CAP Clean Air

RNS Number:7231G
Office of Communications
22 December 2004

                             FOR IMMEDIATE RELEASE

                   Ofcom publishes its statutory assessments
                   for the proposed merger of Capital and GWR


22 December 2004


Ofcom today announces the completion of its own role in the statutory process
for the Capital Radio plc and GWR Group plc proposed merger.


The assessment of key competition aspects of the proposed merger has been
undertaken by the Office of Fair Trading (OFT).  The OFT will announce its
conclusions today.


Ofcom has been given a number of specific duties under the Communications Act
2003 and other legislation in relation to media mergers.  It is today announcing
the outcome of its statutory assessments of the ownership rules in connection
with the proposed merger of Capital Radio plc and GWR Group plc.


Change of control


Section 355 of the Communications Act 2003 requires Ofcom to carry out a review
of any local radio licence that undergoes a change of control, in order to
ensure that the character of the service, the quality and range of programming
and the amount of local programming would not be prejudiced as a result of the
change of control.


* Ofcom has determined that 30 GWR local analogue radio licences would
  undergo a change of control as a result of the merger.

* Following statutory change of control reviews of the 30 GWR licences, if the 
  proposed merger proceeds Ofcom intends to vary two GWR licences in order
  to safeguard local programming:

  * GWR Bristol and Bath FM: separate weekday breakfast services are currently 
    provided for each of the Bristol and Bath areas.  This provision will
    be written into the licence to ensure continued provision of these separate
    services.

  * MFM/Buzz Wrexham and Chester FM licence: a separate weekday breakfast
    service for the Wirral is currently provided, and this provision will be 
    written in to the licence to ensure continued provision of this separate 
    service.



Ownership rules


Ofcom has a duty to apply specific ownership rules that either prohibit certain
categories of persons from holding broadcasting licences, or are designed to
protect plurality of ownership of the media.  These rules are set out in Part 2
of Schedule 2 of the Broadcasting Act 1990, Schedule 14 of the Communications
Act 2003 and the Media Ownership (Local Radio and Appointed News Provider) Order
2003.


* Ofcom has concluded that none of these statutory ownership rules would
  be breached by the proposed merger.

* Specifically, Ofcom has concluded that the specific ownership rules
  designed to protect plurality in relation to local analogue radio licences,
  local digital multiplex licences, and local digital sound programme service
  licences would not be breached if the merger were to go ahead as currently
  envisaged.


Public interest test


If the Secretary of State for Trade and Industry issues an Intervention Notice,
Ofcom is required under Section 61A of the Enterprise Act 2002 to carry out an
investigation into the public interest considerations specified in the notice.

  * The Secretary of State has not issued an Intervention Notice with regard
    to the proposed Capital and GWR merger.  She has the power to issue an
    Intervention Notice only until the OFT makes a decision on whether or not to
    refer the merger to the Competition Commission.  There will, therefore, be
    no assessment of any public interest considerations as part of the
    regulatory scrutiny of this merger.


In relation to competition matters, the outcome of the OFT's consideration will
also be announced today.


The document setting out Ofcom's conclusions is available at: www.ofcom.org.uk


Ends.


NOTES FOR EDITORS AND CSEs

Ofcom is the independent regulator and competition authority for the UK
communications industries, with responsibilities across television, radio,
telecommunications and wireless communications services.


For further details please visit www.ofcom.org.uk.



CONTACT

Ofcom Media Office
mediaoffice@ofcom.org.uk
(+44) (0)20 7981 3033






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