Decision No 1718/2006/EC of the European Parliament and of the Council of 15 November 2006 concerning the implementation of a programme of support for the European audiovisual sector (MEDIA 2007)
Date: 2006-11-15
Institutions: Council of the European Union, European Parliament
Subjects: EU aid, EU financing, EU programme, audiovisual communications policy, cultural policy, employment policy

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DECISION No 1718/2006/EC OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

of 15 November 2006

concerning the implementation of a programme of support for the European audiovisual sector
(MEDIA 2007)

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE
EUROPEAN UNION,

Having regard to the Treaty establishing the European Commu-
nity, and in particular Articles 150(4) and 157(3) thereof,

Having regard to the proposal from the Commission,

Having regard to the opinion of the European Economic and
Social Committee (1),

Having regard to the opinion of
Regions (2),

the Committee of

the

Acting in accordance with the procedure referred to in
Article 251 of the Treaty (3),

Whereas:

(1)

The European audiovisual sector has a key role to play in
the emergence of European citizenship because it is one of
the principal vectors for conveying the Union's common
and shared fundamental social and cultural values to
Europeans and especially young people. Community
support is designed to enable the European audiovisual
sector to promote intercultural dialogue, increase mutual
awareness amongst Europe's cultures and develop its
political, cultural, social and economic potential, which
constitutes genuine added value in the task of making
European citizenship a reality. Such support is intended to
enhance competitiveness and, in particular, to increase the
market share in Europe of non-national European works.

(2)

It is also necessary to promote active citizenship and to do
more to ensure respect for the principle of human dignity,
promote equality between men and women and combat all
forms of discrimination and exclusion,
including racism
and xenophobia.

(1) OJ C 255, 14.10.2005, p. 39.
(2) OJ C 164, 5.7.2005, p. 76.
(3) Opinion of the European Parliament of 25 October 2005 (not yet
published in the Official Journal), Council Common Position of
24 July 2006 (OJ C 251 E, 17.10.2006, p. 1) and Position of the
European Parliament of 25 October 2006 (not yet published in the
Official Journal).

(3) All actions adopted pursuant to this programme should be
compatible with the Charter of Fundamental Rights of the
European Union and, in particular, Article 11 thereof on
freedom of expression and media pluralism.

(4) Article 22 of the said Charter states that the Union is to
is, therefore,
respect cultural and linguistic diversity.
necessary to pay attention to the specific needs of the
smaller Member States and those with more than one
linguistic area.

It

(5) Community support for the audiovisual sector takes into

account Article 151 of the Treaty.

(6) Community support for the audiovisual sector is also in
keeping with the new strategic aim defined for the Union
by the Lisbon European Council of 23 and 24 March 2000,
namely to boost training, employment, economic reform
and social cohesion in a knowledge-based economy. In its
‘content
conclusions,
industries create added value by exploiting and networking
European cultural diversity’. This approach was confirmed
in the conclusions of the Brussels European Council of 20
and 21 March 2003.

the European Council stated that

(7) Community support for the audiovisual sector is based on
the considerable experience acquired in the MEDIA I,
MEDIA II, MEDIA Plus and MEDIA — Training pro-
grammes (4), which have helped the European audiovisual
industry to develop since 1991, as has emerged clearly in
the evaluation of these programmes.

(4) Programmes which were established by:

— Council Decision 90/685/EEC of 21 December 1990 con-
cerning the implementation of an action programme to
the European audiovisual
promote the development of
industry (MEDIA)
(OJ L 380, 31.12.1990,
p. 37) (MEDIA I),

(1991 to 1995)

— Council Decision 95/563/EC of 10 July 1995 on the
implementation of a programme encouraging the develop-
ment
and distribution of European audiovisual works
(MEDIA II — Development and distribution) (1996 to 2000)
(OJ L 321, 30.12.1995, p. 25) and Council Decision 95/564/
EC of 22 December 1995 on the implementation of a training
programme for professionals in the European audiovisual
programme industry (MEDIA II — Training)
(OJ L 321,
30.12.1995, p. 33) (MEDIA II),

— Council Decision 2000/821/EC of 20 December 2000 on the
implementation of a programme to encourage the develop-
ment, distribution and promotion of European audiovisual
works
(MEDIA Plus — Development, Distribution and
Promotion) (2001 to 2005) (OJ L 336, 30.12.2000, p. 82).
Decision as last amended by Regulation (EC) No 885/2004 (OJ
L 168, 1.5.2004, p. 1) (MEDIA Plus), and

— Decision No 163/2001/EC of the European Parliament and of
the Council of 19 January 2001 on the implementation of a
training programme
in the European
audiovisual programme industry (MEDIA — Training) (2001
to 2005) (OJ L 26, 27.1.2001, p. 1). Decision as last amended
by Regulation (EC) No 885/2004 (MEDIA — Training)
respectively.

for professionals

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(8)

The results obtained showed that Community action should
concentrate mainly:

(13) Throughout the EU one major obstacle to competition is an
almost complete lack of companies specialising in provid-
ing loan financing in the audiovisual sector.

— upstream of audiovisual production, on the develop-
ment of European audiovisual works and on the
acquisition and improvement of audiovisual skills, the
latter needing to be seen as an integral part of the
audiovisual pre-production process,

— downstream of audiovisual production, on distribu-
tion, cinema exhibition and promotion of European
audiovisual works,

— on digitisation making a decisive contribution to
strengthening the audiovisual sector and on its being a
central feature of MEDIA 2007. Support for digital
services and European catalogues is one of
the
programme's priorities in order to overcome the
fragmentation of the European audiovisual market.

(9)

The MEDIA programme should encourage authors (script-
writers and directors) in the creative process and encourage
them to develop and adopt new creative techniques which
will strengthen the innovative capacity of the European
audiovisual sector.

(10) There is more than one platform of digitisation in the
projections of films, depending on different uses, users and
needs. Pilot projects of the MEDIA programme are a test
ground for future developments in the audiovisual sector.

(11) The preparatory action ‘Growth and Audiovisual:

i2i
Audiovisual’, which supplements the MEDIA Plus and
MEDIA — Training programmes, marked a further stage in
implementing the policy of Community support for the
audiovisual sector. It was intended specifically to provide a
remedy for the problems of access to funding of small and
sector. The
medium-sized enterprises
evaluation of ‘Growth and Audiovisual:
i2i Audiovisual’
confirmed that it met the sector's needs and confirmed the
need to pursue Community action along these lines but
that it should be more closely geared towards the specific
needs of the sector.

in this

(SMEs)

(12) The European audiovisual sector is characterised by its
considerable potential for growth,
innovation and dyna-
mism, by the fragmentation of the market as a function of
cultural and linguistic diversity and, consequently, by a large
number of SMEs and very small enterprises with chronic
implementing
undercapitalisation. For
Community support, the specific nature of the audiovisual
sector should be taken into account and it should be
ensured that administrative and financial procedures in
relation to the amount of support are simplified as far as
possible and adapted to the aims pursued and the sector's
practices and requirements.

the purposes of

(14) The Commission and Member States should review their
support for the audiovisual sector, in particular the results
of
the preparatory action ‘Growth and Audiovisual:
i2i Audiovisual’, to establish to what extent future support
can simplify the development of specialist offers for SMEs
in terms of loan financing.

(15) Loan finance systems that have been developed in the
Member States to promote national audiovisual projects
and to mobilise private capital should be examined to see
whether such capital could be made available for non-
national European projects.

(16)

(17)

Increased transparency and dissemination of information
concerning the European audiovisual market can make
in the sector, and especially SMEs, more
operators
investors’
could encourage private
competitive. This
confidence by improving understanding of the industry’s
potential. This also makes it easier for Community action to
be evaluated and followed up. Participation by the
European Union in the European Audiovisual Observatory
should help it to achieve these aims.

In a Community of 25 Member States, cooperation is
increasingly becoming a strategic response to strengthen
the competitiveness of the European film industry. There is
therefore a need for greater support for projects for EU-
wide networks at all MEDIA programme levels — training,
development, distribution and promotion. This applies in
particular to cooperation with players from the Member
States which joined the European Union after 30 April
2004.
It should be emphasised that any strategy for
cooperation between players in the audiovisual sector
should comply with the Community's competition law.

(18) Public support for cinema at European, national, regional
or local level is essential to overcome the sector's structural
difficulties and allow the European audiovisual industry to
meet the challenge of globalisation.

(19) European Union accession countries and those EFTA
countries which are parties to the EEA Agreement are
recognised as potential participants in Community pro-
grammes in accordance with the agreements concluded
with these countries.

(20) Cooperation between MEDIA and Eurimages needs to be
strengthened, but without this leading to integration in
financial and administrative matters.

(21) The European Council in Thessaloniki of 19 and 20 June
2003 adopted ‘The agenda for the Western Balkans: Moving
towards European integration’, providing that Community

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programmes should be open to countries in the process of
stabilisation and association on the basis of framework
agreements to be signed between the Community and these
countries.

(22) The other European countries which are parties to the
Council of Europe Convention on Transfrontier Television
are an integral part of the European audiovisual area and
should therefore be enabled, if they wish and taking into
their
account budgetary considerations or priorities of
audiovisual industries, to participate in this programme or
benefit under a more limited cooperation formula on the
basis of
and specific
arrangements in accordance with conditions to be laid
down in the agreements between the parties concerned.

supplementary

appropriations

(23) Cooperation with non-European third countries developed
on the basis of mutual and balanced interests may create
added value for the European audiovisual industry in terms
of promotion, market access, distribution, dissemination
and exhibition of European works in those countries. Such
cooperation should be developed on the basis of
supplementary appropriations and specific arrangements
to be agreed upon with the parties concerned.

(24) Suitable measures should be implemented to prevent
irregularities and fraud and to recover funds which have
been lost or transferred or used improperly.

(25) This Decision lays down, for the entire duration of the
programme, a financial envelope constituting the prime
reference, within the meaning of point 37 of
the
Interinstitutional Agreement of 17 May 2006 between the
European Parliament, the Council and the Commission on
budgetary discipline and sound financial management (1),
for the budgetary authority during the annual budgetary
procedure.

(26) The measures necessary for the implementation of this
Decision should be adopted in accordance with Council
Decision 1999/468/EC of 28 June 1999 laying down the
procedures
implementing powers
the exercise of
conferred on the Commission (2).

for

(27) The arrangements for monitoring and evaluating actions
should include detailed annual reports as well as specific,
measurable, achievable, relevant and time-bound objectives
and indicators.

(28) Provision needs to be made for measures governing the
transition from the MEDIA Plus and MEDIA — Training
established by this
programmes
Decision.

to the programme

(29) Since the objectives of this Decision cannot be sufficiently
achieved by the Member States and can therefore, by reason
of the scale and effects of the action, be better achieved at

(1) OJ C 139, 14.6.2006, p. 1.
(2) OJ L 184, 17.7.1999, p. 23. Decision as last amended by Decision

2006/512/EC (OJ L 200, 22.7.2006, p. 11).

Community level, the Community may adopt measures, in
accordance with the principle of subsidiarity as set out in
Article 5 of the Treaty. In accordance with the principle of
proportionality, as set out in that Article, this Decision does
not go beyond what is necessary in order to achieve those
objectives,

HAVE DECIDED AS FOLLOWS:

CHAPTER I

GLOBAL OBJECTIVES AND BUDGET

Article 1

Global objectives and priorities of the programme

1. This Decision establishes a programme for support to the
European audiovisual sector, hereinafter
referred to as the
‘programme’, for a period from 1 January 2007 to 31 December
2013.

2. The audiovisual sector is an essential vector for conveying
and developing European cultural values and for creating highly
skilled future-oriented jobs. Its creativity is a positive factor for
competitiveness and cultural appeal with the public. The
programme is intended to strengthen the audiovisual sector
economically to enable it
roles more
effectively by developing an industry with powerful and
diversified content and a valuable and accessible heritage and
to add value to national support.

to play its cultural

The global objectives of the programme are to:

(a)

(b)

(c)

preserve and enhance European cultural and linguistic
diversity and its cinematographic and audiovisual heritage,
guarantee its accessibility to the public and promote
intercultural dialogue;

increase the circulation and viewership of European
audiovisual works inside and outside the European Union,
including through greater cooperation between players;

strengthen the competitiveness of the European audiovisual
sector in the framework of an open and competitive
European market favourable to employment, including by
promoting links between audiovisual professionals.

In order to achieve these objectives, the programme shall

3.
support:

(a)

(b)

(c)

upstream of audiovisual production: the acquisition and
improvement of skills in the audiovisual
field and the
development of European audiovisual works;

downstream of audiovisual production: the distribution and
promotion of European audiovisual works;

pilot projects to ensure that the programme adjusts to
market developments.

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4. The priorities in the areas for intervention set out
paragraph 3 shall be as follows:

in

(c)

inclusion upstream of digital technologies for produc-
tion, post-production, distribution, marketing and
archiving of European audiovisual programmes.

(a)

(b)

(c)

fostering creativity in the audiovisual sector and knowledge
and
and dissemination of Europe's
audiovisual heritage;

cinematographic

strengthening the structure of the European audiovisual
sector, particularly SMEs;

reducing the imbalances in the European audiovisual
market between high audiovisual production capacity
countries and countries or regions with low audiovisual
production capacity and/or a restricted geographic and
linguistic area;

(d)

following and supporting market developments with regard
to digitisation, including the promotion of attractive digital
catalogues of European films on digital platforms.

Article 2

The financial envelope

1. The financial envelope for implementing this programme for
the period set out in Article 1(1) is fixed at EUR 754 950 000.
The indicative breakdown of this amount according to areas is
reflected in point 1.4 of Chapter II of the Annex.

2. The annual appropriations shall be authorised by the
budgetary authority within the limits of the financial framework.

CHAPTER II

SPECIFIC OBJECTIVES UPSTREAM OF AUDIOVISUAL
PRODUCTION

Article 3

Acquisition and improvement of skills in the audiovisual
field

In the field of acquisition and improvement of skills,
objectives of the programme shall be to:

the

Steps shall also be taken to ensure the participation of
professionals and trainers from countries other than
those in which training activities supported under
point 2(a), (b) and (c) take place;

2.

improve the European dimension of audiovisual training
activities by:

(a)

support for the networking and mobility of European
training professionals, in particular:

— European film schools,

— training institutes,

— partners in the professional sector;

(b)

training for trainers;

(c)

support for film schools;

(d)

adoption of coordination activities and of promotion
of the bodies supported in relation to the activities set
out in point 1;

3.

enable, through special scholarships, professionals from the
Member States which acceded to the European Union after
30 April 2004 to take part in the training activities set out
in point 1.

The measures set out in points 1, 2 and 3 shall be implemented
in accordance with the provisions in the Annex.

Article 4

Development

In the development sector, the objectives of the programme

1.
shall be to:

1.

strengthen the skills of European audiovisual professionals
in the fields of development, production, distribution/
dissemination and promotion,
in order to improve the
quality and potential of European audiovisual works. The
programme shall support notably action in the following
areas:

(a)

(b)

(a)

(b)

scriptwriting techniques with the aim of increasing the
quality of European audiovisual works and their
potential circulation;

economic, financial and commercial management of
production, distribution and promotion of audiovisual
works to enable European strategies to be devised
right from the development phase;

support the development of production projects intended
for the European and international market, submitted by
independent production companies;

support the elaboration of financial plans for companies
and projects for European productions, in particular the
financing of co-productions.

2. The Commission shall take steps to ensure that the activities
supported in the field of improving professional skills and those
set out in paragraph 1 complement each other.

3. The measures set out
implemented in accordance with the provisions in the Annex.

in paragraphs 1 and 2 shall be

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CHAPTER III

SPECIFIC OBJECTIVES DOWNSTREAM OF AUDIOVISUAL
PRODUCTION

Article 5

Distribution and dissemination

In the field of distribution and dissemination, the programme's
objectives shall be to:

(a)

(b)

(c)

(d)

(e)

to invest

strengthen European distribution by encouraging distribu-
in the co-production, acquisition and
tors
promotion of non-national European films and to set up
coordinated marketing strategies;

improve the circulation of non-national European films on
the European and international markets by incentive
measures for export, distribution on any medium and
cinema exhibition;

promote the transnational dissemination of European
audiovisual works produced by independent production
companies by encouraging cooperation between broad-
casters on the one hand and independent producers and
distributors on the other;

encourage the digitisation of European audiovisual works
and the development of a competitive digital market place;

encourage cinemas to exploit the possibilities offered by
digital distribution.

The measures set out in points (a) to (e) shall be implemented in
accordance with the provisions in the Annex.

Article 6

Promotion

In the field of promotion, the objectives of the programme shall
be to:

(a)

(b)

(c)

(d)

improve the circulation of European audiovisual works by
ensuring that the European audiovisual sector has access to
European and international professional markets;

improve the European and international public's access to
European audiovisual works;

encourage common actions between national
audiovisual programme promotion organisations;

film and

encourage the promotion of Europe's cinematographic and
audiovisual heritage and the improvement of the public's
access to it at both European and international level.

CHAPTER IV

PILOT PROJECTS

Article 7

Pilot projects

1. The programme may support pilot projects to ensure that it
adapts to market developments, with a particular emphasis on
the introduction and utilisation of information and communica-
tion technologies.

For

the purposes of

2.
the
Commission shall be advised by technical advisory groups made
up of experts designated by the Member States in response to a
proposal by the Commission.

implementing paragraph 1,

CHAPTER V

ARRANGEMENTS FOR IMPLEMENTING THE PROGRAMME
AND FINANCIAL PROVISIONS

Article 8

Provisions concerning third countries

1. The programme shall be open to the participation of the
following countries as long as the required conditions are met
and supplementary appropriations are received:

(a)

(b)

(c)

EFTA States which are members of the EEA, in accordance
with the provisions of the EEA agreement;

accession countries benefiting from a strategy for pre-
accession to the European Union in accordance with the
general principles and general conditions and arrangements
for
these countries participating in Community pro-
grammes laid down in the framework agreement and the
Association Councils' decisions respectively;

the Western Balkan countries in accordance with arrange-
ments made with these countries following framework
agreements to be established governing their participation
in Community programmes.

2. The programme shall also be open to the participation of
States which are parties to the Council of Europe Convention on
Transfrontier Television other
referred to in
paragraph 1, assuming that supplementary appropriations are
received in compliance with the conditions to be agreed upon
between the parties concerned.

than those

3. Opening up of the programme to European third countries
referred to in paragraphs 1 and 2 may be subject to prior
examination of the compatibility of their national
legislation
with Community legislation, including Article 6(5) of Council
Directive 89/552/EEC of 3 October 1989 on the coordination of
certain provisions laid down by Law, Regulation or Adminis-
trative Action in Member States concerning the pursuit of
television broadcasting activities (1). This provision does not
apply to actions pursuant to Article 3 of this Decision.

The measures set out in points (a) to (d) shall be implemented in
accordance with the provisions in the Annex.

(1) OJ L 298, 17.10.1989, p. 23.

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4. The programme shall also be open to cooperation with
other third countries which have concluded association or
cooperation agreements with the European Union incorporating
clauses on the audiovisual
sector and on the basis of
supplementary appropriations and specific arrangements to be
agreed upon. Western Balkan countries referred to in paragraph 1
that do not wish to participate fully in the programme may
benefit
the
conditions provided for in this paragraph.

from cooperation with the programme under

Article 9

Financial provisions

Legal and natural persons may be the beneficiaries of the

1.
programme.

Without prejudice to the agreements and conventions to which
the Community is a contracting party, enterprises which benefit
from the programme shall be owned and shall continue to be
owned, whether directly or by majority participation, by Member
States and/or Member State nationals.

2. The Commission may decide, depending on the beneficiaries
and the type of action, whether they may be exempted from
verification of the professional skills and qualifications required
to successfully complete an action or programme of work. The
Commission may also take into account the type of activity
supported, the specific profile of the target public from the
audiovisual sector and the objectives of the programme.

scholarships or any other

3. Depending on the type of action, financial aid may take the
form of grants or
instrument
authorised by Council Regulation (EC, Euratom) No 1605/
2002 of 25 June 2002, on the Financial Regulation applicable to
the European Communities (1). The
the general budget of
Commission may also award prizes
the programme's
activities or projects. Depending on the nature of the activity,
the use of scales of unit costs or
flat-rate financing for
contributions of no more than the amount mentioned in
Article 181 of Commission Regulation (EC, Euratom) No 2342/
2002 laying down detailed rules for the implementation of
Regulation (EC, Euratom) No 1605/2002 (2) may be authorised.

for

4. The Commission shall adhere to the proportionality
principle in respect of administrative and financial requirements,
such as eligibility criteria and financial capacity, with regard to
the size of the grant awarded.

Financial aid awarded under the terms of the programme
5.
may not exceed 50 % of
the operation
supported. However, in the cases expressly provided for in the
Annex, financial aid may be as high as 75 %. Furthermore, such
aid shall be granted whilst ensuring that award procedures are
transparent and objective.

the final costs of

In keeping with the specific nature of the activities cofunded
6.
and in accordance with Article 112(1) of Regulation (EC,
Euratom) No 1605/2002, the Commission may deem costs
directly linked with implementing the activity supported to be

eligible, even if they were partially incurred by the beneficiary
before the selection procedure.

7.
In accordance with Article 113(1) of Regulation (EC,
Euratom) No 1605/2002 and in conjunction with Article 172
of Regulation (EC, Euratom) No 2342/2002, cofunding may be
provided either entirely or partly in kind as long as the value of
the contribution does not exceed the cost actually borne and
duly supported by accounting documents, or the cost generally
accepted in the market in question. Premises made available for
training or promotional purposes may be included in such
contributions.

8. Any sums reimbursed under the programme, those from the
MEDIA programmes (1991 to 2006) and sums not used by
selected projects shall be allocated to the requirements of the
MEDIA 2007 programme.

Article 10

Implementation of this Decision

1. The Commission shall be responsible for implementing the
programme in accordance with the provisions laid down in the
Annex.

this
2. The measures necessary for the implementation of
Decision relating to the matters referred to below shall be
adopted in accordance with the procedure referred to in
Article 11(2):

(a)

(b)

(c)

the general guidelines for all the measures described in the
Annex;

the content of the calls for proposals, the definition of the
criteria and the procedures for the selection of projects;

questions concerning the annual internal breakdown of the
programme resources, including the breakdown between
measures in the fields of
improving professional skills,
development, distribution/dissemination and promotion;

(d)

the arrangements for monitoring and evaluating actions;

(e)

any proposal for the allocation of Community funds in
excess of EUR 200 000 per beneficiary and year in the case
of training and promotion, EUR 200 000 in the case of
development and EUR 300 000 in the case of distribution;

(f)

the choice of pilot projects provided for in Article 7.

3. The measures necessary for the implementation of
this
Decision relating to any other matters shall be adopted in
accordance with the procedure referred to in Article 11(3).

Article 11

Committee procedure

(1) OJ L 248, 16.9.2002, p. 1.
(2) OJ L 357, 31.12.2002, p. 1.

1. The Commission shall be assisted by a committee.

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2. Where reference is made to this paragraph, Articles 4 and 7
of Decision 1999/468/EC shall apply.

relevant international organisations, in particular the Council of
Europe (Eurimages and the European Audiovisual Observatory,
hereinafter referred to as the Observatory).

3. The period laid down in Article 4(3) of Decision 1999/468/
EC shall be set at two months.

4. Where reference is made to this paragraph, Articles 3 and 7
of Decision 1999/468/EC shall apply, having regard to the
provisions of Article 8 thereof.

5. The committee shall adopt its rules of procedure.

Article 12

MEDIA Desks

1. The European network of MEDIA Desks shall act as an
implementing body for disseminating information on the
programme at national
in particular for cross-border
projects, improving its visibility and stimulating its use, whilst
complying with Article 54(2)(c) and (3) of Regulation (EC,
Euratom) No 1605/2002 as defined in point 2.2 in Chapter II of
the Annex.

level,

2. Cooperation between MEDIA Desks through networks,
especially proximity networks, shall be encouraged in order to
facilitate exchanges and contacts between professionals, public
awareness of key events supported by the programme, as well as
prizes and awards.

3. The MEDIA Desks shall respect the following criteria:

have an adequate number of staff, with professional and
linguistic capacities appropriate for work in an environ-
ment of international cooperation;

have an appropriate infrastructure, in particular as regards
informatics and communications;

(a)

(b)

(c)

Article 14

Monitoring and evaluation

1. The Commission shall ensure that the actions covered by
this Decision are subject to prior evaluation, monitoring and ex-
post evaluation. The results of the process of monitoring and
evaluation shall be taken into account in the implementation of
the programme.

The Commission shall ensure that the programme is evaluated
regularly, externally and independently. In order to evaluate the
programme effectively the Commission may compile data in order
to survey all activities supported by the programme. This evaluation
for
should take into account
monitoring and evaluation referred to in Article 10(2)(d).

the Committee's arrangements

This monitoring process shall comprise drawing up the reports
mentioned in paragraph 2(a) and (c) and specific activities.

2. The Commission shall present to the European Parliament,
the Council, the European Economic and Social Committee and
the Committee of the Regions:

(a)

(b)

(c)

an interim evaluation report on the results and the
qualitative and quantitative aspects of implementing the
programme no later than three years after the start of the
programme;

a communication on the continuation of the programme
no later than four years after the start of the programme;

a detailed expost evaluation report by 31 December 2015
covering the implementation and results of the programme,
on completion of its implementation.

operate in an administrative context which enables them to
carry out their tasks satisfactorily and to avoid conflicts of
interest.

The Commission shall publish and disseminate via the MEDIA
Desks any relevant statistics and analyses.

Article 13

Consistency and complementarity

In the implementation of the programme, the Commission
1.
shall,
in close cooperation with the Member States, ensure
general consistency and complementarity with other relevant
Community policies, programmes and actions that
impinge
upon the training and audiovisual fields.

2. The Commission shall also ensure coordination between the
programme and other Community programmes in the areas of
education, training, research and the information society.

3. The Commission shall ensure effective liaison between this
programme and programmes and actions in the training and
in the framework of
audiovisual
Community cooperation with non-member countries and the

fields being carried out

3. Reports produced pursuant to paragraph 2(a) and (c) shall
identify the added value of the programme.

Article 15

Transitional provisions

Activities undertaken before 31 December 2006 on the basis of
Council Decision 2000/821/EC (1) and Decision No 163/2001/
EC of the European Parliament and of the Council (2) shall
continue to be managed until they are terminated in compliance
with the provisions of those Decisions.

The committee provided for by Article 8 of Decision 2000/821/
EC and Article 6 of Decision No 163/2001/EC shall be replaced
by the committee provided for under Article 11 of this Decision.

(1) OJ L 13, 17.1.2001, p. 82.
(2) OJ L 26, 27.1.2001, p. 1.

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CHAPTER VI

INFORMATION ON THE EUROPEAN AUDIOVISUAL SECTOR
AND PARTICIPATION IN THE EUROPEAN AUDIOVISUAL
OBSERVATORY

Article 16

Union after 30 April 2004,
European audiovisual
develop;

thereby enhancing the
sector's ability to compete and

(b)

by enabling the programme to be monitored more
effectively and making it easier to evaluate.

Information on the European audiovisual sector

The European Union shall contribute to increased transparency
and dissemination of information on the European audiovisual
sector.

Article 17

Participation in the European Audiovisual Observatory

For the purposes of implementing Article 16, the European
Union shall be a member of the Observatory throughout the
programme.

The Commission shall represent the European Union in its
dealings with the Observatory.

Article 18

Contribution to meeting the programme's objectives

Participation by the European Union in the Observatory shall
form an integral part of this programme and shall contribute to
meeting its objectives:

(a)

by encouraging transparency in the market through an
improved comparability of data collected in the different
countries and ensuring that operators have access to
financial and legal statistics and information, especially on
the Member States which have acceded to the European

Article 19

Monitoring and evaluation

Monitoring and evaluation of the European Union's participation
in the Observatory shall be carried out within the framework of
the monitoring and evaluation of the programme in accordance
with Article 14.

CHAPTER VII

ENTRY INTO FORCE

Article 20

Entry into force

This Decision shall enter into force on the day following its
publication in the Official Journal of the European Union.

It shall apply from 1 January 2007.

Done at Strasbourg, 15 November 2006.

For the European Parliament
The President
J. BORRELL FONTELLES

For the Council
The President
P. LEHTOMÄKI

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ANNEX

CHAPTER I

OPERATIONAL OBJECTIVES AND ACTIONS TO BE IMPLEMENTED

1.

Acquisition and improvement of skills in the audiovisual field

1.1.

Strengthen European audiovisual professionals’ skills in the fields of development, production, distribution/
dissemination and promotion in order to improve the quality and the potential of European audiovisual works

1.1.1. Scriptwriting techniques

Operational objective

— Enable experienced scriptwriters to improve their capacities to develop techniques based on traditional and

interactive methods of writing.

Actions to be implemented

— Support the development, implementation and updating of training modules on identifying the target audience,
editing and development of scripts for an international audience, and the relationship between the scriptwriter,
the script editor, the director, the producer and the distributor, inter alia.

— Support distance learning and encourage exchanges and partnerships associating countries and regions with low

audiovisual production capacity and/or with a restricted linguistic or geographical area.

1.1.2. Economic, financial and commercial management of production, distribution and promotion of audiovisual works

Operational objective

— Develop the professionals’ ability to grasp and integrate the European dimension into the fields of development,

production, marketing, distribution/dissemination and promotion of audiovisual programmes.

Actions to be implemented

— Support the development, implementation and updating of training modules in management, taking into

account the European dimension.

— Support distance learning and encourage exchanges and partnerships associating countries and regions with low

audiovisual production capacity and/or with a restricted linguistic or geographical area.

1.1.3. Inclusion upstream of digital technologies for the production, post-production, distribution, marketing and archiving

of European audiovisual programmes

Operational objective

— Develop the professionals’ capacity to use digital technologies, in particular in the fields of production, post-

production, distribution, marketing, archiving and multimedia.

Actions to be implemented

— Support the development, implementation and updating of training modules in digital audiovisual technologies.

— Support distance learning and encourage exchanges and partnerships associating countries and regions with low

audiovisual production capacity and/or with a restricted linguistic or geographical area.

1.2.

Improve the European dimension of audiovisual training activities

1.2.1. Support for the networking and mobility of European training professionals, in particular European film schools,

training institutes, partners of the professional sector

Operational objective

— Encourage exchanges and cooperation between existing training institutions and/or activities.

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Action to be implemented

— Encourage the programme beneficiaries to intensify coordination of their training activities, in particular those
involving further training, in order to develop a European network which can receive Community support, in
particular for cooperation involving players, including television broadcasters.

1.2.2. Training for trainers

Operational objective

— Ensure that trainers are competent.

Actions to be implemented

— Contribute to training for trainers, in particular by distance learning.

1.2.3. Support for film schools

Operational objective

— Encourage mobility of cinema students in Europe.

Actions to be implemented

— Encourage mobility scholarships linked to a training project.

— Encourage the development of new talents and professionals through the establishment of a Prize for New

Talent.

1.2.4. Introduction of coordination and promotion measures by the bodies supported under 1.2.1

Operational objective

— Promote coordination and promotion of the projects supported by the programme.

Action to be implemented

— Contribute to the adoption of targeted actions of coordination and promotion of the training activities

supported by the programme.

1.2.5. Enable, through special scholarships, the professionals from the Member States which have acceded to the European

Union after 30 April 2004 to take part in the training activities set out in 1.1

Operational objective

— Facilitate the participation by professionals from the Member States which have acceded to the European Union

after 30 April 2004 in the projects supported by the programme.

Action to be implemented

— Contribute to setting up a grant mechanism.

2.

Development

2.1. Support the development of production projects intended for the European and International market submitted by

independent production companies, in particular SMEs

Operational objectives

— Support the development of European works of the following types: drama, animation, documentary and

multimedia.

— Encourage companies to produce quality works with international potential.

— Encourage companies to use digital technologies in production and distribution right from the development

phase.

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— Encourage companies to devise strategies for international screening, marketing and distribution right from the

development phase.

— Enable SMEs to access support for development and tailor actions to meet their needs.

— Enhance complementarity with the actions supported by MEDIA to improve audiovisual professionals' skills.

Actions to be implemented

— Support the development of audiovisual projects or project catalogues.

— Support digitisation of European audiovisual works right from the development phase.

2.2. Support the elaboration of financing plans for European production companies and projects, including co-production

projects

Operational objectives

— Encourage the elaboration of financing plans by production companies for works of the following types: drama,

animation, documentary and multimedia.

— As a follow-up to the preparatory action ‘Growth and Audiovisual: i2i Audiovisual’, encourage the search for
financial partners at European level to achieve synergy between public and private investors and the devising of
distribution strategies right from the production phase.

Actions to be implemented

— Support the side costs of private financing of production and co-production projects presented by SMEs (such as

financial expenses, insurance and completion guarantee costs).

— Support access by SMEs, especially independent production companies, to companies providing financial
services active in drawing up investment plans for the development and co-production of audiovisual works
with potential for international distribution.

— Encourage financial intermediaries to support the development and co-production of audiovisual works with

potential for international distribution.

— Support cooperation between the national agencies in the audiovisual sector.

3.

Distribution and dissemination

Horizontal operational objective

— Enhance the cultural and linguistic diversity of European audiovisual works distributed.

Action to be implemented

— Support dubbing and subtitling for distribution and dissemination, through all available channels, in particular

digital channels, of European audiovisual works for the benefit of producers, distributors and broadcasters.

3.1. Strengthen European distribution by encouraging distributors to invest in the co-production, acquisition and

promotion of non-national European films and to set up coordinated marketing strategies

Operational objective No 1

— Encourage cinematographic distributors to invest in the co-production, acquisition of exploitation rights and

promotion of non-national European films.

Actions to be implemented

— Establish a system of automatic support for European distributors, proportional to cinema admissions for non-
national European films in the Member States taking part in the programme, subject to a ceiling for each film
and adjusted for each country.

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— The support thus generated may be used by distributors only for investment in:

— non-national European film co-production,

— the acquisition of exploitation rights of non-national European films,

— editing (copying, dubbing and subtitling), promotion and advertising of non-national European films.

Operational objective No 2

— Encourage European distributors to cooperate with a view to adopting joint strategies on the European market.

Action to be implemented

— Establish a system of selective aid for non-national European film distribution intended for European distributor

groupings and grant them direct aid where they exist on a permanent basis.

Operational objective No 3

— Encourage cooperation between distributors, producers and sales agents in order to set up international

marketing strategies for European films right from the development phase.

Action to be implemented

— Establish a system of support for the creation of a promotion kit for European cinematographic works

(including a subtitled copy, an international sound track — music and effects — and promotion materials).

Operational objective No 4

— Encourage access to financing of SMEs for distribution and international sale of non-national European works.

Action to be implemented

— Support

the side costs (such as financial expenses and insurance) connected with distribution and/or
international sales activities such as: acquisition of non-national European film catalogues, searching for new
markets for these films, and setting up of permanent groupings of European distributors.

3.2.

Improve the circulation of non-national European films on the European and international markets by incentives
measures for export, distribution on any medium and cinema exhibition

Operational objective No 1

— Encourage cinematographic distributors to invest in appropriate publishing and promotion of non-national

European films.

Actions to be implemented

— Establish a system of selective support to cinematographic distributors for the promotion and marketing of
non-national European films. The selection criteria for the films may include provisions aiming to differentiate
between the projects according to their origin and the size of their budget.

— Grant special support to films of interest for the development of European cultural and linguistic diversity.

— Grant aid for the release of a non-national European works slate over a given period.

Operational objective No 2

— Encourage the screening of non-national European films on the European market, in particular by supporting

the coordination of a cinema network.

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Actions to be implemented

— Encourage cinema owners and operators to screen a significant proportion of non-national European films in
cinemas for first release for a minimum defined period. The support granted to each cinema will be determined
according to the programming and taking into account the number of tickets sold for non-national European
films over a reference period.

— Contribute to the development of educational and awareness-raising activities for young cinema-goers.

— Support the creation and the consolidation of a European cinema owners’ network developing common actions

of this type.

Operational objective No 3

— Encourage international sales and export of European films, particularly non-national European films within

Europe.

Action to be implemented

— Establish a support system for European companies distributing cinema films internationally (sales agents)
according to their performance on the market over a given period. This support will have to be invested in the
acquisition of new non-national European films and their promotion on the European and international
markets.

3.3. Promote the transnational broadcasting of European audiovisual works produced by independent production
companies by encouraging cooperation between broadcasters on the one hand, and independent producers and
distributors on the other

Operational objective No 1

— Encourage the broadcasting of non-national European audiovisual works from independent production

companies.

Action to be implemented

— Encourage independent producers to produce works (drama, documentary and animation)

involving the
participation of at
three broadcasters from several Member States. The selection criteria for the
beneficiaries will include provisions aiming to differentiate between the projects according to the size of their
budget. Grant special support to films of interest for the enhancement of Europe's cultural and linguistic
diversity and audiovisual heritage.

least

Operational objective No 2

— Facilitate access to financing for European independent production companies.

Action to be implemented

— Support the side costs (such as financial costs, insurance and completion guarantee costs) connected with the
involving the participation of at least three

production of works (drama, documentary and animation)
broadcasters from several Member States belonging to different linguistic areas.

Operational objective No 3

— Encourage the international distribution of European television programmes made by independent producers.
The distribution of such programmes will require the agreement of the independent producer, who must receive
an appropriate share of the sales revenue.

Action to be implemented

— Establish a system of support

for European international distribution companies of audiovisual works
(international distributors) according to their performance on the market over a given period. Support thus
generated will have to be invested by the international distributors in the acquisition and promotion of new
European works on the European and international markets.

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3.4. Encourage the digitisation of European audiovisual works

Operational objective No 1

— Improve the distribution of non-national European works on digital media for private use (DVD), in particular

by encouraging publishers to cooperate on creating multilingual masters on a European scale.

— Encourage the use of digital technologies in European works (creating digital masters which can be used by all

European distributors).

— Encourage publishers in particular to invest in appropriate promotion and distribution of non-national

European audiovisual works.

— Support the multilingualism of European works (dubbing, subtitling and multilingual production).

Actions to be implemented

— Establish a system of automatic support for European cinematographic and audiovisual works publishers on
media intended for private use (such as DVD, DVD-ROM) according to their performance on the market over a
given period. Support thus generated will have to be invested by the publishers in the publishing and
distribution of non-national European works on digital media.

— Support the digitisation of content for distribution.

Operational objective No 2

— Encourage supply of non-national European works for on-line distribution through advanced distribution
services and new media (Internet, video-on-demand, pay-per-view), while developing techniques to securise
online works in order to fight against piracy.

— Encourage the European audiovisual programme industry to adapt to developments in digital technology, in

particular with regard to advanced on-line distribution services.

Actions to be implemented

— Encourage European companies (on-line access suppliers, special-interest channels, etc.) — by measures to
digitise works and create promotion and publicity material on digital media — to create European works slates
in digital format intended for use on the new media.

— Promote the emergence of digital services that carry European catalogues.

3.5. Encourage cinemas showing a significant percentage of non-national European works to exploit the possibilities

offered by digital distribution

Operational objective

— Encourage cinemas to invest in digital equipment, by facilitating access to credit by cinema owners.

Action to be implemented

— Support the side costs (such as financial expenses and insurance) incurred by cinema owners and operators for

investment in digital equipment.

4.

Promotion

4.1.

Improve the circulation of European audiovisual works by ensuring that the European audiovisual sector has access to
the professional European and international audiovisual markets

Operational objective No 1

— Improve the conditions of access for professionals to trade events and to professional audiovisual markets inside

and outside Europe.

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Action to be implemented

— Provide technical and financial assistance in connection with events such as:

— the principal European and international cinema markets,

— the principal European and international television markets,

— thematic markets, particularly for cartoons, documentary, multimedia and new technologies.

Operational objective No 2 and action to be implemented

— Encourage and support the constitution of European catalogues and the setting up of databases of European

programme catalogues intended for professionals.

Operational objective No 3

— Encourage support for promotion from the pre-production or production phase.

Actions to be implemented

— Support the organisation of forums for development, financing, co-production and distribution of European (or

mainly European) works and programmes.

— Set up and launch marketing and sales promotion campaigns for European cinematographic and audiovisual

programmes during the production phase.

4.2.

Improve access to European audiovisual works for the European and international public

Operational objectives and actions to be implemented

— Encourage and support audiovisual festivals to screen a majority or significant proportion of European works.

— Prioritise and support festivals contributing to the promotion of works from Member States or regions with low
audiovisual production capacity and of works produced by young Europeans, and enhancing cultural and
linguistic diversity and intercultural dialogue.

— Encourage and support initiatives for image education organised by festivals for young people, in particular in

close cooperation with schools and other institutions.

— Encourage and support initiatives by professionals, in particular cinema owners, public or commercial television
channels, festivals and cultural institutions which aim, in close cooperation with the Member States and the
Commission, to organise promotional activities for the general public for European cinematographic and
audiovisual creation.

— Encourage and support the organisation of events with wide media coverage such as prize awards and European

cinema days.

4.3. Encourage common actions between national film and audiovisual programme promotion organisations

Operational objective:

— Encourage networking and coordination of European common actions and projects.

Actions to be implemented

— Support the creation of European promotion platforms.

— Support European groupings and umbrella organisations for national and/or regional promotion on the

European markets and worldwide.

— Support the networking of festivals, in particular the exchange of programming and of expertise.

— Support the grouping of projects pursuing identical, similar and/or complementary aims.

— Support the setting up of networks of databases and catalogues.

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4.4. Encourage promotion of and access to Europe's cinematographic and audiovisual heritage

Operational objective and action to be implemented

— Encourage and support the organisation of events, in particular those targeting young people, to promote

Europe's cinematographic and audiovisual heritage.

5.

Pilot projects

Operational objective

— Ensure that the programme adapts to market developments, mainly in connection with the introduction and use

of information and communication technologies.

Actions to be implemented

— Support pilot projects in areas considered likely to be influenced by the introduction and use of new

information and communication technologies.

— Disseminate widely the results of pilot projects by organising conferences or on- and off-line events to

encourage the dissemination of good practices.

CHAPTER II

ARRANGEMENTS FOR IMPLEMENTATION

1.

Community support

1.1. The share of the Community contribution in the cost of operations supported

The financial contribution from MEDIA may not exceed 50 % of the costs of operations supported, except in the
following cases.

The financial contribution from MEDIA may be up to 60 % of the costs of operations supported:

(a)

(b)

(c)

for training activities in countries or regions with low audiovisual production capacity and/or with a restricted
linguistic or geographical area;

for projects submitted under the development, distribution/dissemination and promotion strands which have
the merit of highlighting the value of European linguistic and cultural diversity;

for actions, amongst those described in point 3 of Chapter I of this Annex (distribution and dissemination),
identified as conforming with the procedure set out in Article 11(2).

The financial contribution from MEDIA may be up to 75 % of the costs of operations supported for training activities
in the Member States which have acceded to the European Union after 30 April 2004. Attention will be focused on
this provision during the mid-term evaluation of the programme.

1.2. Arrangements for Community support

The Commission shall ensure that the programme is accessible and is implemented in a transparent manner.

Community support is in the form of grants or scholarships.

In the training sector, an appropriate amount of the available funds each year must be allocated to new activities as far
as possible.

1.3. Project selection

The selected projects must comply with:

— the provisions of this Decision and its Annex,

— the provisions of Regulation (EC, Euratom) No 1605/2002 and Regulation (EC, Euratom) No 2342/2002.

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1.4. Breakdown of resources

The funds available will be broken down according to the following guidelines:

Acquisition and improvement of skills

approximately 7 %

Development

Distribution

Promotion

Pilot projects

Horizontal issues

at least 20 %

at least 55 %

approximately 9 %

approximately 4 %

at least 5 %

These percentages are indicative and subject to change in accordance with the procedure referred to in Article 11(2).

In order to secure overall efficiency and appropriate implementation of the objectives of the programme, as laid down
in Article 1, Community actions should concentrate on the development of the actions carried out under the previous
programmes cited in recital 7.

All actions shall be reviewed on a yearly basis in accordance with the procedure laid down in Article 10(2), allowing
the Community to react to the needs and the development of the sector.

In order to secure the overall cultural and industrial objectives of the programme the decision on the annual
breakdown of the financial envelope should be based on an ongoing monitoring of the effectiveness of the action
lines in the programme.

2.

Communication

2.1. Commission

The Commission may organise seminars, symposia or meetings to help implement the programme and may institute
any suitable information, publication and dissemination measures, particularly in connection with monitoring and
evaluation of the programme. Such activities may be funded by grants or calls for tender or may be organised and
financed directly by the Commission.

2.2. MEDIA Desks and MEDIA antennae

The Commission, acting directly in concert with the Member States, shall establish a European network of MEDIA
Desks and MEDIA antennae, which will operate as an implementing body at national level in accordance with
Article 54(2)(c) and (3) of Regulation (EC, Euratom) No 1605/2002, notably for the purposes of:

(a)

informing professionals in the audiovisual sector about the various types of aid available under European Union
policies;

(b)

publicising and promoting the programme;

(c)

encouraging the greatest possible participation by professionals in the programme's activities;

(d)

helping professionals to present their projects in response to calls for proposals;

(e)

encouraging cross-border cooperation between professionals, institutions and networks;

(f)

supporting the Commission in liaising with the various support bodies in the Member States in order to ensure
that the programme's activities complement national support measures;

(g) making data on national audiovisual markets available to interested parties.

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3.

Information about the European audiovisual market and participation in the Observatory and possible
cooperation with the Council of Europe's Eurimages Support Fund.

The programme provides the legal basis for the expenditure necessary to monitor Community audiovisual policy
measures.

It provides for the European Union to continue participating in the Observatory. This will ease access to information
for operators and dissemination in the sector. It will also contribute to greater transparency in the production process.
The programme could likewise enable the European Union to explore possibilities for cooperation (excluding financial
and administrative matters) with the Eurimages Support Fund, with a view to promoting the competitiveness of the
European audiovisual sector on the international market.

4. Management tasks

The programme's financial allocation can also cover expenses pertaining to preparatory, monitoring, control, audit
and evaluation activities, required directly for the management and the realisation of the objectives of the programme,
in particular, studies, meetings, information and publication actions, expenses linked to informatic networks focusing
on information exchange, together with all other technical and administrative assistance expense that the Commission
may have recourse to for the management of the programme. Experts from the technical advisory groups, or other
evaluation and selection procedures, may be duly remunerated.

In implementing the Programme, the Commission will ensure compliance with the objectives and priorities set out in
Article 1 and ensure that the participation of professionals in the programme reflects European cultural diversity in a
balanced way.

5.

Checks and audits

For the projects selected in accordance with the procedure described in Article 9, a system of random auditing shall be
set up.

Any beneficiary of a grant shall keep at the Commission's disposal for a period of five years following the final
payment all supporting documents on the expenditure incurred. Beneficiaries shall ensure that, if need be, any
supporting document in the possession of partners or members is made available to the Commission.

The Commission, either directly through its staff or through any other qualified, external agency of its choice, is
entitled to carry out an audit on the use of the grant. These audits may be carried out throughout the term of the
contract and for a period of five years from the date of the payment of the balance of the grant. The outcome of these
audits may lead to a decision by the Commission to recover funds.

The Commission's staff and external persons authorised by the Commission shall have suitable access, in particular to
the offices of the beneficiary and to all information needed, including that in electronic form, to carry out the audits
properly.

The Court of Auditors and the European Anti-Fraud Office shall have the same rights, especially of access, as the
Commission.

Moreover, in order to protect the European Communities’ financial interests against fraud and other irregularities, the
Commission is authorised to carry out checks and verifications in situ under the present programme, in compliance
with Council Regulation (Euratom, EC) No 2185/96 of 11 November 1996 concerning on-the-spot checks and
inspections carried out by the Commission in order to protect the European Communities’ financial interests against
fraud and other irregularities (1). If need be, investigations shall be carried out by the European Anti-Fraud Office and
shall be governed by Regulation (EC) No 1073/1999 of the European Parliament and of the Council of 25 May 1999
concerning investigations conducted by the European Anti-Fraud Office (OLAF) (2).

(1) OJ L 292, 15.11.1996, p. 2.
(2) OJ L 136, 31.5.1999, p. 1.