Landmark legal challenge seeks to stop Malta's political parties owning TV stations

A TV set displaying the broadcast of Maltese Prime Minister Joseph Muscat addressing the nation, Sunday, Dec. 1, 2019. - Copyright AP

By David Walsh

Published on 25/01/2021 - 15:00•Updated 26/01/2021 - 01:35

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In a historic case that could change the face of the Maltese media, one independent news outlet is taking on the political establishment to restore impartiality to the airwaves.

The assassination of Daphne Caruana Galizia in 2017 sent shockwaves throughout Malta, setting off a political earthquake that saw the eventual toppling of a prime minister and the spotlight firmly fixed on imperilled press freedoms.

More than three years on from the investigative journalist’s murder, the aftershocks continue to rattle the foundations of the Maltese state as calls for reform of the country’s institutions gain momentum.

Now a legal bid to disentangle political control over Malta’s media and declare the perceived bias of party-owned broadcasters unconstitutional is fast becoming the latest political faultline to open up on the Mediterranean island.

The hegemony of Malta’s two establishment parties over its broadcast media has been a fait accompli for three decades, acknowledged openly over the years by politicians from both tribes and exacerbated by the setting up of competing media companies wholly owned by the Labour Party (PL) and Nationalist Party (PN) in opposition to each other.

"In Malta, this has been the norm for 30 years," Christian Peregin, the CEO and founder of independent media outlet Lovin Malta, told Euronews. "What’s crazy is that we think it's normal".

The 33-year-old entrepreneur and journalist has become the driving force behind a crowdfunded legal challenge launched this month which he hopes will ultimately help combat corruption, reduce the spread of misinformation and go some way to healing entrenched political divisions on the island, cemented in part by a partisan media.

'One day there would be a challenge'

The current polemic can trace its roots back to the early 1990s when the ruling PN government passed the Broadcasting Act. Under the legislation, Malta’s Broadcasting Authority (BA) was permitted to consider the output of all stations collectively rather than reviewing outlets individually when enforcing its remit on impartiality.

Article 119 of the Maltese constitution, however, tasks the BA with ensuring "as far as possible, in such sound and television broadcasting as may be provided in Malta, due impartiality is preserved in respect of matters of political and industrial controversy".

Therein lies the bone of contention between reform advocates like Peregin and the party-owned broadcasters.

"We have got a legal challenge against this law that they passed in 1991 which allowed the Broadcasting Authority to view the stations on balance so that they cancel each other out," he said. "And our argument is that that’s not what the constitution demanded, it’s not what good practice demands and actually there shouldn’t be political ownership of business in general, media companies especially."

Despite there being reservations from both sides of the political divide about its long-term impact, there has so far been little impetus among the political elites to reform the law in the 30 years since it was passed.

"This is interesting because when they passed this law 30 years ago, they actually warned - the opposition leader at the time had warned - that one day there would be a legal challenge to it and now it’s 30 years later and we’re making that legal challenge," said Peregin.

The law has never been tested in the courts before. What happens next will have historic and far-reaching implications for the island.

Case of Malta is 'unique'

"The case of Malta regarding this dominance of parties in the control of the media is unique," Pavol Szalai, head of the EU desk at Reporters Without Borders, told Euronews. "It is not something that the EU has, as an institution, a lot of experience of."

While there are ongoing concerns over press freedom in various member states, the bloc "doesn’t have uniform EU-wide rules about the regulation of media," Szalai explained. As such, instances of political parties exerting creeping influence on the media, for instance in Poland and Hungary, have become commonplace.

That being said, Malta continues to be a cause for concern for activists seeking to uphold press freedoms like Szalai.

The country has plummeted 34 places to 81 on the World Press Freedom Index in just three years, a decline accelerated by Caruana Galizia’s assassination in 2017 and the slow progress in establishing an independent inquiry into her murder.

While the security of journalists on the island has been the primary concern in the wake of Caruana Galizia’s death, Szalai said, the “existential” threat posed by the erosion of media pluralism is also troubling.

"I would say there are two types of media in Malta. It’s not opposition or government media; it’s the political party media and the independent media, or the politically-biased media and the independent media," said Szalai.

"And most of the media are controlled by the political parties in various ways. It’s not just ownership but there are many ways in which political parties exert pressure and obtain results".

The three biggest broadcasters in terms of audience share are the public television channel, Television Malta (TVM), followed by ONE TV, the Labour-owned channel, and Net TV, the Nationalist Party’s channel, respectively.

However, according to a survey taken by the BA in November and published earlier this month, while TVM had a higher audience share, the PL’s ONE TV edged out the public broadcaster in airtime with viewers watching for the party channel for longer.

As well as TV stations, each party media company also has radio stations and newspapers in their portfolios.

While each channel broadcasts a range of programmes besides news and current affairs, the respective political parties are hardwired into the structures of the umbrella corporations overseeing them.

According to company details kept by the Malta Business Registry, ONE Productions Ltd, which operates ONE TV, is owned by two shareholders; the PL and a separate company MLP Holdings Ltd, whose only two shareholders are also the PL and a former Labour MP, Gino Cauchi.

Alongside its executive chairman and head of logistics, the company’s board of directors also features Alison Zerafa Civelli, a former Labour mayor and the sister-in-law of the current prime minister, Robert Abela.

Party grandees also adorn the board of directors of PN-owned Media.Link Communications, which runs Net TV. Businessman and current PN MP Robert Arrigo sits alongside Francis Zammit Dimech, the party’s secretary-general and a former foreign minister, MP and MEP.

Given the political DNA of the companies, it’s little wonder that Peregin’s opening salvo at the Broadcasting Act has put the party-owned media on a war footing.

War of words

"There has been quite a strong reaction from certain quarters," said Peregin of the initial reaction to his company’s legal action.

In an interview on ONE TV’s morning show Espresso on January 14, Jason Micallef, executive chairman of ONE Productions Ltd, told viewers that the objective of Lovin Malta’s legal suit was to make sure the station closed for good, an accusation Peregin denies.

"They’re trying to mischaracterise this is as us saying the party TV stations themselves have to close but we’re not saying that," he said. "What we’re saying is that they should obey the laws of impartiality and even companies in terms of publishing their accounts.

"But also they should divest ownership from the political party itself. There should be a separation between the political party and the stations, but obviously, the stations can continue according to the law."

Euronews contacted Micallef but he didn’t respond to our requests for comment at the time of publication, nor did the prime minister’s chief of staff, Glenn Micallef.

The BA also declined a request for an interview with the chair of the agency to discuss the case as "media content falls within the Authority’s remit and it is considered not appropriate to express comments on this area, even more so since this could eventually form part of legal proceedings".

For his part, Karl Gouder, Chief Operations Officer at rival channel Net TV, freely admits his channel’s output is biased but caveats that it has been necessary, not least because of the Labour government’s alleged influence over TVM.

"The reason why we showed our bias more as time passed was because the other party’s station was totally biased. When we are in opposition - we still are - we criticise the government a lot and rightly," he told Euronews.

"But the national station, Television Malta, is totally, totally biased against us. Incredibly biased against us. So, the only way we can get out our voice, show our voice is by obviously giving our version of the events".

Gouder is not unduly worried about Lovin Malta’s legal action and even suggests Net TV would support its outcomes - so long as its stated aims of achieving impartiality extended to all broadcasters on the island.

"If this challenge is about us simply being more impartial, our situation - as a station and as a political party - is let’s go for it. No problem - just give us the guarantees that all stations, first and foremost public broadcasting and ONE Television, are just as impartial".

Unpublished accounts

For Peregin, impartiality is not the only red flag raised by what he sees as the problematic ownership of the main broadcasters by political parties. Corruption, too, is a major concern, something that is compounded by the apparent secrecy surrounding company accounts.

"These stations lose so much money every year. The political parties have become a slave to the big business that support these stations," he contends.

"They are constantly trying to collect money to keep their stations afloat and they obviously distort the advertising market in a big way. They create a totally unlevel playing field but they make themselves very exposed to corruption and other things".

Neither ONE Productions Ltd nor Media.Link Communications have published their accounts for the past 10 and 17 years respectively. In their last publicly available accounts, both companies posted massive losses: Media.Link Communications operated with a net loss of 608,948 Maltese Lira, or around €1.4 million at 2003 conversion rates while ONE Productions Ltd posted a net loss of €507,479 in 2010.

According to Peregin, such heavy financial losses leave a question mark over how operating costs are realistically covered and where this funding comes from.

"So, basically, you either finance these parties through big business donations that jeopardise your policymaking or you do it by taking money from the taxpayer or you find a way, especially when you’re in government, for the government to somehow subsidise your operations," said Peregin. "And that leads to these situations where they can’t publish their accounts because they have a lot to hide".

On this point, Gouder acknowledges that Media.Link Communications has been at fault for not publishing its official accounts as it is required to do by law.

“It’s true. I mean, the party, we haven’t been giving our accounts for a number of years, which is totally wrong. Since I took over the station, the last two-three years, we’ve got auditors here to try to get our books in order,” Gouder conceded.

"At least from now onwards, we can start publishing our accounts. We do pay the fines for not publishing them but it's totally wrong and we are totally committed that we will publish the 2021 public accounts".

Has the hitherto lack of transparent accounting been a means of covering up nefarious funding streams? Gouder is adamant that it is not and that some delays partly stem from a major restructuring in 2013 when the company went bankrupt.

"To have a television station in Malta, as with everywhere else, costs a lot of money. We run like a company. We don’t get any subsidies from our party. We run our organisation purely commercially," he told Euronews.

"Our income is purely advertising, sale of air time, etc. However, we suffer a lot and I would maybe concede to the fact that the fact we’re owned by a political station might mean that certain advertisers would help the party indirectly by advertising on us.

"However, I’m afraid if we do come to a stage where we would close ONE and Net TV, the television industry in Malta would finish. Totally. It will go".

Society polarised

While Gouder believes that the existence of party-owned media is unavoidable and necessary to maintain current employment levels in the industry, for Szalai, their existence is poisoning the well of Maltese democracy.

"It is dangerous for society because partisan media tend to present only one dominant opinion and they only speak to the voters of that party," he told Euronews. "They polarise the society. They are not seeking the truth, as the media should. They know the truth and they are just not telling it".

As well as concretising hatred and division between opposing political camps, the output of their respective media companies has further served to inflame existing ill-will towards independent journalists caught in the cleavage between the two.

"It’s a small country and there are only a handful of investigative journalists who can work independently outside of this internal political pressure in their media," said Szalai.

"Daphne was one of them; there are others continuing in her work. But, of course, this kind of political capture of the Maltese media is dangerous for the other journalists working independently.

"So these other journalists, like Daphne when she was alive, face harassment campaigns online, libel cases are brought against them and the other media don’t support them".

The fact that the party-owned stations are biased is a reality not lost on the Maltese public either, argues Peregin. If anything, the fact that they may have agendas is obvious because of each station’s overt political allegiances.

"They actually say that, you know. 'At least we know these things. It’s better than the situation in America where there is bias and it’s more underhand,'" he explained.

"But at least in America, which is already problematic, you have a situation where a Democrat would appear on Fox or a Republican would appear on CNN but in Malta, a Nationalist politician would barely ever appear on the Labour channel and vice-versa.

"You could literally spend your whole life watching a station and only hear the other side through a really distorted picture".

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