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Daily Mail
5 hours ago
- Daily Mail
House of Lords block attempt to limit foreign investment in British newspapers
A bid to severely limit foreign state investment in UK newspapers was defeated by peers tonight. Paving the way for the takeover of The Daily Telegraph and Sunday Telegraph, the House of Lords blocked an attempt to prevent passive shareholdings being raised to 15 per cent. It is the latest turn in a tumultuous two-year takeover process for the 170-year-old business. It comes after the previous Conservative government put a 5 per cent limit in place amid fears the Telegraph could be bought by RedBird IMI, a firm majority-owned by the UAE, in a £500million deal. But following a consultation, Labour proposed a higher cap to enable newspapers to access crucial finance. Tory Baroness Stowell said the 15 per cent cap supports the 'much bigger principle of Press freedom' and told the Lords: 'While we all care about protecting a free Press, upholding that principle will serve little purpose if our news industry can't survive – and their economic conditions are worsening.' Liberal Democrat peer Lord Fox had tabled a rare 'fatal motion' to block the proposals, despite approval by the Commons. But it was defeated by 267 votes to 155. RedBird Capital, the US junior partner in RedBird IMI, agreed a deal in May to buy a majority stake in the newspaper for £500 million. Abu-Dhabi's IMI will look to buy a minority stake as part of the consortium.
Telegraph
8 hours ago
- Telegraph
Laws to allow UAE stake in The Telegraph approved by Lords
The House of Lords has approved legislation to enable the United Arab Emirates to become part-owner of The Telegraph against significant cross-party opposition. Peers agreed to allow foreign states to take passive shareholdings in British newspapers of up to 15pc. The move prepares the ground for the end of more than two years of damaging limbo for The Telegraph, which has effectively operated without an owner since June 2023. Lords on Tuesday evening voted through a statutory instrument proposed by the Government to ease an existing outright ban on newspaper investments by foreign powers. Peers rejected a rare 'fatal motion' tabled by the Liberal Democrats that attempted to block the legislation. The motion, which would have controversially overturned a vote in the House of Commons, was defeated by 267 votes to 155. Gerry Cardinale, the founder of RedBird Capital, the US private equity firm in line to become the controlling shareholder in The Telegraph, said: 'Today marks an important milestone that provides the clarity we need to press ahead with RedBird Capital's acquisition of The Telegraph. 'With legislation now in place, we will move quickly and in the forthcoming days work with DCMS [the Department for Culture, Media and Sport] to progress to completion and implement new ownership for The Telegraph.' A well-attended upper chamber heard arguments that the statutory instrument undermined the intention of the outright ban introduced last year to block an attempted takeover of The Telegraph. The decision opened a diplomatic rift with the UAE, which ministers have been attempting to close, including in a visit to Abu Dhabi by Sir Keir Starmer in December. The blocked bid was majority funded by IMI, a media company controlled by Sheikh Mansour bin Zayed Al Nahyan, the vice president of the UAE, which prompted a cross-party outcry over press freedom. The UAE positioned itself to take control by repaying the overdue debts of the Barclay family, the previous owners, but did not reckon on a change in the law. There followed a year during which IMI tried to exit its investment in an auction which failed to deliver a bid able to match its price. In May Lisa Nandy, the Culture Secretary, announced plans to treble the limit on foreign state investment to 15pc. Prior to the general election, Conservative ministers proposed a limit on foreign state investment of just 5pc to protect press freedom. Ms Nandy said the shift was necessary to allow publishers greater access to sovereign wealth investment as they attempt to negotiate the decline of print newspapers. Baroness Twycross, her junior minister in the Lords, this evening said: 'The far greater risk is how UK news media faces significant, genuinely existential challenges as their business models move away from print towards digital, and new technologies emerge. 'Whilst it is vital we support stronger protections for UK newspapers and other news media, we need to make sure we don't inadvertently make it harder for newspaper groups to survive.' The Conservative Lord Black of Crossharbour, and deputy chairman of Telegraph Media Group, backed the Government. He warned: 'It really is five minutes to midnight for much of the British press ... the passage of these regulations is absolutely vital to the future of the British press.' The Telegraph last year reported a 35pc increase in operating profits to £54m on a turnover of £278m, up 5pc. Lord Fox, the Lib Dem business spokesman behind the fatal motion, said: 'Whether the Government is trying to deliver capital to the sector or it is mending a diplomatic fence, in doing so they are parlaying foreign influence. Whatever the side-deals, they are not worth the cost of press freedom.' He was supported by a group of 41 Conservative peers who went against the party's policy of supporting the legislation. The rebellion was larger than expected. Their leader, Lord Forsyth, said: 'It is completely unacceptable that our parliamentary procedures should be overridden and that we should create an open door for foreign governments to get into our media. 'If we have foreign governments owning newspapers … that will mean there is a conflict of interest between our journalists and their proprietors. Between journalists who might want to write unpleasant things about some regimes.' Peers appeared to ease the ban with some reluctance. The Tory peer Baroness Stowell of Beeston, who played an influential role in forcing action against the UAE bid for The Telegraph prior to the general election last year, criticised the Labour Government's subsequent handling of the 'sorry saga'. Her 'motion of regret' rebuked ministers for a loophole in the statutory instrument which could allow multiple foreign powers to take stakes of up to 15pc each. She said: 'What I find so frustrating is it's taken the Government a year to get to this point. And we still need a further set of regulations to be laid out to address the serious loophole. 'This foot-dragging and apparent incompetence have given rise to legitimate questions about who or what has really influenced the Government in its approach to this incredibly important matter. 'If the Government were acting only in the interests of the press industry, we would have got all this sorted and the ownership of The Telegraph long before now.' But Lady Stowell argued that if the 15pc limit is properly enforced, it will allow investment in newspapers at a critical time. She said: 'While I respect those who are framing this debate as a battle about the future of press freedom, actually, if it's a battle about anything, it's over the future of a financially viable press. We don't just need our newspapers to be editorially independent, we need them to survive.' IMI is now expected to become a passive minority investor in the £500m takeover of The Telegraph by RedBird, meaning it will have no governance rights and be unable to appoint directors. The Government will be obliged to intervene and could unwind the deal if it is found to have sought influence. RedBird was the junior financial partner in last year's blocked attempt, but has since agreed to increase its outlay to become the controlling shareholder. Mr Cardinale has also lined up British minority investments from the Daily Mail publisher Lord Rothermere and Sir Leonard Blavatnik, the owner of the sports streaming service Dazn. Ms Nandy is expected to trigger an initial investigation by the media regulator Ofcom of its potential impact on the public interest and by the Competition and Markets Authority of its compliance with the new foreign state investment regime. Their findings will inform Ms Nandy's decision weeks later on whether to demand more in-depth scrutiny, taking about six months. That would mean The Telegraph would not be under new ownership until next year. Lord Fox and Lady Stowell urged the Government to fully scrutinise RedBird's deal. It has faced attacks from Conservatives, including Sir Iain Duncan Smith over the longstanding business links to China held by John Thornton, RedBird's chairman. After his motion to block the legislation was defeated, Lord Fox said: 'The Government's move to force through this legislation in the face of historic cross-party resistance is reckless.' He said the Lib Dems would 'hold the Government's feet to the fire and limit the damage in any way we can'. RedBird is expected to continue to develop ambitious investment and growth plans for The Telegraph as it navigates the regulatory process. Mr Cardinale said: 'At 170 years old, The Telegraph is one of Britain's most iconic cultural institutions and frankly should be one of its greatest cultural exports. 'But The Telegraph can't rely solely on that heritage. If it doesn't proactively look to innovate and find new ways to grow and diversify its subscriber base and other revenue-based verticals, its relevance and important leadership position in the UK and globally will be severely challenged. 'RedBird is the right owner at the right time in this critical fork in the road for The Telegraph. 'RedBird is well-capitalised, has a track record in owning and growing iconic intellectual property businesses, and importantly has a track record in being 'talent-friendly' while also embracing financial growth.'
The National
9 hours ago
- The National
‘No breach' by UK Government of human rights on Russia probe
The European Court of Human Rights (ECtHR) found there was no breach of measures aimed at ensuring free and fair elections after a long-running legal action backed by three former MPs. The Strasbourg court acknowledged there was evidence of a 'significant and ongoing threat' to the UK's democratic processes from Vladimir Putin's country, but said Westminster had taken action to respond to the danger. The case was lodged at the ECtHR in 2022 by three then-MPs, Labour's Ben Bradshaw, the Green Party's Caroline Lucas and the SNP's Alyn Smith (below), after applications for a judicial review of Boris Johnson's decision not to order an investigation into Russian activities were declined by domestic courts. In a judgment published yesterday, the court ruled that the UK Government's response did not violate the right to free elections. The judgment said: 'While the Court does not underestimate the threat posed by the spreading of disinformation and the running of 'influence campaigns', their nature is nevertheless such that it is difficult to assess accurately the impact that they may have on individual voters and, by extension, on the outcome of a given election.' There was also a risk to freedom of expression if there were 'knee-jerk reactions' to debate during an election contest. 'There is a very fine line between addressing the dangers of disinformation and outright censorship,' the judgment said. READ MORE: 'Wake up, America!': Alan Cumming hits out at Donald Trump over trans attacks Any actions taken by states 'to counter the risk of foreign election interference through the dissemination of disinformation and the running of influence campaigns' would have to be balanced against the right to freedom of expression under Article 10 of the European Convention on Human Rights. 'Therefore, while states should not remain passive when faced with evidence that their democratic processes are under threat they must be accorded a wide margin of appreciation in the choice of means to be adopted in order to counter such threats,' the judgment said. 'In the court's view, the United Kingdom's response to the threat of Russian election interference did not fall outside the wide margin of appreciation afforded to it in this area.' The case followed reports from the Commons Digital, Culture, Media and Sport Committee and the Intelligence and Security Committee (ISC) which looked at alleged Russian disinformation campaigns, including during the 2016 Brexit referendum. The court noted that 'there were undoubtedly shortcomings in the Government's initial response' to the Russian threat but there were 'thorough and independent investigations' by the ISC and the DCMS committee. The judgment also noted that following the publication of the ISC report in 2020 there had been new laws passed to help address the risk: the Elections Act 2022, the National Security Act 2023 ('the NSA 2023') and the Online Safety Act 2023. Following the judgment, Lucas said: 'It's hugely significant that the court has found in favour of our case that foreign interference is a threat to our right to free and fair elections and that they recognise there will be cases when states do have a duty to investigate. And while it's clearly disappointing that they found that the Government had done enough, I've no doubt that this will continue to be contested. 'The bottom line is that we still cannot be assured that our democratic system is robust against foreign interference – and for as long as that is the case, we will continue to explore all possible avenues for remedy.' READ MORE: Broadcast watchdog called in over Labour's 'misleading' Scottish water claim Tessa Gregory, a partner at Leigh Day, the law firm which represented the three former MPs, said: 'In an important judgment, which will have far-reaching implications, the court has accepted, contrary to the UK's submissions, that in order to safeguard citizens' right to free and fair elections, states will in certain circumstances have to take positive action against foreign interference in electoral processes including by investigating credible allegations. 'Our clients continue to think the UK has fallen short of protecting our democracy and are considering next steps in relation to the court's conclusion that there has been no violation of their right to free and fair elections.' A UK Government spokesman said: 'We note today's judgment, which found no violation. 'We are committed to safeguarding our electoral processes, which is why we recently announced tougher new rules on political donations to protect our elections from the growing danger of foreign interference. 'These changes will boost transparency and accountability in politics by closing loopholes that would allow foreign donors to influence elections. 'More broadly, national security is our first responsibility, and we have taken action to harden and sharpen our approach to threats – whether standing with Ukraine against Russia's illegal invasion, placing Russia on the enhanced tier of the foreign influence registration scheme, and working with allies to monitor and counter Russian submarines and ships in UK waters.'
