Wemf takes a closer look at countertrades

In February, it became known that the young Basel weekly TagesWoche had increased its subscription circulation by more than 100 percent to 22,639 subscriptions thanks to countertrade deals. Specifically, it delivered 11,500 copies a week to the airports in Zurich and Basel-Mulhouse and had them placed there free of charge. The airports were charged 50 percent of the subscription price, which meant they were considered paid subscriptions. The airports, in turn, charged TagesWoche for placing the newspapers in boxes - at exactly the same price. The rage among TagesWoche customers was great, because the paper had only risen to number 2 among Basel's subscription newspapers thanks to this brazen countertrade. In reality, however, it is far behind in fourth place. The public prosecutor's office in Basel is still investigating fraud, because this was never stated in the media documentation. However, the case also concerned Wemf, since TagesWoche's actions even complied with Wemf regulations. Other titles, such as Basler Zeitung, do the same, albeit to a somewhat lesser extent.

Obviously abusive

But there is to be an end to such "games" now. "It is obviously abusive when attempts are made to increase the circulation sold with countertrades, even though the countervalue is in no way appropriate," Wemf writes. For this reason, it has tightened the circulation regulations. The TagesWoche case was not the reason for this, Wemf emphasizes; the change in regulations had already been discussed beforehand. However, the Board of Directors did not adopt them until March 2014. They will come into force on July 1, 2014 and will have their first effect on the publication in October 2015.

Under the new rules, countertrades remain permitted, but Wemf now checks whether the consideration corresponds to the value of the subscriptions. To assess this, Wemf can call in experts from auditing firms at the publisher's expense. If the consideration is appropriate, these subscriptions will continue to be part of the circulation sold and will not be reported separately.

"Bulk" - the new circulation category

However, Wemf is already making one thing clear: a pure distribution service no longer counts as a real countervalue for subscriptions, and corresponding copies would thus be deleted from the paid circulation. Instead, the publisher can count them towards the free circulation, but only if it can also prove the returns. Otherwise, Wemf assigns them to the new "bulk" circulation category. Bulk circulation is, after all, part of distributed circulation. "For advertisers, it is crucial that there is no mixing of sold and free circulation," says Roland Achermann, who is responsible for circulation certification at Wemf.

Pre-publication on October 1 not applicable

The regulations now also require publishers to disclose all countertrades that affect the circulation and to submit the corresponding documents. These were already required in the past, said Achermann. But there was no way to do this. Now, however, a penalty of 50,000 francs can be imposed.

Another point: Until now, the print runs self-declared by the publishers were published on October 1 each year, followed by the verified figures on November 1. This will be the last time this year. Starting in 2015, Wemf will set a publication date in October for all audited figures. Pre-publication will be dispensed with. This is to prevent individual publishers from profiting from overly high self-declared figures during a month, says Achermann. However, he cannot say whether fibbing was regularly carried out in this way and how many titles did so in each case.

Markus Knoepfli

These are countertrades

Previously, Wemf defined countertrade as a "cashless exchange of services between a media company and third parties. Now it no longer matters whether money flows or not: subscriptions can only be attributed to the circulation sold if the value of the consideration is appropriate and invoiced for it properly and within the collection period.