WRITTEN QUESTION E-3475/02 by Benedetto Della Vedova (NI) to the Commission. State aid for public broadcasting companies.
Date: 2002-12-06
Institutions: European Parliament, Provisional data
Subjects: Italy, State aid, application of EU law, communications policy, competition law, control of State aid, private media, public sector, public service, supervisory body

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Who signed the interim statement of account?

When did the new accounting officer countersign the interim statement of account?

Did he express any reservations when so doing?

If so, can the Commission let me know exactly what he said?

Answer given by Mrs Schreyer on behalf of the Commission

(5 March 2003)

A copy of the Decision appointing Mr Oostens is being transmitted direct to the Honourable

1.
Member and to Parliament’s Secretariat.

2.
Two eligible candidatures were received for this post. It is not true that only Commission officials
were given the opportunity to apply for this vacancy; applications were also invited from officials of the
other institutions.

3.
The interim statement of account was prepared by the accounting services during the fourth quarter
of the year 2002. Mr Oostens signed it on 27 January 2003. This delay is because the financial statements
include extra information on accrual elements, collected within several Directorates General
(DG’s),
controlled by DG Budget and introduced in the accounting system on a double entry basis by the
Accountant’s services.

4.
In the event of an accounting officer terminating his duties, an interim statement of account shall be
drawn up on the date of the termination of officer’s duties. Consequently, the interim statement of the
accounts was drawn up as of 31 August 2002.

5. Mr Taverne signed the transmittal note on 21 January 2003 as the Accounting Officer terminating
his duties on 31 August 2002. Mr Oostens, the appointed Accounting Officer as from 1 September 2002,
signed the reception note for the interim statement on 27 January 2003.

6.

7.

8.

The new accounting officer countersigned the interim statement of account on 27 January 2003.

Yes.

A copy of the notes is sent direct to the Honourable Member and to Parliament’s Secretariat.

(2003/C 280 E/018)

WRITTEN QUESTION E-3475/02

by Benedetto Della Vedova (NI) to the Commission

Subject: State aid for public broadcasting companies

(6 December 2002)

The existence of a public broadcasting service can be justified in that it gives viewers and listeners
programmes not otherwise provided by existing commercial channels.

Broadcasting is not exempt from the application of Articles 86, 87 and 88 of the EC Treaty relating to
competition and while the Protocol to the Treaty of Amsterdam on the system of public broadcasting
reaffirms the power of the Member States to provide for the funding and define the role of public service
broadcasting, it does so on condition that ‘such funding is granted for the fulfilment of the public service
remit as conferred by each Member State’, ‘insofar as such funding does not affect trading conditions and
competition in the Community to an extent which would be contrary to the common interest’ and with
regard to ‘the need to preserve media pluralism’.

The definition of public service in the service contract between the Italian Government and RAI appears to
be at variance with the requirements set out by the Commission in its Communication on State aid for
public service broadcasting,
is excessively general and much broader than is considered
acceptable in the communication.

in that

it

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However, Article 1 of Directive 80/723/EC (1) on financial transparency requires clarity in the definition of
public service and the use of public funds; Article 5 of the directive requires public broadcasters to make a
clear distinction in their accounts between public activities and commercial activities in order to ensure
that the latter are not financed with public funds.

A member of RAI’s board of governors stated publicly on 21 September 2002 that RAI was unable to
make a distinction between programmes financed by public resources and those financed by advertising.

The RAI licence fee cannot be construed as ‘pre-existing aid’ which was in place before the entry into force
of the EC Treaty and therefore not subject to the Treaty rules, given the radical changes that have occurred
in the Italian broadcasting system.

Can the Commission therefore answer the following questions:

1. Has RAI introduced the separation of accounts required by Directive 80/73/EC, as the Commission

ordered it to do last June?

2.

3.

Is it compatible with the separation of public service activities and commercial activities for
programmes acquired with public funds to be interrupted by commercial breaks?

Is acceptable that Italy should have no independent broadcasting authority to monitor compliance
with the public service obligations imposed on RAI?

4. Can the Commission evaluate the proportionality of public funding received by RAI?

5. Are the separation of accounts and compliance with the criterion of proportionality satisfied by public

service broadcasters in the other EU Member States?

6. What are the reasons for the delay in starting and concluding the infringement proceedings in respect

of State aid to RAI and several other European public broadcasters?

(1) OJ L 195, 29.7.1980, p. 35.

Answer given by Mr Monti on behalf of the Commission

(4 February 2003)

As regards the general issues the following remarks can be made.

The Protocol on the system of public broadcasting in the Member States, which was annexed to the EC
Treaty by the Treaty of Amsterdam, recognises the role and the importance of public service broadcasting
and confirms that the Member States are competent to define and organise the public service remit and its
financing. The choice of the financing scheme falls within the competence of the Member State, and there
can be no objection in principle to the choice of a dual financing scheme (combining public funds and
advertising revenue) rather than a single funding scheme (solely public funds). This applies also to
broadcasters whose entire programme spectrum of programs is deemed to be part of its public service
remit.

The issues of separation of accounts and proportionality of public funding comes up in several
broadcasting cases the Commission is dealing with, involving several Member States. The Commission is
presently investigating these cases and it is therefore not possible to anticipate the answer to this question.

in the Communication on State aid to public service broadcasting (1)

Regarding the necessity of an authority controlling the activity of the broadcaster entrusted with the
the
general service mission,
Commission stated that: ‘It is also necessary that the public service be actually supplied as provided for in
the formal agreement between the State and the entrusted undertaking. It is therefore desirable that an
appropriate authority or appointed body monitor its application.’ The presence of such an authority is a
means for the Member States to ensure that the mission is fulfilled and at the same time it may facilitate
the tasks of the Commission under the State aid rules. However, the absence of such an authority is not in
itself an indication of incompatible aid.

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Concerning the length of the Commission investigations in this sector, the Commission is assessing several
complaints concerning State financing of public broadcasters. While the Commission was carrying out the
analysis of these complaints, new legislative developments (such as the Amsterdam Protocol, the new
Commission Communication on services of general interest (2) and the new Transparency Directive (3)) have
occurred. The necessity to take into account these developments as well as the need to treat consistently
the various cases has slowed down the investigation of the State aid procedures. In this connection the
Commission has decided to draft a Communication on the application of State aid rules to public
broadcasting which was adopted on 5 November 2001. Following the Communication, decisions have
already been taken in cases involving Portuguese TV, Belgium local TV stations and BBC digital channels.
Decisions concerning RAI and other broadcasters are expected to be taken this year.

As to the issues specifically relating to the RAI case, it can be emphasised that the investigation of the
Commission is at an advanced stage. As soon as this investigation will have been completed,
the
Commission will take a decision dealing also with the points you are raising. Of course, the Commission
position on these issues cannot be anticipated, but some remarks can be made. As to the issue relating to
the existence of an appropriate authority or appointed body monitoring RAI’s activity, RAI is, as to the
knowledge of the Commission, subject to the control of a specific Parliamentary Commission and to the
control of the ‘Autorità per le garanzie nelle Comunicazioni’. As to the issue of the evaluation of the
proportionality of the public funding received by RAI, the Commission will carry out this assessment, in
the framework of the pending State aid case concerning RAI, on the basis of the criteria set out in the
above mentioned Communication of 5 November 2001. Finally, as to the separation of accounts, also this
issue will be dealt with in the context of the pending procedure.

Also on this point the Commission decided in December 2002 to launch an action before the Court of
Justice against Italy for non-transposition of the latest modification of the ‘transparency’ directive.

(1) OJ C 320, 15.11.2001.
(2) COM(2002) 689 final.
(3) Commission Directive 2000/52/EC of 26 July 2000 amending Directive 80/723/EEC on the transparency of

financial relations between Member States and public undertakings (cid:1) OJ L 193, 29.7.2000.

(2003/C 280 E/019)

WRITTEN QUESTION E-3488/02

by Charles Tannock (PPE-DE)
and Christopher Heaton-Harris (PPE-DE) to the Commission

(9 December 2002)

Subject: Fraud in the European Union and the disciplining of Marta Andreasen

Following claims by the recently-suspended Chief Accountant Marta Andreasen that the EU’s accounting
system is deeply flawed, the European Court of Auditors has refused for the eighth year running to certify
the EU budget, admitting that it can only guarantee that five per cent of taxpayers’ money is being spent
properly. In addition to stating that the monies could not be controlled once they had been handed-over to
Member States or dispersed in aid, the Court has also made serious criticisms of the Commission’s own
finances which continue to be based on out-dated and discredited cash-based accounting systems.

There are varying reports as to when the Commission intends to replace the cash-based system. In view of
the criticisms of previous years, could the Commission indicate why it has taken so long to accept the
need for change, and why a more modern accounting system cannot be introduced within a matter of
months rather than years?

Does the Commission accept that its monitoring arrangements both for money distributed to Member
States and in the form of aid outside the European Union are woefully inadequate and in need of urgent
review, and, if so, does the Commission have any concrete proposals as to how the monitoring procedures
might be improved?

Finally, could the Commission indicate why it felt the need to suspend Marta Andreasen, given that the
Court of Auditors would appear to be in substantial agreement with her assessment of the state of the
European Union’s finances? What effect does the Commission believe that the decision to suspend her has
had on the reputation of the Commission and on its commitment to openness and transparency? Does the
Commission acknowledge the validity of her criticisms, and what plans does the Commission have to
reinstate her?