Publication: Monitor Volume: 4 Issue: 157

The heads of Russia’s commercial television companies are complaining that a presidentially ordered reorganization will put them in an unfair financial position and increase the state’s power over independent broadcasters. They accuse the Kremlin of trying to assert control over independent broadcasters in anticipation of next year’s parliamentary elections and the presidential election due in 2000. (Nezavisimaya gazeta, August 11)

Private TV companies first complained when, on May 8, President Yeltsin issued a decree transforming the All-Russian State Television and Radio Company (VGTRK) into a new and much larger state-owned media holding. Confusingly, VGTRK did not change its name. But it gained control not only of the government-owned RTR national television channel, but also of all the 113 broadcasting companies in Russia’s regions and of the transmission facilities used by all Russian television stations, both private and public. (RTR, May 8; Moscow Tribune, May 15) Private channels warn that VGTRK could set unfavorable transmission rates for private companies and use rates to put pressure on commercial television. (Moscow Times, May 27)

This week, the independent companies made a fresh complaint. This time, they are complaining about a government ruling dated July 27, which gives VGTRK substantial financial privileges, including tax breaks and access to credit, that the commercial companies do not have. The independent broadcasters say the ruling violates Articles 8 and 34 of the Russian Constitution (which prohibit monopolies and unfair competition and guarantee equal conditions to all enterprises, regardless of whether they are publicly or privately owned). (Nezavisimaya gazeta, August 11)

Yeltsin is believed to have formed the new company in the wake of April’s gubernatorial election in Krasnoyarsk Krai, when the ORT television company, of which the state owns a 51 percent share but which is effectively controlled by business magnate Boris Berezovsky, supported Aleksandr Lebed instead of the Kremlin favorite. (Moscow Tribune, May 15)