WRITTEN QUESTION E-1367/01

by Bernhard Rapkay (PSE) to the Commission

(7 May 2001)

Subject: Funding for broadcasting from fees after the Preussen Elektra judgment

In the past the Commission has treated the funding of public service broadcasting by fees Phoenix/Kinderkanal, News 24) as aid within the meaning of Article 87(1) of the EC Treaty. Viewers pay broadcasting organisations fees based on legal guidelines. In this respect the Commission interprets the criterion of by a Member State or through State resources to the effect that a charge to the State budget is not absolutely required. However, the required charge to the State was established by the fact that viewers were obliged to pay the fees on the basis of legal guidelines.

However, in the Preussen Elektra v. Schleswag judgment (Case C-379/98) the Court of Justice ruled on 13 March 2001 that not all advantages granted by a State, whether financed through State resources or not, constituted aid; the distinction between aid granted by a Member State and aid granted through State resources was intended merely to bring within the definition both advantages which were granted directly by the State and those granted by a public or private body designated or established by the State (paragraph 58 of the judgment). Furthermore, the fact that the purchase obligation in question was imposed by statute and conferred an undeniable advantage on certain undertakings did not confer upon it the character of State aid (para. 61).

The Court then turned to Article 10(2) of the EC Treaty, which requires Member States to abstain from any measure which could jeopardise the attainment of the objectives of the Treaty. This also could not be used to extend the scope of the definition of aid to conduct by States that did not fall within it (para. 65).

1. In view of the above, how does the Commission intend to treat broadcasting fees in future?

2. Does it consider that the situation is altered by the fact that broadcasting organisations use a system set up by them for that purpose to deal with purely technical matters (receipt and transfer of fees) which itself is neither owed the revenue from the fees, nor monitors or administers them?

Answer given by Mr Monti on behalf of the Commission

(10 September 2001)

In its decision on Preussen Elektra the Court ruled that only advantages that are financed directly or indirectly through state resources fall under the meaning of state aid of article 87(1) EC. Decisions of the state for example imposing private companies to buy renewable energy for prices higher than its economic value do not constitute a transfer of state resources to the private producer of renewable electricity.

The financing of public broadcasters directly from the state budget falls clearly within the definition of state resources. The Commission has so far considered - without challenge - that also funding of public broadcasters through licence fees constitute State Aids. However, the Commission is currently examining if the judgement of the Court of Justice in the case of Preussen Elektra Judgement implies any change in its previous assessment of this issue. The Commission will keep you informed of the conclusions of this analysis.