The Competition Commission earlier approved the merger between Media24’s On the Dot and community newspapers and Novus Print.
The Competition Appeal Court reserved judgement in an urgent application brought by Capital Newspapers and Caxton & CTP Publishers and Printers to interdict Media24 and others from taking any steps to implement the proposed merger between Novus and On the Dot and Media24’s community newspapers and soccer publications.
Capital Newspapers and Caxton & CTP Publishers want to stop the merger between Novus Print Proprietary Limited, Free 4 All Proprietary Limited, Intrepid Printers Proprietary Limited, Victory Ticket 376 Proprietary Limited, and the Media Supply Chain Management Division operated and conducted by Media24 Proprietary Limited, referred to as “On The Dot”, the local news portfolio of Media24, and the Football Publication Division of Media24 titled Soccer Laduma and Kick Off.
In addition, Capital Newspapers and Caxton &CTP Publishers want the decision by the Competition Commission to approve the merger to be declared inconsistent with the Constitution and invalid and want it to be set aside.
Judges Dennis Davids, Lister Nuku and Thina Siwendu only heard arguments about the urgent application to stop the merger and not to suspend the approval of the merger on Thursday.
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In its application to suspend or interdict the merger, Capital Newspapers and Caxton & CTP Publishers said in its court filing that pursuant to its obligations under section 7(2) of the Constitution to promote, protect, respect, and fulfil the rights set out in the Bill of Rights, as well as the “added responsibility” imposed on it to do so having regard to the preamble and purpose of the Competition Act, the commission should consider the impact of the merger on constitutional rights.
These constitutional rights include the impact of the transaction on the right to freedom of expression and the plurality of media voices in South Africa. Capital Newspapers and Caxton & CTP Publishers believe the commission failed to do so.
In addition, Capital Newspapers and Caxton & CTP Publishers argued that:
- The commission failed to consider the consequences of the merger for other newspaper publishers and owners due to the increase in distribution costs that will arise as a result of the proposed transaction
- The commission failed to properly consider the impact of the merger on employment and the fact that the transaction will likely result in the loss of employment for up to 400 employees at Media24 and a further 100 employees at On the Dot and at least 784 employees at third parties
- The commission failed to consider the impact of the merger on the employment of journalists in South Africa, a critical source of news and information in South Africa
- The commission failed to act in a manner that protects media freedom and failed to ensure that the press is not dominated by a single press company such as Media24 or by limiting the availability of media news to online-only
- The implementation of the merger will result in irreparable harm to the media industry in South Africa and undermine the rights in section 16 of the Constitution and
- It would be just and equitable under section 172(1)(b) of the Constitution for the Court to suspend/interdict the operation of the commission’s approval of the merger, pending the finalisation of the applicants’ review of the commission’s decision.
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Advocate Jerome Wilson argued on behalf of Capital Newspapers and Caxton & CTP Publishers that the decision of Media24 to close down its print titles in the north cannot happen before the decision of the commission to approve the merger has been reviewed.
However, advocate Kate Hofmeyer, for Media 24, argued that the interdict is not about the merger but about the decision of Media24 to close its print newspapers and migrate its news division to digital.
She directed the attention of the judges to various letters from the Media24 executive to staff that show that the migration was not dependent on the merger. She also pointed out that the newspapers that will be closed were not part of the initial offer from Capital Newspapers and Caxton & CTP Publishers to buy On the Dot and the community papers and soccer publications.
Hofmeyr said that Capital Newspapers and Caxton & CTP Publishers did not demonstrate sufficient harm to the media landscape that supersedes the harm to Media24 if the merger does not go through.
