MAKING CHANGES TO THE REGISTER OF MEDIA ENTITIES IN CONNECTION WITH THE CHANGE OF THE OWNERSHIP STRUCTURE OF THE LICENSEE (AUDIOVISUAL MEDIA) IN ACCORDANCE WITH THE LAW OF UKRAINE “ON MEDIA”

On March 31, 2023, the Law of Ukraine "On Media" came into force. This law represents an important step in advancing media reform and aligning Ukrainian legislation with the legal framework of the European Union, as its adoption is one of the requirements for Ukraine's accession to the EU.

It should be noted that with the adoption of the Law "On Media," the following laws have been repealed: the Law of Ukraine "On Television and Radio Broadcasting," the Law "On Printed Media (Press) in Ukraine," the Law "On Information Agencies," and the Law "On the National Council of Ukraine on Television and Radio Broadcasting."

According to the preamble of the Law "On Media," the purpose of this law is to ensure the realization of the right to freedom of expression, access to diverse, accurate, and timely information, promotion of pluralism of opinions, free dissemination of information, protection of Ukraine's national interests, safeguarding media service users' rights, and regulation of activities in the media sector based on the principles of transparency, fairness, impartiality, competitiveness, equality, and media independence. It also defines the legal status, structure, operations, and authority of the National Council of Ukraine on Television and Radio Broadcasting.

Currently, under martial law, the issue of transparency in the ownership structure of entities in the media sector (especially audiovisual media) has become particularly pressing. Consequently, the procedure for updating the media registry in connection with changes in ownership structure has gained significant relevance.

Ownership Structure Transparency Requirements

Article 25 of the Law "On Media" stipulates that the ownership structure of media entities must be transparent. An ownership structure is deemed transparent if the following conditions are simultaneously met:

1. The information about the ownership structure allows the identification of all persons who have direct or indirect significant influence on the entity or its management, all key participants, and their relationships.
2. There are no trusts among significant owners unless the trustee operates solely in the interest of a trustor who declares themselves as the ultimate beneficial owner.
3. None of the significant owners are legal entities registered in offshore zones as defined by the Ukrainian government.

Media entities with non-transparent ownership structures are prohibited from operating in the sector.

Obligations of Media Entities

Article 26 outlines the responsibilities of audiovisual media entities and electronic communication service providers. They must:

• Submit ownership information to the National Council as required.
• Publish up-to-date ownership details on their websites.
• Annually submit financial statements to the National Council by June 10.

In case of ownership structure changes (e.g., a new ultimate beneficial owner or key participants), entities must update their records in the registry within 45 business days. Failure to do so violates Article 60.

Licensing and Structural Updates

The licensing process is governed by the "Procedure for Submitting Applications to the National Council for Media Licensing," approved on May 18, 2023. Entities undergoing reorganization or ownership changes must submit supporting documents, including updated ownership diagrams and beneficiary details, in specific formats set by the National Council.

Simplifications and Challenges

While the new law simplifies the procedure for updating the registry by removing the requirement to submit a tax declaration on the financial status of ultimate beneficial owners, this change may affect ownership transparency. Ensuring genuine transparency remains vital, particularly during wartime, to prevent control by entities linked to aggressor states.

Conclusion

The adoption of the Law "On Media" is expected to positively influence the regulation of the Ukrainian media industry and strengthen its integration with EU legislation. However, further refinements to ensure genuine transparency and alignment with national security priorities are recommended.