4 May 2019 18:37

Communications Ministry's amendments keep ban on direct foreign ownership of Russian media outlets

MOSCOW. May 4 (Interfax) - The Russian Ministry of Digital Development, Communications and Mass Media has put forward amendments to the part of Russia's law on mass media that restricts foreign ownership of Russian media outlets, but the proposed amendments change only the legal wording of the provisions and do not alter their main points.

The relevant draft amendments are available on the federal portal of draft regulatory legal acts. They have been drawn up by the Ministry of Digital Development, Communications and Mass Media together with the country's telecommunications watchdog Roskomnadzor in compliance with the Russian Constitutional Court's January 17, 2019 ruling, an explanatory note said.

The Constitutional Court ruled at the time that Parts 1 and 4 of Article 19 of the media law were at odds with the Constitution, and compelled parliament to clarify the norm of the media law imposing restrictions on media owners.

For instance, the provisions use the notions of "media founder" and "media participant", a circumstance which complicates the establishment of the actual subject of the ban, the court said. It is also unclear from the law whether the ban applies to media founders or media shareholders.

The bill submitted by the ministry amends Articles 19.1, 19.2 and 19.4 of the abovementioned law. However, the term "media participant", which drew the court's criticism, has been excluded only from the first part of Article 19.1 and remains in the rest of the text. For instance, the law's section that restricts ownership to no more than 20% of shares in the charter capital of the entity being a participant in a media founder has been supplemented only by the phrase "established in the form of a legal entity", which does not change the essence of the restriction itself.

Interfax reported earlier that in early April the Ministry of Digital Development, Communications and Mass Media had agreed upon another text of amendments to the media law part limiting foreign ownership of Russian media outlets.

That version proposed fully excluding the word "participant" from the media law, thus simplifying the scheme of corporate restrictions earlier introduced by the law on mass media with regard to foreign ownership and enabling foreigners or people with dual citizenship to directly own or otherwise control up to 20% of a media founder's charter capital.

Since the existing restrictions came into force, several leading publishing houses and media holding companies have had to alter their ownership structure. The list of such companies comprises Business News Media (the publisher of Vedomosti), Independent Media, Hearst Shkulev Media, Axel Springer (the publisher of the Russian version of Forbes), STS Media, Ekho Moskvy, and also several television channels, including Channel One Russia.