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IBF-AAAI to act against defaulting clients; Sets deadline

21-March-2002
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IBF-AAAI to act against defaulting clients; Sets deadline

Observing that agencies are defaulting in their dues to broadcasters, primarily because of their clients defaulting on payments, IBF-AAAI have set March 28th as deadline for advertisers to clear their dues. Else they are likely to face ‘embargo on their advertising activity across all TV channels.’

Agencies have been arguing that non-payment of dues to TV channels is primarily because clients delay payments of bills raised for Television media. “Many agencies have reported that they are unable to pay TV channels on time because of advertisers defaulting on payments to them. About 20-30% of dues to TV channels are held up because of this,” says Srinivasan Swamy, Chairman, IBF-AAAI Joint Working Committee.

Indian Broadcasting Foundation (IBF) and Advertising Agencies Association of India (AAAI) had signed an agreement on February last year, that sets out the basis of professional and commercial relationship between their respective member groups. Regulating the delayed payment to broadcaster was top most items on the agenda. Both bodies have been discussing and implementing measures to meet this objective.

In the recent meeting of Joint Working Committee, ‘Client Disputes’ was another important issue. Agencies argue that the amount due towards the broadcasters is lower due to disputes with the clients over campaigns. “The dispute amounts must be reconciled within a definite time frame. Agencies have not even reported such huge amounts as disputes in their bilateral discussions with us,” says Raj Nayak, Executive VP, Star TV and Member of Joint Working Committee expressing his concerns.

The Joint Committee has advised both agencies and broadcasters to resolve their disputes by March 28th and send a feedback to the committee.

© exchange4media 2002

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