SIYABULELA MAKUNGA | Ploughing back core value of Competition Commission

Funds make a difference in media, agriculture

Last week I shared more information about the Competition Commission of SA’s support of the Tshwane community, and why giving back is part of our organisation’s ethos. These values are an invisible string throughout our merger assessments and investigations.

Ensuring mergers, transactions, and the conduct of businesses create opportunities for small businesses to enter the market. The creation of bursaries and training for surrounding communities are but three of many examples of conditions the commission has imposed during merger assessments or advocated for during investigations. I want to share stories of the impact this ethos has had in the agriculture and media fields.  

 A question the commission often receives is where the penalties or fines that are part of settlement agreements concluded through enforcements and our advocacy work go.

These funds are usually returned to the National Treasury, or, at times, the commission recommends a portion go towards what we refer to as a development fund. These development funds are geared towards increasing enterprise development and the market competitiveness of small to medium-size enterprises and firms owned by historically disadvantaged persons .

These funds are administered and managed by carefully selected independent trustees or fund managers.

One of these is the Economic Development Fund (EDF) which is managed and administered by the Media Development and Diversity Agency.  

Back in 2011 the commission initiated and investigated a complaint against 24 media companies accused of anti-competitive conduct and restrictive advertising practices.

Between 2017 and 2022, the commission concluded settlement agreements with 15 of these companies who, as part of the agreement, committed to contributing a set amount of their advertising turnover to the EDF over three years.

Totaling just over R39m, the EDF has gone on to provide support for black individuals to pursue undergraduate degrees in media or advertising disciplines as well as for black professionals requiring post-qualification support in the advertising and media sectors. Since 2021, 30 students have graduated with either an undergraduate degree or postgraduate qualifications through the support from the EDF and partner universities.

After completion of their studies, one of the beneficiaries joined the World Food Programme’s graduate programme to kickstart their career.   

In addition, the EDF offers direct funding to qualifying media and advertising agencies in need of start-up capital. Support from the EDF includes funding for operational costs. In July 2022, a total of 19 awards were granted to eligible companies including a fully black-owned advertising and North West multimedia company, Da Virtue.

The company specialises in corporate branding, print media, broadcast media and marketing. The EDF award has greatly assisted Da Virtue in acquiring quality equipment which has given it a competitive advantage and allows it to get business from local Rustenburg businesses as well as garner support from the local community, specifically the township.

Empuma Community News, a monthly newspaper delivered to the towns and villages in Qonce in the Eastern Cape has – through the support from an EDF award – managed to employ eight community members. The newspaper is also now in a position to offer practical experience to third-year journalism students from Rhodes and Walter Sisulu universities.  

In the agricultural sector, our team recently met with farmers in the Eastern Cape, Mpumalanga, Gauteng and KwaZulu-Natal who were the beneficiaries of four of these economic development funds in the agriculture sector to learn more about how the support and impact of these funds have been on their businesses.

The funds are Pepsico’s Kgodiso Development Fund, SA Breweries’ Public Investment Fund, Coca-Cola’s Mintirho Development Fund, and Mondi’s Zimele Development Fund.

Established between 2015 and 2020, these funds have to date dispersed R1.3bn to 1,009 beneficiaries. Our team’s study found that these four funds have created 7,797 jobs that the farmers said were likely to be sustainable. Mbonambi Agric Enterprise, a small farm that produces and supplies vegetables to supermarkets, small businesses and school feeding schemes, received support from the fund that enabled the owner to fence her garden, purchase Jojo tanks and nets to protect the produce from animals.

Most importantly, the fund gave the owner, 27-year-old Minenhle Mbuyazi, access to the market as it negotiated with Food Lovers’ Market in Richards Bay to supply the store with spinach. 

These stories illustrate the impact of our work in making a difference in the lives of entrepreneurs, farmers, and the next generation of media practitioners. As a core value of the commission, we remain committed to giving back to this country through all areas of our work.   

Makunga is spokesperson for the Competition Commission of South Africa