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AFCA files request for examination of MEDIAFOREUROPE N.V.; ProSiebenSat.1 Media SE merger with Cartel Court

The media merger of MFE MEDIAFOREUROPE N.V.; ProSiebenSat.1 Media SE was notified on 13 December 2022. MFE MEDIAFOREUROPE N.V plans to raise its current stake in ProSiebenSat.1 Media SE (P7S1), before P7S1’s next ordinary annual general meeting on 2 May 2023, to 29.9% of the voting rights, thereby gaining de facto sole control of P7S1.

The planned merger falls under the notification obligation according to the European Merger Regulation. It will therefore be examined by the European Commission in relation to its impact on competition, with the sole purpose of examining the effect on media plurality (§ 12 and § 13 of the Federal Cartel Act – KartG). The Austrian Federal Competition Authority (AFCA) is entitled to examine mergers of media companies or media support companies pursuant to § 8 KartG or to request an in-depth review pursuant to § 11 KartG if it is expected that a media merger will affect media plurality (§ 13 para. 1 KartG). The KartG defines media plurality structurally as the diversity of independent media companies that are not affiliated to each other as defined in § 7, thereby ensuring media coverage that takes into account a variety of opinions.

Via its wholly-owned German subsidiary Seven.One Entertainment Group GmbH (Seven.One), P7S1 is the sole shareholder of ProSiebenSat.1Puls4 GmbH (P7S1-AT), which combines all media activities of the P7S1 Group. Specifically, the planned merger affects the Austrian channels PULS 4, PULS 24, ATV and ATV 2, as well as the Austrian programme and advertising blocks on ProSieben, kabel eins, SAT 1, Sixx, ProSieben MAXX, Sat.1 Gold and kabel Eins Doku.

AFCA files request for examination with Cartel Court

P7S1 is one of two providers of commercial TV channels that produce a large and broad range of content (news, entertainment, infotainment, films and series) particularly for an Austrian audience. As a market participant, P7S1 is therefore significant to ensure media plurality in Austria as defined in § 13 KartG.

In relation to the question of the planned merger’s impact, AFCA found in its examination that, based on currently available information, negative effects on the current status of P7S1’s media activities in Austria cannot be ruled out, particularly with regard to the extent of Austria-specific programming content.

“Media plurality is one of the pillars of democracy, and any attempt to limit it will be taken very seriously by the AFCA,” explains interim Director General Natalie Harsdorf-Borsch.

The Austrian Communications Authority (KommAustria) has submitted a statement in which it also voices concerns about a potential negative impact on media plurality and recommends carrying out another examination.

Furthermore, an undertaking as defined in § 10 para. 4 KartG has also submitted a statement to the AFCA, judging the notified merger to have a negative impact on media plurality.

Based on the available information, an in-depth review of the planned merger is deemed necessary. The AFCA therefore requested an examination pursuant to § 11 KartG on 10 January 2023. The Federal Cartel Prosecutor (Federal Ministry of Justice) will also file a request for examination.