Posted by: euromediablog | June 18, 2009

Press Aid in Sweden vs. European Competition Law

The state of the art

State funding has been one of the most important revenues for Swedish newspapers, which can not manage to combine journalistic values with economic success. Government’s support is normally legitimated as a reaction against the market failure of quality press, by supporting media pluralism.

The problem

Neelie Kroos, EU Competition Commissioner,  sees state funding in a different way, namely as an infringement of the European competition law and  the rules on state aid. She argued that the permanent financial support of big Swedish newspapers leads to a distortion of competition with negative consequences for smaller editions, not funded by the state. This distortion is taking extreme measures in the time of advertising crisis.

The solution

The EU Commission proposed  a reduction in aid and a time limit for the state funding, in order to diminish the distortion of competition.

The Reaction

Agneta Lindblom Hulthén, chairwoman of  the Swedish Union of Journalists, defined the commissions proposal as a threat to democracy, by  arguing for the democratic purpose of the state aid:

“Government support for newspapers has a very long tradition and assures that there are more voices. It has been a very important part of the development of Swedish democracy.”

Our opinion:

Tackling state aid for the press in the time of an Europe wide newspaper crisis does not seem to be the smartest strategic move by the European Commission. Not in times when journalistic quality does not automatically ensure enough economic benefits and when newspaper associations constantly plead for economic subventions.

At the moment there seem to be more important things to be done for safeguarding the newspaper industry, as the oldest watchdog of democracy. It could be more useful to concentrate on increasing the transparency of state aid, by applying common European rules on media pluralism and concentration and by harmonising the state funding for quality journalism, as a typical case of market failure.

Related Articles:  European Commission to Help Newspaper Industry?

For further information: ejc and EUobserver

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Responses

  1. […] for French Youngsters for Free A day after the EU Commission officially denounced state aid for the newspaper industry in Sweden, the French ministry of culture announced the first concrete measure of Sarkozy’s press […]


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