The American-owned parent company of The Northern Echo and Darlington & Stockton Times is seeking to buy a major Scottish newspaper publisher.

The bid by Gannett UK Limited - owners of Newsquest (North East) Limited - for the Scottish Media Group's (SMG) newspaper arm has been referred to the Competition Commission.

Gannett UK Limited has applied for consent to acquire SMG's newspapers and related assets under the special newspaper merger regime. The titles include The Herald, Sunday Herald and Evening Times.

The Glasgow-based newspaper group has a joint circulation of more than 500,000, a figure which demands automatic referral of any sale to the Competition Commission.

In a statement the Department of Trade and Industry said the Competition Commission will be directed to report on whether the proposed transfers may be expected to operate against the public interest, looking in particular at the need for accurate presentation of news and free expression of opinion. It is due to report by 10 March, 2003.