Foreign governments will be banned from owning UK newspapers and magazines, a minister has confirmed, amid concern over the gulf state-backed takeover of The Telegraph.
In the face of cross-party pressure and a threatened defeat in the House of Lords, the Government has said it will bring forward an amendment to the Digital Markets, Competition and Consumers Bill that would block such deals.
The move was prompted by concern about the proposed takeover of The Daily Telegraph and The Spectator by Redbird IMI, an investment fund majority-owned by Sheikh Mansour bin Zayed Al Nahyan, vice president of the United Arab Emirates and owner of Manchester City Football Club.
Speaking in the Lords on Wednesday afternoon, media minister Lord Parkinson of Whitley Bay said: “We will amend the media merger regime explicitly to rule out newspaper and periodical news magazine mergers involving ownership, influence or control by foreign states.”
Explaining how the new rules would work, he added: “Under the new measures the Secretary of State would be obliged to refer media merger cases to the Competition and Markets Authority through a new foreign state intervention notice where she has reasonable grounds to believe that a merger involving a UK newspaper or news magazine has given or would give a foreign state or body connected to a foreign state, ownership, influence or control.
“The Competition and Markets Authority would be obliged to investigate the possible merger and if it concludes that the merger has resulted or would result in foreign state ownership, influence or control over a newspaper enterprise the Secretary of State would be required by statute to make an order blocking or unwinding the merger.”
Lord Parkinson said the changes could apply to the Telegraph Media Group takeover if they pass into law swiftly.
“We intend that the changes should take immediate effect upon Royal Assent,” he said.
“As noble Lords know, the Secretary of State is currently considering a live merger case under the Enterprise Act regime, on which I cannot comment further today.
“With regard to any live case, if it is still ongoing when the new changes come into effect, the Secretary of State will continue to follow the process set out in the existing regime and will also apply the new measures that will be set out in the Government amendments.”
A spokesperson for Redbird IMI said the company was “extremely disappointed by today’s development”.
The spokesperson added: “To date, Redbird IMI has made six investments across the UK and US, and we believed the UK’s media environment was worthy of further investment.
“As with each of our deals, we have been clear that the acquisition of The Telegraph and The Spectator has been a fully commercial undertaking. We remain committed to developing powerful and commercially sustainable global media assets.
“We will now evaluate our next steps, with commercial interests continuing to be the sole priority.”
The CMA and Ofcom have both sent reports on the potential Telegraph deal to the Culture Secretary, who said this week she would aim to publish them and make a further statement on any decision “as quickly as possible”.
In a bid to reassure foreign private investors, Lord Parkinson said the Government remains “committed to encouraging and supporting investment into the United Kingdom”.
The minister also confirmed to peers that the ban would not apply to broadcasters.
A Government spokesperson said: “We have listened carefully to the arguments made by Parliamentarians in recent weeks, and are taking action to explicitly rule out foreign state ownership, influence or control of newspapers and periodical news magazines.
“This will deliver additional protections for a free press, a pillar of our democracy and a priority for the Government.
“While our media merger regime already provides protection for accuracy of the news and free expression of views, which allows for the consideration of foreign state ownership, we will bring forward an amendment that puts the position beyond doubt.”
Former editor of the Daily Telegraph Lord Charles Moore, who sits as a non-affiliated peer and is still a columnist for the newspaper, said it had been a difficult time for the title.
He said: “This is a very important matter of principle.
“The delay that has been involved in this has been very difficult for newspapers in general, particularly for my own and for The Spectator.
“While you don’t know what’s going to happen you can’t really get on with your journalism and that tends to erode things of you are not careful.
“If we had had such a rule from the start and such clarity people wouldn’t have had to get into this issue of saying rather difficult truths about many regimes over the word, we would simply be able to say ‘No, sorry, the rule is the rule and that’s that’.”
Baroness Tina Stowell, who chairs the Lords Communications and Digital Committee and had filed an amendment to require Parliament’s approval before UK news media organisations could be purchased by a foreign government or power, said: “The stark difference between foreign businesses and foreign governments is that if the latter were allowed to own our news media it would raise big questions about foreign policy, editorial independence and the relationship between an outlets owners and its coverage.
“We can’t ignore that public trust on news, Parliament and the political class has fallen significantly in recent years.
“Allowing foreign governments to own such a critical and sensitive part of our nation would damage public confidence in all of us yet further if it was allowed to happen.”
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