Silvio Berlusconi, the former Italian prime minister, has been sentenced by a Milan court for tax fraud connected to his Mediaset television channels and also banned from holding public office for five years.

The court sentenced him on Friday to four years but later cut it to one year because of an amnesty law which reduces the sentences of all crimes committed up to May 2006.

In addition to the prison sentence, Berlusconi and 10 co-defendants were ordered to pay 10m euros ($13m) to Italian tax authorities, a statement said.

Berlusconi, 76, is considered certain to stave off any imprisonment or ban on his political activities by appealing through higher courts.

The Milan court also said Berlusconi could not hold public office for five years or manage any company for three years, penalties that would take force only if the conviction is upheld.

The tax scam helped to create secret overseas accounts and reduce profits to pay fewer taxes in Italy.

Big consequences

Berlusconi was accused of having artificially inflated the price of film distribution rights bought by shell companies, then selling these back to his Mediaset empire.

The prosecution had asked for a prison sentence of three years and eight months for Berlusconi.

Al Jazeera's Claudio Lavanga, reporting from Rome, said: "Does it mean he'll go to prison immediately? Probably not, as there are two levels of appeal, but this conviction is certainly unexpected, and will have big consequences.

"His conviction will affect his political party, as well as the right.

"Furthermore, there has already been a strong reaction on the stock market as a result, showing that Berlusconi is paying the price economically at least."

In a phone call to his Italia 1 private network, Berlusconi, who will remain free pending appeals, said: "It is a political conviction that I can define perfectly well as incredible and intolerable."

Connection denied

Berlusconi denied that there was any connection between this case and his decision to step aside and allow another centre-right candidate to seek the premiership.

"My lawyers and I never thought that such a conviction would be possible," he said.

Fabio De Pasquale, the prosecutor, said in June that Mediaset costs for the films had been inflated by $368m from 1994 to 1998, and by 40m euros from 2001 to 2003.

Berlusconi was at "the top of the chain of command in the sector of television rights until 1998", he said at the time.

De Pasquale had asked for a prison sentence of three years and four months for Fedele Confalonieri, Mediaset's president.

However, Confalonieri, who was a close Berlusconi aide in his business dealings, was acquitted on Friday.