EC probes Teuton TV subsidies

Complaint hopes to reduce TV, radio fees

BERLIN — European regulators are looking into claims that German pubcasters ARD and ZDF illegally used public funds for commercial activities.

The probe was launched after the German association of commercial broadcasters and telecommunication (VPRT) filed a complaint. It has been spearheading a crusade to reduce the TV and radio fees that finance the powerful broadcasters and to bar advertising from the channels, which it argues have an unfair advantage over commercial rivals.

The European Commission acknowledged April 24 that the pubcasters had not kept separate accounts for commercial and non-commercial operations and, as a result, cross-subsidization at the broadcasters could not be excluded. The Commission accused Germany of failing to introduce in 2001 an EU law, known as the “transparency directive,” which requires public companies to operate separate accounts.

Brussels will consider legal action against Germany for failing to introduce the directive and probe whether ARD and ZDF violated subsidy rules.

Reacting to the Commission’s decision, Markus Schaechter, head of ZDF, said April 25 that ZDF’s online activities fell under the pubcaster’s legal rights. He blasted the VPRT’s claims as an attempt to compensate for the dire financial state of commercial broadcasting and accused the org of trying to alter the playing field in Germany to the advantage of commercial broadcasters: “The difficulties of the commercial TV sector that were caused by its own mismanagement are now to be corrected by attacking the public broadcasters.”

ARD said it expects the Commission will find the complaint “groundless.”

The VPRT added that it would campaign for a ban on advertising on public TV and seek to cut license fees to prevent the competitive gap between pubcasters and commercial channels from growing larger.

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