Ticketing provider Computicket on Monday said it would appeal a decision by the Competition Tribunal that it used dominance between 2005 and 2010 relating to exclusive agreements with inventory providers for live entertainment events.
The Competition Tribunal earlier announced that it had ordered Computicket to pay an administrative penalty of R20-million.
The tribunal found Computicket abused its dominance between 2005 and 2010, by using long-term exclusive agreements to exclude new entrants from the outsourced ticket distribution market.
The Competition Commission’s investigation found evidence that Computicket required or induced its customers to not deal with competitors. A rival, known as Strictly Tickets, in February 2008 first lodged a complaint with the commission. This was followed by complaints by other competitors up to September 2009.
The matter was referred to the tribunal for prosecution in April 2010. The hearing of the matter only started in October 2017, owing to a lengthy and litigious history between the parties over the discovery of documents, followed by an unsuccessful administrative law challenge to the commissioner’s decision to refer the complaint.
TRIBUNAL FINDING
The tribunal said Computicket’s exclusivity contracts increased dramatically – in terms of quantity and duration – following its takeover by Shoprite in 2005.
Additionally, the commission found that, from December 2006 to September 2009, Computicket’s personnel aggressively enforced the exclusive agreements among its clients including theatres, music promoters and event organisers, particularly when new entrants emerged in the market.
Computicket denied that its contracts had an exclusionary effect. Instead, it argued that customers preferred to use its services and that exclusive contracts were also a means to mitigate against reputational risk.
Further, according to the tribunal, Computicket argued that there were a number of players that entered the market in the relevant period and which competed with Computicket for inventory.
In the tribunal’s judgment, which was published on Monday, it noted that Computicket enjoyed a near monopoly position at the time and that it introduced the three-year version of the exclusive contracts in 2005.
“No other theory for why entry [of competitors] was so limited and ineffectual has been offered to rebut this conclusion.”
Computicket noted in a statement that it had 15 business days to file a notice of appeal against the tribunal’s decision.