Media Matters:Written statement - HCWS1677

WS
Department for Digital, Culture, Media and Sport
Made on: 27 June 2019
Made by: Jeremy Wright (Secretary of State for Digital, Culture, Media and Sport)
Commons

Media Matters

Times/Sunday Times application to vary 1981 conditions

On 10 January 2019, News UK submitted an application to vary certain conditions put in place in 1981 by the then Secretary of State for Trade. The proposed changes would allow The Times and The Sunday Times to share journalistic resources, subject to the agreement of each newspaper’s editor.

Having considered this application [using my quasi judicial power as Secretary of State as set out in the Enterprise Act 2002] alongside the representations made to the Invitation to Comment published on 17 January 2019, I concluded that there had been a material change in circumstances since 1981 that would justify the variation as the effect of the proposed changes did not, in my view, materially impact on the public interest considerations as set out in Section 58 Enterprise Act 2002.

In my Written Statement to the House on 11 April 2019, I announced that I was minded to accept News UK’s application to vary the 1981 undertakings. However, in considering the proposed new undertakings as a whole, I also noted that the existing governance arrangements lacked clarity and certainty over roles and responsibilities. Before agreeing the application, I therefore made clear to News UK that their proposals needed to be suitably updated and enhanced to reflect corporate best practice.

I asked officials at the Department for Digital, Culture, Media and Sport (DCMS) to take forward discussions on these issues with News UK in order to consider proposals from News UK which would address my concerns. Following the conclusions of these discussions, News UK have submitted revised undertakings which, in my assessment, represent a sufficient improvement on those contained in the original proposal and which substantially meet my concerns. I therefore propose to accept the revised News UK undertakings.

Before doing so, and in line with the Enterprise Act 2002, I have today published a Consultation Notice on the Government website seeking representations on the proposed undertakings. I have also published the revisions to the Times Newspaper Holdings Limited Articles of Association, which give effect to the agreed changes.

Views are sought on the revised News UK undertakings and the supporting documents by​ 10am ​on ​Monday 15 July 2019​. Responses should be sent to media-mergers@culture.gov.uk​ or to DCMS Media Team, Department for Culture, Media and Sport, 100 Parliament Street, London, SW1 2BQ.

I will consider any representations received on the revised undertakings before this deadline, and will consider whether any further modifications are required in light of them, or if the undertakings are now sufficient. I will keep the House informed of further developments with this matter.

Acquisition of 30% shareholder stake in the Evening Standard.

On 13 June I instructed my officials to write to Lebedev Holdings Limited (LHL) and Independent Digital News and Media Limited (IDNM), the owners of the Evening Standard and the Independent, to inform them that I was ‘minded to’ issue a Public Interest Intervention Notice (PIIN). I can confirm today that I am issuing the PIIN.

This relates to concerns I have that there may be public interest considerations - as set out in section 58 of Enterprise Act 2002 - that are relevant to the recent acquisition of a 30% stake by the International Media Company (IMC) in LHL and the linked transaction involving the acquisition of a 30% stake by Scalable LP in IDNM and that these concerns warrant further investigation.

I invited the Parties to submit representations to me, which they have done. I acknowledge the points they have raised about the structure of the transactions and the turnover of the companies. Nonetheless, I still consider that there are reasonable grounds to suspect that a relevant merger situation has been created. I have also noted what they have told me about protections for editorial independence, including the provisions in their Shareholding Agreement. However, I continue to believe that it may be the case that the public interest considerations of freedom of expression and accurate news reporting are relevant to this merger. I thus consider it appropriate for me to intervene in this matter.

At this stage, my decision to issue the PIIN triggers the requirement for the Competition and Markets Authority (CMA) to report to me on jurisdictional and competition matters, and for Ofcom to report on the media public interest considerations in section 58 of the Enterprise Act 2002: (2A) The need for (a) accurate presentation of news; and (b) free expression of opinion. I have asked both the CMA and Ofcom to report back to me by 23rd August 2019.

My role as the Secretary of State in this process is quasi-judicial and procedures are in place to ensure that I act independently and follow a process which is scrupulously fair, transparent and impartial.

I will update the House once I have received both reports from the regulators and have had time to consider the recommendations.

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