On 3 November 2003 the Swedish Competition Authority presented its report on Competition and Co-operation within the media sector. The report had been commissioned by the Ministry of Culture with the instruction to describe and analyse structural problems in media markets from a competition point of view.
The report covers the markets for local/regional newspapers, magazines and broadcasting. According to the report, the level of competition on these markets was, on the whole, satisfactory. The Authority stated that it would continue to monitor the various forms of co-operation regarding advertisements and printing in the newspaper markets, as well as the increasing spread of cross-ownership in commercial local radio.
Competition Law vs. Freedom of Speech
Of special interest is the report’s section on the application and reach of the Competition Act in the media sector. The report notes that previous official reports have presented conflicting views on whether applying the regulations of the Competition Act, inter alia, the restrictions on acquisitions and concentrations, to media markets would entail a breach of the freedoms of establishment, production and distribution laid down in the constitutional laws of The Freedom of the Press Act and The Fundamental Law on Freedom of Expression.
The report notes that the Competition Act in itself holds no exemption regarding the media markets. While the Competition Act implements EC regulations on competition, the Authority finds it unclear whether EC competition law over-rides certain acts protected in The Freedom of the Press Act, i.e. the unequivocal right of an editor-in-chief to refuse the publication of any particular advertisement. According to the report, the concept of freedom of establishment in EC law is focused on prohibiting discrimination, whereas the Swedish constitutional laws specifically seek to protect actions relating to dissemination of opinions and information through print media, cable transmissions and the production and distribution of recordings.
Competition Act and Constitutional Laws Deemed Compatible
The Authority reiterates in the report its standpoint that the Competition Act in general is applicable to the media sector. Thus, the prohibitions of the Act against anti-competitive co-operation and abuse of a dominant position, as well as the regulations regarding acquisitions and other concentrations between undertakings, are applicable in the media sector. The Authority points to its earlier investigations of mergers in the newspaper market. In these cases, the Authority decided not to intervene and thus did not have to seek a court decision to prohibit the concentration. The office of the Press Ombudsman, a semi-official institution, filed a complaint in 1996 to the Parliamentary Ombudsmen against the Competition Authority opening an investigation into the Schibsted publishing company’s purchase of the national tabloid newspaper Aftonbladet. In its decision, the Parliamentary Ombudsmen found that the Competition Authority had deemed the notification of the acquisition to be required but that it had taken no decision hindering anyone from carrying out the publication of a newspaper. The Parliamentary Ombudsmen stated that any such decision would have entailed a court trial. The Parliamentary Ombudsmen declined to pre-empt the outcome of any such future court decision. There is as yet no court decision on the principal question of the application of the Competition Act to the media sector, with the exception that the refusal of a newspaper to publish an advertisement was judged not to constitute an abuse of dominant position.
Call to Clarify
The Competition Authority nonetheless recommends introducing legislation explicitly recognising the applicability of competition law in the media sector. The Authority concluded that the Competition Act be applied in a manner which respects the objectives of the constitutional laws in order to prevent the rights enshrined in these laws from becoming illusory.
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