Media law is constitutional, court rules; Argentina prepares auction of Clarin assets

18 Dec 2012

The Argentine government has begun the process of auctioning off media licences held by local media giant Grupo Clarin, after a lower court judge ruled that the country’s controversial media law is constitutional, writes Dow Jones Newswires. The report cites government officials as saying that the move should take around 100 business days to complete. ‘We notified Clarin that the auction process has begun. The law is constitutional, and it is in full effect,’ said Martin Sabbatella, who was appointed by President Cristina Kirchner to enforce the law. However, Clarin, which owns local cableco Cablevision, broadband provider FiberTel and a number of TV channels, said it has appealed the ruling to a federal appeals court and as such, the decision would be automatically suspended until it has been confirmed or rejected by a higher court. The media group accused the government of violating other court decisions by starting the auction process and noted that even if the law was found to be constitutional, the company would still have one year to comply with it. Sabbatella meanwhile has repeatedly said that the twelve-month divestment period has already expired, meaning that the government has the right to enforce the law immediately.

In December 2009 Clarin won a court suspension of Article 161 of the Audiovisual Communication Law, which states that companies exceeding licence limits set forth by the law must make divestments within one year, notes TeleGeography’s GlobalComms Database. The three-year precautionary measure was due to mature on 7 December 2012, and from that date the government said it planned to auction off Clarin’s licences that exceed legal limits (158 TV licences, one for each of the cities in which it offers cable and internet, and 134 more than the 24 allowed) if it failed to comply with the law. Earlier this month Clarin was awarded a last-minute extension of the injunction until the constitutionality of the media law could be determined by the lower court.

Argentina, Cablevision (FiberTel)