Discovery Vows to Fight a Polish Measure That Targets Investment
Discovery Vows to Fight a Polish Measure That Targets Investment
(Bloomberg) -- Discovery Inc. vowed to stay in Poland and defend its local television broadcaster, fighting legislation that if enacted would force the U.S. media giant to sell a majority stake in its investment.
Poland’s parliament unexpectedly approved the media changes on Friday, triggering rebukes from Washington, the European Union and Discovery -- one of the biggest U.S. investors in the country. The bill awaits approval by President Andrzej Duda, who could veto the measure.
Discovery International’s chief executive officer, Jean-Briac Perrette, said the Polish government has sent a message that it’s “closed for business” from foreign investors, and against an independent media. The company is focused on preventing the legislation from becoming law.
“We love the business,” Perrette said in an interview. “We have no interest whatsoever in breaking it up or selling it. At this point our intention is 100% clear: We want to remain in Poland.”
But if Duda signs the bill, Discovery would “have to reassess” its options, Perrette said. Discovery operates in almost 200 locations worldwide, including difficult markets like “Russia or parts of the Far East,” but has never run into a situation like that in Poland, he said.
The proposed law would force Discovery to sell more than 50% of its TVN unit, the country’s most popular private television broadcaster. Poland’s ruling party has long tried to reduce the U.S. company’s clout, blaming its often critical coverage on foreign ownership.
Prime Minister Mateusz Morawiecki said the new rules are needed to prevent companies from countries such as Russia and China from buying media outlets.
Erode Confidence
Parliament’s vote further strained relations between Poland and the U.S., which Timothy Garton Ash, a scholar of Polish history at Oxford University, said were already at their lowest point since the former communist country joined the North Atlantic Treaty Organization in 1999.
The U.S. slammed the law, saying it would “erode foreign investors’ confidence in their property rights and the sanctity of contracts in Poland.” It urged Duda to veto the measure.
“We strongly encourage him to respect these norms and commitments in regard to this legislation that will severely affect media freedom and the foreign investment climate in Poland, if it is allowed to become law,” State Department spokesman Ned Price said in a statement on Friday.
Perrette said the new law could have widespread consequences for Poland while European security faces risks from Russia’s actions along Ukraine’s borders and a migrant crisis orchestrated by Belarus.
“We’re in a very precarious situation for Poland, Europe and the U.S. in relation to what’s happening just east of Poland,” he said. “This is a test of relationships and partnerships that touches on national security interests, well beyond the scope of the free press.”
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