South Africa’s MultiChoice Group has encountered a legal setback in a protracted dispute over a 2013 channel distribution agreement with the South African Broadcasting Corporation (SABC) after the Competition Tribunal dismissed its attempt to halt an investigation into the arrangement.
The tribunal rejected MultiChoice’s “exception application,” which contended that its commercial agreement with SABC was not a merger and did not require regulatory approval. This decision paves the way for a full hearing to ascertain whether the deal granted MultiChoice undue influence over the public broadcaster.
At the heart of the case is a contract permitting MultiChoice to broadcast SABC’s free-to-air channels on its DStv platform for a fee. Controversially, the contract included a clause allowing MultiChoice to terminate their agreement and request a refund if the SABC encrypted its broadcast—an issue of contention, especially as rival E.TV supported the encryption of set-top boxes distributed by the government.
Opponents, including the media outlet Caxton and public broadcasting advocacy groups, objected to the deal’s classification as a notifiable merger under the Competition Act. If accurate, this would have necessitated formal notice and regulatory scrutiny, as MultiChoice would have had a say in SABC’s strategic direction.
Although the case was initially dismissed in 2016, subsequent rulings from South Africa’s Competition Appeal Court and the Constitutional Court revived the investigation. The Competition Commission later concluded that the deal could have influenced SABC’s policy decisions, recommending a full hearing.
In its recent ruling, the tribunal underscored that complex factual and legal questions remain, and these should be examined through oral evidence rather than being dismissed on procedural grounds.
MultiChoice described the decision as “procedural,” asserting that the 2013 agreement was a standard commercial arrangement, not a merger.
The outcome of the forthcoming hearing could reshape how regulators approach similar agreements involving public broadcasters, particularly in emerging markets where media and policy interests frequently intersect.
