US House backs Emmis in Hungary battle

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The US House of Representatives passed 333-74 a resolution condemning the process by which the Hungarian government stripped Slager Radio, majority-owned by US-based Emmis Communications, of its license to broadcast.


HR 915 introduced by Rep. Joe Donnelly (D-IN) “(1) condemns the recent action by the Hungarian National Radio and Television Board that awarded the national community radio licenses; (2) encourages the Republic of Hungary to respect the rule of law and treat foreign investors fairly; and (3) encouragers the Republic of Hungary to maintain its commitment to a free and independent press.”

The measure had broad support from both US political parties. Rep. Mike Pence (R-IN), Chairman of the House Republican Conference, took to the House floor in support of the measure introduced by a Democratic colleague.

“What could and should have been a fair competition to rebid Hungary’s only two national, commercial FM radio broadcast licenses is now mired in allegations of political corruption. As nine embassies in Hungary including the United States warned in a joint letter last month, we are concerned that such instances of non-transparent behavior affecting investors could discourage foreign investment and hamper economic growth in Hungary. This concern is underscored by a report commissioned by the Public Procurement Council in Hungary, which recently found that between 70 and 90 percent of all public procurements in Hungary are tainted by corruption,” Pence said.

“The broadcast licenses previously held by Slager Radio (owned by an Indianapolis-based company) and Danubius Radio (owned by a Vienna-based private equity firm) were recently awarded by the Hungarian National Radio and Television Board (ORTT) to other bidders despite unrealistic business plans and irregularities in those bids that I am told should have disqualified them under Hungarian media law. Not only that, but prior to the ORTT’s highly controversial decision, Slager and Danubius were reportedly approached by agents of the Fidesz and Socialist parties seeking to acquire partial control of the stations to ensure their licenses would be renewed. Although the ORTT chairman resigned in protest and refused to sign the contracts, the delegates appointed to the ORTT by the Fidesz and Socialist parties all voted in favor of the two new stations. A poll of Hungarians suggested that six of out ten agreed that the decision to end the broadcast rights of Slager Radio and Danubius was ‘outrageous’,” noted Pence, himself a former radio broadcaster.

“Slager and Danubius have appealed the ORTT decision, but litigation could drag on for years, while their popular broadcasts were forced off the air on November 18, 2009, the day we introduced this resolution. In addition, the Hungarian parliament voted to investigate the matter and a prosecutor is looking into whether criminal charges are warranted. I am encouraged by these steps and it is certainly my hope that the matter will be expeditiously resolved,” the GOP Congressman said.

“US and other foreign investors deserve equitable treatment in accordance with Hungarian law. It bears mentioning that the United States is the fourth-largest contributor to foreign investment in Hungary and the largest non-European source of investment. The United States has invested over nine billion dollars in Hungary since 1989,” Pence said. “Unfair treatment of foreign companies will deter investment and hinder economic growth, while upholding the rule of law and promoting a free and independent press – as we urge in this resolution – would instead spur investor confidence.”

A Hungarian court has scheduled a hearing for next week on Emmis’ lawsuit to overturn the license award.

Click here to read RBR-TVBR’s exclusive commentary by Emmis CEO Jeff Smulyan on the events in Hungary.