Commentary on Sections Part 5: Competition in Communications Markets Chapter 2: Media mergers Section 376: Adaptation of role of OFT in initial investigations and reports
812.Under the public interest regime of the EA 2002, where the Secretary of State has intervened in a merger, the OFT is obliged to prepare a report for the Secretary of State under section 44 EA 2002. This section amends section 44 EA 2002 to adapt the role of the OFT in relation to mergers where a media public interest consideration has been specified in an intervention notice.
813.Subsection (1) makes amendments to section 44(3)(b) EA 2002 to provide that the OFT’s duty to provide the Secretary of State with a summary of relevant representations received in relation to public interest considerations mentioned in the intervention notice does not extend to representations received in relation to media public interest considerations. This is to avoid duplication, as OFCOM will have this duty where a media public interest consideration has been specified in the intervention notice (see section 377).
814.Subsection (2) adds a new section 44(5A) EA 2002 that ensures that the OFT nonetheless has the power to include such a summary of representations. Such a power might be used, for example, if the OFT received representations after OFCOM had delivered its report, in order to ensure that representations were drawn to the Secretary of State’s attention. It also clarifies that the OFT is not required to artificially separate out plurality and competition issues where this is unhelpful to the overall purpose of advising the Secretary of State.
815.Subsection (3) inserts new sections 44(8) to (10) into the EA 2002. Sections 44(8), (9) and (10) contain the definitions of “media public interest consideration”, “broadcasting” and “newspaper”. The definition of “media public interest consideration” encompasses the considerations in new section 58(2A) to (2C) EA 2002 that are inserted by section 375 of this Act or any other public interest consideration concerning broadcasting or newspapers that the Secretary of State thinks should be specified in section 58 EA 2002. This latter aspect could encompass, for example, any changes to the existing media public interest considerations that the Secretary of State thinks ought to be made. The definition of “broadcasting” covers the provision of services, the provision of which is required to be licensed under Part 1 or 3 of the Broadcasting Act 1990 or Part 1 or 2 of the Broadcasting Act 1996, or which would be required to be so licensed if provided by a person subject to licensing under the Part in question. The latter part of the definition is intended to capture services provided by the BBC or the Welsh Authority, or by broadcasters established abroad and broadcasting into the UK under EC licences. Although neither the BBC nor the Welsh Authority could be involved in a merger situation, this broad definition allows the Secretary of State to take account of the existence of their services when carrying out an assessment of the sufficiency of plurality of controllers of media enterprises for the purposes of new section 58(2C)(a). The definition of “newspaper” is the same as that currently used for the purposes of the special newspaper regime in the FTA 1973. This covers daily and Sunday newspapers (whether national or local) and local periodical newspapers.
816.New section 44(11) EA 2002 sets out a power for the Secretary of State to amend the definition of “newspaper” or of “broadcasting” by statutory instrument. This power is designed to deal with future developments in the nature of the newspaper or broadcasting markets that might mean that the scope of the media public interest consideration should be redefined (for example, in relation to newspapers, if it became more common for newspaper titles to circulate across national boundaries such that important UK titles did not necessarily circulate “wholly or mainly” in the UK). An order under new section 44(11) can only be made after a draft has been laid before, and approved by a resolution of, each House of Parliament (see paragraph 24 of Schedule 16, which amends section 124 EA 2002).