Vivendi contests finding that execs manipulated market as EC casts doubt on new media law

Italian authorities have accused Vivendi bosses Vincent Bolloré and Arnaud de Puyfontaine of market manipulation – allegations hotly denied by Vivendi – while the EU has cast doubt on the validity of an Italian media law that allowed its regulator to probe Vivendi’s assets in the country.

Vincent Bolloré

The Milan public prosecutor’s office last week published findings of a preliminary enquiry into the legal battle between Vivendi and Mediaset and said Bolloré and De Puyfontaine are suspected of market manipulation, which carries a potential prison sentence of between one and six years, and obstruction of exercise of control for failing to communicate certain facts to Italian markets regulator CONSOB, which carries a potential sentence of two to eight years.

Vivendi issued a statement at the end of last week – when reports of the prosecutors’ conclusions first emerged – strongly denying wrongdoing and condemning the leaking of a confidential document to the press.

The French media company said it was “shocked that a confidential document, intended for the protection of the individuals under investigation, was made public as soon as it was notified to their attorneys, also misrepresenting its contents”.

It said that “the timing of this leak improperly influences the course of ongoing judicial disputes between private parties and tarnishes the image of the individuals concerned, to whom Vivendi will continue to provide its full support”.

Regarding the prosecutors’ allegation that Vivendi communicated incorrect information to the market and failed to make correct disclosures to the markets regulator, the company said that it, and its officials, had acquired its stake in Mediaset within the law.

Arnaud de Puyfontaine

Vivendi said that its attorneys had “expressed full willingness to provide the necessary clarifications before the Prosecutor’s office takes a decision, being confident that the decision will be the closure of the proceedings without charges”.

In another twist to the long-running saga of Vivendi’s battle with Mediaset, the latest developments come as the European Commission raised doubts over whether Italy’s recently-approved media law, which could have an impact on Vivendi’s presence in the country, was valid and asked for it to be notified to Brussels.

Italy last month passed a law that would allow communications regulator AGCOM to begin an investigation into Vivendi’s Italian assets to verify if they were harmful to media plurality.

The law was intended as a stop-gap measure after the EC ruled that the previous Italian media law, known as the Gasparri law, was invalid. This had included the notorious TUSMAR provision that prevented companies from holding simultaneous large stakes in media and telecom companies.

Vivendi has lobbied hard against the new law, which it said was contrary to rules protecting free movement of capital.

Vivendi acquired a 29% stake in Mediaset in a series of moves after the pair spectacularly fell out over the French company’s decision to pull out of a strategic pact that would have seen it acquire Mediaset’s pay TV arm in 2016.