Brussels, 22/07/2010 (Agence Europe) - The annual funding mechanism of France Télévisions has been judged to be in line with Community state aid rules, the European Commission announced on Tuesday 20 July. This mechanism receives a proportion of the resources from the contribution to public audiovisuals (previously the television licence, which was approved by the Commission in 2005) plus a subsidy from the national budget. This annual subsidy is based on the legislation on the new public broadcasting service, under which advertising on public channels will be reduced and ultimately abolished altogether by the end of 2011.
In 2008, the French authorities launched an in-depth reform of public broadcasting to sharpen its focus and raise standards, which resulted in the law of 5 March 2009 on audiovisual communications and the new public television broadcasting service. Amongst other things, the reform provides for advertising to be phased out on public channels and for the introduction of two taxes, one on advertising and the other on electronic communications. It also brings in a new set of specifications unique to France Télévisions, which further consolidates its general-interest mission and its specific place in French broadcasting. Additionally, the law provides financial compensation for the removal of advertising, which represented between 25% and 30% of the annual income of France Télévisions.
On 1 September 2009, the Commission approved the payment of a maximum annual subsidy of €450 million for 2009 and opened formal investigation proceedings on various aspects of the annual subsidy for the subsequent years, which could total in excess of a billion and a half euros up to 2012. The Commission was concerned about the possible use of the revenue from the new taxes to finance the annual subsidy and the danger of over-compensation for public service costs up to 2011-2012. The Commission concluded that the definition and control of the public service mission vested in France Télévisions comply with the applicable state aid rules and with the communication of the Commission concerning the application of these rules to the public broadcasting services. The Commission is satisfied with the undertaking given by the French authorities that the annual subsidy will be calculated on the basis of the public service costs incurred by France Télévisions and that the revenue from the taxes introduced by the reform will not be paid into this aid and will not affect its amount, unless the scheme is amended in the future, in which case the amendment would have to be notified to and approved by the Commission. The advertising tax will be paid by the television channels and the tax on electronic communications by the service providers, such as internet portals and cable or satellite operators. The money raised by these taxes will go into the state coffers, without being formally earmarked.
The Commission was therefore able to approve the annual subsidy mechanism for an unlimited period. (L.C./transl.fl)