Registered users can save articles to their personal articles list. Login here or sign up here

Media24 fined for price fixing

Pays a R14 million administrative penalty, along with others.

Media24 has agreed to pay R14 million as a settlement agreement with the Competition Commission after admitting to price fixing and fixing of trade conditions in the media industry.

The tribunal began its investigation in late November 2011, and found that Media24, alongside 27 other media companies contravened the Competition Act by offering discounts or payment terms to advertising agencies which advertise with Media Credit Co-ordinators (MCC) members.

The tribunal found that MCC accredited agencies were offered a 16.5% discount, while non-members were offered 15% discount.

According to a statement released by the CompCom on Friday, Media24 agreed to pay an administrative penalty of R13.8 million and will contribute R4.9 million to the Economic Development Fund, (a fund which seeks to develop small black-owned media businesses and media graduates), over three years.

Media24 also agreed to provide a 25% bonus advertising space for every rand of advertising space, purchased by small agencies which qualify. This will be over three years and is capped at R35 million annually.

The other companies charged with and admitted to price fixing and fixing of trading conditions (so far) includes Provantage Media, which will pay a R1 million settlement agreement.

Meanwhile, Caxton and CTP Publishers and Printers, Independent Media and DStv Media Sales have all agreed to pay administrative penalties of R5.8 million, R2.2 million and R22.2 million, respectively.

The tribunal found that companies charged for fixing prices and trading conditions in the industry have contravened the Competition Act by restricting competition between the competing companies by not independently determining the discounts but fixed prices instead.

“It is a problem because it consolidates operations of a few media houses that gang up against mainly small advertising agencies. It is encouraging that some media houses have settled the matter and will also be directly contributing towards promoting the entry of small and black advertising agencies,” noted CompCom commissioner Tembinkosi Bonakele in a statement. 

Get access to Moneyweb's financial intelligence and support quality journalism for only
R63/month or R630/year.
Sign up here, cancel at any time.

AUTHOR PROFILE

COMMENTS   0

To comment, you must be registered and logged in.

LOGIN HERE

Don't have an account?
Sign up for FREE

LATEST CURRENCIES  

USD / ZAR
GBP / ZAR
EUR / ZAR
Insider GOLD
ONLY R63pm

Moneyweb's premium subscription is a membership service which will give you access to a number of tools to take charge of your investments.
Or choose a yearly subscription at R630pa - SAVE R126

Get instant access to all our tools and content. Monthly subscription can be suspended at any time.

Podcasts

GO TO SHOP CART

Follow us:

Search Articles:Advanced Search
Click a Company:
server: 172.17.0.2