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The reaction of TV stations after the Competition Council fined Casa Media 1.8 million lei

14 September 2020
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The administrations of at least three of the four television stations that complained to the Competition Council (CC) about an alleged cartel agreement between two advertising sales houses are dissatisfied with the authority’s decision to fine only one player on the market 1.8 million lei. They describe it as “insufficient” and “politically motivated” because the second company in question got off scot-free.

The investigation, which lasted over two years, started after the stations RTR Moldova, Jurnal TV, Pro TV Chisinau, and TV8 filed a notification, invoking unfair competition on the advertising market. The complainants claimed that there was an alleged cartel agreement between the companies Casa Media Corp (whose sole shareholder is Dorin Pavelescu, an intermediary in the entourage of former Democrat leader Vlad Plahotniuc, according to mold-street.com) and Exclusiv Sales House (founded by the company Exclusiv Media, which belongs to the Party of Socialists’ MP Corneliu Furculita). The two companies had allegedly concluded an agreement, proposing very big discounts to advertising providers.

“THE PENALTY IS DISPROPORTIONATELY SMALL”

Asked by Media Azi to comment on the CC’s decision, the general director of Jurnal TV, Adrian Buraga, said that the findings in the decision “are no longer relevant to the current situation, which is not the subject of study.”

“Moreover, the activity of the second sales house, part of this scheme, was left without any appreciation. At the same time, the penalty is disproportionately small in relation to the actual amounts collected through the scheme revealed in our complaint,” Buraga commented.

PRO TV Chisinau representatives are also disappointed by the solution adopted by the competition authority. “The decision came much too late after the entire TV advertising market was severely affected, for three years, by the cartel agreement between the two sales houses. It finds an abusive position of Casa Media, but does not penalize the agreement with Exclusiv, through which the two sales houses illegally shared the advertising market. We consider it incomplete and insufficient,” they commented.

TV8’s representative Mariana Rata also regrets that the authority “overlooked” the second advertising sales house, Exclusiv Sales, denounced by the four TV stations.

The journalist believes that the Council’s decision was approved under the influence of politics. “The way in which the Competition Council carried out the investigation shows that this institution remains politically controlled. The decision related to Casa Media came after the power in the state changed and there was no longer danger for them from the Democratic Party. Instead, the coming to power of the Party of Socialists determined the omission of the second component of the cartel,” considers the director of TV8 news Mariana Rata.

The representatives of RTR Moldova did not respond to Media Azi’s requests to comment on the decision.

CC: DOMINANT POSITION – YES, CARTEL – NO

The Competition Council announced that it fined Casa Media 1.8 million lei because it had admitted actions that disadvantaged several television stations and advertising providers. The CC found that the company was the only one that held, between 2017 and the first half of 2019, a dominant position on the market and had a different approach towards advertising providers regarding discounts and surcharges on the purchase of advertising space. As regards the investigation into the alleged cartel agreement, the CC stated that it had not identified sufficient evidence to demonstrate there was an agreement to share the advertising market.

Moreover, both sales houses denied the existence of such negotiations.

After the decision was issued, Casa Media announced that it did not agree with the conclusions of the CC and challenged the decision in court, in the administrative litigation procedure. Casa Media representatives consider that the authority was manipulated “by political pressure and media attacks,” “mainly through fake news mechanism.” “This investigation began under pressure, with a clear purpose that developed over time, as evidenced by the fact that the result of the investigation itself is not of interest to anyone, not even to the complainants,” was the official reaction of the company.

Earlier, the CC Chairman Marcel Raducanu told Media Azi that it was a “difficult case, never before seen in the Republic of Moldova.” “The investigation will continue until we get a nice case, not one at someone’s command, of which we are accused,” Raducanu argued in July 2019.