Mediaset to Challenge Court Decision on Decoders

MILAN: Mediaset has said it will appeal the European General Court’s ruling that it must pay back millions of euros in subsidies granted to pay for viewers‘ digital terrestrial decoders. 

The Italian broadcast group said it would contest the sentence in the European Court of Justice. The European General Court sided with the European Commission in its decision, arguing that the Italian subsidy on digital terrestrial decoders constituted state aid and must be recovered. "The measure is not technologically neutral and confers an indirect advantage on digital terrestrial broadcasters to the detriment of satellite broadcasters," the court said.

The subsidy was first introduced in 2004, with 150 euros to be given to every user who purchased or rented equipment to receive DTT feeds, ahead of the 2012 analogue cutoff. In 2005, the subsidy was reduced to 70 euros. The spending limit of the subsidy for each year was 110 million euros.

The Commission began a formal investigation into the subsidies after receiving complaints from satellite-TV players SKY Italia and Centro Europa 7 and, in 2007, ruled that they constituted as state aid to DTT broadcasters offering pay-TV services and digital cable pay-TV operators. "The Commission took the view that, even though the transition from analogue to digital TV broadcasting was a common interest objective, the subsidy was disproportionate and did not prevent unnecessary distortions of competition: since the measure at issue did not apply to digital satellite decoders, it was not technologically neutral. The decision ordered Italy to recover the aid from the beneficiaries, together with interest."

Mediaset sought to have the decision dismissed. After losing its battle yesterday, the group issued a statement stressing that the subsidies were "passed directly to the consumers and not to the broadcasters that broadcast in digital terrestrial. And that, consequently, Mediaset has derived no advantage."