The fate of the transparency of the media’s ownership bill is to be decided between first and second reading

From AEJ

2018-09-17 09:00:49   |  Views: 902  |    |  0 comment(s)

The bill on obligatory submission of print and other materials, introduced in the parliament by representatives from MRF, among which the media mogul Delyan Peevski, was ratified on first reading with 92 votes for it, 12 against and 28 abstained.

A series of concerns and issues were raised in the public sphere in regards to several problem areas of the bill from various institutions, including major stakeholders such as the Ministry of Culture and the National Library “Saint Cyril and Methodius” – stakeholders that are directly impacted by the bill. AEJ issued its own opinion on the matter in the beginning of March where it addressed similar problems and predictions concerning the proposed amendments to the current law.

Stemming from this, a thorough analysis of the bill is necessary in order to follow through on its development and introduced amendments between its first and second reading.  Furthermore this is done in order to assess the extent to which the MPs have taken the public opinion into consideration and to predict what additional changes are to be expected in the future.

To begin with, it is important to note that there is a distinct will to change the current legislature and shed light on the question of medias ownership; however the parliament has opted out of drafting a completely new law and its MPs have rather embraced the idea of amending specifically the Law on Obligatory Submission of Print and Other Materials, whose main focus is to “determine the conditions under which certain print and other materials created in the country or related to it are to be deposited for the purposes of being kept as part of the national cultural heritage”.  Neither the Ministry of the Culture, nor the National Library consider in their respective opinions of the bill that the proposed amendments correspond to the aims of the law.

No other law in Europe or in any other country of the world related to the obligatory submission of print and other materials includes rules on media ownership. The reason for this is that the issue of true media ownership, be it print or online, is paramount for the greater society, for pluralism and for upholding a democratic process rooted in open debate and freedom of speech. This issue has greater economic, political, and pubic repercussions. The new legislation ought to be extremely detailed and well written; it would be much better if is made as a separate directive written specifically for the purpose of media ownership. A statement from the National Library rightfully accuses the MPs of not being sufficiently knowledgeable in the law and referring to it as a “media law” or as an “amendment to the media law”.

The essence of the changes introduced to the bill between the first and second reading, together with an expert commentary from AEJ is to be found in the table below.

First reading

Article 7c.(1) A legal person or an entity that distributes or sells print materials must submit, by January 31 of the respective year, a declaration, approved by the minister of culture in the Ministry of Culture, which identifies its real owner as well as the number of print materials retail outlets, which it uses as part of its business.
(2) The Ministry publishes on its website the information pertaining to point 1 in a 10 day period after receiving the declaration.
(3) In case the legal person’s or legal entity’s business accumulates more than 1/3 of all declared print materials retail outlets, the Ministry of Culture notifies the Commission for Protection against Discrimination.

Second reading


No changes

AEJ comment

This is one of the main amendments to the law. It follows the current law, implemented in 2010 and its article 7A that obliges print material issuers to declare in their first annual issue their real owner and to submit a declaration to the Ministry of Culture in a seven day period. The same article is now to be applied to print material distributors as well.

First reading

Article 7c.
(1) By the 30th June of the respective year the media services providers are to submit a declaration to be published in the Commercial Register as per article 3, point 1 of the registry law, which contains information regarding the real owner of the media services providers as well as information on any, received in the previous calendar year, financing together with information about the person who has provided this financing.
(2) The media services providers must also publish the information about their real ownership on their Internet websites

Second reading


Article 7c.
(1) By the 30th June of the respective year the media services providers are to submit a declaration to be published in the Commercial Register as per article 3, point 1 of the registry law, which contains information regarding the real owner of the providers of media services to date and information on whether or not that person is someone who takes a public post, if he or she is subject to criminal proceedings, or have received a sentence that unequivocally shows that the person is guilty of committing a crime; as well as information on any, received, in the previous calendar year, financing together with information about the person who has provided this financing, its size and the grounds for making it. In case the person who manages the content of the media provider or the editorial policy is different from the real owner of the same media, than this fact must also be included in the declaration.
(2) Included in the declaration, as per point 1, should also be all concluded in the previous year contracts and their amounts between the providers of media services and any public, municipal, state or other organization, with a political party or as a result of a public tender, or such with advertising agencies or companies that are subject to regulations or such that have been received through European financing.
(3) The declaration as per point 1 is to be submitted at the Ministry of Culture following the same deadline; while the Minister of Culture is responsible for managing a separate, public register of the submitted declarations on the ministry’s webpage
(4) The declaration’s template as per point 1 is to be approved by the Minister of culture
(5) The media services providers must also publish the information about their real ownership on their Internet websites

AEJ comment

It is apparent from the proposals made during the second reading of the bill, that media services providers will be expected to also declare “the person who manages the content of the media provider or the editorial policy” in case he/she is different from the real owner. How is this to be verified, however, and who will be the responsible institution to make the necessary checks, is not clear.
In reality the bill provides a definition for a real owner that has not been changed since the originally proposed one in point 3. In point 10, section 1 from the additional provisions, certain amendments are made: “A real owner is a legal person, who is the final beneficiary of the legal entity’s property, or are the founding members of an NGO that own shares of media services organization either directly or through related parties”.
The proposal does not shed light on the reasons why the opinion of the Council for Electronic Media was never sought even though it is the organization that monitors all media service providers.
The proposal made in point 2, related to the obligatory declaration of any state or political party financing is commendable.

First reading

Section 1, point 10 from the Additional Provisions states that:
„A real owner is a legal person, who is the final beneficiary of the legal entity’s property, or are the founding members of an NGO that own shares from the provider of media services either directly or through related parties”

Second reading

No changes

AEJ comment

AEJ has already commented on the term “real owner” and would like to once again highlight the need for uniform, non-contradictory definitions of terms in the Bulgarian legislation.

First reading

No amendment to this point in the first reading of the bill

Second reading

Article 17:
New points – 7 and 8 – have been created with the following content
(7) A legal person or an entity that fails to submit a declaration in the proscribed by the law term, or submits one with false information is subject to a fine in the range of BGN 10000 to 15000 in case it does not constitute a crime. In case of a subsequent infringement, the fine can either be in the range of BGN 20000 to 30000 or it can be a penalty payment.
(8) A legal person or an entity that fails to submit a declaration in the prescribed by the law term as per article 7, or submits one with false information is subject to a penalty payment in the range of BGN 10000 to 15000 in case it does not constitute a crime. In case of a subsequent infringement, the fine or penalty payment is in the range of BGN 20000 to 30000.
A new point 9 has been created with the following content
(9) A legal person or entity that provides media services, without having submitted a declaration as per article 7c is subject to a penalty payment in the range of BGN 10000 to 15000 in case it does not constitute a crime. In case of a subsequent infringement, the fine or penalty payment is in the range of BGN 20000 to 30000.

AEJ comment

During the first reading of the bill no sanctions for non-submission of a declaration were included. The proponents of the motion clearly indicated in their assessment that there wouldn’t be any additional administrative burdens or fees for the society.
Although such sanctions are needed their lower threshold is unjustifiably high. A threshold of BGN 10000 for initial infringement and a BGN 20000 for a secondary one is not only disproportionate but it also seriously threatens freedom of speech and may very well result in serious negative repercussions and censorship.
The administrative body should be able to assess the extent of the infringement’s severity and to make prescriptions and provide assistance prior to applying such enormous fines, especially when taking under consideration the fact that as of right now these sanctions constitute 20 times the minimum wage in Bulgaria for initial infringements. Such legislative maneuvers are a clear sign of the lack of consistency and are an attempt to limit the public debate on the motion between the first and second reading.

First reading

No amendment to this point in the first reading of the bill

Second reading

Article 18
At the end of point 1 the following sentence is added:
“Any infringements as per article 76 are to be declared by officials from the Ministry of Culture. In the cases when the party at fault cannot be determined or when the provider of media services performs its activity without having submitted a declaration as per article 7c, the minister of culture is to inform the Interior Ministry and is to publish information pertaining to the said exchange of information on the ministry’s webpage.”
“The Minister of culture or an authorized by him/her person issues a criminal decree as per article 76 and point 7c

AEJ comment

One of the main criticisms of the 2010 amendments requiring that infingement penalties are to be drawn up by officials from the Ministry of Culture, is that there is no mechanism and reglament set in place to help establish them on the one hand or mechanisms to sanction the offenders on the other.
The motion made during the second reading of the bill does not solve this problem. The issue of penalty payments without a working mechanism to do so, when put in the hands of an administrative body that is not independent, as is the case with the Council for Electronic Media, is bound to create a multiplicity of problems and can create a situation where the state represses the media.

First reading

In section 1 of the Additional Provisions points 12 and 13 have been created with the following content:
“The term “financing” is to be understood as any monetary, property and/or other grant received regardless of the used legal form, which does not coincide with the usual sources of revenue for the provider of media services, as well as any NON-BANK issued loans.
13. The terms “media service” and “provider of media service” are to be understood based on the definition given in section 1, point 16 from the Additional Provisions of the Electoral Code

Second reading

In section 1 of the Additional Provisions points 12 and 13 have been created with the following content:
“The term “financing” is to be understood as any monetary, property and/or other grant received regardless of the used legal form, which does not coincide with the usual sources of revenue for the provider of media services, as well all loans, INCLUDING bank issued ones
13. The terms “media service” and “provider of media service” are to be understood based on the definition given in section 1, point 16 from the Additional Provisions of the Electoral Code

AEJ comment

It is commendable that one of the shortcomings of the bill as presented at the first reading – namely the lack of requirement for declaring bank loan financing, has been rectified.

The analysis clearly indicates that there are certain problem areas, such as the inclusion of bank loans in the definition of the term “financing”, that have been properly addressed between the first and second reading of the bill. Perhaps the biggest positive change has been the additional obligation to declare all contracts and their amounts with state and municipal institutions, or with organizations with state or municipal involvement, with political parties, as a result of public tenders, concluded advertisement contracts with legal entities that are subject to regulation as well as such that provide financing from EU funds. This is necessary and important information that the general public is entitled to and as such AEJ was appealing for its inclusion in the bill.

Despite these gains, certain new amendments raise more questions. It is especially concerning, that time and again certain issues of great public importance are altered between first and second reading, and their public discussion is left for the peak of the summer season, when, traditionally, people’s attention to such matters is understandably lower. The most serious of these changes is the one concerning the high fines applied in case of failure to submit a declaration. Although sanctions are indeed necessary to ensure upholding of the law, the extremely high lower threshold of BGN 10000 is capable of bankrupting many sites, forums and portals and borderlines censorship. This lower threshold should be reconsidered and the administrative body applying it should be given the possibility to make its own assessment on the matter.

In addition the bill does not make it clear why the media services providers should submit the same declaration both to the Trade Registry and to the Ministry of Culture. The obligation to submit two, identical declarations creates only additional administrative burdens for the media services providers. What is more, it is never explained why it is the Ministry of Culture that is in charge of maintaining the registry since the Council for Electronic Media is the responsible organization whose activity mainly focuses on regulating the activities of the media services providers. Furthermore, the Ministry is burdened with more administrative tasks, such that the Council could easily handle at a more expert level.

In conclusion, it could be considered that some of the initial weaknesses of the bill were successfully rectified; however new, serious issues appeared during the second reading of the bill. The members of parliament therefore, should take a stand and make sure that the finalized bill is one that sheds light on media ownership without endangering freedom of speech.

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