IPA Claims New ITV Network Rules Are Anti-Competitive
ITV Networks Limited (ITVNL) has been accused by the IPA of breaching the 1998 Competition Act by insisting that members sign up to accreditation rules whereby agencies have to secure bank guarantees or insurance bonds to cover the cost of proposed media spend. The industry body is particularly concerned that there has been a move to delist IPA members, when negotiations on the issue were believed to be ongoing.
Hamish Pringle, IPA director, said yesterday: “The latest actions by ITVNL to begin to delist creditworthy IPA members, while we thought we were in the middle of negotiations, lead us to believe that they have no intention of reaching an amicable solution to this issue. If ITVNL insists on acting in a way that damages our members’ interests then they risk a massive and very public debate about their anti-competitive behaviour, and possible legal action by individual agencies and the IPA.”
According to the legal advice sought by the IPA, even the discussion of standardised terms and conditions by a cartel requires notification to OFTEL, while accreditation requirements are a barrier to entry and therefore anti-competitive.
The IPA, whose media and finance groups had an initial meeting with ITVNL on 26 April, has said that the new terms are inappropriate and do not reflect commercial reality. It says that it is not up to agencies to insure media owners from loss, that the cost of providing bank guarantees is too expensive and that wide exposure in one medium would force up premiums. It points to the fact that agencies already take out “appropriate” client credit insurance. According to the legal advice sought by the IPA, even the discussion of standardised terms and conditions by a cartel requires notification to OFTEL, while accreditation requirements are a barrier to entry and therefore anti-competitive.
At the 26 April meeting, the IPA says it was led to believe that an agreement had been reached whereby no action would be taken against members until KPMG presented the findings of a report for ITVNL. This is due to occur at some point in May and the IPA was expecting to meet with ITVNL soon afterwards.
IPA: 020 7235 7020 www.ipa.co.uk ITV: 020 7843 8000 www.itv.co.uk
Recent TV Stories from NewsLine: Administrators Switch Off ITV Digital Channel 4 Reveals Ad Downturn Damage Research Shows Digital TV Uptake Is “Stalled”
Subscribers can access ten years of media news and analysis in the Archive