously proposed various measures to address these problems. Slide 16 These reports and this final statement from the highest authority regarding competition in Sweden, the Swedish Competition Authority, has not affected the Department of Rural Affairs or the Board of agriculture in any way. Slide 17 Veterinrer i Sverige, ViS, request that the European Commission enjoins Sweden to remove the competitive distortion in the veterinary sector. Slide 18 Ministry for Rural Affairs Swedish Board of Agriculture District Veterinarians, Headquarters 80 District veterinary stations, 400 veterinary surgeons Ministry for Rural Affairs Swedish Board of Agriculture The world's largest veterinary company? No counterpart in EU. Slide 19 Swedish Board of Agriculture 80 District veterinary stations, 400 veterinary surgeons Ministry of Finance 110 MSEK every year Cheap loans for investments in equipment, ( ca 2 % lower than for private practitioners) 110 MSEK every year, (12,5 MEUR) Slide 20 The District veterinarian More than 80 % of their work concerns small animal and sport horses. They work exactly in the same way private practitioners do except that they can act as official veterinarians. (Which gives them a great advantage in terms of competition.) Slide 21 The most aggressive marketing of all veterinary companies in Sweden Translation: HORSE AND SMALL ANIMALS Specialist in diseases of dogs and cats. MEDICINE SURGERY X-RAY Food for small animals Swedish Board of Agriculture The District Veterinary Organisation Slide 22 Small animals Translation: The District Veterinary Station in Laholm Clinic for small animals We welcome all dog and cat owners to our fine new premises. Swedish Board of Agriculture The District Veterinary Organisation Slide 23 Sporthorses Slide 24 Slide 25 10 vets, 5 assistants. Specialists in dentistry for horses. Open 24/7 for small and large animals. Clinic head: My dream is to get an indoor lunging path for the horses Slide 26 Slide 27 Selling fodder to small animals Slide 28 Slide 29 Article from RAID 2012 Slide 30 The Director-General of the Bord of Agriculture inaugurates a district veterinary clinic Slide 31 The Minister for Rural Affairs inaugurates an District veterinary station Slide 32 We also request that the European Commission enjoins Sweden to create an independent supervisory authority, consisting of civil servants who are not in a financially position of dependence to the subject under their supervision. The latter request implies that veterinarians that perform supervisory work will not be permitted to run a veterinary practice. This also includes a request that the European Commission enjoins Sweden to create an independent supervisory authority for veterinarians. Slide 33 Ministry for Rural Affairs Swedish Board of Agriculture District Veterinarians, Headquarters Department for Animal Welfare and Health Swedens animal-owners Supervisory activities Commercial activities 80 District veterinary stations, 400 veterinary surgeons Also official veterinarians, same persons Ministry for Rural Affairs Swedish Board of Agriculture Department for Animal Welfare and Health Supervisory activities Slide 34 Swedish Board of Agriculture Swedens animal-owners 80 District veterinary stations, 400 veterinary surgeons 50 % of the fees from commersial actvities Slide 35 Slide 36 Ansvarsnmnden Slide 37 We also request that the European Commission investigates whether the subsidising of a major veterinary organisation, whose primary purpose is to provide cheap veterinary care to the country's livestock producers, should be regarded as an illegal governmental subsidy. Slide 38 We also request that the European Commission investigates whether the Board of Agriculture, in order to sharpen its competitive edge, is in breach of EU's working hours legislation by avoiding reporting actual worked hours and instead call unreported time as "duty working hours", (frtroendearbetstid). Slide 39 We request that the European Commission investigates the consequences, both from the perspective of employees and employers of the introduction of new regulations for veterinary nurses.