Italian court rejects Vivendi move to overturn restriction on Mediaset stake

Vivendi has suffered a setback on one front in its ongoing legal war with Mediaset, after the Lazio Regional Administrative Court (TAR) rejected an attempt to overturn regulator AGCOM’s ruling that its ownership stake in Mediaset is in breach of the country’s controversial TUSMAR law against holding simultaneous stakes in media and telecom companies.

The law forced Vivendi to put the bulk of its 28.8% stake in Mediaset in trust via Simon Fiduciaria because it is also the largest shareholder in Telecom Italia.

Simon Fiduciaria has been banned by Mediaset from participating in shareholder meetings, stymieing Vivendi’s attempts to thwart Mediaset’s plans to create a new European holding company and merge its Italian and Spanish businesses. Vivendi has only been able to vote against Mediaset’s plan through its remaining directly held 9.6% stake in the Italian media outfit.

Vivendi had called on the court to “confirm the cessation of the measures of compliance with resolution no. 178/17/CONS”, in which AGCOM found that the French media giant’s presence as the largest shareholder in Telecom Italia and holder of a significant stake in Mediaset meant that it had to choose between the two.

The French media giant has consistently argued that TUSMAR law is in breach of European regulations, citing advice given to the European Commission stating that the ruling, which holds that companies with large stakes in media and telecom organisation s must reduce one of those stakes to under 10% – violates EU rules on freedom of capital movement and freedom to carry out business activities anywhere in the EU.

The TAR has ruled that there was no real justification for Vivendi’s request.