Australia tightens rules on foreign ownership of media

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SYDNEY -- Canadian Issy Asper's CanWest Global Communications may have to sell about $550m worth of Network Ten's shares, representing 61% of the company. This follows a recommendation from the Foreign Investment Review Board (FIRB) to Federal Treasurer Peter Costello that he can force CanWest to reduce its holding to 15%, the maximum permitted by foreigners.

The FIRB has backed the Australian Broadcasting Authority's ruling last Friday that CanWest is illegally in control of Ten. Both decisions come as the Federal Government appears to be toughening its discretionary policy on foreign ownership of the media.

The ABA had last year approved CanWest's then 57.5% stake in Ten, which combined the maximum 15% voting share block allowed foreigners with 42.5% held in non-voting debentures. Last week the ABA ruled that CanWest's financing of a group of local businessmen to acquire a 37.5% block of Ten's voting shares had put CanWest in control of Ten by way of association with the businessmen.

CanWest's Australian representatives have refused to comment on the two rulings, but Asper is expected to visit Canberra to speak directly with the Federal Treasurer. He has, it is understood, also kept open the possibility of mounting a legal challenge.

Copyright April 1997, Crain Communications Inc.

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