26/06/2013 16:19

Competition and ownership rules applicable to the Belgian media sector

The general Competition Act of 10 June 2006[1] and relevant EU laws apply to the media sector. Structural media regulations almost exclusively target audiovisual broadcasting. The main broadcasting act for the Flemish Community is the Act of 27 March 2009 on radio and television broadcasting (hereafter ‘FLBA’).[2] The main broadcasting acts for the French Community are the Act of 27 February 2003 on audiovisual media services (as modified by the Act of 5 February 2009; hereafter ‘FRBA’)[3] and the Act of 14 July 1997 on the Belgian radio and television of the French Community (hereafter ‘RTBF Act’).[4]

 

Newspapers and magazines

There are no special rules for newspapers or magazines concerning ownership, concentration or protection of pluralism, nor are there obligations for newspapers or magazines to provide transparency about their capital structure, shareholders or owners.

 

Audiovisual media

For radio and television, the broadcasting acts do contain specific competition and ownership rules.[5]

 

For the French Community, the regulator (CSA) monitors whether editors or distributors with a “significant position” in the audiovisual sector are not threatening the access of the public to a pluralistic offer of broadcasting services (Art. 7 FRBA). A presumption of significant position exists in the following situations: 1. a natural or legal person holds more than 24% of the capital of 2 editors of television services (directly or indirectly); 2. Same rule for radio services; 3. several editors of television services, directly or indirectly controlled by the same natural or legal person, have an audience share of 20%; 4. Same rule for radio services. If the CSA concludes that a threat to pluralism exists, it will start negotiations with the people or companies concerned with a view to reaching a solution to this threat. If negotiations do not lead to an agreement within six months time, or if such agreement is violated, a range of sanctions may be applied, ranging from fines to revocation of licences. Article 6 FRBA contains specific requirements for audiovisual broadcasting companies to make available to the public some basic information about their companies. This article also contains some specific transparency requirements for media players to obtain a licence from the authorities (e.g. requirements to identify the persons or legal entities that participate in the company’s capital, the amount of such participation, participations in other media players and service providers, etc). The CSA runs a website dedicated to all this transparency-related information.[6]

 

For the Flemish Community, a similar regulation applies where the Flemish Regulator (VRM) has the task to monitor concentrations in the Flemish media sector (Art. 218 FLBA) and to apply sanctions in case a company has significant market power. Significant market power exists if a company has, alone or together with other companies, an economic power that enables it to act in a significant way independently from its competitors, clients or consumers (Art. 190 FLBA). The sanctions are rather “soft” sanctions, ranging from obligations to provide additional transparency to obligations to grant access or interconnection to networks, etc. (Art. 192 FLBA). It is unclear if VRM can also apply harder sanctions (fines and revocation of licences) in case pluralism is in danger. Every year, VRM publishes a report on the concentration in different media sectors in Flanders. VRM also developed a “media database”, which can be used for the annual reports and for ad hoc reports in response to specific questions.[7]

 

Cross-media regulations

Rules on the limitation of cross-media ownership in Belgium are not so much targeted to media companies as such, but rather to persons combining different functions and mandates in various media companies (the underlying rationale is to limit evasions of the rules through setting up structures with various subsidiaries and connected companies). For instance, in the French Community, one cannot be a director to the public broadcaster RTBF and at the same time hold a function or have interests in a competitor of RTBF (Art. 12 RTBF-Act). Also, a person cannot be a member of the board of directors of a local television station and at the same time hold the position of director or executive of other service providers, press companies or organisations with similar activities, if such other position may cause a conflict of interest with the local television station (Art. 72 FRBA). In Flanders, a director to the public broadcaster VRT cannot have a function or a mandate in another media company (Art. 12 FLBA). A director to a Flemish Community-wide or regional radio broadcaster can not have a political mandate and can not be a director to a public broadcaster or another local or regional radio broadcaster (Art. 138 and 141 FLBA). Only one fifth of the directors of a Flemish regional television broadcaster may be a director or have a leading role in another media company, an advertisement company, VRT or a private broadcaster that targets the entire Flemish Community (Art. 172 FLBA). It is worth noting that, when the first commercial television and radio broadcasters appeared in Belgium, the Belgian authorities required that newspaper and magazine editors had to participate in the commercial broadcasters (amounting to 31% in RTL-TVI[8] and to 51% in VTM[9]), but these rules did not survive, due to pressure from the EU. These compulsory concentration rules were meant to secure the survival of the written press, by guaranteeing that advertisement revenues lost to the commercial radio and television broadcasting would in fact flow back to the written press.

 

The Federal Competition Council's sanctioning powers

Sanctioning powers lie mostly with the federal Competition Council. This Council is obliged to approve mergers unless there are serious doubts suggesting that effective competition on the Belgian market or a substantial part thereof will significantly be obstructed.[10] The Council does not take into account specific concerns about plurality of opinions. So far, the Council has prohibited no merger of media companies.[11] In theory, the Belgian federal government has the power to overrule a decision of the Belgian competition watchdog, and can declare a concentration admissible for general interest reasons, overriding the competition related risk on the Belgian market (or part of it) (Art. 60 Competition Act).

 

License and declaration rules for Belgian audiovisual media

In the French Community, editors of terrestrial radio services need to obtain a licence, which entitles them to broadcast using a designated frequency. It is the government that designs the allocation scheme and opens calls for applications. Operators that provide radio services transmitted by other means (cable or Internet) are only required to make a declaration to the regulator CSA. This is also the case for editors of television services that intend to broadcast in the French Community.[12]

 

In Flanders, terrestrial radio broadcasters also need to obtain a licence in order to broadcast (Art. 134 FLBA). If radio broadcasters only transmit via cable or Internet, they simply need to make a declaration to the regulator VRM (Art. 147 FLBA). Television broadcasters need to obtain a licence only if they broadcast regional television (Art. 166 FLBA); for all other types of television broadcasting, broadcasters are only required to make a declaration to the VRM (Art. 161 FLBA). Broadcasters in both Communities need to comply with a set of rules that are applicable to their broadcasting activities.

 

Rules for interaction between politicians and the media

Specific rules exist regarding interaction between politicians and the media. In general terms, there is interaction rather than separation between the political world and the public radio and television broadcasters. This system can be described as a system of internal pluralism, whereby different political parties have a proportionate representation in the public broadcasters’ governing bodies. This system is tempered with legal safeguards regarding the content of the public broadcasters’ programming.

 

Public broadcasters are subject to a system where influence from politicians, at least on the level of their boards of directors, is institutionalised, although in a proportionate manner. The underlying rationale of this system is aimed at safeguarding a sufficient degree of internal pluralism within the public broadcasters. For example, in the French Community, the board of directors of the public broadcaster (RTBF) must be composed, in a proportionate manner, of representatives of the various recognised political groupings in the Parliament of the French Community.[13] In the Flemish Community, the directors of the public broadcaster (VRT) are appointed by the Flemish government, in proportion to their representation in the Flemish Parliament.[14] In the small German-speaking Community, the board of directors of the public broadcaster (BRF) must be composed of representatives of the various political parties in the Parliament of the German-speaking Community, in a proportionate manner.[15] In all three Communities, the position of director at the public broadcaster is incompatible with several political mandates (e.g., in a government or in a parliament).[16]

 

A special regime applies to regional and local broadcasters, which are also subject to influence from politicians, but where this influence is more limited (and also proportionate). For example, in the French Community, maximum half of the directors of a local television station may have a political mandate. Those directors that have a political mandate should represent in a proportionate manner the political parties in the councils of the municipalities located within the emission region of the local television (in Brussels-Capital: proportionate representation of the political parties in the Parliament of the French Community).[17] In the Flemish Community, the boards of directors of regional television broadcasters must be composed in a proportionate way, and only 1/5th of their directors may have a political mandate (they should not have an executive mandate).[18] Also, the general assembly of the Flemish regional television stations must be composed in a representative way as regards political, social, cultural, ideological and regional criteria.[19]

 

The implications of media concentration and foreign ownership on media freedom and independence

Belgium has relatively small media markets and its economy is open, with no specific restrictions on foreign media ownership. It follows that a certain degree of media concentration is probably inevitable. Both the French-language and the Dutch-language media are characterised by a limited number of players in each of the different types of media outlets (these players are often the same players for the different types of media outlets).  However, at present, no media group dominates all different types of media.

 

In the past, there was more competition in the newspaper market,[20] but newspapers depended much more on political parties (‘pillarisation’). Now, there are fewer direct links with political parties, but more dependence on the market.

 

Where news agencies are concerned, it must be noted that Belga News Agency (‘Belga’) is the only big Belgian news agency, but that international news agencies also play a considerable role in the Belgian market. There is a lack of data on the extent to which the Belgian media rely on information from Belga. On the one hand, it seems that other sources of information such as social networks and specific press databases[21] gain importance. According to other sources, newspapers (and especially the online editions of newspapers) are still largely based on sources from Belga. This seems in particular the case for reporting of new facts, but less or not at all for the explanation of news and background information.

 

Where foreign ownership is concerned, relatively few of the Flemish media are foreign owned (the Finnish Sanoma controls part of the magazine sector but mainly not information-focused magazines). The German ProSiebenSat1 group recently sold its Flemish SBS channels to a Flemish consortium of Woestijnvis, Corelio and Sanoma. At the French-language side, the German Bertelsmann indirectly holds the majority of the shares of the main television and radio broadcaster RTL. RTL is based in Luxembourg and refuses to comply with Belgian rules on television broadcasting (it does not accept the authority of the Belgian regulator CSA neither, yet accepts Belgian legislation as regards its radio services).

 

As far as the distribution sector is concerned, the Flemish broadband cable services provider Telenet was sold by the Flemish communities to the American investment fund Liberty Global Consortium. The fact that Telenet evolved from a (semi-) public company to a private and foreign owned company has had unintended consequences. For instance, in 2011, the company announced that it would lower the amount of money for copyrighted materials it pays to regional television broadcasters, thereby threatening the further existence of certain regional television broadcasters.

 

Several media regulators in Belgium (BIPT, CSA, VRM and Medienrat) have recently adopted four decisions aiming at opening the market for television broadcasting (e.g. by forcing the cable operators to give competitors access to their cable network for digital television, and by forcing them to offer their competitors access to resale of analogue television services and resale of Internet access services). The BIPT also adopted a decision imposing local loop unbundling, provision of bitstream access and access to multi-cast functionalities, etc.  Together, these five decisions aim at regulating the various commercial activities known as ‘triple play’ services. 

 

Please contact me for any question, comment or suggestion you may have, or if you need advice from a Belgian lawyer specialised in media law in intellectual property law.

 

Author: Bart Van Besien

Finnian & Columba

Belgium

bart@finnian.be

Attorney - Lawyer - Brussels - Belgium - European Union (E.U.)

Specialised in media law and intellectual property law (copyright, trademarks, patents, domain names, etc.).

 


[1] Moniteur belge, 29 June 2006.

[2] Moniteur belge, 30 April 2009.

[3] Coordinated by Decision of the French Government of 26 March 2009, Moniteur belge, 24 July 2009.

[4] Moniteur belge, 28 August 1997.

[5] Articles 6 - 7 FRBA and 190 – 192 FLBA.

[6] See Conseil supérieur de l'audiovisuel, “L'offre de médias et le pluralisme en Communauté française”, available at: http://www.csa.be/pluralisme.

[7] See Vlaamse Regulator voor de Media, http://www.vrmrapporten.be.

[8] Decision of the Government of the French Community of 21 December 1987.

[9] See art. 8 Act of the Flemish Community of 28 January 1987.

[10] Art. 9 §3 Competition Act.

[11] But certain conditions were imposed to safeguard pluralism e.g. when Tecteo acquired BeTV (available at: http://economie.fgov.be/nl/binaries/press_release_TecteoBeTVACML_31102008_fr_tcm325-28694.pdf).

[12] If operators wish to use terrestrial broadcasting methods (either analogue or digital), they still need to apply for authorisation.

[13] Art. 11, § 1 RTBF-Act and Art. 19 Act of 16 July 1973 on the protection of ideological and philosophical convictions (hereafter “Culture Pact Act”).

[14] Art. 12, §1 FLBA and Art. 19 Culture Pact Act.

[15] Art. 8, § 1 BRF-Act and Art. 19 Culture Pact Act.

[16] Art. 12 RTBF-Act; Art. 12 § 2 FLBA; and Art. 9, § 2 BRF-Act.

[17] Art. 70 FRBA.

[18] Art. 172 FLBA.

[19] Art. 171 FLBA.

[20] But there was less competition in the radio and television broadcasting market.

[21] Such as the databases Mediargus and Pressbanking, available at: www.mediargus.be and www.pressbanking.be

 

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Contact

Bart Van Besien

Finnian & Columba
K. De Deckerstraat 20A
2800 Mechelen, Belgium



+32 486 626 355
+32 15 29 42 57