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U
S A 19. ANTITRUST LAWS LIMITING CAPITAL
CONCENTRATION IN THE PRINT MEDIA Capital concentration in the print media is not an issue in
the United States. Media companies are not limited in the number
of newspapers they can own, as long as new purchases or mergers
do not violate antitrust laws. Section 7 of the Clayton Act prohibits certain mergers, acquisitions
and joint ventures where the acquisition would lessen competition
or create a monopoly. A defense to a possible Section 7 violation
is that the acquired company is in a precarious financial condition,
although that is a difficult argument to make. For example, the Supreme Court in 1969 held that a joint operating
agreement between two Arizona daily newspapers violated Section
7 because one of the papers was not on the ?verge?? of going out
of business. In the wake of that decision, the Supreme Court passed
the Newspaper Preservation Act, which provides a limited antitrust
exemption to allow joint operating agreements like the one attempted
by the Arizona papers. The act provides that if one of the newspapers
is ?in probable danger of financial failure,?? it is eligible for
a joint operating agreement. However, under the act, the newspapers
can combine only their business facilities and must keep their editorial
staffs separate.
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