Joint statement on Art 13 – AVMSD

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BRUSSELS, 16 OCTOBER 2017. Europe’s commercial broadcasters (i) warn that proposals to impose cross-border levies on linear channels will lead to less localization, less choice, less media plurality, less competition, and less investment in European content and jobs. It will not result in levelling the playing field between linear and non-linear services. Instead, it will compound the existing regulatory gap and create further barriers for broadcasters, who are already by far the biggest investors in European content, to compete and offer innovative services. 

LESS CHOICE: The proposal seriously undermines the Country of Origin principle by discouraging broadcasters from making channels, particularly niche channels, available across borders. The Country of Origin principle has played a vital role in enabling broadcasters to provide cross border services to the benefit of European audiences. The proposal would particularly impact smaller Member States and niche services, where the economies of scale created by the Country of Origin principle are vital. Services such as news, children’s and documentary channels might not otherwise be viable, especially in smaller markets.

LESS COMPETITION: Instead of creating a more level playing field between linear and non-linear services, the proposal will create further barriers to compete for already heavily-regulated linear broadcasters. The playing field is already tilted in the favour of non-linear services, who are not subject to the robust regulations that apply to linear services for advertising (content and volume), access services, child protection and the promotion of European works (at 50%) and independent works. Extending the cross-border levy to linear channels will therefore make this playing field even more unequal.

LESS INVESTMENT IN EUROPEAN WORKS: European broadcasters are already responsible for the vast majority of commercial investment in European content, along with paying significant taxes and providing highly regulated services that are subject to robust audience protections, particularly for minors. Investment by VoD services remains a tiny proportion of investment in European works compared to broadcasters.[1] The proposal would inevitably force broadcasters to reconsider their investment in European content production and acquisition, partnerships with local producers, and potentially also jobs. In some cases, they could be forced to raise charges to consumers to compensate.

There has been no impact assessment of levies on the linear broadcasting sector, which is undergoing a period of significant change. There is no certainty as to how high a levy would be, or whether the resulting revenues would be fully reinvested by a Member State in European content, or used in part at least for purposes unrelated to the broadcasting of European works. Along with creating significant administration costs, the proposal would at best transfer commissioning from broadcasters to state bodies, preventing channels from taking an innovative approach to funding content in response to changing audience demand. And there are no guarantees that that content would be broadcast locally or across borders.

LESS LOCALIZATION: Instead of increasing levels of local content, the proposal risks reducing localized services and investment in local content. Broadcasters would be forced to consider stopping localizing cross-border channels so they are not subject to levies. As part of this, broadcasters subject to a levy would have to reconsider their investment in content production and acquisition in local markets, and broadcast more generic content instead. This would set the European broadcasting sector back decades, with channels reverting to the pan European broadcasting model of the 1980s, before international broadcasters were able to develop localised services.  

LESS MEDIA PLURALITY: The proposal provides Member States with carte blanche to introduce onerous levies that deliberately force cross-border channels off air. This would damage media plurality and broadcasters’ freedom to provide channels to EU audiences.

Europe’s broadcasting sector has been a success story over the ten-year lifetime of the current AVMS Directive, steadily increasing investment in European content, jobs and the number of channels that EU citizens can choose from. As European broadcasting associations with members across the EU, we urge politicians and policy makers to ensure our sector’s competitive strength in the long term by delivering on the original stated aim of this review “to create a fairer environment for all players” [2] and “to ensure that Europe is a leader in the global digital economy.”[3]