Memorandum submitted by Associated Newspapers
1. Associated Newspapers Limited ("Associated")
is part of the DMGT Plc group. It is a leading UK newspaper publisher,
whose titles include the Daily Mail, The Mail on Sunday,
the Evening Standard and Metro. It also has significant
Internet interests including ukplus.co.uk, thisislondon.co.uk
2. This submission addresses the elements
of the proposed legislation relating to newspaper ownership. DGMT
is making a separate submission concerning radio ownership, cross-media
ownership, Teletext and the nominated news provider for Channels
3 and 4.
3. Overall, Associated welcomes the Government's
intention to introduce a lighter-touch to the regulation of UK
media. Its success will depend on the practical details of the
legislation. We have therefore considered the provisions set out
in the Draft Bill in that light.
4. Associated agrees with several of the
specific changes to existing law, but is concerned that the draft
provisions on newspaper mergers are in some respects more complex
than the existing regime. There is particular concern that the
new Exceptional Public Interest test (EPI) introduces new elements
of subjectivity, uncertainty and regulatory overlap into the procedures.
5. Associated endorses the proposals to:
remove the requirement for the Secretary
of State's prior consent to newspaper transfers;
place newspapers proprietors and
non-proprietors on an equal footing;
remove criminal sanctions against
purporting to transfer a title without consent, or breaching a
condition of consent; and
introduce de minimis provisions
which will entirely remove the smallest newspapers from regulation.
6. It is regrettable that the full details
of the new provisions are not available for discussion in this
consultation process. The outline provisions which are published,
however, offer a process for newspaper mergers which disappoints
by failing to follow through the legislation's broad objective
of producing a "streamlined and less burdensome regime".
We do not think that the cause of de-regulation is well served
by procedures which are more complex than the current regime in
fail properly to define the exact
limits and roles of each party;
fail to describe or define the central
concept of plurality;
involve potentially more stages;
at present prescribe no time limits
for each stage;
introduce new elements of uncertainty
and subjectivity with regard to the powers of the Secretary of
7. The competition test required by the
Enterprise Bill seems relatively straightforward in its intent
and application. The issue of plurality concerns and the related
desire for procedures to "protect the additional public interest
involved" give rise to a series of proposals (paragraphs
9.7.4 to 9.7.7 in the Policy Document) which are both opaque and
confusing. In particular:
7.1 The roles of the Secretary of State
, OFT, OFCOM and the Competition Commission in raising, advising
and deciding on EPI cases are far from clearly defined.
7.2 The powers of the Secretary of State
in paragraph 9.7.7 are too wide-ranging, and open to an unacceptable
degree of subjectivity. Although she will not be able to dispute
the findings of the OFT and the Competition Commission on competition-related
public interest issues, she may override them by virtue of having
the "final decision" on EPI issues "where plurality
issues justify this course of action". She will apply an
overall public interest test "that will take account of both
plurality and competition."
7.3 The concept of "plurality of views
in the Press" on which these powers in part reside is nowhere
described or defined in the proposals. The application of the
Secretary of State's "final decision" could therefore
be entirely arbitrary and political in character. At lower levels,
it is impossible to see how the OFT could properly identify a
plurality issue (9.7.5), how the Competition Commission could
examine EPI issues based on plurality concerns (9.7.6), or how
OFCOM could advise on EPI (9.7.7), without an open, consistent
and commonly understood definition of plurality.
7.4 Even with a clear definition of plurality
as the basis of a public interest test, the proposals lack clarity
as to the exact point at which EPI considerations would be introduced.
Would this be at both referral and scrutiny stages? At what stage
and with whom might the Secretary of State raise EPI concerns?
7.5 There is no promise of transparency
in regulatory judgments and advice in these issues, nor any indication
of the overall timetables that might operate.
7.6 We are not persuaded that OFCOM (whose
staff will be largely drawn from the existing regulatory cultures
of the ITC and OFTEL) has any expertise to offer in making judgements
about newspapers, which unlike broadcasters are unlicensed, and
whose freedom of expression is exercised without external regulation
7.7 We are opposed to the idea of Citizens'
Juries being invoked to advise on issues relating to the ownership
of local newspapers (9.7.6). The process of selection would be
fraught with difficulty. Whom are they presumed to represent?
What is their understanding of the issues? What are their prejudices?
What weight would be given to their advice? Would their conclusions
be published, and open if necessary to correction?
Associated believes that the draft legislation,
while going some way to rationalise the regime for newspaper mergers,
is defective in several key respects:
too many regulatory bodies are involved.
The resultant framework is therefore overly and unnecessarily
the exact roles and responsibilities
of OFT, OFCOM, Competition Commission and Government remain unclear.
There is consequently a real danger of parties and issues being
bounced between competing regulators;
there is no definition of the critical
concept of plurality in newspaper ownership, itself part of the
EPI concept; and
the Secretary of State retains a
power to override other regulators in making the final determination
of EPI issues.
Associated believes that it is essential that
these elements of confusion be clarified. The overall regulatory
complexity would be much simplified were OFCOM, currently playing
an ill-defined consultative role, to be removed from the framework
altogether. Similarly, much uncertainty could be removed were
the Secretary of State to have no regulatory "casting vote"
on EPI issues. Politics would also be removed from an area where
political involvement is no longer appropriate.