Media Ownership Rules - Spain

07 November 2002

Javier Cremades & Isabela Crespo, Cremades & Calvo-Sotelo













SPAIN


Introduction


 

In Spain, the communications sector has a significant influence in the political, social and cultural arenas.

From a legal point of view, a number of regulations have recently been adopted by the Spanish Government, mainly concerned with the implementation of digital television and radio broadcasting. These regulations cover both the local and national levels and apply to both the public and private sector.

The latest development in the media sector is the pending merger of the only two digital television broadcasting platforms in Spain, approval of which is expected by the end of 2002. If this operation is approved, the merged company will control 95% of the pay -TV business in Spain.

1. Television

  • Foreign Ownership Restrictions - Can a non-EU entity control the following broadcasting interests in Spain?


Satellite yes
Cable no
[1]
Terrestrial (analogue) no[2]
Terrestrial (digital) no[3]


  • Ownership Aggregation Limits -


a) Shareholding threshold restrictions

An entity may not control more than 49% stake in a licensed cable or terrestrial (analogue/digital) broadcaster, nor (directly/indirectly) hold a stake in more than one such broadcasting entity.[4]

b) Ownership of channels

National Level

i. Ban on controlling more than one terrestrial analogue channel within the same region on both public and private TV.[5]
ii. Ban on controlling more than two programmes on a terrestrial digital channel, except for private TV where only one programme may be controlled at a time.

Local Level

i. Ban on controlling more than one local terrestrial analogue channel within a region.
ii. Ban on controlling more than one regional terrestrial analogue channel within the same region, [unless there is sufficient radio electrical spectrum available, in which case a maximum of two channels can be owned.]
iii. Ban on controlling more than two programmes on a regional terrestrial digital channel.


2. Radio

  • Foreign Ownership Restrictions -


A non-EU entity may not control more than 25% share of an analogue/digital broadcasting entity, except where the principle of reciprocity applies.


  • Ownership Aggregation Limits -


a) Shareholding Threshold Restrictions

An entity may not control greater than 49% share of more than one radio station within the same territory.

b) Ownership of Channels

National Level

i. An entity may only hold one analogue radio broadcasting licence at a time.

Local Level

i. An entity may only hold one licence to provide analogue/digital radio broadcasting services within a region, except where plurality/competition in that market can be guaranteed.


3. Newspapers

  • Foreign Ownership Restrictions -


No specific restrictions on non-EU ownership of newspaper publishers, except for the application of general competition law principles.


  • Ownership Aggregation Limits -


No specific restrictions exist on ownership aggregation limits, other than the application of general competition law principles.


4. Cross-media Ownership Restrictions -


No specific restrictions exist on cross-media restrictions, other than the application of general competition law principles.


5. Local Competition Law Policy


Parties to a prospective merger must notify the deal in advance to The Spanish Competition Authority (the “SCA”), where certain business volumes or market share thresholds are exceeded.

The SCA has the will to enforce its policy with great vigour, but unfortunately lacks the manpower and economic means to do so. This year the 2 providers of digital TV services notified their intent to merge on the grounds of an insufficient market to sustain 2 digital TV platforms. Canal Satélite Digital (Sogecable), of the Prisa Group, would acquire Via Digital, whose main shareholder is Telefónica.

The main issue being considered is the impact on consumers when competition no longer exists. Telefónica is presently the main shareholder in Antena3, one of three privately owned national TV stations. If the merger goes ahead, Telefónica will also become a major shareholder of a second licensed broadcasting entity, but Spanish law prohibits an entity from having a controlling interest in more than one licensed broadcaster.

The European Commission studied the merger and decided that it was not within its jurisdiction. Thereby the Spanish Competition Authority is now the competent authority to decide whether to approve the merger or not.


Footnotes




[1] If a non-EU entity wishes to acquire more than 25% share capital of a Spanish broadcasting entity it must first either:

- obtain an authorisation from the Counsel of Ministers; or
- be incorporated in a country that has signed a treaty, for example GATT, which provides for reciprocal treatment for Spanish entities wishing to invest in its national broadcasting entities.

[2] Subject to the principles of reciprocity (detailed above), a non-EU individual or body may not control more than 49% of the share capital of a licensed broadcasting entity, nor be permitted either directly or indirectly to hold any shareholding interest in more than one such broadcasting entity.
[3] Please see note 2 above
[4] See Local Competition Law Policy below for a recent merger case on this issue
[5] Ownership of a second channel TVE2 is permitted on Public TV