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Vivendi secures ECJ victory in Mediaset ownership rules battle, overturning Italian media law

The European Court of Justice has ruled in favour of Vivendi in its battle to overturn the Italian media law that prevents it from simultaneously holding stakes in Mediaset and Telecom Italia.

Vivendi has been battling to overturn the restriction on ownership, which has enabled Mediaset to prevent it from voting in shareholder meetings to reflect its full stake. In order to comply with the TUSMAR regulation that prevents companies from simultaneously holding large stakes in media and telecom organisations, Vivendi was forced to transfer the bulk of its holding in Mediaset in trust to Simon Fiduciaria. Mediaset has successfully prevented the latter from participating in shareholder meetings, restricting Vivendi’s voting power to the 9.6% stake it holds directly.

Vivendi said it “welcomes with great satisfaction” the ECJ ruling, which will give it greater influence over the future direction of the Italian broadcaster, which is effectively controlled by the Berlusconi family’s investment vehicle, Fininvest.

Vivendi has already successfully derailed Mediaset’s plans to merge its Italian and Spanish arms under a Dutch holding company through legal victories in Spain and, most recently, the Netherlands.

Vivendi said that Mediaset’s moves to prevent it from voting at shareholder meetings “caused the resolutions to be adopted following this exclusion to be illegal” and “placed Mediaset in a situation of severe legal uncertainty”.

The French media giant said it was maintaining “its commitment towards Italy and confirms its willingness to be a long-term investor in this beautiful country”.

Mediaset’s shares rose on news of the verdict as investors digested the possibility of new merger possibilities for Mediaset.

The Italian company for its part said that the ECJ’s findings “must be examined in the subsequent stages of judgment before the competent national judge and on which it is hoped that the [AGCOM – the Italian communications regulator] can provide any appropriate clarification”.

Mediaset said the AGCOM would have to “assess the risk to plurality” that it believes the judgement opens, due to the “unlimited potential for telecommunications companies to strengthen their position in the media sector”.

If the Italian law is overturned, and the possibility of media and telecom mergers is opened up, Mediaset said it “will evaluate with the utmost interest every new opportunity in the [telecom] business”, citing this week’s agreement to create a single open fibre network infrastructure for Italy.