Unlocking the Gates: Foreign States Can Now Own a Slice of UK Newspapers

In a notable shift in UK media policy, foreign states will soon be allowed to own up to 15% of shares in British newspapers and news magazines, as per new laws introduced by the government. The decision follows a controversy over a failed takeover bid of the Telegraph and the Spectator by RedBird IMI, which had the backing of the Abu Dhabi ruling family. Initially, the takeover attempt prompted the Tory government to impose a complete ban on foreign-state ownership of UK media following intense opposition from parliamentarians.

On Thursday, Culture Secretary Lisa Nandy announced that State Owned Investors (SOIs), such as sovereign wealth funds and public pension schemes, will now be able to acquire stakes in UK media. Nandy emphasized that these changes are aimed at protecting media plurality while enabling struggling publishers to secure vital funding.

The decision comes after consultations revealed many in the newspaper industry felt that an outright ban was overly restrictive and hindered financing opportunities. The new regulations set the threshold for SOI investment to 15% of a newspaper’s shares or voting rights, which is deemed a straightforward and balanced approach. This threshold also follows a crisis when Lloyds Bank took control of the Telegraph and Spectator to recover £1bn in debts from their previous owners.

The announcement reflects a recognition of the significant role that foreign investment can play in the sustainability of UK media while maintaining safeguards against foreign control. Nandy stated, “Britain’s free and independent press is a national asset like no other,” ensuring that the media can still function effectively while also allowing for low-risk foreign investment that mitigates the risk of market dominance.

This law change represents a complex balancing act between maintaining the integrity of the UK press and adapting to financial realities in an evolving media landscape.