1. 1 Media ownership in Latvia Presented by Anita Kehre, 15.11.2003. in Ljublana

2. 2 Major research goals  To analyse changes in Latvian media ownership patterns  To identify and analyse impact changes in the political environment have had on the formation of media ownership structures into their current form  To discuss these changes in relation to the issue of media pluralism

3. 3 Political and economic background Two transitions at the same time Two transitions at the same time  move from totalitarian to democratic system  move from planned to free market economy In addition of political and economic transition in Baltic states - Process of decolonisation In addition of political and economic transition in Baltic states - Process of decolonisation

4. 4 Result – method of privatisation Gap between formal democratic and market institutions on one hand and informal practices on the other. Gap between formal democratic and market institutions on one hand and informal practices on the other. Emergence of new political and economic elite surfaced as result of privatisation that was carried out by people involved in political elite Emergence of new political and economic elite surfaced as result of privatisation that was carried out by people involved in political elite

5. 5 Growing cleavage in society Cleavage between poor and wealthy Cleavage between poor and wealthy Cleavage along ethnic lines Cleavage along ethnic lines Ethno-linguistic cleavage is mirrored in the existence of two parallel information spaces and two markets for media products Ethno-linguistic cleavage is mirrored in the existence of two parallel information spaces and two markets for media products market split has generated extra constrains on the media industry because it’s limited size market split has generated extra constrains on the media industry because it’s limited size

6. 6 Influence of history Early history – prior 1918 Early history – prior 1918 The democratic and authoritarian regime 1918- 1940 The democratic and authoritarian regime 1918- 1940 Totalitarian regime 1940- 1986 Totalitarian regime 1940- 1986 National awakening 1986-1991 National awakening 1986-1991 1991- benchmark year for the emergence of private property in legal sense in Latvia 1991- benchmark year for the emergence of private property in legal sense in Latvia

7. 7 Ownership pattern during Soviet regime Soviet doctrine of social ownership of media was introduced by Lenin in 1917 Soviet doctrine of social ownership of media was introduced by Lenin in 1917 Only three kinds of organizations could own or operate media companies Only three kinds of organizations could own or operate media companies  Party organizations  Government bodies  Public organizations

8. 8 Ownership pattern during Soviet regime Print media belonged to organizations Print media belonged to organizations Broadcast were state owned Broadcast were state owned All media suppliers were controlled by the Communist party All media suppliers were controlled by the Communist party Media ownership was actually concentrated in hands of the state Media ownership was actually concentrated in hands of the state

9. 9 Privatisation First major changes of Latvian media system in terms of ownership is linked to process of privatisation First major changes of Latvian media system in terms of ownership is linked to process of privatisation Two ways of denationalisation: Two ways of denationalisation:  State transferring it’s assets to non – state agents (“Diena”)  Emergence of new, privately owned companies

10. 10 Spontaneous privatisation Unlike regular privatisation, can be defined as illegal action Unlike regular privatisation, can be defined as illegal action Widely accepted in Latvia in beginning of 90-ties Widely accepted in Latvia in beginning of 90-ties Case of the press Case of the press

11. 11 Concentration of media ownership Second major change in media ownership patterns Second major change in media ownership patterns Began in mid-1990s Began in mid-1990s Time of transitional recession Time of transitional recession Linked to media consolidation and concentration of ownership Linked to media consolidation and concentration of ownership Market structures become oligopolistic or even monopolistic, impossible for new newspapers to enter into market Market structures become oligopolistic or even monopolistic, impossible for new newspapers to enter into market

12. 12 Regulatory framework Media regulation consisting of two major domains – market regulation and state regulation Media regulation consisting of two major domains – market regulation and state regulation Developments in the market have preceded the state regulations, which have actually been shaped by lobbying power of agents- media owners Developments in the market have preceded the state regulations, which have actually been shaped by lobbying power of agents- media owners

13. 13 First: Media law First media law in the post-Communist period was introduce in very end of 1990 First media law in the post-Communist period was introduce in very end of 1990 At that time first non-state media outlets had already been in operation for 3-4 years At that time first non-state media outlets had already been in operation for 3-4 years “not against blank background of new epoch, but in a set of circumstances where new habits and new patterns were already established. “not against blank background of new epoch, but in a set of circumstances where new habits and new patterns were already established. Instead of regulating, it legalized the existing situation in the media market without distinguishing between press and broadcast Instead of regulating, it legalized the existing situation in the media market without distinguishing between press and broadcast

14. 14 Criticism of press law Delayed press law hindered private initiative in the broadcast media as it did not provide any legal foundation for the emergence of private broadcasters Delayed press law hindered private initiative in the broadcast media as it did not provide any legal foundation for the emergence of private broadcasters Law did not address matter of the level of ownership concentration that is to be regarded as monopolization Law did not address matter of the level of ownership concentration that is to be regarded as monopolization Law was adopted too late for development of private press because there were few people with sufficient resources to launch press operations Law was adopted too late for development of private press because there were few people with sufficient resources to launch press operations

15. 15 Press law about editorial relations It stipulates that it is duty of media outlet to publish materials of it’s owners or publishers It stipulates that it is duty of media outlet to publish materials of it’s owners or publishers Relationship between owners and editors and editorial staff is to be regulated on the basis of collective agreements. Such agreements do not exist in practice Relationship between owners and editors and editorial staff is to be regulated on the basis of collective agreements. Such agreements do not exist in practice

16. 16 Broadcasting law First adopted in 1992 when first private broadcasters were already operating First adopted in 1992 when first private broadcasters were already operating Law set out principles for de-monopolisation in the broadcast field, specifying that airtime given to one media company could not exceed 25 % of total time Law set out principles for de-monopolisation in the broadcast field, specifying that airtime given to one media company could not exceed 25 % of total time Law established National radio and television Council as the regulatory authority Law established National radio and television Council as the regulatory authority

17. 17 Second broadcasting law Adopted in 1995 Adopted in 1995 Main arguments concerned role of public broadcasters Main arguments concerned role of public broadcasters Council became politicised institution Council became politicised institution Council supervises all broadcasters, but also acts as the owner of the public service broadcasters by managing the state’s capital shares therein. Council supervises all broadcasters, but also acts as the owner of the public service broadcasters by managing the state’s capital shares therein.

18. 18 Other laws and regulations General laws, roughly divided into two groups: General laws, roughly divided into two groups: Contains regulations on concentration of ownership Contains regulations on concentration of ownership Regulates relationship between owners and the management of their companies Regulates relationship between owners and the management of their companies

19. 19 Competition law Specifies that one or more market participants achieve a position of dominance when they take over at least 40 % of the market share Specifies that one or more market participants achieve a position of dominance when they take over at least 40 % of the market share In general law is designed to prevent dominant market positions in economic sense, but it does not deal with the social and pluralistic aspects In general law is designed to prevent dominant market positions in economic sense, but it does not deal with the social and pluralistic aspects Limitations of foreign ownership in in some sectors, including media were stricken away from law in 1996 Limitations of foreign ownership in in some sectors, including media were stricken away from law in 1996

20. 20 Commercial law General provisions on structure and power hierarchy in company General provisions on structure and power hierarchy in company No Latvian media company is a public joint stock company listed on the stock exchange No Latvian media company is a public joint stock company listed on the stock exchange Most media companies have few shareholders, management and supervisory boards are just formalities Most media companies have few shareholders, management and supervisory boards are just formalities Does not require high transparency in company reports Does not require high transparency in company reports

21. 21 Conclusions Latvian media legislation does not impose strict regulations on media concentration outside the general provisions Latvian media legislation does not impose strict regulations on media concentration outside the general provisions There are certain limitations on media concentration in the broadcast media, but there are no regulations concerning cross- media concentration There are certain limitations on media concentration in the broadcast media, but there are no regulations concerning cross- media concentration Legislation concerning media concentration is not very elaborate because political elite are often reluctant to place this issue on the political agenda because media concentration have possitive effect for the political elite Legislation concerning media concentration is not very elaborate because political elite are often reluctant to place this issue on the political agenda because media concentration have possitive effect for the political elite