Staatssteun: Commissie geeft groen licht aan plan voor financiële herstructurering van de Portugese publieke omroep RTP (en)

The European Commission has decided that the financial restructuring agreement signed between the Portuguese Government and the public service broadcaster RTP in September 2003 is in line with EC Treaty state aid rules. This agreement, which runs until 2019, is aimed at progressively reducing RTP's debt of about €1 billion. After an investigation, the Commission concluded that this debt is almost entirely due to the constant under financing of RTP's public service tasks in the past and that the financial support now given by the state is proportional to RTP's public financing deficit.

Competition Commissioner Neelie Kroes i said "This decision confirms Member States' rights to define public service tasks and to compensate broadcasters for performing them, provided that the compensation is proportional to the actual costs of the public service mission."

From 1993 to 2003, the Commission received several complaints from a commercial broadcaster, raising concerns about the commercial behaviour and financing system of Portuguese public broadcaster RTP.

In October 2003, the Commission took a first decision on the matter, considering that several ad hoc state aid measures granted to RTP between 1992 and 1998 did not exceed the net public service costs and were therefore compatible with EC Treaty state aid rules (see IP/03/1399).

In March 2006, the Commission closed its enquiry into the new financing system of RTP, introduced in 2003. This decision followed commitments from Portugal to increase transparency and proportionality in the system (see IP/06/349).

Finally, the Commission was required to assess the financial restructuring agreement intended to reduce the €1 billion debt accumulated by RTP by 2003.

On the basis of a detailed examination of RTP's financial accounts, the Commission concluded that this debt was almost exclusively created by the constant under financing of RTP's public service tasks. The reasons for this under financing were threefold: first, the annual compensations paid to RTP were subject to VAT, which reduced their net value; secondly, the state failed to pay the full amounts due to RTP under the concession agreements; and thirdly, the concession agreements did not allow RTP to claim compensation for the full costs of public service provision.

As the overall amount of the state aid measures included in the financial restructuring agreement (mainly capital injections), together with the ad hoc measures granted to RTP until 2003 did not exceed the public service costs, the Commission concluded that the measures are compatible with the Single Market.

Background

The Commission assesses state aid measures in the broadcasting sector with regard to Article 86(2) of the EC Treaty and the principles of the Commission's 2001 Communication on the application of state aid rules to public service broadcasting (see IP/01/1429). The analysis carried out in today's decision is also in line with earlier Commission decisions regarding ad hoc aid granted to France 2 and 3 (France; see IP/04/1686), RTP and RAI (Portugal and Italy; see IP/03/1399) and NOS (Netherlands; see IP/06/822),

Investigations concerning the German, Irish and Dutch public broadcasting systems and their annual funding are still pending (see IP/05/250).

For further information on the applicability of state aid rules to public broadcasting, see MEMO/05/73.

Information on the present case will be available on the Commission's web site at: http://ec.europa.eu/comm/competition/state_aid/register/ii/by_range_nn2006.html