In order to align with the European Media Freedom Act, Austria is taking concrete steps by adopting appropriate laws at the national level, in order to ensure greater control over mergers and acquisitions involving business entities in the media sector.
The amendments to Austrian legislation are expected to achieve several key objectives, in particular expanding the scope of transactions subject to control and approval, taking into account not only the impact of the transaction on competition, but also its impact on media pluralism, freedom and independence of the media, as well as an increased role for the Austrian state media regulator in merger and acquisition procedures.
Regarding the scope of transactions, unlike the existing regulation, according to which for a transaction to be considered to fall within the media sector, it was necessary for at least two parties to carry out an activity in that sector, the new solution provides for the so-called “one-sided media merger”. In essence, this means that the transaction will be subject to a special media assessment within the framework of the merger control procedure even in a situation where only one participant is an entity that carries out activities in the media sector. In this way, the scope of transactions subject to control is significantly expanded, including deals concluded by entities that have no direct connection with the media sector at all.
Additionally, enhanced controls are also seen through the fact that the assessment of mergers and acquisitions will not be based solely on the impact of the deal on the competitive situation. On the contrary, the assessment of the deal will also have to take into account its impact on media pluralism, freedom and independence of the media.
Finally, these changes will also lead to an increased role for the Austrian state media regulator, KommAustria, in the procedures for mergers and acquisitions of business entities in the media sector. In such situation, in cases concerning mergers and acquisitions of media entities, in addition to the competent competition authority, KommAustria will also participate, and will be asked for an expert opinion on whether the specific transaction may affect media pluralism and editorial independence.
The new rules, although on the one hand could provide for enhanced control and stricter criteria for approving deals, not only from the perspective of competition, but also from the perspective of media freedom, on the other hand could slow down the process, as a result of the larger scope of deals subject to control, the stricter assessment criteria and the greater involvement of multiple authorities.