EU General Court upholds RTVE s funding mechanism

In August 2009, Law 8/2009 amending the financing mechanism of Corporaci n de Radio y Televisi n Espa ola (RTVE) entered into force. This law introduced a prohibition on advertising, teleshopping, merchandising and pay-per-view services as source of revenue. By way of compensation, RTVE was to receive additional public funding generated from the following measures:

A tax on the revenues of free-to-air commercial broadcasters (3%) and pay-TV broadcasters (1.5%);

A 0.9% tax on the revenues of electronic communications operators and

A share of 80% of the already existing levy on radio spectrum use, up to a maximum amount of 330 million.

In July 2010, following a formal investigation procedure under Article 108(2) TFEU, the Commission adopted a decision declaring the RTVE aid scheme compatible with the Treaty.

On 11 July 2014, the General Court upheld the Commissions findings, rejecting all arguments put forward by the appellants, DTS Distribuidora and Telef nica. More particularly, the Court confirmed that, since the financing received by RTVE is based only on the net cost of providing the public service (i.e., the amount of funding received by RTVE is independent of the actual amount of revenue generated by the taxes), the new taxes fall outside the scope of the State aid rules. Furthermore, the General Court emphasised that the Member States have a wide margin of discretion to ensure an equal and varied program offer, including premium content (sports and films).

The legality of the new taxes was also subject to infringement proceedings brought by the Commission against Spain (which also introduced a telecoms tax to compensate for the ban on advertising on public television) for an alleged breach of Article 12 of the Authorisation Directive 2002/20/EC. However, after the European Court of Justice upheld a similar scheme in France in June 2013, the Commission withdrew its action against Spain.

Share this page on

--

LINK:	http://www3.ebu.ch/contents/expertise/media-law/Latest/2014/eu-general...
	See more stories from ebu

Most recent headlines