Economics and Media Regulation

None of the national acquisitions have been questioned, while Syvertsen writes, that it prevented the further expansion of the largest actors on the Norwegian market. In the regional and local markets 11 acquisitions were questioned by the authority. But the next step of economic evaluation led the authority in six of these cases not to intervene, because a purchase would have been the only way to ensure the further reasonable running of the business.

In a report on the practice of media regulation of this authority, Syvertsen collected data from the work of the authority from 1 January 1999 until 30 April 2002. Finding only five incidences of intervention (in relation to 40 cases a year) by the authority, the author comes to the conclusion that the Eierskapstilsynet has a position somewhere between being

“hard” and “soft”. The Media Ownership Authority works together with parties involved in the acquisition process, but it is up to the authority “to initiate and control the process”. According to the law, the authority is not allowed to make any intervention without a formal trial to arrive at a solution together with the involved companies. Doing this, the authority must trust the different parties to disclose all the relevant material, which leads Syvertsen to the conclusion, that the media companies with open communication as their aim and background could have greater influence on the outcome of the discussion than the other parties (Syvertsen 2003:6f). But she also mentions critically that the authority did not analyse the possible relation between the content of media products and did not consider the arguments that came from the media companies themselves. (Syvertsen 2003:13)

5.1.2. Recent Developments

Østbye gives a general critique on the realisation of media policies in Norway. In his opinion the shortage of “a well integrated area, guided by overall principles” has led to “ad hoc” decisions from different political areas. In the early 1980s the new Ministry of Culture was made responsible for many media regulation policies, “but the convergence process has again divided the responsibility between the Ministry of Culture and the Ministry of Transport and Communications” (Østbye 2004:163).

Regarding the Media Ownership Authority, he writes that besides “probably” hindering Schibsted from “taking over some of the regional newspapers”, the “Act and the Authority have not proved efficient in preventing the continued concentration of ownership in the media”.

He also sees problems with the legislation mainly, “that it covers only a few media (newspapers, radio and television) and that it does not take into consideration multimedia concentration” (Østbye 2004:165).

While this report was being written, there has been discussion about a new Act on media ownership. On 4 June 2004 the Ministry of Churches and Culture proposed the following amendments to the Act:⁴¹

• the limit for ownership on the national level be increased from 33 to 40% it introduces the idea of “multimedia ownership” with companies owning more than 30% in one sector being prohibited from owning more than 20% of companies in other media sectors;

• no longer intervention on local markets;

• intervention on regional markets stays in principle, but with defined geographical markets,borders, and multimedia borders;

• the law is widened to include the electronic media;

• co-operation agreements (cartels) can have the same consequences as acquisitions On the ministry’s website there were some more details on the new law;⁴²

• the limit of ownership in the regional circulation of daily newspapers is set to 60% multimedia ownership;

41 http://www.eierskapstilsynet.no/regelverk/dbaFile954.html 42 http://odin.dep.no/filarkiv/212219/OTP0304081-TS.pdf

• If the owner has ownership in two markets, the limits are set to 30% in the first, 20% in the second market;

• If the owner is active in three different markets, he is allowed to hold 20% in each market.

5.1.3. Owners’ Reactions

The last two points and the definition of ownership regions caused anger among the largest media owners and confusion, for example, amongst the ministry lawyers.The reaction was quick to follow. Already on 5 June 2004 the daily Dagens Næringsliv wrote of the first reaction from the Schibsted Group, that they claimed the law to be a “Lex Schibsted” and a hostile economic policy. A representative from the Ministry of Culture found out later that day that the ministry lawyers thought that multimedia ownership was permissible where owners have 40% in one market and 20% in the other two markets.

According to Dagens Næringsliv, Schibsted CEO Kjell Aamot was more pleased after hearing this new information, since calculations of the Media Ownership Authority say that the Schibsted group could own eight of Norway’s largest newspapers without reaching the limit on a national level (Aagedal 2004).

More angry were the representatives of the other two of the three largest actors on the newspaper market: “However the regions are defined”, Alf Hildrum, Chief Executive Officer from A-Pressen, would be disappointed about the limits on the regional level. He was also very critical of the limits on co-operation agreements. The representative from Orkla Media expressed his hope, that the Norwegian Parliament will change and improve the general conditions for newspaper owners.⁴³

5.2. Ownership Regulation in the Baltic States

In Baltic States there is no specific law regulating media concentration. The broadcasting laws have only some regulations regarding radio and TV ownership issues. However, in theory, the media companies should be treated in the same way as other companies that are regulated through the Competition Law.

The Baltic laws on competition state that 40% of the turnover is the maximum of how much of a business sector that may be owned by one company or group of companies linked to each other. The Competition Council will rule on cases that could pose a threat to the free market, that is, where the existence of a monopoly-like situation could deform the market in a negative way.

However, the Competition Law in Latvia for instance, says nothing about media specific issues. The law does not say how this 40% should be calculated. For example, what data should be used to calculate the share of the market among newspapers, the number of newspapers, the number of printed copies on weekdays, the number of readership or something else. The law does not clarify if national and local newspapers should be counted separately or together. The law does not state how many times per week a newspaper must be published in order to be considered a daily newspaper. It is, moreover, not defined by the law if language specific (e.g., the Latvian-language and the Russian-language) newspapers should be calculated together or separately. It is natural to conclude that the absence of clarification on such issues reflect not only the unawareness of the legislators of the specifics of the media industry, but even more, the absence of thinking of the possible need for limiting the concentration of ownership in the media sector.

In Estonia, the Broadcasting Act sets restrictions on media concentration – e.g. a broadcasting licence cannot be issued to a company that would in this way obtain media monopoly or become the simultaneous owner of radio, television and print media. However the absence of clear legal definitions for the terms used in this regulation has made the provisions

43 “Restriktivt” og “utkantfiendtlig”.Dagens Næringsliv, 5 June 2004.

declarative and they have never been applied. In Latvia, the Radio and Television Law has one section on restrictions of concentration and monopolisation of electronic mass media. The laws says that a person who is the sole founder of a broadcasting organisation or whose investment in a broadcasting organisation ensures control of it, or the spouse of such a person, may not own more than 25 per cent of shares (capital share) in other broadcasting organisations. Political parties are not allowed to establish broadcasting organizations.⁴⁴