Johannesburg - Independent Media has agreed to pay an administrative penalty imposed by the Competition Commission after it found that the company, under previous ownership, had participated in price fixing and fixing of trading conditions with a number of media companies.
* IOL is part of Independent Media.
The Competition Commission said that Independent Media and Caxton & CTP Publishers and Printers have concluded consent agreements and agreed to pay fines amounting to millions of rands after they admitted to having contravened the Competition Act.
In terms of the agreement, Independent Media agreed to pay an administrative penalty amounting to R2 220 603 and contribute R799 417 to the Economic Development Fund over a three-year period.
The Economic Development Fund seeks to develop black-owned small media or advertising agencies which require assistance with start-up capital and will assist black students with bursaries to study media or advertising, among others. The fund will be managed by the Media Development and Diversity Agency (MDDA) and is audited annually.
Independent Media will also provide 25 percent bonus advertising space for every rand of advertising space bought by qualifying small agencies which are majority owned by black people. The company will obtain its own credit insurance so that these small agencies will not be required to commit any guarantees when booking advertising space.
Caxton agreed to a penalty of R5 806 890.14 and pay R2 090 480.45 to the Economic Development Fund over three years.
Caxton will also provide 25 percent in bonus advertising space for every rand of advertising space bought by qualifying small agencies. This will be for three years, capped at R15 million per annum.
The matter dates back 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.
MCC accredited agencies were offered a 16.5 percent discount, while non-members were offered 15 percent.
In 2011, Independent Media was still under the ownership of the Irish-based Independent News and Media (INM). With the acquisition of Independent Media by a Sekunjalo-led consortium in 2013, Independent Media became the largest black-owned South African media company.
In a statement, the company said Sekunjalo embarked on a clean-up of all its business practices when the company took ownership of Independent Media in 2013. This included co-operating fully with the Competition Commission's investigation.
Independent Media said it was satisfied with the outcome and was committed to working with and supporting the development of small black-owned media and advertising agencies.