Newspapers to be subject to test of accuracy under takeover guidelines

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The Independent Online

Newspaper rivals seeking to buy each other's businesses will be subject to a new test of their own accuracy under proposed government guidelines published yesterday.

The guidelines are likely to be in place in time to affect any bids for the Telegraph group of newspapers from rivals such as Richard Desmond's Express group or Associated Newspapers, publishers of the Daily Mail. The Department of Trade and Industry said that ministers would only intervene in media deals where there were specific public interest issues raised.

Patricia Hewitt, the Secretary of State for Trade and Industry, was announcing a consultation period on the guidelines for assessing deals and said the draft guidance would underpin the new regulatory regime imposed on the media industry by last year's Enterprise Act and this year's Communications Act.

Mrs Hewitt said ministers would not normally intervene in deals involving broadcasters where there have never been media ownership rules in place or where such rules continue to operate. They would consider intervening in broadcasting deals where media ownership rules have been removed, she said. This could affect any bid for Channel Five from an overseas rival such as Rupert Murdoch's News Corporation.

However, newspaper takeovers present a different set of issues for governments. Under the proposed new guidance, drawn up by the DTI with the Office of Fair Trading and the Competition Commission, there will be three key public interest measures. A bidder will have to prove its record in the "accurate presentation of the news in newspapers"; bidders will have to demonstrate "the free expression of opinion"; the Government will want to ensure the newspaper market contains a "sufficient plurality of views".

The DTI said ministers would also consider the concentration of media ownership in any particular area as a result of a proposed deal.

While the Communications Act comes into force from 29 December, the Government will consult on these public interest guidelines until 12 March.