Digital Markets, Competition and Consumers Bill

Lord Parkinson of Whitley Bay Excerpts

Report stage
Wednesday 13th March 2024 Lords Chamber

[The Parliamentary Under-Secretary of State, Department for Culture, Media and Sport (Lord Parkinson of Whitley Bay) (Con)]

My Lords, it is a pleasure to speak on this Bill for the first time, even if it is some 43 minute later than advertised by some of our free media outlets. It touches on debates we have already had in connection with the Media Bill.

His Majesty’s Government firmly believe in a free media and a free press. It is the bedrock of our democracy and an essential safeguard which ensures accountability and effective government. I know that noble Lords share that firm belief. We heard it strongly again today, not least from my noble friend Lady Stowell of Beeston, whom I thank for her work in reflecting these important principles through her scrutiny of this Bill, the Media Bill and others.

Media freedom depends on having a plurality of media through which the public can access a wide range of accurate, high-quality news, views and information. My right honourable friend the Secretary of State has championed press and media freedom from her very first moment at the Department for Culture, Media and Sport. She has been clear about its importance and has made it a personal priority.

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[Lord Bassam of Brighton (Lab)]

My Lords, in order to help, can we be absolutely clear that this covers minority ownership and control? We need clarity on that. The noble Lord, Lord Moore, made that point. It would help the House for the avoidance of doubt.

[Lord Parkinson of Whitley Bay (Con)]

The noble Lords have intervened at a helpful point, because I was about to outline that we want to ensure that the new measures do not have undesired effects on wider foreign business investment in the UK media, or on purely passive investments made by established investment funds.

In the amendment we will bring forward at Third Reading, it will be necessary to take a power to make secondary legislation to set out two points clearly: first, what limited types of established investment funds we mean, which could be split out of the general prohibition on foreign state ownership provided for by this regime; secondly, the very low threshold up to which they may be permitted to invest, which we intend to be considerably lower than the current thresholds for material influence in the Enterprise Act.

As we bring this forward ahead of Third Reading, we would be very happy to discuss the drafting with noble Lords before it is tabled so that we can discuss the detail. We will set that out in the provisions at Third Reading.

[Lord Lansley (Con)]

I am sorry to interrupt my noble friend but, as he knows, I am interested in the question of media enterprises more generally. Is he intending that the amendment to be brought forward will relate only to newspapers, and therefore will not touch upon broadcasters, as they will be excluded? I am not sure I understand why the presentation of news by broadcasters is to be treated differently from the presentation of news by newspapers.

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[Lord Parkinson of Whitley Bay (Con)]

The provisions we will bring forward at Third Reading will relate to newspapers and periodical news magazines, as I have set out. It will not cover television and radio broadcasters at this time, but that is something we will continue to consider. We have already been considering it as part of our broader work on the media mergers regime. That work will continue. I am happy to speak with my noble friend Lord Lansley and others about it.

[Lord Clement-Jones (LD)]

Could the noble Lord go through again what will happen to an existing merger, which is subject to existing procedure? He seemed to be saying that, as soon the new provision comes in when the Bill passes, it will be subject to the new procedure as well as the old. Is that what he was saying, and how will that work?

[Lord Parkinson of Whitley Bay (Con)]

That is what I was saying, but it depends on when the Bill gets Royal Assent. That is in the hands of noble Lords and not just the Government. If any live case is still ongoing at the time of Royal Assent—we intend for the new provisions to come into effect at Royal Assent—then the Secretary of State will obviously follow the provisions as set out in other Acts of Parliament as decided by Parliament previously, and follow the law as enacted after Royal Assent.

[Lord Clement-Jones (LD)]

I have a second question. I am assuming that internet digital news media—not a newspaper—will not be covered by these provisions.

[Lord Parkinson of Whitley Bay (Con)]

No. I am grateful that we have separated the debate on the noble Lord’s previous amendment from this so that I can respond directly to the amendment brought by my noble friend Lady Stowell. I am grateful for his understanding of that.

The Government are focused on the reforms to media ownership rules, which were suggested in Ofcom’s 2021 review. It did not recommend that online inter- mediaries, including social media platforms, search and video/audio-on-demand services should fall in scope of that. I heard what the noble Lord said about having this debate in the Media Bill, and I look forward to doing so.

The secondary legislation provisions that I have outlined will be subject to the affirmative procedure in Parliament. Until such time as those regulations are laid and approved by Parliament, the whole regime applies to everybody caught by the general foreign state prohibition.

We have always believed that the trustworthiness of our news and the lack of government interference in it, whether domestic or foreign, is of paramount importance, which is why we are setting out today our plan to make that more explicit in the regulatory regime that exists. As my noble friend Lady Stowell is aware, work is already under way to update the media mergers regime more broadly, and I touched on that in my responses to noble Lords. We will continue to take that work forward. I hope that, on that basis, my noble friend is able to withdraw her amendment today. With renewed thanks to her and a renewed commitment to work with those who have supported her, I am grateful for the opportunity to speak today.

[Baroness O'Neill of Bengarve (CB)]

My Lords, for the avoidance of doubt, could the Minister clarify whether the proposed restrictions apply not only to print and broadcast media but to digital media?

[Lord Parkinson of Whitley Bay (Con)]

No, it is just to newspapers and periodical news magazines.

[Baroness Stowell of Beeston (Con)]

My Lords, I am very grateful to all noble Lords who have spoken for their support and for the powerful speeches that they have given, and I am very grateful to my noble friend for his clear and comprehensive explanation of the Government’s position, and their firm intention to bring back an amendment at Third Reading to address that simple objective that I outlined at the start of this debate.

Because my noble friend covered such a lot of ground and this is quite complex stuff, for the benefit of other noble Lords and anyone else following this debate, I shall play it back at him a little bit, perhaps in plainer English, if I may—although noble Lords must forgive me if some of it is not as plain as it would be if I was speaking outside the House.

What we have heard is that the Government will bring forward an amendment at Third Reading that will expand the definition of foreign power beyond that in the National Security Act to include individuals who might not otherwise be adequately captured. That is something that has been of particular interest and concern to some of the legal noble Lords who have been following and commenting on my amendment. The amendment will expand the definition of “newspaper” in the Enterprise Act to include news magazines explicitly. The amendment will give the Secretary of State a new power to issue a foreign state intervention notice if she is notified or becomes aware at any time of possible foreign state involvement to own, control or influence a newspaper or news magazine. Once her order is issued, the CMA must investigate and, if it establishes that it is a foreign state, as newly defined, any investment or takeover will be blocked—or, if the investment has already happened, the Secretary of State will have the power to unwind that investment. All that will come into force once the Bill gets Royal Assent, and it will apply to any live regulatory case alongside the existing procedure that the Secretary of State is following.

In addition, at Third Reading, the Government will bring forward an amendment to create secondary legislation, which will be subject to the affirmative procedure. Those regulations will define what kind of indirect foreign state entity might be allowed to make a passive investment, such as a sovereign wealth fund of a democratic state, and include a very low threshold below which such an entity could invest. The purpose of those regulations will be to preserve the opportunity of legitimate foreign investment in news media. For example—and I think that it helps to get an example to understand what we are talking about here—it has been pointed out to me that the Norwegian state investment fund has single digit investments in News Corp, Reach, which is also known as the Mirror Group, Paramount Global, which owns Channel 5, and Comcast, which owns Sky.

To me, what my noble friend has outlined today, on my simple interpretation of it, makes sense. I am very grateful to the Minister for emphasising the very low-level investment that the Government are considering for the secondary legislation that will come forward, but the precise percentage will matter. I know that he will not be able to commit now to bringing forward the regulations in draft at Third Reading, because there is a lot of work for officials to do between now and then, but I hope that he can commit to doing as much as he can at Third Reading to provide the detail that we will need to be properly satisfied that what then follows will meet all our concerns.