The UK holds the highest share of British media ownership abroad

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The UK is considering doubling the proposed limit on foreign ownership of the country’s media in response to fears that setting the limit too low could unduly stifle the media industry.

A Labor government is likely to allow figures as high as 10 percent, significantly higher than the 5 percent the previous Conservative administration was negotiating, according to people familiar with the matter.

In March last year, the Tories changed the law to prevent foreign countries from owning stakes in UK news organizations for the first time, a move aimed at preventing a takeover of the Telegraph newspaper by an investor. The United States is supported by the United Arab Emirates.

Ministers plan to introduce an exemption from the ban on small stakes under a certain limit to allow passive investments, especially in listed media companies, from private wealth and government pension funds. Negotiations on a 5 per cent rate hike continue as Labor ousts the Tories in July’s UK general election.

One person with knowledge of the current government’s thinking described the 10 percent as a “smart” level, adding: “It’s all about finding a balance to allow deals to happen without and giving editorial control or influence to foreign countries.”

The Department for Digital, Culture, Media and Sport said: “We have not made final decisions on the status of the exception for ‘Native Investors’ in the new foreign newspaper regime. We are currently considering the responses to the interview, and will make an announcement in the future. ”

The Telegraph remains without a permanent owner after the Barclay family lost control of the company due to unpaid bank debts, but an attempt to buy the group through RedBird IMI was restricted by the foreign ownership ban. RedBird IMI is a joint venture between US fund manager RedBird Capital and Abu Dhabi media investment company IMI.

People close to the sale said RedBird Capital could still take a stake in Telegraph separate from its partnership with IMI.

UK media groups have privately raised concerns with the government that setting the threshold too low could prevent them from receiving funding from wealthy Middle Eastern countries. When the Telegraph went on sale in 2023, for example, the The owners of the Daily Mail held an interview and investors from Qatar regarding the possibility of contact please.

Media executives are also concerned that the law will hit state pension funds, as do many Norwegian, Canadian and Australian funds that are shareholders in listed media companies.

Labour’s decision on whether to impose an ownership limit is likely to be controversial following a heated debate last year among MPs about the dangers of allowing foreign powers to influence the media. UK news.

MPs from both major parties were critical of the RedBird IMI proposal, as were the Telegraph authorities themselves. Among worried Tory MPs, a key issue was the possibility of far-right overseas control seen influencing their party leadership contests.

The Telegraph sale, which has led to scrutiny of press freedom in Abu Dhabi itself, has strained relations between the UK and the UAE, which is Britain’s biggest investor.

Emirati officials have expressed dismay at the negative comments made about their country by a series of British politicians regarding the proposed Telegraph deal. Former Tory leader Sir Iain Duncan Smith was among the MPs who argued that the UAE’s participation would raise “security concerns” despite existing security ties. between the two countries.

Prime Minister Sir Keir Starmer visited Abu Dhabi last month in hopes of rekindling relations.