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Limited ambitions: the Audiovisual Media Services Directive

February 2008 - Media, Entertainment & Sport. Legal Developments by Harbottle & Lewis LLP.

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In September 2007 a common position was reached in Europe for an Audiovisual Media Services Directive. Its main purpose was to extend television broadcasting regulation to video on demand (VOD) services and to allow some relaxation of television advertising rules. The final text of the Directive has now been settled with no material changes and was published as Directive 2007/65/EC on 18 December 2007. Its compulsory elements must be implemented by member states by 19 December 2009.

In September 2007 a common position was reached in Europe for an Audiovisual Media Services Directive. Its main purpose was to extend television broadcasting regulation to video on demand (VOD) services and to allow some relaxation of television advertising rules. The final text of the Directive has now been settled with no material changes and was published as Directive 2007/65/EC on 18 December 2007. Its compulsory elements must be implemented by member states by 19 December 2009.

The original proposal for the Directive was much more ambitious, aiming to extend regulation to most forms of audiovisual content on the internet. Such a development would have been against the trend of broadcasting policy in the UK, where official thinking has tended towards withdrawing from attempts to regulate what we watch on our screens. The UK spearheaded an effective campaign to limit the scope of the new Directive. The result is that it will extend to VOD and no further. Even some VOD services will escape the new rules.

A NEW BROADCASTING ACT?

Some might think that the two years that member states have been given to implement the compulsory elements would be an opportunity for the government to tidy up the law of broadcasting by bringing forward a new Broadcasting Act. At present we have two Broadcasting Acts and a Communications Act and the amendments that they make to each other are not easy to navigate. The law would be much more accessible if they were consolidated into a single statute. There is, however, little prospect of this happening. Instead, official thinking is to implement the Directive by using the European Communities Act to make further amendments by ministerial order. This is bad news for lawyers in television broadcasting, who will now have no less than four separate sources to cross-refer to when seeking to understand the law.

SCOPE OF THE NEW DIRECTIVE

It may not matter too much since the extension of the scope of television broadcasting regulation is now so limited. Certainly a member state that campaigned against the extension cannot be expected to interpret the Directive other than narrowly and indeed officials are emphasising that the extension of regulation to on-demand services applies only where at least six tests are satisfied. In particular, an ondemand service will not be caught unless:

  • it consists of programmes whose form and content are comparable to that of television broadcasting;
  • it is under the editorial control of a media service provider;
  • its principal purpose is the provision of programmes to inform, educate or entertain, so services where that is incidental fall outside the net;
  • it is established in the European Union;
  • it is a mass media service for reception by and capable of having a clear impact on a significant proportion of the general public (quite what that means is not clear);
  • it is ‚Äėtelevision-like‚Äô in the sense that it competes for the same audience as television broadcasts and the nature and means of access would lead the user reasonably to expect regulatory protection.

Ministers who are unenthusiastic about the extension in the first place are unlikely to treat the obscurities here generously. The practical upshot is that the only kind of service certain to be brought within the regulatory net is a straightforward VOD service of the kind that competes with current near-VOD (NVOD) services, where the same programme (such as a film) is broadcast repeatedly at short intervals of 15 minutes or so, typically by satellite.

But what sort of regulatory net will be used? The Directive encourages the use of co-regulation and (with qualifications in relation to the compulsory elements) self-regulation. Co-regulation involves the state reserving powers to intervene if its objectives are not met. Officials have indicated informally that co-regulation with the lightest possible touch is likely to be the way forward for VOD. They see their task now to be to create a system and they are looking for ideas. A public consultation is planned in the early part of this year.

THE BYRON REVIEW

It is intended that this exercise should be entirely separate from anything flowing from the Byron Review. This is the independent review that Dr Tanya Byron has been asked to undertake, supported by officials from the Department for Children, Schools and Families and the Department for Culture, Media and Sport (DCMS), looking at the risks to children from exposure to potentially harmful or inappropriate material on the internet and in video games. She is due to report in March.

PRODUCT PLACEMENT

In addition to the compulsory elements, there are some optional items which member states are free to adopt. One of those relates to product placement. In fact it begins as a compulsory element in the sense that there is to be an outright prohibition on product placement. However member states are allowed to derogate from the prohibition in certain circumstances, such as in relation to films and series (although not for children’s programmes). They are also allowed to derogate in relation to props and prizes (including in children’s programmes), so long as they are not of significant value. There may be substantial opportunities for new revenue streams from product or prop placement if the UK decides to derogate from the general prohibition.

IMPLEMENTATION

The two-year timescale for implementation of the Directive is less (or perhaps not at all) relevant to the optional items. It would be open to a member state to derogate forthwith from the prohibition against product placement. Whether the UK should do so and when is likely to be a matter of some controversy. Officials say that there will be a public consultation in the second quarter of 2008. But it has also been reported that senior officials involved in the decisionmaking process have said that it is unlikely that the government will oppose product placement.

Unlike the 2002 directives in the telecoms sector, which required member states to implement the new rules on a particular date, under the new Directive member states have a degree of choice. This flexibility could lead to some anomalous results. In particular, new rules for jurisdiction over certain non- EU satellite services have been introduced, with the result that, depending on the speed at which different member states implemented the new rules, some satellite services could be wholly unregulated and could deliver unacceptable material during the period before 19 December 2009. Officials have apparently drawn this to the attention of the European Commission, whose only suggestion appears to be that member states are free to cooperate by nominating a common date for the change.

Following the consultations in the first half of this year, officials at the DCMS are expecting to draft policy options for ministers. They will also be expected to prepare draft impact assessments. One of the problems with the Directive all along, however, has been the absence of evidence as to the effects that it is likely to have. They have informally invited interested parties to give them information about possible impacts.There is probably an opportunity here for those whose interests are affected by the Directive to influence policy in relation to the optional elements in the Directive by making submissions now to officials at the DCMS.

CONCLUSIONS

A Directive that at one time was feared to be an attempt to regulate all audiovisual material on the internet has been cut down substantially and, except for straight VOD services, will not now extend beyond traditional television broadcasting services. The task now is implementation and the government will be taking the task forward early this year and, at least in relation to the optional items in the Directive, has some policy choices to make. Those affected have an opportunity to influence those choices not only by responding to the upcoming consultations but also by offering information about impacts on them where officials are currently feeling less than well-informed. By Tony Ballard, partner, Harbottle & Lewis LLP

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