HL Deb 11 February 1993 vol 542 cc759-62

3.11 p.m.

Lord Thomson of Monifieth asked Her Majesty's Government:

What steps they are taking within the European Community to ensure that United Kingdom television contractors are not discriminated against in the matter of cross-frontier takeover bids.

Viscount Astor

My Lords, the Government are concerned that the legislation of a number of EC member states contains provisions which discriminate against nationals of other member states in the matter of ownership of broadcasting companies. We have informed the European Commission of our concerns and understand it has action in hand against several of our partners.

Lord Thomson of Monifieth

My Lords, I thank the noble Viscount for that reply. However, is he aware that from 1st January next year it will be entirely open for great continental media conglomerates to make take-over bids for total ownership of television contractors in this country, whereas it will be impossible for British interests to make comparable bids on the Continent? Will the Government seriously consider extending the moratorium inserted in the Broadcasting Act to a time when there is a level playing field within the European Community for these matters?

Viscount Astor

My Lords, we are taking action as regards the European Commission and the Commission is taking action against a number of countries. Take-overs are an important market discipline and after the initial moratorium it would not be right for the ITC to interfere with issues of ownership. An extension of the moratorium after the end of 1993 would require primary legislation, as would any change to allow a large ITV franchise holder to take over another large franchise holder.

Lord Bruce of Donington

My Lords, what makes the Government think that the European Commission has the necessary powers of discernment to enable it to draw any conclusions or make any decisions on this matter?

Viscount Astor

My Lords, I can give the noble Lord an example as regards Belgium. In Wallonia significant equity participation by the Francophile print media is guaranteed on the commercial channels. In Flanders at least 51 per cent. of the capital of a commercial TV licensee must be owned by the publishers of Flemish language print media. The European Court of Justice has recently ruled that these Flemish measures are contrary to the Treaty of Rome.

Lord Buxton of Alsa

My Lords, does my noble friend agree that there is no chance of anything being changed within 10 months—before the end of this year —through the European Community? Therefore —this comes back into the Government's court—something has to be done between now and January (the noble Lord, Lord Thomson, pointed this out) otherwise our ITV companies are wide open to take-over by Germans, Italians and anyone else who wishes to do so.

Viscount Astor

My Lords, I agree with my noble friend Lord Buxton. It is frustrating that this problem is taking so long to be resolved. However, as I said, progress is being made. This is an area of complicated EC and national legislation. The Commission has been made aware of the problem in other member states and is taking action. We will provide further details of our anxieties and assist the Commission in pursuing those anxieties in whatever way we can. If any European company wished to take over an ITV broadcaster, it would have to abide by the licence conditions.

Baroness Birk

My Lords, does the Minister recall that in the debates on the 1990 Broadcasting Act noble Lords on this side of the House fought hard to obtain a two-year moratorium on take-overs by TV companies but the Government settled on a period of one year? In view of the continuing recession and the turmoil that the UK industry is in, will the Government reconsider extending the moratorium and will they reconsider the matter of legislation? That is a small thing compared with both the principle and the fact of the matter we are discussing. Will the Government consider extending the moratorium, preferably to 1996 when the BBC Charter is due for renewal? That would permit our entire broadcasting system to be considered at the same time.

Viscount Astor

My Lords, the ownership rules were thoroughly debated by Parliament. It is too early to consider any changes when the new system has been operating for only a month. I remind the noble Baroness that the ITC chairman, Sir George Russell, proposed a one-year period when the provision was being debated. As I said, an extension would require primary legislation.

Lord Archer of Weston-Super-Mare

My Lords, does the Minister realise that if this anomaly is taken to its extreme Telefis Eireann would be able to take over Ulster TV? Surely no one in this country would wish that anomaly to arise.

Viscount Astor

My Lords, no one can simply come along and take over Ulster TV, or indeed any other ITV franchise. Take-overs will be subject to the oversight of the ITC once the moratorium is lifted. The ITC must ensure that the original licence conditions continue to be met regardless of changes in ownership.

Lord Chalfont

My Lords, as our own legislation — that is; the Broadcasting Act 1990—enables citizens of the EC to own British television stations, if this matter cannot be solved by our partners in the Common Market will the Government consider amending our legislation so that we have a level playing field, as the noble Lord, Lord Thomson, said —I use that awful clichÉ—between ourselves and the rest of the Community?

Viscount Astor

My Lords, we can own television stations in some European countries. Some European countries—for example, France and Italy—are not restrictive about ownership as regards EC nationals. However, what is fair—we do this—is that countries may apply ownership restrictions equally to both their own nationals and nationals of other member states.

Lord Donoughue

My Lords, I hope the Minister will tell his noble friend Lord Archer that the Irish took over British broadcasting many years ago. Will he confirm that, apart from the obscure case of Italy, no EC country except the UK allows foreign creditors to gain control of its television? Is it not therefore an inevitable consequence that, come next year, continental media companies looking to expand are bound to target the relatively small UK television companies? Does not the Minister agree that we have suffered for long enough from foreign control of our newspapers? What will the Government do, until that distant and remote time when the EC imposes a level playing field, to maintain British control of our television?

Viscount Astor

My Lords, a number of things are happening. The European Commission has recently produced a consultation document entitled Pluralism and Media Concentration which sets out a number of different options. The Government will consider the paper carefully before deciding how to respond. There are a number of other countries in Europe—for example, Italy and Luxembourg—which do not have restrictive conditions.