19 Dec 2017

Media merger appeal dismissed

11:58 am on 19 December 2017

A proposed merger between two of New Zealand's largest media companies has been dismissed, the High Court says.

The Commerce Commission has declined a merger which would have created New Zealand’s biggest news media company
Fairfax Media NZ, Stuff.co.nz, 
NZME, NZ Herald.

The Commerce Commission has declined a merger which would have created New Zealand’s biggest news media company Fairfax Media NZ, Stuff.co.nz, NZME, NZ Herald. Photo: RNZ/ Brad White

The proposed merger between Fairfax New Zealand and NZME would have created one large media entity with control of many of the country's major metropolitan newspapers, websites, and radio stations.

In May, the Commerce Commission declined that proposed merger because it would centralise too much media power. The companies appealed against that earlier decision, in which the Commission - the country's competition watchdog - said one joint company would concentrate ownership of newspapers in New Zealand to an 'unprecedented' extent.

The Commerce Commission has declined a merger which would have created New Zealand’s biggest news media company
Fairfax Media NZ, Stuff.co.nz, 
NZME, NZ Herald.

Photo: RNZ/ Brad White

In a High Court decision declining the appeal, Justice Robert Dobson said it was appropriate to consider the importance of maintaining media diversity.

This plurality was a fundamental value in a modern democratic society, the court said.

"We cannot be certain that a material loss of plurality will occur... However the risk is clearly a meaningful one and, if it occurred, it would have major ramifications for the quality of New Zealand democracy."

A competition lawyer said the merger was probably dead in the water.

Andy Glenie of Anderson Creagh Lai said the media companies had the option to go to the Court of Appeal.

"My view is that the High Court has got the decision right, as the Commission got the decision right, and I would expect that the Court of Appeal will also come to that conclusion," he said.