COMPETITION TRIBUNAL IMPOSES NOVEL CREDIT GUARANTEE REMEDY ON MEDIA 24

Tuesday, September 06, 2016
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On 6 September 2016, the Competition Tribunal (Tribunal) imposed a Credit Guarantee obligation on Media 24 Limited (Media 24) for having contravened section 8(c) of the Competition Act (Act) based on evidence of Media 24’s intention to exclude competition in the Welkom market for community newspapers between 2004 and 2009.

The Credit Guarantee remedy provides Media 24’s competitors, and future market entrants, with the opportunity to enjoy certain favourable credit terms from Paarl Coldset Proprietary Limited (Media 24’s associated printing company) and/or On The Dot (Media 24’s distribution business).  It  includes allowing publications in the area 90 days to pay for printing and distribution, instead of these companies having to pay upfront.  The Credit Guarantee remedy applies for a period of three years.

The Credit Guarantee obligation is a novel remedy, developed with the objective of restoring competition in the market.   The specific section of the Act which Media 24 contravened between 2004 and 2009 does not allow the Tribunal to impose a financial penalty for a first contravention.  The Tribunal explained that this did not mean that it could not impose other remedies.

For more information, please contact the Competition Practice Area at Bowmans.