The European Parliament, the Commission, and many national authorities become concerned when own ership of the media is concentrated in too few hands.

They worry that so-called 'media moguls' will use their media companies to promote themselves (as some claim Silvio Berlusconi has done) or their other interests (as others claim Rupert Murdoch did, for example, when his UK newspapers promoted his satellite services).They also worry that if the media becomes overly concentrated, the small number of players left will be less likely to provide objective views and a diversity of opinion, and less likely to give the public full access to information.Until quite recently, most media concentrations involved mergers between two media companies from the same country.

Not surprisingly, most of the rules governing cross media ownership and pluralism are national rules, developed by governments, to deal with national problems.

This has led to a 'patchwork' of rules which vary significantly from country to country.

The key question today is whether this patchwork is so outmoded that it requires replacement, either by a single set of European Economic Area-wide rules, or by new national legislation.The first point to note is that the market has changed beyond all recognition; where once most activity within the media occurred on a national scale, it is now starting to happen on a European or global scale.

Canal +, for example, originally concentrated within France, is now a producer on a global scale and a strong player in the pay television sector in Belgium and Spain; News International is also now investing in German television stations and newspapers.European and global mergers are becoming the norm, spurred on by advances in technology which facilitate trans-border broadcasting, and by the gradual elimination of old national monopolies.Changes in a market do not always necessitate changes in the law.

What is it, then, which makes the law on media regulation special and which means that current national law is deficient or ill equipped to deal with today's media market?The short answer is that the current rules are a disincentive to investment and cross border merger, they lead to a squandering of resources, and they inhibit the functioning of a single European media market.

This answer can only be understood by considering the national rules which currently exist, and how media companies are responding to them.Each of the member states of the EU has its own national rules on pluralism and media ownership.

These can be divided into five categories: rules which limit ownership of the press; rules which limit ownership of television or radio; rules which limit one media company owning a company in a different sector of the media; rules which prevent any company from owning more than a given percentage of a television station; and rules which declare certain classes of people ineligible to hold media interests.And even where two member states have rules in the same area, they will have legislated differently.

Contrast, for example, the UK and German rules on cross media ownership.

The UK rules stipulate precisely the levels of investment media companies may undertake in different media markets (a terrestrial television company may own up to a 20% interest in a national newspaper, a national newspaper owner may own up to a 20% interest in a terrestrial television company and so on).

The German rules (which are not national but state rules) apply a much more general test, providing simply that if a newspaper company holds a dominant position in a given area, it may not, in that area, exert a controlling influence over programme b roadcasts.It is not surprising that this patchwork of differing rules has an adverse effect on media companies.

Those wishing to expand to a particular country have to weigh up not only whether the commercial environment is favourable but also whether the legal environment is more, or less welcoming, than that prevailing in other countries in the EU.This patchwork has led to companies responding to the rules in different ways.

In some cases they must devote considerable time and resources to comparisons of different legal frameworks.

They must also adapt commercial objectives to comply with national legal restraints and devise routes to 'circumvent' national rules.

They may also have to determine their investment strategy as much on the basis of what is legally possible in a particular country, as on what is commercially attractive.Some companies may establish secure footings in countries with liberal regimes and then use those secure footings as a base for international expansion (as the chairman of Havas SA has said of the Havas and Canal + grouping: these interests 'probably couldn't have evolved anywhere else but in France').

This allocation of resources is dictated as much by the legal patchwork as by commercial objectives.A company may also establish a business in one country and transmit programmes across the border into another, potentially avoiding that second country's national (and presumably stricter) rules.There is increasingly a mismatch between what is commercially sensible in terms of new investment and what is legally permissible.

The problem is growing daily as new opportunities present themselves in a marketplace which is becoming more and more international.

Other industries are increasingly able to benefit from a single market; media companies are being circumscribed by an erratic landscape of differing legislation.The case for new rules seems compelling.

Several arguments, however, are run against the introduction of new rules on a Union-wide basis.First, subsidiarity - the rule that denies the Commission competence where a particular matter can be dealt with effectively by national legislation.

Yet media companies are only going to invest on a pan-European basis if there is a single set of enabling rules.

Without Commission intervention there will never be a single market or a single set of rules.Secondly, over-regulation - many are concerned that the Commission, once charged with devising a single set of rules, will come up with a set of highly restrictive rules, incorporating many of the features of current national regulation.This is a valid concern.

The Commission appears to accept this, rejecting the idea that the industry is being asked to 'sign a "blank cheque"'.

There is, however, a long way to go before determining what level of regulation is appropriate and what is overly restrictive.The third argument is timing.

Given the rapid developments in the media, some argue it would be sensible to wait to regulate until there is a period of stability.This argument is absurd, no-one knows when there will be a period of stability.

And, by the time there is, the distortions in the market will have become entrenched and there will have been a huge waste of resources.There does seem to be a strong case for a single set of rules, provided those rules do not unduly stifle media investment.

The directorate within the Commission with responsibility for cross media ownership, DGXV, appears to share this view:'Now that the European media industry is at a watershed...the Commission considers that a Community initiative is necessary.

Such an initiative should enable the single media market to function, and in particular should facilitate the exercise of freedom of establishment for media companies and the free movement of media services in the Union, while maintaining pluralism in the face of certain concentrations.

It would provide both a maximum of legal certainty for investments in the media sector, and a safety net preventing concentrations which represent a threat to pluralism and which cannot be dealt with under conventional competition-law rules.'Given this statement, regulation might have been expected as a matter of urgency.

However, disagreements within the Commission as to the need for regulation and the means of regulating has meant that the whole issue of cross media ownership has been sent back for what the Commission calls a 'second round of consultation' - in reality a third or fourth round.

The European Commission has indicated that an 'initiative' may follow in 1995.

The debate is set to run for many months to come.