Public broadcasters under the EU competition microscope

LEIGH PHILLIPS

11.01.2008 @ 17:51 CET

EUOBSERVER / BRUSSELS - The European Commission has public television and radio stations within its targets once again, this time with the launch of a public consultation on the future of state broadcasters.

The commission announced the consultation process on Thursday (10 January). It marks the start of a comprehensive review of the state of the sector since the adoption of its 2001 broadcasting communication.

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The commission said in a statement that it hopes the review will build on the fundamental principles of the financing of public service broadcasting as laid down in European Community law, but also be able to clearly define what a public service mission is and limit state aid to "what is necessary for the fulfilment of this mission."

Competition commissioner Neelie Kroes said: "There are many ways the present broadcasting communication can usefully be improved to increase transparency and legal certainty."

Brussels hopes to explore the role of public broadcasters in the new media environment. Specifically, it would like the process to investigate what it terms "overcompensation" and "cross-subsidies for commercial activities" by public broadcasters.

This is not the first time the commission has put public funding of broadcasters under its competition microscope. In 2005, EU regulators warned German public broadcasters ARD and ZDF that the receipt of monies from the German government was not in line with EU law forbidding subsidies that damage competitors.

Ms Kroes launched a probe into the state funding of the two German public broadcasters after receiving complaints from private television stations who claimed the use of public monies for services that compete with them – in particular their ventures into the internet - was unfair.

Although concessions from the broadcasters resulted in the investigation being closed a year later, the probe shocked state broadcasters across Europe at the time, concerned that it was the beginning of a full-frontal assault on public radio and television, and that their services would soon go the way of public railways or public water in much of the EU.

In the last few years, public service broadcasters such as the BBC in the UK, NOS in the Netherlands, and ARD and ZDF in Germany have repeatedly come under attack from their commercial rivals, who hope European competition regulations can be used to begin to dismantle the decades-old structures of state financing of these organisations.

In response to the announcement, a BBC spokesperson said it boiled down to a question of "whether EU guidelines published in 2001 on the application of state aid rules to public service broadcasting need to be revised in the light of jurisprudence and technological change."

"We welcome the opportunity to respond and will be making a submission in due course."