A regional newspaper publisher has attacked the competition regulator's refusal to take action on the Trinity Mirror take-over of Local World.
Last November's deal, which valued Local World at £220m, gives Trinity Mirror control of more than a third of the UK regional press market making if three times larger than the next biggest groups: Johnston Press and Newsquest.
Chris Bullivant (senior) is the founder and chairman of a dozen weekly newspapers across the Midlands.
In Spring 2010 he launched the paid-for Birmingham Press and Free Press weekly titles, but he closed them in October that year claiming that predatory ad pricing by Trinity Mirror forced the titles out of business.
In a letter to the Competition and Markets Authority he said the regulator's decision to nod through the Trinity Mirror deal was "profoundly disturbing".
He said: "Apparently there was no ministerial overview despite the transaction giving 'ownership' of much of the UK regional news and advertisement market to a PLC convicted of illegal activities only months before."
Trinity Mirror has admitted breaching the privacy of more than a hundred individuals by hacking their mobile phone voicemails, however the Crown Prosecution Service decided to not to proceed with a criminal prosecution of the company or of individual journalists. Trinity Mirror has estimated that it will cost £41m to settle the various civil privacy claims.
Bullivant said: "In my opinion the transaction was not only for the transfer of newspaper titles but, in reality, ownership of the majority of news and advertising sources in the cities, towns and regions of mainly England."
He said Trinity Mirror's regional monopolies make it harder for entrepreneurs to take advantage of new technology to launch competitive titles which would create "many more jobs and, more importantly, a variance of editorial views within each competing marketplace".
He used the example of Rotherham, where one independently-owned publisher runs the town's two newspapers (one paid-for and one free).
"For an example of the stultifying effect of daily newspaper monopoly in England one needs look no further than Rotherham. If true newspaper competition were operational there the attacks on 1500 young women would not have gone unreported for so long."
Bullivant said: "I believe, by accident or design, an opportunity to break into the regional monopolies existent in all of the cities of England has been thwarted by Government inaction either directly or via the quangos that sometimes 'front' Government decisions.
"Your predecessor, the OFT, was informed of my concerns as was the CMA. Both were far too busy to investigate. Their 'non decision' has stymied future competition in the cities of the UK, for which a finger of blame may be pointed at your organisation in the future."
He said he will look for a "legal remedy" if "any collusion between Government and yourselves can be established".
Bullivant said the tactics of the big regional publishers made it impossible for entrepreneurs such as himself to set up rival titles in their markets. And he said that given Trinity Mirror's involvement in criminal activities (phone-hacking), more scrutiny should have been given to the Local World deal.
The CMA and Trinity Mirror declined to comment.
Rotherham Advertiser editor Andrew Mosley has issued a statement responding to Bullivant's comments about Rotherham.
He said: "For Chris Bullivant to use the Rotherham Advertiser as an example to prove his point is ridiculous. For a start the Rotherham Advertiser is a weekly paper, but that’s not the main issue.
"Rotherham is also covered by two daily newspapers, The Star and the Yorkshire Post.
"Equally, if it was not, the existence of other newspapers would not have proved Chris’s argument.
"Times journalist Andrew Norfolk, who broke the story, has himself said he worked on the case for four years before his paper was able to go with it.
"I seriously doubt that another regional paper, if it existed in Rotherham, would have allowed a member of its staff to work for so long on a single story. I doubt another regional paper in the country would be able to accommodate a reporter working on a story for so long – I am pleased for The Times and Andrew Norfolk that it could afford to do so and that it produced the results that it did.
"Monopolies are never a good thing, but to incorrectly use the Rotherham Advertiser as an example of a ‘stultifying regional monopoly’ is simply wrong."