Competition law looks set to replace old-fashioned over-complicated media ownership controls.

The Draft Communications Bill, unveiled by Culture Secretary Tessa Jowell and Trade Secretary Patricia Hewitt, will abolish unique controls and restrictions which apply to newspaper mergers.

It has been produced as a response to the quickly-changing technological and market environment.

The Newspaper Society, which exists to improve the environment in which local and regional newspapers work, has welcomed the main thrust of the proposed legislation.

But it remains concerned over the wide-ranging powers of watchdog OFCOM and its potential impact on editorial freedom and the development of regional and local newspapers.

The Bill stated that the current system for regulating newspaper transfers was too inflexible and imposed unnecessary burdens on business and on the authorities.

It would replace it with a “streamlined regime” focusing on regulatory action on newspaper transfers that appeared to raise competition or plurality concerns. The smallest local newspapers would be removed from regulation altogether.

Newspaper transfers would be treated the same as other mergers considered by the competition authorities, which means there would be no requirement for the Secretary of State’s prior consent to newspaper transfers.

Instead, newspaper companies would be able to complete acquisitions – but at the risk that the competition authorities might subsequently take action.

The Bill stated that the numerous views and opinions in the press continued to be a vital public interest. The Government remained committed to the protection of the special interests that can arise in relation to the transfer of newspaper titles.

Newspaper Society director David Newell said: “The Government’s Communications Bill and media ownership proposals respond specifically to the representations which the Newspaper Society has made to the Government over the last five years.

“The proposals will create some new opportunities for newspaper companies to expand as newspaper publishers and broadcasting companies.”

The Newspaper Society plans to press for further changes to the proposals so that regional and local newspaper companies can compete on the same terms as other media companies. It hopes to express its views at forthcoming meetings with the DTI and DCMS.

Under the new rules outlined in the Bill, local newspaper owners would be allowed to own local FM radio licences for the first time – but local newspaper publishers with more than a 20 per cent share of a local market would not be allowed to control an ITV regional licence in that same area.

And there would also be a scheme to ensure that at least three commercial local or regional media voices existed, in newspapers, television and radio, in addition to the BBC in almost every local community.