The Competition Commission has ruled that the channel distribution agreement between Multichoice and SABC, signed in 2013, constitutes a notifiable merger. The five-year agreement deal allows MultiChoice the right to broadcast SABC’s 24-hour news channel and an entertainment channel, SABC Encore. This means the public broadcaster and Africa’s largest pay TV operator are in violation of competition laws by not registering the transaction as a merger.
On the other hand, Parliament received information last year that appeared to confirm that as part of the deal, SABC undertook to back MultiChoice’s position on the encryption of set-top boxes. The finding by the commission has taken both MultiChoice and the SABC by surprise as it contradicted two previous rulings by the Competition Tribunal and the Competition Appeals Court that the agreement was not a merger. MultiChoice has indicated it would appeal the finding.
The investigation led by the competition authorities was a legal challenge launched by Caxton Publishing, civil society organisation Save our SABC (SOS), and Media Monitoring Africa, in 2015.