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Baroness Buscombe: My Lords, I thank the Minister for his response. He will not be surprised to hear that I am disappointed by it. It is an important issue, and we have raised it repeatedly.

I hear what the Minister says. I hear his concerns that the amendment could seriously damage Ofcom's power to regulate effectively and flexibly. Obviously, we must seek to avoid that. I shall not press the amendments; it would not be appropriate to do so at this late stage. However, I hope that Ofcom will take on board some of the issues that we raised in the

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debates and address some of them head-to-head—if I may put it that way—with the broadcasters who are particularly concerned about them. On that basis, I beg leave to withdraw the amendment.

Amendment, by leave, withdrawn.

[Amendments Nos. 58 to 65 not moved.]

Clause 314 [Review of powers exercised for competition purposes]:

[Amendments Nos. 66 to 69 not moved.]

Clause 333 [Promotion of equal opportunities and training]:

Lord McIntosh of Haringey moved Amendment No. 70:


    Page 295, line 3, leave out "fair treatment of" and insert "equalisation of opportunities for"

On Question, amendment agreed to.

Clause 344 [Modification of disqualification provisions]:

Lord Fowler moved Amendment No. 71:


    Page 301, line 28, at end insert "only in relation to individuals and bodies corporate domiciled in countries which offer full reciprocal arrangements for British individuals and bodies corporate to own radio and television services"

The noble Lord said: My Lords, in moving Amendment No. 71, I recall that earlier today the noble Lord, Lord McIntosh, said of another amendment that it was better to be late than inflexible. Although it is late in the day, I very much hope that he will not prove to be inflexible on this issue.

The intention of the amendment is straightforward. It is that there should be reciprocal arrangements between one country and another on the ownership of radio and television services. The essential proposition is that if the rules in Britain allow a company in another country to take over a broadcasting organisation, such as ITV, British media companies should have the same rights in that other country. It would allow free trade on the basis of equal rights on a level playing field. It would bring the law into line with the position inside the European Union, where there are full reciprocal arrangements.

The Government's position is significantly different from that. For example, they would certainly allow American media companies to take over ITV, but they are content that there are no reciprocal arrangements with the United States. We would therefore give complete freedom to an American company to own a British television company, but British companies would face a ban on ownership in the United States. It is not a question of being anti-American or protectionist. As it happens, I am passionately pro-American, and frankly I doubt whether any American administration that I can remember would have been daft enough to contemplate the one-sided arrangement that apparently the British Government are to go along with. Nor do I think that it is protectionist to allow access to our market but to insist that we should have equal rights. It seems self-evident business common sense. If the Government's aim is to

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negotiate reciprocal arrangements, I cannot see what will have been gained by throwing away our strongest negotiating card.

When the noble Lord, Lord Gordon of Strathblane, proposed a similar amendment at Report stage, the Minister sought to dismiss these arguments as of no consequence. Let us examine the Government's case. It will be noted that the legislation that the Government seek to change is the Broadcasting Act 1990, in which, I remember only too well, my noble friend Lady Thatcher took a very close personal interest, to which I and others in this House can testify. She saw no reason to change the law, and she can hardly be described as either protectionist or anti-American.

Even more to the point is the fact that up to 18 months ago the present Government saw no reason to change the law either. In November 2001, the Government said:


    "Without reciprocal arrangements with other nations that will allow our own companies to expand into their markets, we do not feel that we could justify lifting our ban at the present time".

That was the present Government's position only 18 months ago. Therefore, I think that we can agree, if on nothing else, to dismiss the argument that this amendment and the amendment proposed earlier by the noble Lord, Lord Gordon, are of no consequence. Until a very short time ago, that was the policy of both major parties in this House.

The Minister had additional arguments. First, he said on Report that the United States were not imposing a full ban. A British company could invest 20 per cent, even at times 25 per cent, in an American broadcasting company. Therefore, the proposition is that one party can take full control and full ownership, while British companies can take 20 per cent. It is precisely because that position is so inherently unsatisfactory that in another part of the Bill we are changing the ownership regulations relating to ITV and ITN.

Secondly, he said that we are not unique and that other countries have no reciprocal arrangements either—namely, Finland, Belgium, the Netherlands, as well as Germany, Spain and New Zealand. In practice, I think that in some of those countries a would-be investor from overseas might find himself in some practical difficulties when it comes to it. But leave that as it may.

What is beyond doubt is that the issue of direct concern is of much greater concern to Britain than to any other country. There is no conceivable doubt about that. For the chairman of a big United States media company, the prize would not be Finland or Belgium, it would be ITV in Britain, which under this Bill will have the right to own ITN. There is a big population in this country; there is no difficulty in language; and there is the opportunity to distribute programmes and share news services. It is a natural target as far as an American company is concerned.

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Why therefore have the Government changed their mind? The Minister says that the reason is that they have listened to everyone who has taken part in the debate, including the Joint Committee—well,


    "Up to a point, Lord Copper".

The fact is that they have listened to some. The noble Lord, Lord Crickhowell, who has added his name to this amendment, can speak for himself. But I observe that the Joint Committee's point was not that this was irrelevant, it was a rather different and rather longer point than that. I hope that noble Lords will bear with me while I read it. The Joint Committee stated that,


    "as matters stand, we do not view the argument on reciprocity as pivotal. If the economic case for permitting US investment emerged as compelling, we would see no impediment in principle in the form of waiting for reciprocal developments. But that case has yet to be established. OFCOM will face an enormous range of challenges immediately after it assumes its regulatory functions. We do not feel that it should face the additional pressure that would arise from the lifting of restrictions on non-EEA ownership until it has established itself as an effective regulator that commands market and public confidence".

It went on, of course, to make a detailed proposition.

The fact is that it is not just that the Government did not go along with my proposal; the Government did not go along with the Joint Committee's proposal either, which was the proposal that they voted down last week. They can hardly claim that they have been listening to what the Joint Committee said. The Minister's arguments would be stronger had not the Government's listening process led not only to the rejection of the reciprocal arrangement solution but also of the solution put forward by the Joint Committee.

I have no doubt that the Government have been listening to some on this issue, but on the issue of foreign ownership I do not think that it was the Joint Committee that they were listening to mainly. The Minister says that we should not be diverted by the issue of reciprocity. Indeed, he sets out a rather wider proposition than that. Again, I quote from the debate on Report:


    "I really do not think, when we are considering an issue of such importance as the liberalisation of world trade, that we should be diverted by the issue of reciprocity".—[Official Report, 2/7/03; col. 935.]

That is a pretty extreme statement for the Government to make. Is that actually the Government's position? If the position was, for example, that we already had full reciprocal arrangements with the United States but not with France and Germany, would they be introducing this change to the law which would give France and Germany rights without any equality in return? I dare say that one or two newspapers might be challenging such a policy; I dare say that my party would be challenging such a policy; and I dare say that the Government would not be risking the collective wrath by introducing such a policy.

There are some in this House who would impose a full ban on foreign ownership and for whom the amendment does not go far enough. I agree with them to the extent that the issues raised by the ownership of media companies are different in kind from those surrounding ownership of a normal commercial company. They are different not because media

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companies are better than normal companies, but because media companies are an integral part of the democratic process.

The decision on whether there can be foreign ownership has now effectively been taken. That cannot be undone. The amendment is designed to recognise the new world in respect of that issue and to say quite simply, and fairly moderately, that British companies should have equal rights to build up their own media businesses to those we are giving to people overseas. That is our proposition, and it is not an extreme one. It is the kind of proposition that both Conservative and Labour Governments ascribed to up until a few months ago. I very much hope that, even at this stage, the Government will reverse their position. I beg to move.

9.15 p.m.

Lord Crickhowell: My Lords, I put my name to this amendment with some enthusiasm. I made most of the points that needed to be made during the debate on non-EEA ownership. My task has been simplified by the speech of my noble friend Lord Fowler, because he has taken up two points that I was going to comment on.

The Minister on Report uncharacteristically misrepresented the position of the Joint Committee. He said that our position, which was given in detail by my noble friend Lord Fowler, was a politer way of saying that the issue was a red herring. I do not think that that was the Committee's position, and my noble friend Lord Fowler has explained why that was a misrepresentation.

In that debate, the Minister spoke about the importance of opening up our industry to inward investment, and said that that was the compelling argument. I spent a large part of my ministerial career in encouraging, with some success, inward investment into this country. I doubt if there was any Minister who undertook quite so many overseas foreign investment missions to the United States, the Far East and parts of Europe, all with great success, so I do not need to be told why we need foreign investment. However, the overriding reason why we sought to attract that inward investment was that it gave us a base from which we could take our industrial production into Europe and other parts of the world. That is why we did it. In this case, we are talking about our industry's ability to export its products into the greatest available markets, of which the United States is by far the most important.

The Minister said on Report that when dealing with an issue of such importance as the liberalisation of world trade we should not be diverted by the issue of reciprocity. That is an odd way to enter into a negotiation about reciprocity—to throw away one's cards. It does not appear that all members of the Government feel that the issue is entirely irrelevant and should be discarded. The Secretary of State for Culture, Media and Sport, when giving evidence to the Joint Committee, did not put that argument to us. Indeed, she told us that the decision to lift restrictions was being used as a negotiating tool in discussions with

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US authorities. It is a rather odd negotiating tool—to say that we will give everything away. She clearly thought that it was not entirely convincing herself, as she then said that there was no case for holding out for a reciprocal agreement because no change in US policy appeared in prospect.

It is extraordinary to argue that we should not attempt to get reciprocation because we do not believe that there is much chance of winning the argument. As the noble Lord, Lord Gordon, said, it is particularly perverse given that we are getting quite deep into GATT discussions on that very issue. To surrender our negotiating position in such a way is very odd indeed.

The hour is now late and the arguments have been advanced. This discussion is all part of the wider debate that we have had about the good sense of allowing overseas investment without some control and protection. I warmly support the amendment moved by my noble friend.


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