DStv Media Sales has admitted to price fixing and the fixing of trading conditions in contravention of South Africa’s Competition Act
This is according to a statement by the Competition Commission on Thursday. The admission forms part of a consent agreement between DStv and the commission.
In terms of the consent agreement DStv Media Sales will pay “an accumulative remedy” of R180 million.
It will pay an administrative penalty of R22 262 599. R8 million will be paid to the Economic Development Fund over three years. This goes toward the development of black-owned small media or advertising agencies needing start-up capital, and will help black media or advertising students needing bursaries, among others. The Media Development and Diversity Agency will manage this.
DStv Media Sales will also provide 25% in bonus airtime for every rand of airtime that qualifying small agencies buy, for three years, subject to a R50 million airtime cap.
“The matter relates to a November 2011 investigation which found that, through the Media Credit Co-Ordinators (MCC), various media companies agreed to offer similar discounts and payment terms to advertising agencies that place advertisements with MCC members,” states the commission.
“MCC accredited agencies were offered a 16.5% discount for payments made within 45 days of the statement date, while non-members were offered 15%.
“The commission found that the practices restricted competition among the competing companies as they did not independently determine an element of a price in the form of discount or trading terms. This amounts to price fixing and the fixing of trading conditions in contravention of the Competition Act.”
The commission’s filed the consent agreement with the Competition Tribunal for confirmation.
Owned by Multichoice, DStv Media Sales handles commercial airtime sales and on-air sponsorship. Airtime is sold on pay TV commercial channels and on the two terrestrial M-Net channels.