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Predatory Pricing in South Africa: Lessons from the Media24 Case

The Constitutional Court has confirmed the complexity of proving predatory pricing under South African competition law in the landmark case Competition Commission v Media 24 (Pty) Ltd.

What is Predatory Pricing?

Predatory pricing occurs when a dominant firm deliberately sets prices so low that competitors cannot survive, forcing them out of the market. The aim is to eliminate rivals, then raise prices again once competition has been weakened.

Under the Competition Act 89 of 1998, Section 8 prohibits dominant firms from:

  • Selling below marginal or average variable cost (Section 8(d)(iv)); or

  • Engaging in exclusionary acts that reduce competition without sufficient pro-competitive justification (Section 8(c)).

The Media24 Case

Between 2004 and 2009, Media24 was accused of using one of its community newspapers, Forum, as a “fighting brand” by charging advertisers below sustainable rates to drive competitor Gold Net News out of the Welkom market.

  • The Competition Tribunal initially found Media24 guilty under Section 8(c).

  • The Competition Appeal Court overturned this, ruling that intention was irrelevant, and that average total cost was not the right benchmark for predatory pricing.

  • The Constitutional Court granted leave to appeal but dismissed the case, holding that the Commission had not proven predatory pricing. It confirmed that:

    • Proving intent is not enough.

    • Appropriate cost benchmarks (such as average avoidable cost) must be shown.

    • Lower pricing strategies can be competitive rather than unlawful if not clearly exclusionary.

Why It Matters

This case illustrates how difficult it is to prove predatory pricing in South Africa. While low pricing can harm competitors, regulators must show that it crosses the line from tough competition to unlawful exclusion.

How KKA Attorneys Can Help

At KKA Attorneys, we assist businesses in:

  • Understanding competition law obligations.

  • Structuring lawful pricing strategies.

  • Responding to Competition Commission investigations.

💻 Book your free online consultation today to protect your business from competition law risks.



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