Tuesday, April 25, 2006

The Gasparri law and the SIC - or why normal anti-trust rules don't work here

Following on from yesterday's post, there seems no third way to resolve the tremendous conflict of interest posed by Berlusconi's control of the media. Whilst in many other countries, existing anti-trust or media legislation would be used to break up or otherwise ameliorate Mediaset's dominant position in the Italian media, that doesn't seem possible in the Italian case.

At the moment, prevention of anti-competitive positions in the media market is governed by the provisions of the infamous 2004 Gasparri law. The Gasparri law (here in English) followed a much stricter 1997 law, according to which no single subject could control more than 30% of the television market. The Gasparri law abolished this restriction: no single subject may now control more than 20% of the entire media market - the so-called Integrated Communications System, or SIC. The problem is, no one knows quite how big the SIC is, and there was more than a sneaking suspicion at the time of the passage of the law that the SIC was a legal fiction designed to protect Berlusconi's media empire.

(There's a wonderful passage in Sabina Guzzanti's film Viva Zapatero! which deals with this.
"Let's take the example of Coca-Cola. Coca-Cola has a dominant position in the world of soft drinks. To stop Coca-Cola from being dominant, I extend the definition drink to all liquids, like whisky, river water, sea water, ocean water - then I say: "look at all the water in the world, Coca-Cola is no longer the dominant liquid")

But almost two years after the passage of the Gasparri law, the communications watchdog has still not rendered a judgement on the size of the SIC, or whether anyone has reached 20% of the SIC. According to this March press release, the communications watchdog is 'shortly' to arrive at an estimate of the size of the SIC. Will this estimate be consequential?

This wikipedia article gives no source when it claims (1) that the total value of the SIC is €87 billion and (2) that the absolute value of the 20% limit is more than the absolute value of the previous, 1997 limit. If both are true, then it looks unlikely that Mediaset's control over the SIC is in violation of the Gasparri law.

At the same time, there has as yet been no definitive judgement - so a safe, technocratic (but only partial) solution to the problem is still possible.

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