EU Competition Law: Does media pluralism fit?

Konstantina BaniaPhD Candidate, EUI

Research Assistant, CMPF-EUDO, RSC, EUIKonstantina.Bania@eui.eu

EU Competition Law: Does media pluralism fit?

• Outline: 1. How doesthe European Commission perceive

the relationship between EU competition law and media pluralism?

2. How should the European Commission perceive the relationship between EU competition law and media pluralism?

3. Conclusions

1. How does the European Commission perceivethe relationship between EU Competition Law

and media pluralism?

1. Media pluralismis aspontaneousresult delivered bythe undistorted functioning of the markets (1)

– See, for instance, EC Issue Paper for the Liverpool Audiovisual Conference, p. 2 (2005); EC SWD on media pluralism in the MS of the EU, SEC(2007) 32, p. 7:

“The application of European competition law plays an important role not only in respect of the preventing the creation or the abuse of dominant positions, but also with regard to ensuring market accessfor new entrants. […] Thus, in applying antitrust and merger control principles competition policy can make an important contribution to maintaining and to developing media pluralism, both in traditional television markets and in new upcoming markets”

1. Media pluralismis aspontaneousresult delivered bythe undistorted functioning of the markets (2)

– E.g. Bertelsmann/Planeta/Circulo, Case COMP/M.5838[2010] OJ C 228, para. 122: “Círculo has a smallpresence in the various markets analyzed. The notifiedoperationwill not have any significant impact on thediversity of books made available to consumers and istherefore unlikely to threaten consumer choice andcultural diversity”

– E.g. Bertelsmann/KKR, Case COMP/M.5533 [2009] OJC 240/01, para. 79: “[I]t can be concluded fromthecompetitive assessment that the transaction is unlikelyto have a negative impact on cultural diversity”

2. Media pluralismis not the Commission’s problemto solve

• E.g. Newscorp/BSkyB Case COMP/5932 [2011] OJ C 37/02 , paras. 307 and 309: “The purpose and legal frameworks for competition assessments and media plurality assessments are very different. The focus in merger control is whether there is […] the ability of the merged entity to profitably increase prices on defined antitrust markets post-merger […] The present decision is based solely on competition-related grounds under the Merger Regulation”

Why does the Commission go down that path?

1. Impact of U.S. antitrust policy on EU competition decision-making (how decisive are non-economic considerations?)

2. Media pluralism a fuzzy concept and a highly controversial issue: See, for instance, OECD PRR on media mergers (2003), p. 10

3. Article 21(4) EC MR: MS are better placed to deal with pluralism concerns

What does the Commission do? Supply diversity = Competitive media markets =

Media pluralism? (1)

• The objective? Market access

• How? Access to premium content and infrastructure

Supply diversity: a proxy for content diversity (?) (2)

Impact of an operation on content diversity?

• E.g. Bertelsmann/Kirch/Premiere, para. 122: ‘[s]ince the parties will wall off and control the market, other potential providers of digital pay-TVand multimedia services will be unable to develop freely and without restriction’

• E.g. Newscorp/Telepiù, para. 37: if the merged undertakings restrict access to premium content, ‘potential competitors will not be in a position to create an alternative successful pay-TVplatform’

2. How should the Commission perceive the relationship between EU competition

law and media pluralism?

Rethinking the Commission’s competition practice: Applying EU Competition law in a pluralism-friendly

manner (1)

• Does the integration of content diversity considerations comply with EU law?

– Article 167(4) TFEU

– Article 11(2) and 51(1) CFR

– Recital 23 and Article 2(1) EC Merger Regulation

• Is the integration of content diversity considerations a legitimate subject for competition law enquiries? – Competition hasnon-price dimensions: high quality,

wide selection of goods and services and innovation;– Commission’s job is to check “the ability of one or

more undertakings to profitably increase prices, reduceoutput, choice or quality of goods and services ordiminish innovation” (EC Horizontal MergerGuidelines,[2004] OJ C 31/3, para. 8)

Rethinking the Commission’s competition practice: Applying competition law in a pluralism-friendly

manner (2)

3. Conclusions

• The EU framework is not clear-cut

• The Commission’s duty to develop a pluralism-friendly merger practice is not an easy task

BUT,

• The EU’s limited competence to regulate for media pluralism is NOT an excuse to violate the Treaties

Thank you for your attention.

Konstantina.Bania@eui.eu