News Headlines: Relaxation of Media Regulation

The draft Communications Bill was published yesterday, paving the way

for deregulation and greater competition in the media and communications

sector. The Government is inviting comments on the substance of its

proposals by 2 August 2002. Provisions on media ownership and newspaper

mergers are not yet contained in the draft Bill, but the Government's

proposed policy in these areas is published alongside the draft Bill, in

the 'Policy Narrative' and further draft clauses will follow for

consultation.

The first reading of the Bill is set to take place in October 2002,

with entry into force expected by the end of 2003.

Unified Regulator

The draft Bill establishes a single regulator, the Office for

Communications (OFCOM), replacing the existing five regulators (the ITC,

Radio Authority, Oftel, Broadcasting Standards Commission,

Radiocommunications Agency). OFCOM will establish and maintain a 'Content

Board', which will have the principal function of ensuring that the public

interest in the nature and quality of TV and radio programmes is strongly

represented within OFCOM's structure. OFCOM will have concurrent powers

with the OFT to apply the Competition Act 1998 in the communications

sector.

Media Ownership

The media ownership rules will be simplified and liberalised, keeping

only the minimum level of regulation necessary to ensure diversity of

content from a plurality of sources. All rules on foreign ownership will

be abolished in order to encourage inward investment. Cross-media

regulation will be reduced to three core rules: a rule limiting joint

ownership of national newspapers and Channel 3, a parallel regional rule

and a scheme to uphold the plurality of ownership in local media.

The current system for regulating newspaper transfers will be replaced

with a more streamlined and less burdensome regime, in line with the new

system for non-newspaper mergers that will be introduced by the Enterprise

Bill. De minimis provisions will remove the smallest local newspapers from

regulation, there will be no requirement for the Secretary of State's

prior consent to newspaper transfers and the current criminal sanctions

for transferring a title without consent will be removed.

In relation to transfers that potentially raise plurality concerns, the

Secretary of State will retain the power to refer transfers for a wider

investigation by the Competition Commission, through an extension of the

'exceptional public interest' provision in the Enterprise...