TELEVISION BROADCASTING ACTIVITIES (15983/05)
Letter from the Chairman to James Purnell
MP, Minister for Creative Industries and Tourism, Department for
Culture, Media and Sport
Sub-Committee B considered this document and
your Explanatory Memorandum at its meeting on 6 February 2006
and agreed to maintain the scrutiny reserve, pending receipt and
examination of the Regulatory Impact Assessment which you mentioned
will be forwarded to us under a Supplementary Explanatory Memorandum.
We noted, and shared, the serious misgivings
of UK industry in relation to this document. We are minded to
revisit this matter more fully in the forthcoming weeks.
In paragraph 39 of your Explanatory Memorandum
you mentioned the UK-based stakeholder group. It would be helpful
to have a brief summary of areas of concernthat this group has
In paragraph 48 and 49 of your Explanatory Memorandum
you explained that the UK Government had serious reservations
about aspects of these Proposals. Are you able to expand further
on these reservations?
9 February 2006
Letter from James Purnell MP to the Chairman
Thank you for your letter of 9 February about
the European Commission's proposal toamend Council Directive 89/552/EEC,
otherwise known as the "Television without Frontiers"
You asked about the UK-based stakeholders group.
The group met three times last year andhas met once so far this
year, with another meeting imminent. Represented on it is a wide
range of interests including broadcasters, satellite and cable
operators, Internet Service Providers, new media providers, content
producers, co and self-regulatory organisations, trade unions
and civil society groups.
The major concern for stakeholders has been
the scope of the Directive. An overwhelming majority are not in
favour of the scope being extended to on-line services. Many have
expressed concerns that the Commission's proposals could lead
to increased regulatory burdens and legal uncertainty. They also
believe that the Commission's definitions do not make it clear
which services the revised Directive will cover, or where exactly
the proposed dividing tine between "linear" and "non-linear"
services would be drawn.
The Government shares these views. Aside from
the important issue of tack of clarity in the proposed definitions,
our key concern is that the concepts of "audio-visual media"
and "non-linear" services in the Commission's text appear
to bring in a very wide range of new media services which have
little in common with broadcasting. This is a fast growing and
converging area, and we should take great care before imposing
controls which might discourage particular business models or
encourage providers to move outside the EU.
Harmonisation of minimum standards of the kind
proposed across all the services which fallinto the scope of the
current draft Directive would pose a threat both to their growth
and to national traditions of free speech. We consider that the
case for such harmonisation in this way at this time has not been
In particular, the impact assessment prepared
by the Commission offers no convincing case for harmonisation
across all the services falling within the scope of the Directive.
It is based upon a theoretical projection of what might happen
if Member States were to take advantage of derogations available
under the e-commerce Directive to impose burdensome national controls
that would distort the working of the internal market, or if there
were to be serious distortions (in terms of legal certainty or
market advantage) as between the types of regulation that applies
to different platforms.
It concludes that there would be an overallalbeit
essentially unquantifiedloss of business. But there are
very few figures in the assessment to back this assertion up.
We see no sign that Member States are in fact
imposing burdensome, damaging controls in these areas, although
the assessment claims that no less than 23 already have controls
of some sort. Our own extensive discussion with UK and pan-European
businesses and trade associations has not revealed any evidence
of concern that lack of harmonisation is stifling business opportunities.
Rather, discussion has revealed severe concerns
that these proposals could increase business uncertainty and regulatory
risk. Without more evidence of potential harm to business, it
seems to us that proceeding with these measures in their current
form would run counterto the Commission's own stated aimendorsed
by Member Statesof better regulation.
If evidence of undue interference in the single
market for such information society services did come forward,
we believe that the question would be best resolved in the forthcoming
review of the Electronic Commerce Services Directive.
Our overall concern, therefore, is that the
imposition of controls of the sort suggested onnon-linear services
could itself cause just the kind of damage to growth and development
inthese sectors which the Commission quite rightly seeks to avoid.
They could themselves lead to market distortions and to a net
outflow of jobs and development in the new media industries from
the EU area.
28 February 2006