Broadcasting (Ownership) (Hansard, 19 May 1989)

§ Mr. Hurd

The White Paper made clear our determination that ownership in the independent broadcasting sector should remain widely spread, and that unhealthy concentrations of ownership and excessive cross-media ownership should be prevented. We are grateful to those who responded to the invitation to comment on the scope and formulation of the rules needed to achieve this objective.

The White Paper envisaged (paragraph 6.51) that the same group would be permitted to hold two, but not more than two, regional Channel 3 licences. Many of those commenting thought it would be undesirable if the same group could control two large or contiguous Channel 3 regions. It has also been argued that some flexibility is needed to take account of the ways in which independent terrestrial television might develop.

In the light of these responses we propose to strengthen the rules envisaged in the White Paper in the following way. Power would be taken to prescribe in subordinate legislation limits on the number of Independent Television Commission or Radio Authority licences within each main licence category which any one body or group would be permitted to hold or control. In the case of regional Channel 3 licences the initial limit would be set at two, as envisaged in the White Paper. But these limits would be capable of further restriction by reference to audience share and contiguity of licence area. The Government do not envisage that the same group should be allowed to own two large franchises or two franchises for contiguous areas.

Paragraph 6.53 of the White Paper proposed clear reciprocal limits on broadcasting and newspaper cross-holdings. Taking account of comments on the White Paper, we propose that no proprietor of a national newspaper should be allowed to have an interest exceeding 20 per cent. in any DBS, UHF TV (including regional Channel 3) or national radio franchise. We also see a strong case for debarring national newspaper proprietors from having a significant financial interest in more than one such franchise. These limits also apply reciprocally to the holders of such franchises investing in groups controlling national newspapers. No regional or local newspaper would be allowed to have more than a 20 per cent. interest in any regional or local Independent Television Commission or Radio Authority licensee with whose area it substantially overlapped, and vice versa.

Paragraph 6.53 of the White Paper proposed, folowing a recommendation by the Home Affairs Committee, that ownership of satellite channels not using United Kingdom broadcasting frequencies but receivable in the United Kingdom (whether based here or abroad) should be capable of being taken into account by the Independent Television Commission and the Radio Authority in operating their controls. We propose that no operator of such a service should be permitted to have more than a 20 per cent. interest in a DBS, UHF TV (including regional Channel 3) or national radio licensee, and that cross-interests exceeding 20 per cent. between DBS, UHF TV and national radio licensees should not be permitted. Similarly, cross-interests exceeding 20 per cent. would not be permitted between regional Channel 3, local delivery operator and local radio licensees whose areas substantially overlapped. These limits would be expressed in subordinate legislation and would be capable of variation. We envisage that legislation would also leave open the possibility of limiting other forms of cross-holding.

319W

In line with paragraph 6.49 of the White Paper, local authorities and bodies whose objectives are wholly or mainly of a political or religious nature (and also bodies which are affiliated to or controlled by such bodies) would be disqualified from holding any ITC licence. Local authorities and political bodies would similarly be disqualified from holding any Radio Authority licence: as envisaged in paragraph 7.10 of the radio Green Paper, religious bodies would be allowed to have a financial interest in radio stations provided this did not lead to bias or editorialising on religious or controversial matters.

We propose that no ITC or Radio Authority licence may be held or controlled by a non-EC company or individual not ordinarily resident in the EC, with the exception of local delivery licences and any operators licensed under the Cable and Broadcasting Act 1984. In the case of these exceptions, concerns about editorial and cultural influence, which are less applicable to local service delivery, are outweighed by the advantages for investment which the possibility of non-EC control would bring about.

While the Government do not envisage that the ITC or Radio Authority would have a wide discretion in dealing with ownership questions, they do propose that they should be given the enforcement powers needed to police the rules effectively. These would include the ability to include licence conditions requiring licensees to give advance notice of, and seek prior consent for, changes in shareholdings. The ITC and Radio Authority would also be able, for the purposes of enforcing the ownership rules, to require changes in a company or group as a condition of its being awarded, or retaining, a licence, and to withdraw licences if declarations to them proved false.

Transitional account will be taken, in framing the rules, of the position of shareholders in franchises awarded under existing legislation.