“I refuse to sign the bill ... and am returning it to the Sejm [lower house of parliament] to be reconsidered,” the Polish president said at a press conference.
"This means I am vetoing the legislation," he added.
He told reporters he shared worries by some Poles about freedom of speech and that signing the bill
into law could harm his country's relations with the United States.
Duda, who is an ally of the country's ruling conservative government, has previously said that takeovers of foreign-owned media groups should take place on market terms and not with "forced solutions," in a sign he could use his power to veto the bill, news agencies reported.
His announcement on Monday came after a US State Department spokesman said earlier this month that Washington was "deeply troubled" over the controversial Polish bill.
US 'deeply troubled'
“The United States is deeply troubled by the passage in Poland ... of a law that would undermine freedom of expression, weaken media freedom, and erode foreign investors confidence in their property rights and the sanctity of contracts in Poland,” US State Department spokesman Ned Price said in a statement after Polish lawmakers voted in favour of the plan in mid-December.
The legislation, which sought to strengthen a ban on companies from outside the European Economic Area controlling Polish broadcasters, passed with 229 votes in favour, 212 against and 11 abstentions in a final vote in Poland's parliament on December 17.
The US State Department at the time called on Duda to "reaffirm his past statements about respecting the shared democratic norms that underpin our relationship and his commitment to defend the constitutional principles of freedom of speech, freedom to engage in economic activity, property rights, and equal treatment under the law."
The US State Department statement said: "We strongly encourage him to respect these norms and commitments in regard to this legislation that will severely affect media freedom and the foreign investment climate in Poland, if it is allowed to become law."
It added: "A free and independent media strengthens our democracies, makes the Transatlantic Alliance more resilient, and undergirds our bilateral relationship. We look forward to working with the Government of Poland to advance our shared priorities on the basis of democratic values and respect for fundamental freedoms, including freedom of expression. Now is the time for solidarity among Allies."
During emotional debates in parliament, opposition MPs decried the bill as an attack on media freedoms and an attempt to gag TVN24, a US-owned news channel critical of the government.
Critics have also warned that the controversial new regulations could harm US investment in Poland and sour Warsaw's relations with Washington.
The European Commission said the bill was sending another negative signal about the rule of law and respect for democratic values in Poland, the Reuters news agency reported.
A group of prominent US senators in the summer warned the Polish government against pursuing legislation that they say would infringe on a free, independent media and jeopardize US media investment in Poland.
Earlier this month, thousands of people protested across Poland in defence of media freedoms, objecting to the plan approved by parliament.
'Views that may threaten Poland's security'
Poland's Prime Minister Mateusz Morawiecki in July defended the bill, saying that an effort to tighten foreign ownership rules for media firms was a “perfectly normal” legislative move.
Deputy Prime Minister Jacek Sasin said the proposed new media rules were designed to provide “tools to protect the media market from an aggressive takeover by Russian or Chinese capital."
He told reporters in the summer that the "mass media should not become a mouthpiece for spreading views that may threaten Poland's security.”
Poland’s governing conservatives have long argued that foreign entities own too much of the country’s mass media and distort the public debate.
'Issue of media pluralism, freedom of speech'
When announcing his veto on Monday, Duda told reporters he believed that "generally limiting the possibility of holding shares or stocks in media companies is sensible when it comes to foreign capital."
He said he shared the view that the proposed new rules "should be introduced in Poland, but for the future."
He added that the proposed legislation concerned "entities already present in the market" and "there is also the issue of media pluralism, of freedom of speech."
"When taking my decision, I took this element into serious consideration," he told the press conference.
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Source: PAP, TVP Info, Reuters