South Africa’s competition regulator has ruled a 2013 distribution deal between pay-TV operator Multichoice and public broadcaster SABC should have been registered as a merger under the country’s Competition Act.
Under the agreement Multichoice had agreed to pay SABC R500 million in return for the broadcaster agreeing not to encrypt any of its channels as a result of its move to digital terrestrial television.
In addition, the decision is said to have led to SABC dropping proposals for control of the country’s set-top box inventory.
The two now face possible sanctions if they do not notify the authority’s retrospectively.
The new ruling is contrary to a decision made in 2016 by South Africa’s Competition Tribunal
“The SABC Board is reviewing the Commission’s recommendations in relation to the encryption part of the 2013 agreement and will respond appropriately in due course,” the public broadcaster said in a statement.
Multichoice argues the 2013 agreement did not amount to a merger and has indicated it will challenge the decision.