Changes to Irish Media Merger Control
The Competition and Consumer Protection Act 2014 (the "2014 Act") has introduced significant changes to Irish media mergers effective from the 31 October 2014. The 2014 Act now mandates dual notification of media mergers to the Competition and Consumer Protection Commission (CCPC) (or the European Commission) and the Minister for Communications, Energy and Natural Resources (Minister). The CCPC will now only examine the competition aspects of the merger, while the responsibility of inspecting the media plurality of the merger will vest solely with the Minister.
Provisions of the 2014 Act
The 2014 Act defines a media merger as occurring where each of at least two of the undertakings involved carries on a media business in Ireland or where one carries on a media business in Ireland and one carries on a media business elsewhere.
The definition of a “media business” has been broadened to encompass online media, such as the publication of newspapers or periodicals consisting substantially of news and comment on current affairs on the internet.
According to the Act: ‘to carry on a media business in the State’ means: (1) having a physical presence in Ireland, including a registered office, subsidiary, branch, representative office or agency, and making any sales to customers located in the State; or (2) having made sales in Ireland of at least €2 million in the most recent financial year.
Notification timelines and assessment procedures of media mergers under the Act
All media mergers must be notified by the undertakings involved to the CCPC, regardless of whether they meet the monetary thresholds applied to non-media mergers. Notifications of media mergers must be made to the CCPC. Media mergers governed by Irish law with an EU dimension must be notified to the European Commission in Brussels under the EU Merger Regulation (EUMR), in addition to the Minister.
Assessment of a Media Merger by the CCPC
As with non-media mergers, the CCPC may apply both a Phase 1 and a Phase 2 assessment. In Phase 1, the CCPC will assess the media merger within 30 working days from notification to determine if it would be likely to substantially lessen competition. Normally the period runs from the date of receipt of a notification but if the CCPC requests more information, the period begins from the date it receives such information. The CCPC can discuss potential commitments by the undertakings to obtain a phase 1 clearance and this extends the timeline to 45 working days. A Phase 2 investigation must be concluded within 120 days of notification (or from when the CCPC receives a response to a request for further information) or 135 days if commitments are proposed.
Assessment of a Media Merger by the Minister
Under the Act, a written notification form containing the full details of the merger (including details which may impair plurality of the media) must be made to the Minister by the undertakings involved, on or before the “relevant date” (i.e. 10 workings days, from the date of the applicable Commission or the CCPC clearance decision) or the date when the media merger is deemed to be cleared under the EUMR or the Competition Acts. This notification cannot be made before the date of the European Commission or CCPC clearance decision whichever applies or the date when the media merger is deemed to be cleared under the EUMR or the Competition Acts. Upon notification, the Minister will apply a media plurality test to the merger which examines the effects on “diversity of ownership” and “diversity of content”.
The Minister has 30 working days (extendable if he requires further information) to clear, clear on conditions or refer the media merger to Phase 2 because the merger may be contrary to the public interest in protecting the plurality of the media. In Phase 2, the Broadcasting Authority of Ireland ("BAI") assesses the media merger and must draft a report within 80 working days giving its view as to whether the merger will be contrary to the public interest in protecting media plurality. In doing so, it must invite submissions from the Joint Oireachtas Committee and may be assisted by an Advisory Panel appointed by the Minister. The Minister has a further 20 working days after receipt of the BAI’s report within which to make a determination to prohibit or to approve the merger (with or without conditions). The reasons for this decision will be published.
Consequences of failing to notify a media merger or to supply required information to the Minister
The persons in control of an undertaking who have failed to notify the Minister (either at all or on time) or who have failed to supply the information required by the Minister is guilty of an offence and is liable: (a) on summary conviction, to a fine, or (b) on conviction on indictment, to a fine up to €250,000 (plus daily default fines of up to €25,000).A media merger concluded prior to the Minister’s approval is void and also if the merger has not been put into effect within 12 months of the determination.
Consequences of failing to notify a media merger or to supply required information to the CCPC
The persons in control of an undertaking who have failed to notify the CCPC (either at all or on time) or who have failed to supply the information required by the CCPC is guilty of an offence and is liable: (a) on summary conviction, to a fine: or (b) on conviction on indictment, to a fine up to €250,000 (plus daily default fines of up to €25,000).A media merger concluded prior to the CCPC’s approval is void and also if the merger has not been put into effect within 12 months of the determination.
The revised requirements of dual notification to the CCPC and the Minister, in addition to the extended time periods given to the Minister to respond, will significantly impact the regulation and control of media mergers and media business in Ireland. Following the changes implemented by the 2014 Act, media mergers will take considerably longer to process and ultimately may deter media mergers transactions in the future.
For further information please contact a member of our EU, Competition & Procurement Team.
Date published: 20 March 2015