Responsibility for overseeing media mergers is to be transferred to Mr Rabbitte’s department under the new law.
Mr Rabbitte wanted to have the sections dealing with media mergers extracted from the larger Bill and put through the Dáil and Seanad, so that new rules would become law by the summer.
“That conversation is now over,” said one Government source. There would be no separate Bill as suggested by Mr Rabbitte.
Another source said the matter had not been discussed at Cabinet.
There was no response to a request for a comment from Mr Rabbitte.
A spokesman for Mr Bruton said the Minister’s position remained as was set out in a recent reply to a parliamentary question.