WRITTEN QUESTION E-1174/02 by Toine Manders (ELDR) to the Commission. Position of power of media undertakings.
Date: 2002-04-24
Institutions: European Parliament, Provisional data
Subjects: Germany, bankruptcy, commercial media, competition law, exclusive distribution agreement, professional sport, sports body

C 301 E/100

Official Journal of the European Communities

EN

5.12.2002

The most complete and recent transport study covering both transport infrastructure and the public
1.
transport system in the region of Attika, is the Metro Development Study prepared with the co-ordination
of Attiko Metro Company. The alignment finally chosen by the Greek authorities for the Athens tramway
follows the conclusions of the above mentioned study. Alternative alignments have been examined, but the
one finally proposed by this study and selected for support serves the transport needs of a large part of the
Athens urban area better.

The managing authority has confirmed that an environmental impact study has been carried out and
legislation have been

2.
the rules on publicity and consultation of the public provided by the national
respected for the Athens tramway.

3.
The agency ‘Tram Ltd’ has launched an extensive information campaign for the project, targeting, in
particular, to the nine municipalities which will be directly served by the tram. The managing authority
confirms that all the rules of national and Community law concerning tendering procedures have been
respected.

The objective set for the completion of the project is the first semester of 2004, so that it can service
4.
the 2004 Olympic Games. The Greek authorities consider this objective to the both ambitious but realistic.

The agency ‘Tram Ltd’

5.
is a subsidiary of Attiko Metro Company which has extensive direct
experience in rail public transport systems construction and operation. It should also be recalled that this is
the first project of its kind in Greece in the period since the 1960s.

(2002/C 301 E/104)

WRITTEN QUESTION E-1174/02

by Toine Manders (ELDR) to the Commission

(24 April 2002)

Subject: Position of power of media undertakings

As a result of the recent bankruptcy of the Kirch Media Group German pay-TV football organisations can
expect as of next season to forego the estimated EUR 358 million in TV rights that they currently receive.
This leaves the clubs in a difficult position, with the sword of Damocles of players’ salaries hanging over
them. The bankruptcy shows how a whole industry can be ruined as a result of a disproportionate
dependency on a single company. The situation in Germany is not a one-off case. In other Member States
too the football industry depends for an excessively large part of its income on companies with monopoly
or quasi-monopolistic positions.

1.

Does the Commission have information about the failure of Kirch in Germany?

2.
Does the Commission take the view that this is a case of authorised cartel formation, with the result
that a whole sector, in this case the football industry, has become disproportionately dependent for its
income on a monopoly holder, so that as soon as the monopoly holder runs into trouble the industry is
dragged along with it, making it necessary to give state support to suffering clubs in order to placate
public opinion, which then conflicts with Article 87 of the EU Treaty concerning unlawful state aid?

3.

Does the Commission know if Kirch’s broadcasting rights form part of the bankruptcy assets?

Is the Commission prepared to take measures to prevent such practices in future and, if so, what

4.
measures?

5.12.2002

EN

Official Journal of the European Communities

C 301 E/101

Answer given by Mr Monti on behalf of the Commission

(10 June 2002)

The Commission’s knowledge concerning the circumstances of KirchMedia GmbH & Co.
1. and 3.
KGaA’s filing for insolvency and the state of play of the insolvency procedure is based on publicly
available information. KirchMedia GmbH & Co. KGaA had previously acquired the broadcasting rights of
the German first and second division football league matches. The Commission does not have information
on the insolvency procedure’s exact impact on this contract.

2.
A cartel is an arrangement between firms designated to limit or eliminate competition between them,
with the objective of increasing prices and profits of the participating companies and without producing
any objective countervailing benefits. The Commission does currently not have indications that the Kirch
group or parts thereof have engaged in such an activity in order to obtain their position on any market.

However, as pointed out in the Union of European football Associations (UEFA) Champions League
case (1), an agreement among football clubs to sell their media rights jointly on an exclusive basis for a
long period of time to a single broadcaster, via a football association, fosters oligopolistic structures in the
broadcasting markets. The Commission has not yet examined whether this would create a dependency of
the football clubs on the buyer.

The Commission is currently not aware of any measure in favour of the German football clubs contrary to
Article 87 of the EC Treaty.

The Commission will continue to monitor closely the ongoing developments and ensure compliance

4.
with Community competition law.

(1)

IP/01/1043.

(2002/C 301 E/105)

WRITTEN QUESTION P-1196/02

by Giovanni Fava (PSE) to the Commission

(22 April 2002)

Subject: Mobile telephony market in Italy and Community competition laws (cid:1) Vertenza Blu S.p.A.

The crisis affecting the mobile telephony company Blu S.p.A. is not due to market considerations since its
results have often exceeded the targets set in its initial business plan, giving the impression of a small but
thriving company.

The measures currently being taken will jeopardise existing jobs (cid:1) some 400 young operators have so far
lost their jobs, but 1 700 posts are threatened in the company’s various branches in Italy, including 500 in
the Palermo Call Center alone (cid:1) with the aim of proposing as the only possible solution in the current
emergency to transfer its assets temporarily to TIM (at present controlled by the same majority
shareholders as Blu) and thus to effect a lucrative break-up of the company (by selling Blu’s more valuable
assets).

These measures take no account of the fact that the company has a debt to the institutions which have
contributed to making it the country’s fourth operator and setting up the ‘centro-sud’ production unit,
including the support of national and European legislation on employment aid for disadvantaged areas
(Objective 1).

The objective of eliminating a thriving competitor from the mobile telephony market on the eve of the
introduction in Italy of MNP (mobile number portability) will in fact mean a reduction in competition on
the market, with obvious implications in terms of the service available to customers.