Sale of Ecuador's El Comercio marks a turning point for country's media and raises concerns

By Eva Hershaw

After more than a century in the hands of the Mantilla family, one of Ecuador's oldest and most traditional newspapers – El Comercio – has been sold to Latin American media mogul Remigio Ángel González, a Mexican who launched his TV empire in Guatemala and is known for avoiding editorial conflict with governments.

The sale marks a turning point for Ecuador, where El Comercio was considered one of the last bastions of opposition in a media landscape that increasingly favors President Rafael Correa's administration. The government has long been at odds with private news organizations while simultaneously expanding its own state media network.

In Venezuela, another country where the government has been in confrontation with private media, the leading newspaper El Universal was also sold last year. A couple of months after the sale to an unknown group of Spanish investors, El Universal changed its editorial line and fired columnists who had been critical of the government.

While the legality of El Comercio's transaction remains dubious, long-time Ecuadorean journalists believe that the sale will have the effect of further limiting freedom of expression in the country, where the government has tightened its grip in recent years.

“El Comercio is the most important and traditional publications in the country of Ecuador,” said Diego Cornejo Menacho, the executive director of the Ecuadorean Association of Newspaper Editors (AEDEP). “It is a newspaper that has built its reputation upon transparency of information, and it set off alarms for us when there was so little in the process of this sale.”

While a sale had been rumored since mid-2014, the news was first broken by Organizaciones Muñoz-Ugarte on December 29. On January 15, El Comercio ran a short front-page announcement stating that as of January 12, 94 percent of El Comercio's shares – amounting to some 15.5 million dollars – had been sold to Telglovisión, S.A.

For the readership of a newspaper founded in 1906, it offered little in the way of comfort or information: “The El Comercio Group tradition of serving the informative needs of the community will be upheld and promoted in this new phase, based on its experienced professional teams.”

Telglovisión has a mere 800 dollars in issued share capital. The remaining shares, according to Plan V, are divided between two closely-linked parent companies, the Uruguayan Blackster, S.A. and the company that owns Guayaquil network RTS. The Blackster, S.A. representative in Ecuador is the president of RTS. While Telglovisión is registered in Quito, the president is Argentinian Josefina Tejeda Rodriguez.

But the man behind the curtain, and at the head of the company that owns RTS, is Mexican millionaire Remigio Ángel González. Married to Guatemalan Alba Elvira Lorenzana and currently living in Miami, 70-year-old González has earned nickname “the Ghost” (El Fantasma) due to his discretion in negotiations that involve his holdings.

Long a specialist in entertainment television and radio, González first entered Ecuador 30 years ago, when he purchased Tele4 Guayaquil. In 2010, the Miami-based company Albavision – named after his wife – had reportedly grown to control 26 television channels, 82 radio stations, and 40 movie theaters in 10 Latin American countries. Today, González owns an estimated 40 television channels across twelve Latin American countries. In Ecuador, he owns a combined 13 television channels and radio stations. The purchase of El Comercio marks his first venture into print journalism.

The terms of the sale were not only murky but, in the eyes of many, served a government interest in silencing one of the few critical voices in a country increasingly dominated by government-allied outlets.

“In Latin America, they are no longer closing down newspapers,” said Cornejo. “Now, they are selling them to owners with ties to the government. This is how they censor criticism. It would appear that this could be one of those cases, given the critical positions that El Comercio has maintained.”

González, on the other hand, is known to tow the government line in whatever country he operates, regardless of the political lean of the administration. In Nicaragua, La Prensa recently published a column criticizing González: “One of the characteristics of Ángel González … is that he does not allow his channels to criticize the ruling government. Even in Guatemala and other countries, media outlets have indicated that during elections, he warms up to the candidates that are most likely to win and offers them television space as favors that pay off when the candidate wins the presidency.”

“The other concern that this sale emphasizes is that in Ecuador, we are seeing an increasing concentration of media,” said César Ricaurte, the director of the Andean Foundation for Media Study and Observation (Fundamedios). “With this purchase, González will own upwards of 20 media outlets in Ecuador. This makes him a media magnate in our country, and we hardly know anything about him, his intentions, his philosophy or editorial line.”

For many, the sale flies in the face of the justification used by the government to introduce the 2013 Communication Law, which categorized media as a “public service” subject to government regulation. The administration announced that it would use the law to break up large media corporations. El Comercio, which was relatively small in size – selling for $40 million – has now been sold to a foreigner that continues to acquire an increasing share of Ecuadorean media space.

“It is only now that we are seeing the creation of the big monopolies they were referencing,” added Ricaurte. “It has caused a great deal of uncertainty surrounding the sustainability of media outlets in Ecuador. It will be hard for any publication to survive unless it is allied with the government.”

The Communication Law states in Article 6 that: communication outlets of national character cannot belong, wholly or in part, directly or indirectly, to a foreign organization or company housed outside of the State of Ecuador, or to a foreign citizen. But in December of 2013, Correa passed a “reglamento,” a tool used to facilitate the implementation of the law. In this case, it acted to modify the original law – Article 6 – allowing foreigners from countries that had signed cooperative agreements with Ecuador to own national media outlets.

“There are few recourses at our reach at this point,” said Ricaurte. “We have asked for an official response, but they haven't said a word. The government says that we have freedom of expression in Ecuador, and we don't.”

In recent years, the internet has become a refuge for writers who are critical of the Correa government, but even that may be changing soon. This past weekend, the administration announced a strategy for fighting what Correa considers a “systematic attack” and “campaign of infamy” on social networks that intend to destabilize his government.

“We are safe on the Internet for now,” Ricaurte added. “But we don't know for how long.”

Note from the editor: This story was originally published by the Knight Center’s blog Journalism in the Americas, the predecessor of LatAm Journalism Review.