European Commission Approves French, Spanish Pubcaster Funding

BRUSSELS: The funding mechanisms put in place by France Télévisions and Spain’s RTVE comply with state aid rules, the European Commission has said.

France Télévisions receives a share of the revenue from the public-service broadcasting contribution, plus a subsidy from the national budget to help fill the gap from the elimination of advertising on public channels by end 2011. "State compensation of the costs of a public service mission is allowed, provided that the mission is clearly defined and there has been no over-compensation," said Joaquín Almunia, the Commission’s VP for competition. "I am satisfied that the French legislation includes the requisite mechanisms to preserve fair competition between the public and private sectors."

The Commission has announced a similar ruling in Spain, where advertising has also been abolished on RTVE. The pubcaster will be funded through new taxes on TV and telecommunications operators, in addition to the existing state financing. The new laws call for RTVE revenues to be secured from a 3-percent revenue tax on free-to-air commercial broadcasters and a 1.5 percent tax on pay-TV broadcasters, a 0.9 percent tax on the revenues of electronic communications operators, a share of 80 percent of the tax on radio spectrum use. "The Commission has now concluded that the compatibility of the aid to RTVE is not affected by the legality of the new taxes and that the measure is in line with the state aid rules, because it ensures that RTVE will not be overcompensated for providing public broadcasting services," the Commission said.

"Spain’s choice to place greater emphasis on RTVE’s public service mission as part of the reform of public service broadcasters is in line with the policy of media plurality which the EU supports," Almunia said. "Moreover, it significantly reduces the risk of anticompetitive spill-overs between public and commercial activities."