Brussels, 02/07/2009 (Agence Europe) - On Thursday 2 July, the European Commission opened a formal investigation on the restructuring aid package of TV 2 Danmark A/S. The Commission will investigate whether the aid complies with the EU rules on state aid to companies in difficulty, and, in particular, whether TV 2 Danmark A/S is viable without continued state support and whether the restructuring plan contains enough safeguards commensurate with the state support.
TV2 Danmark A/S is wholly owned by the Danish State. It operates the public television channel TV 2 along with a number of commercial channels including TV2 Zulu, TV2 Charlie and a news sport television channel TV2 Sports. In the course of 2008, TV2 Danmark A/S experienced serious liquidity problems which were temporarily addressed through a credit facility approved by the Commission as urgent rescue aid. In line with the EU Guidelines on state aid for rescuing and restructuring firms in difficulty, the Danish authorities have now submitted a restructuring plan, covering the period 2009 to 2012, aimed at restoring the long term viability of TV2 Danmark A/S.
The Commission has opened an in-depth investigation to receive stakeholders' views on several key aspects. It wants to know, firstly, whether TV2 Danmark A/S's financial prospects would condemn it to going out of business without long term state support, secondly, whether the introduction of user charges on TV2's public service channel would be, on balance, positive for competition and whether such charges should be phased in automatically by 2012 without a market test, and thirdly, whether the only measure proposed to mitigate the distortion of competition brought about by the state support, namely not to launch new pay channels, is proportionate to the strength of TV2 on the Danish market. Denmark has so far chosen to provide support under the general rules which apply to the restructuring of firms in difficulty, rather than the specific rules concerning the compensation of public service costs of public broadcasters. Indeed, the public funding provided to TV 2 Danmark A/S benefits not only the public service TV2 channel, but also commercial activities of the broadcaster. The specific rules for public service broadcasting would therefore not apply to the restructuring plan in its current form. (O.L/transl.rt)