Ukrainian media controlled from offshore companies


At a press conference on Wednesday the Media Law Institute, together with foreign experts, published the results of their research into who is behind particular media outlets. They agreed that information about media owners is not accessible and lacking in transparency, while the relevant legislation is inadequate. They believe that this is first and foremost because a fair number of Ukrainian media outlets are controlled through foreign intermediaries.

Most nationwide radio stations and the most widely watched television channels are owned by legal entities registered abroad with Ukrainian and Russian businessmen and politicians behind them. These were the preliminary results of studies over many years carried out by the Media Law Institute and Article 19.

According to the Director of the Media Law Institute, Taras Shevchenko, the foreign shareholders of Ukrainian media outlets are most often in Cyprus and other offshore zones, i.e. countries whose legislation makes it possible to pay less tax and to conceal the real final owners of the business. He says that if a company is registered in an offshore location it is virtually impossible to establish the media outlet’s owner. “When we tried to ascertain the people owning the television channel Inter, Valery Khoroshkovsky denied his involvement with the channel. In the documents we saw offshore companies. There was only one legal moment which identified the real owners. One of the shareholders had given his rights to Khoroshkovsky, and he transferred the shares to an offshore company”.

Such situations are typical of the majority of the TV and radio companies analyzed, lawyer Olha Sushko, who took part in the research, explains. Some resources are registered with various foreign firms, with the final owner one and the same person.

Georgia: Offshore companies have been prohibited from owning media outlets

Boiko Boyev from Article 19 believes that faulty legislation is too blame for owners being so hard to track down. Legislation says that information about the real owners must be published but does not specify whether individuals are meant, or legal entities.  He adds that many international norms of the media do not apply in offshore zones.

He recommends that Ukraine take into account the experience of countries like Greece, Georgia and Romania which have restricted the right of offshore companies to own media outlets. Whereas in Ukraine several Ukrainian radio stations, among them “Melodia”, lost their frequencies with the State regulator giving these to little-known companies whose owners are registered in offshore zones. This could be avoided if the system was made more transparent, Ihor Khomin, Director of the Melodia network says.

The authors of the study propose amendments to media legislation which will make it possible for the public to receive full information about the owners of each television channel, radio station or newspaper. The relevant draft laws are already being considered by parliament.

From a report at  The photo is from a demonstration against control over the media from 26 August 2010 


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