Course of procedure
The merger had been notified once before, at the end of 2022. The applicant withdrew that notification following a request made by the Austrian Federal Competition Authority (AFCA) for an examination, resulting in the launch of an in-depth review by the Cartel Court (see press release of 10 January 2023). The Federal Cartel Prosecutor (BKAnw) also filed a request for examination at that time.
The planned merger had to be notified to the European Commission too. The Commission cleared the merger in September 2023, having not found any competition concerns.
The AFCA only examined the effects the merger would have on media plurality in Austria, again applying for an in-depth review by the Cartel Court following the second merger notification, since it could not rule out a negative impact on media plurality. The Austrian Communications Authority (KommAustria) also submitted a critical statement.
Specific media plurality issues identified by the AFCA
- Increased pressure to cut costs, possibly resulting in a reduction of local news and content. This might impair national media plurality and also reduce demand for national media productions.
- A stronger focus on group companies can result in smaller countries such as Austria finding themselves at a disadvantage in relation to the marketing of national advertising inventory and thus weaken the financial and editorial independence of the P7S1 Austria Group.
The BKAnw also argued that media plurality might be hampered by the change in ownership structure. P7S1 is currently a listed joint stock company (AG), in which no shareholder can exert control and opposing interests therefore prevent any undue influence on content. If it were to become an AG controlled by a family, the owners’ convictions might be reflected in the news reports and general choice of content.
Measures to strengthen media plurality – agreed commitments
The official parties, KommAustria and MFE finally agreed on the specific commitments, and MFE confirmed its acceptance of them to the Austrian Federal Competition Authority and the Federal Cartel Prosecutor. The commitments dispel concerns about possible impairments of media plurality, which is why the AFCA withdrew its requests for examination filed with the Cartel Court.
“Media plurality is one of the pillars of democracy, and we will scrutinise any potential attempt to limit it. The merger was notified for the first time in 2022, and withdrawn again after we had initiated antitrust proceedings. In December 2023, we requested another in-depth review by the Cartel Court. The applicant has now accepted commitments, which will secure media diversity, and we can bring the case to a close,” explains Natalie Harsdorf-Borsch, Director General of the AFCA.
MFE accepted the following commitments to maintain media plurality
- MFE undertakes to focus P7S1 Austria Group’s programming on local content, producing local content and maintaining a relevant share of news. This content should not be reduced.
- MFE undertakes to ensure the independence of P7S1 Austria Group’s managers and editors-in-chief.
- MFE is committed to P7S1 Austria Group’s existing editorial values and standards and guidelines for editorial practices.
- P7S1 Austria Group’s independence is to be secured by setting up a separate budget for these companies and by allocating all marketing revenue from the Austrian ad inventory to this Group.
- P7S1 Austria Group is to market its ad inventory independently.
- The audiovisual offers of P7S1 Austria Group are not to be “bundled” with other MFE content for content aggregators.
- P7S1 Austria Group is not to be granted less favourable terms in relation to service transactions within the Group.
- The head office and administration of the P7S1 Austria Group companies are to remain in Austria.
MFE will annually report its avenues of influence on P7S1, the appointment of managers and editors-in-chief, advertising revenue, amendments to the editorial values and standards, as well as the share of news programmes and local productions to the AFCA and the BKAnw.
The commitments are deemed agreed for an indefinite period of time, with the parties having included a hardship clause to cover potential changes to market conditions and the economic situation of the target company.
Commitments Z-6429 MFE MEDIAFOREUROPE N.V. und ProSiebenSat.1 Media SE (German)
Case Report Z 6429 MFE MEDIAFOREUROPE N.V. und ProSiebenSat.1 Media SE (German)