CJEU holds that the Audiovisual Media Services Directive’s limitation of costs for broadcasting short news events of high interest to the public is valid

On 22 January 2013 the Court of Justice delivered its judgment in the case of Sky Österreich GmbH v Österreichischer Rundfunk (ORF) (C-283/11). The Court held that the Audiovisual Media Services Directive’s limitation of costs for broadcasting short news events of high interest to the public, such as football matches, is valid.

This case regarded the compatibility of the Directive with the Charter of Fundamental Rights of the European Union.

This Directive authorizes broadcasters in the EU to produce short news reports on events which are of high interest to the public, when such events are subject to exclusive broadcasting rights. Compensation may be requested but only for the additional costs incurred by providing access to the signal.

Sky Österreich contested these financial obligations in a dispute with ORF, the Austrian public broadcaster. Sky acquired the exclusive rights to broadcast Europa League matches in seasons 2009/2010 to 2011/2012 in Austrian territory. They said that they spent millions of euros each year on licence and production costs. However KommAustria, the Austrian communications regulator, did not take those costs into consideration when granting ORF the right to make short news reports. Sky did not directly incur costs by providing access.

The Bundeskommunikationssenat (the Austrian Federal Communications Senate) asked the Court in a preliminary ruling on 8 June 2011 whether the Audiovisual Media Services Directive, in so far as it limits compensation for additional costs directly incurred in providing access to the signal, is compatible with the Charter of Fundamental Rights of the European Union, which guarantees the right to property and the freedom to conduct a business.

The Court held that the Charter does not preclude this kind of limitation.

Regarding the protection of property the Court recognized that exclusive broadcasting rights have asset value. However, at the time when Sky acquired those rights in August 2009 EU law already provided for this limitation. Accordingly Sky can’t exercise its exclusive broadcasting rights autonomously and rely on the Charter’s right to property.

In contrast the Directive encroaches upon the freedom to conduct business as it prevents parties from freely deciding on the price to be charged for access to the signal. However, this right is subject to interventions by public authorities which may limit its exercise in the public interest. Here the principle of proportionality must be implemented.

The Court held that the limitation on the freedom to conduct a business is justified and in line with the principle of proportionality.

The Directive’s limitation pursues its objective to safeguard the fundamental freedom to receive information and to promote pluralism of the media which is guaranteed by the Charter and in the general interest, without affecting the essential content of the freedom to conduct a business.

The legislation in question is proportionate because of the importance of safeguarding the fundamental freedom to receive information and the freedom and pluralism of the media and because EU legislature was entitled to adopt rules which limit the freedom to conduct a business.

Furthermore the contested legislation ensures a fair balance since the Directive provides that the news reports should not exceed ninety seconds, may only be produced for general news programs and their sources must be attributed. Holders of exclusive broadcasting rights are not prevented from charging for the use of their rights. [Nicole Daniel]

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