The Commission presents its ninth Communication on the application of Articles 4 and 5 of Directive 89/552/EEC (Television Without Frontiers Directive), as amended by Directive 97/36/EC and Directive 2007/65/EC for the period 2007-2008 (‘Audiovisual Media Services’). The Communication is based on Member States’ statistical statements on the achievement of the proportions referred to in these Articles by each of the television programmes falling within their jurisdiction and presents the Commission’s opinion on the application of these provisions, including the main conclusions to be drawn from the Member States’ reports.

The purpose of this biennial reporting exercise is twofold:

the Communication brings the statistical statements by the Member States to the knowledge of the other Member States, the European Parliament, the Council, the European Economic and Social Committee and the Committee of the Regions: it aims to verify whether the measures adopted by the Member States with a view to promoting European works and independent productions have been properly applied.

For this reporting exercise, the Commission provided all the Member States with a predefined list of channels extracted from the MAVISE data base of the European Audiovisual Observatory. The purpose was to use a uniform basis to increase the consistency and comparability of the statistical data provided by the Member States. In accordance with the provisions of the Directive, local channels were removed from the list since they are excluded from the scope of Articles 4 and 5 as well as channels which do not broadcast in an EU language and channels which broadcast exclusively for reception outside the EU and cannot be received in the EU. As had already been the case for the previous report, all channels falling within the jurisdiction of a given Member State had to be considered independently of their audience share. Additional details can be found in the background documents included in the Commission Staff Working Document accompanying this Communication ( SEC(2010)0995) .

For the first time, Bulgaria and Romania, which joined the EU on 1 January 2007 and provided statistical data on a voluntary basis for the 2005-2006 period, fulfilled their obligation to report on the application of Articles 4 and 5 during the 2007-2008 period. It is thus the first time that this Communication includes the compulsory reports of all 27 EU Member States.

According to the statistical data provided by the Member States, the scheduling of European works at the EU level registered a very slight increase during the current reference period. Over the period 2005-2008, development was stable, although some variations were registered between 2005 and 2007 (upward trend followed by a decrease in 2007). However, in 2008 European works scheduling was back at the same level as in 2005 (63.2 % for the EU- 27). This demonstrates stabilisation at a relatively high level, well above the required proportion set out in Article 4 . Furthermore, this result has to be interpreted against the background of a continued increase in the number of channels on the market, with the emergence of small specialised channels which may well find it difficult to meet the required proportion of European works from the start of their operations. This aspect was already stressed in the eighth Communication and should be taken into account when assessing overall performance with respect to the scheduling of European works in the EU over the current reference period.

Although the overall situation is satisfactory, there is still some room for progress:

the three Member States (Cyprus, Sweden, Slovenia) which failed to attain the required proportions of European works in 2007 and 2008 should step up their efforts in order to improve their performance and strengthen the increase (in one case, very slight) already registered in 2008. Since two of these underperforming Member States belong to the EU-10, an increase in their European works averages would have a positive impact on the downward trend registered by the EU-10 between 2005 and 2008, which should also be corrected; it is worth drawing attention to the high level of European works scheduling achieved by the two most recent Member States during the reference period and the increase they registered over the 2005-2008 period.

With respect to the implementation of Article 5 of the Directive , the overall development observed during the reference period shows a slight downward trend for independent works. According to the statistical statements provided by the Member States, a decrease was registered over the current reference period as well as in the period 2005-2008. Although it is not a significant decrease (-0.83 point from 2005 to 2008), it reverses the positive trend that was registered in the previous period. As far as independent productions are concerned, it should be noted that the EU-10 improved their performance.

There is a somewhat sharper downward trend as regards recent works by independent producers over the period 2005-2008. Member States are invited to encourage the channels falling within their jurisdiction to step up their efforts in order to increase the scheduling of independent productions and recent works.

Nonetheless, the results achieved during the reference period testify to a satisfactory implementation of Article 5, with a level of achievement well above the proportions required by this provision.

As already stated in the eighth Communication, the results of the analysis of the reports submitted by the Member States 33 show that the requirements set out in Articles 4 and 5 of the Directive have been met comfortably during the period 2007-2008.

This Staff working document supplements the Commission’s Communication on the application of Articles 4 and 5 of Directive 97/36/EC, pursuant to Article 4(3). The ninth Communication, covering the years 2007 and 2008, outlines the Commission’s opinion on application of Articles 4 and 5 at Community level and the principal conclusions which can be drawn from the Member States’ reports. This document contains a detailed analysis of application of Articles 4 and 5 in each Member State based on the reporting obligations for the reference period.

The Commission is responsible for ensuring correct application of Articles 4 and 5 of the Directive in accordance with the Treaty. Article 4(3) of the Directive requires the Member States to provide the Commission with a report on application of Articles 4 and 5 every two years. Summaries of these reports are provided in Annex 3. This document comprises two parts: general remarks on the application of Articles 4 and 5; and detailed analysis for each Member State on the application of those provisions.

This report is the Seventh Annual Report from the Commission on the application of Directive 89/552/EEC “Television without frontiers” between 2007 and 2008.

The main objective of this report is to describe and analyse the salient facts relating to the application of the TWFD during the reference period. On 11 December 2007, the Council and Parliament adopted Directive 2007/65/EC , to be transposed not later than 19 December 2009. This Directive, which entered into force on 19 December 2007, substantially amended the TWFD and re-named it "Audiovisual Media Services Directive" (AVMSD) (see COD/2005/0260 ). The new provisions of the Directive will also be referred to.

Recent technological developments and development of the television market in Europe : Pay-TV operators have generally reaped significant rewards for their activity while traditional free-to-air and public service broadcasters have suffered from stagnating or declining revenues. From a statistical perspective, the most recent data from 2006 show net revenues of EU broadcasting companies at almost €79 billion (public service 39%, free-to-air commercial 28%, pay-TV 22%, thematic and teleshopping 11%). By November 2008, more than 4 000 broadcast services were established in the Member States 6 . In addition to 352 analogue and digital terrestrial national channels, some 1 742 channels were available over one or more platforms and at least 650 channels targeted the market of a Member State other than the country of establishment or countries outside the Union. In addition to the channels available nationally or originated in other Member States, it is estimated that more than 1 500 regional channels are available. Moreover, the European public can access more than 750 channels originating from third countries and delivered in at least one Member State.

By December 2008, more than 600 on-demand services were provided by audiovisual media services providers established in the European Union. Most of the non-linear services are provided via Internet or as IPTV services. Audiences have further fragmented as viewers have to a certain extent switched to new channels and on-demand services. However, viewers have not substantially modified their overall viewing patterns over the period under review. In certain countries viewing time increased in 2008 compared with 2006 ( e.g. UK, Spain, Romania) while in others it declined ( e.g. Czech Republic, Germany, Belgium, Netherlands). Hungary remains the country where daily viewing is longest (260 min/day), while Austria and Sweden are the Member States where viewers spend the least time watching TV per day (148 and 160 min/day, respectively).

New rules introduced by Directive 2007/65/EC : t he new AVMSD provides the necessary level of harmonisation of rules to achieve internal market objectives by providing the legal framework for free circulation of audiovisual media services on the basis of the country of origin principle. Other new rules include those relating to safeguard measures in non-linear services, circumvention procedures in linear and non-linear services, advertising, short reporting, protection of minors and public order.

Enlargement – prospects : C roatia, Turkey and the Former Yugoslav Republic of Macedonia are candidate countries for membership of the European Union. After the alignment of Croatian legislation with the TWFD, the Council of the European Union provisionally closed Chapter 10 of the accession negotiations on information society and media on 18 December 2008. The Council decided to open the same chapter in the accession negotiations with Turkey on the same date on the basis of the compromise alignment of Turkish audiovisual legislation with European audiovisual legislation. As regards the countries of the Stabilisation and Association process (Albania, Bosnia and Herzegovina, Montenegro and Serbia as well as Kosovo under UN Security Council Resolution 1244/99), the Commission is pursuing a strategy for the convergence of their audiovisual policies with European media standards, in cooperation with the Council of Europe. The Commission monitors the process, paying particular attention to the development of administrative and judicial capabilities .

Future reports : Article 26 of the re-named AVMSD stipulates that no later than 19 December 2011, and every three years thereafter, the Commission must submit to the European Parliament, the Council and the European Economic and Social Committee a report on the application of this Directive and, if necessary, make further proposals to adapt it to developments in the field of audiovisual media services, in particular in the light of recent technological developments, the competitiveness of the sector and levels of media literacy in all Member States. The report should also assess the issue of

television advertising accompanying or included in children's programmes, and in particular whether the quantitative and qualitative rules contained in the Directive have afforded the level of protection required. Therefore, the Member States will have to report to the Commission regarding these various issues. Furthermore, the accessibility of audiovisual media services to people with a visual or hearing

disability and the co- and self-regulatory regimes should also be referred to.

Conclusion : the Commission concludes that this report demonstrates that the Television without Frontiers Directive continues to function as an effective tool to ensure the free circulation of broadcasting services whilst guaranteeing an appropriate level of consumer protection and promotion of European works. The infringement procedures in connection with application of the advertising rules demonstrate the need for close monitoring. However, as stated in the previous report, the legal framework needed to be revised in order to address technological evolution and changes in the market. The adoption of Directive 2007/65/CE, amending substantially the TWFD and modifying its title, responds to these various issues. The adequacy of this new instrument will continue to be monitored and will be addressed by the Commission in coming reports.

This Communication is drawn up pursuant to Article 4(3) of Council Directive 89/552/EEC, as amended (Television without Frontiers Directive). The Commission reports, for the eighth time since the adoption of the Directive, on the application of Articles 4 and 5, now for the period 2005-2006. The report is based on the Member States’ statistical statements on the achievement of the proportions referred to in these Articles by each of the television programmes falling within their jurisdiction and it presents the Commission’s opinion on the application of these provisions, including the main conclusions to be drawn from the Member States’ reports.

For the first time, the statistical statements of the ten Member States that joined the EU on 1 May 2004 are presented and assessed for the entire reference period of the report (2005-2006). Furthermore, it should be noted that Articles 4 and 5 (in particular the former) are being successfully applied in a changing audiovisual environment: for the first time, channels broadcasting in Digital Video Broadcasting-Handheld (DVB-H) are listed in a Member State’s report.

The Commission looks at Articles 4 and 5 in the context of the European audiovisual landscape and examines their application in Member States. According to the statistical statements provided by the Member States, the scheduling of European works at Community level increased over the current reference period, following a decline during the last reference period. The trend over four years has been relatively stable, while over six years (2001-2006) there has been a slight decrease. Overall, however, the proportion of European works broadcast on EU screens has stabilised at a relatively high level of above 63%. However, there are four factors that hinder a fully consistent evaluation. First, starting from the last report, figures now include the statistical statements of the ten Member States that joined the EU in 2004. Second, the method of calculation has been altered, in as much as figures for channels with an audience share of less than 3% have been included in the averages since the last report. Third, the growing fragmentation of the sector produces economic pressure and a need for cheap and easily accessible content, thereby creating a more difficult environment for investment in and scheduling of European works. Lastly, the number of channels for which no data were communicated has fallen.

This notwithstanding, the stabilising trend in terms of the scheduling of European works is undeniable and is further confirmed by the positive trend in the average compliance rate of the channels covered. This rose by more than 4% during the reference period, and also developed positively over the four-year term (2003-2006). In conclusion, the overall situation is satisfactory for the transmission of European works on EU television channels, although there is still scope for progress in certain Member States. The scheduling of European works at European level has stabilised well above 60%, and a proportion above 65% or more is sustainable in future. This positive assessment applies equally to the 10 new Member States which actually performed better than the ‘old’ Member States in the reference period - showing that their initial efforts to comply with Article 4 have been successful.

With respect to the implementation of Article 5 of the Directive, a positive trend can also be observed: after a considerable decline of -6.25% during the period 2001-2004, the 2006 rate stabilised at a level comparable with that recorded in 2001 (37.59% compared with 37.75%). This means that the average proportion increased quite substantially by 6.2% over four years, despite the impact of the factors described above. It is remarkable that the vast majority of the Member States were able to stabilise their performance as regards independent productions at a level well above 25% of total qualifying transmission time.

The situation concerning recent works by independent producers is also very satisfactory: despite a slight decrease over the reference period and over four years, the figures improved over six years. During the reference period, more than 25% of total qualifying transmission time was devoted to recent works.

These results, based on a detailed analysis of the Member States’ national reports, demonstrate that the objectives of Articles 4 and 5 of the Directive have been met comfortably over the current reference period at both Community and Member State levels.

This paper contains background documents dealing with the following: performance indicators; charts and tables on the application of Articles 4 and 5; the application of Articles 4 and 5 in each Member State; summary of the reports from the Member States and voluntary reports by Bulgaria and Romania; reports from the Member States of the European Free Trade Association participating in the European Economic Area; average transmission time of European works by channels with an audience share above 3%; list of television channels in the Member States which failed to achieve the majority proportion required by Article 4; and the list of television channels in the Member States which failed to achieve the minimum proportion required by Article 5.

With regard to monitoring , the Commission notes that, although further efforts seem to be needed in some of the Member States, monitoring practice improved in general, including the monitoring of commercial channels and, in particular, satellite channels. The increased number of monitored channels reflects an ever-growing number of private broadcasters entering the market.

The dynamic development of the sector is further mirrored in the Member States’ reports. For the first time, channels broadcasting in Digital Video Broadcasting-Handheld (DVB-H) are listed in a Member State’s report. Italy’s statistical statement featured four such channels. Some Member States have also included on-demand channels in their reports. Belgium included the channel ‘SiA a la demande’, while citing the reservations expressed by the channel as to the possibility of applying Articles 4 and 5 to its format.

On the question of cases of non-compliance with the required proportions, in most cases, the Member States chose to hold talks with the channels/broadcasters concerned. In some cases, broadcasters were given a formal notice or subjected to specific monitoring. Only a minority of Member States explicitly mentioned that their legislation provides for administrative or penalty procedures. As in the previous report, only a few cases were mentioned where measures had already been taken at the time of reporting. In this regard, the Commission would like to insist on the need for Member States to improve their enforcement measures against channels in breach of the Directive, in order to ensure that the proportions of transmission time laid down in Articles 4 and 5 are achieved. Especially in cases where channels continuously fail to meet the proportions - and the number of such channels is significant - only stricter enforcement of the rules can ensure the effective implementation of Articles 4 and 5 at Member State level.

The Commission stresses that this is the first report containing statistical statements for the entire reference period from the 10 Member States that joined the EU in 2004. In general, with an increasing number of covered (and reported) channels, in both the EU-15 and the EU-25 as a whole, the national reports indicate satisfactory application of the provisions of Article 4, although there remains ample room for improvement. 15 of the EU-25 Member States increased their average majority proportion during the reference period. In the EU-15, 8 Member States were able to increase their percentages from 2005 to 2006. Nonetheless, over a medium-term perspective, looking at the previous reference period and the subsequent development, the majority of Member States have not seen any increase in the figures regarding the 50% proportion European works. Correspondingly, only 12 Member States increased their average majority proportion either during the years 2003-2006 or from the beginning of reporting in 2004. This negative impression is slightly mitigated when taking into account that 9 Member States saw only a decrease of 5% or less over 4 years.

As regards Article 5 (European works made by independent producers), 15 of the EU-25 Member States increased their average proportions for independent productions during the reference period. Over four years, the percentages fell in only 7 Member States, whereas the 18 other Member States saw often quite substantial increases. It may also be noted that 18 Member States were able to stabilise their performance regarding independent works at well above 25% of total qualifying transmission time. Despite the fact that a number of channels faced significant losses and given that Article 5 stipulates a minimum proportion of only 10%, this is a significant development, showing the positive effects of the progressive achievement approach.

This report is the sixth annual report from the Commission on the application of Directive 89/552/EEC “Television without frontiers” between 2005 and 2006.

The main objective of the report is to describe and analyse the salient facts relating to the application of the Directive during the reference period. Given that the Commission has adopted a proposal for the modernisation of the Directive, this report also refers to recent developments concerning this legislative proposal.

In recent years, the television market has faced important technological and economic challenges. The broadcasting sector has improved its overall economic performance in terms of turnover (the total net revenues of radio/TV companies in 2004 stood at around EUR 72.8 billion – an increase of 7.9% compared to 2003). However, this trend has not prevented a concentration of operators in specific areas, such as Pay-TV, where business conditions have in many cases not allowed the simultaneous presence of several operators on individual national markets. The development of digital television broadcasting and IPTV has introduced a further element of change to the broadcasting industry.

The report finds that the Directive continues to function effectively as a means of ensuring the freedom to provide television services in the EU. The Commission, acting as guardian to the Treaty, continues to verify the effective implementation of the Directive and takes action where necessary to ensure it. The seventh report on the applications of Article 4 and 5 of the Directive indicate general satisfaction of the results in terms of channels meeting the requirements for European works.

At the same time, the technological and market developments have opened the way to the development of new audiovisual services such as on-demand services. This confirms the need to modernise the EU legal framework. This will be done once the amending Directive on audiovisual media services has been finally adopted.

The report comprises of the Commission’s seventh communication on the application of Articles 4 and 5 of Directive 89/552/EEC "Television without Frontiers", as amended by Directive 97/36/EC, for the period 2003-2004.

The purpose of this bi-annual reporting exercise is, firstly, to bring Member States’ statistical statements to the attention of the other Member States, the European Parliament and the Council and, secondly, to check that the measures to promote European and independent production are being properly applied in the Member States. For the first time, the ten Member States which joined the European Union on 1 May 2004 are included in this report.

Reported data indicate that, for the first time, there has been a slight decrease in the scheduling of European works (Article 4) at Community level during the current reference period. However, the medium-term (1999-2004) trend is positive. Two factors have to be taken into account when evaluating progress under Article 4. First, the figures for 2004 include the ten Member States which joined the EU in 2004. Second, the method of calculation has been altered inasmuch as secondary channels with audience shares below 3% are now also included in the average proportions of European works.

These results show that, notwithstanding the slightly downward short-term trend, scheduling of European works has stabilised in the EU at a level well above 60% of total qualifying transmission time. Particularly for the ten Member States which participated in this monitoring exercise for the first time this is an encouraging development. Thus, overall the application of Article 4 of the Directive at European level has been satisfactory.

As regards the application of Article 5, the slight increase during the present reference period (+ 0.11% percentage points) can be seen as a positive development, bearing in mind that the data for 2004 include the ten Member States joining the EU in 2004. However, from a midterm perspective, this short-term upward trend is offset by a serious drop of more than 6 percentage points (or a decrease of more than 16%) compared with the averages for 1999 or 2001.

However, this downward mid-term trend is offset to some extent by three factors:

1) the EU-average compliance rate has risen within the present reporting period, meaning that in 2004 substantially more channels in the EU complied with the minimum proportion set in Article 5 than in 2003;

2) levels of transmission of recent European works by independent producers were relatively high . In relation to independent productions, recent works have risen by 30% in six years;

3) proportions have remained at levels well above the 10% minimum set by the Directive.

Overall, the application of Article 5 has been generally satisfactory.

This report is the fifth report from the Commission on the application of Directive 89/552/EEC “Television without Frontiers” .

The present Report follows the Fourth Report, adopted in January 2003, and deals with the application of the Directive in the years 2003 and 2004. In an annex to the Fourth Report, the Commission proposed a work programme to open a debate on the possible need to adjust the EU regulatory framework in this field because of the developments in markets and technologies. Accordingly, the Commission launched consultations in 2003 for a review of the Directive. The present Report has to be seen in the context of this debate.

During the years up to 2004, the favourable trend in the development of the EU audiovisual industry reached a high degree of maturity. At the same time, some business models had to face hard tests and in some areas operators underwent a process of consolidation. New business opportunities, notably “Digital Terrestrial Television”, and the delivery of audiovisual services through new technological platforms have expanded the presence of such services on the market reinforcing the well-known phenomenon of fragmentation of supply. This trend seems to be stabilising against the background of a softening in advertising resources and little prospect of an increase in public funding.

As regards enlargement, the new Member States, which joined the EU on 1 May 2004, were required to notify their legislation transposing the Directive. An assessment carried out shows that they have complied with their obligations in this respect. The EU is now preparing for the next enlargement. Bulgaria and Romania are expected to join the European Union in 2007. Croatia and Turkey are candidate countries. As regards the Western Balkan countries, the European Council has underlined their prospects of EU membership on several occasions. The Commission pursues a strategy for the convergence of the audiovisual policies of these countries with European media standards, in cooperation with the Council of Europe.

The report concludes by stating that the “Television without Frontiers” Directive continues to function successfully in ensuring the freedom to provide television services in the European Union. The fundamental objectives of public interest that the Directive aims to safeguard in establishing a minimum harmonisation in the internal market remain valid. The Directive provides effective regulation for the European audiovisual sector and the Report confirms the validity of the common European approach to audiovisual matters.

However, in view of market and technological developments, a need to review the current EU regulatory framework, as outlined above, has become apparent. Therefore, the Commission intends to come up with a proposal for revision of the Directive at the end of 2005.

This report constitutes the Sixth Communication from the Commission on the application of Articles 4 and 5 of Directive 89/552/EEC "Television without Frontiers", as amended by Directive 97/36/EC, for the period 2001-2002. It sets out the Commission's opinion on the statistical statements submitted by the Member States on the achievement of the proportions referred to under Articles 4 and 5 for each of the television programmes falling within their jurisdiction.

The reporting period (2001-2002) concerns the EU-15. The ten new Member States, which joined the EU on 1 May 2004, are not covered by this document. However, they will be included for the first time in the next application report for the monitoring period 2003-2004.

The document includes two parts:

-Part I – Commission opinion on the application of Articles 4 and 5;

-Part II – Conclusions drawn from the above opinion and the Member States' reports.

The figures on the average transmission time for the EU-15 indicate that, for the first time, there has been no progress at Community level in the scheduling of European works (Article 4). However, notwithstanding a slight decrease (-0.85 points) over the present reference period (2001-2002), there was a more apparent increase of 5.42 points over four years (1999-2002) which demonstrates a stabilisation in the scheduling of European works at almost 2/3 of total qualifying transmission time. Consequently, from a mid-term

perspective there has been an overall satisfactory application of Article 4 of the "Television without Frontiers" Directive.

As regards the application of Article 5, the trend is less positive. For the first time, there was a decrease both within the present reference period (-3.70 points) and also compared with the previous reference period (-3.46 points). However, the EU-average transmissions of European works by independent producers were constantly at levels which are well above the minimum proportion of 10% set by the Directive. In addition, there were relatively high levels of transmissions of recent European works by independent producers. In relation to European works by independent producers overall (recent or not), recent works were even increasing. In this perspective, the positive development over the reference period continued the positive trend of the previous reference period (1999-2001). The overall assessment is therefore that the objectives of the Article 5 of the "Television without Frontiers" Directive have broadly been met. The application of Article 5 in respect to the scheduling of recent European works made by independent producers was generally satisfactory.

Detailed examination of the Member States' reports reveals, in a context of a general increase in the number of channels, stability in the broadcasting of European works, including those – to a lesser extent – by independent producers, particularly in the case of recent works.

This generally positive situation must, however, be qualified given that certain Member States did not communicate data on a considerable number of channels which are covered by Articles 4 and 5.

OBJECTIVE: to amend Directive 89/552/EEC, known as "Television without frontiers", in order to update and improve its functioning so that a stable legal framework will be in place for promoting the development of the audiovisual sector within the European Union. COMMUNITY MEASURE: European Parliament and Council Directive 97/36/EC amending Directive 89/552/EEC which seeks to coordinate certain legislative, regulatory and administrative measures within the Member States relating to the exercise of television broadcasting activities. CONTENT: the main provisions of the new directive are as follows: - Principles of jurisdiction: the directive defines precisely which Member State has competence with regard to television channels; this is determined principally on the basis of the effective head office and the place where editorial decisions on programming are taken. The clause on derogations from the principle of freedom of reception is amended. In addition, a clause has been introduced to define the television broadcasting organisation; - Freedom of reception and retransmission: as a general rule, Member States ensure freedom of transmission and do not impede retransmission within their territory of television programmes emanating from other Member States for reasons which come within the areas coordinated by the directive; - Better access to the courts: it is proposed that appropriate procedures be set in place by the Member States to allow those third parties directly concerned, including nationals from other Member States, to have recourse to the competent authorities, legal or otherwise, to ensure that the provisions of the directive are respected; - Retransmission of major events (mainly sporting events): the Directive lays down the conditions under which the public may be guaranteed free access to the broadcasting of such events. The Member States may each draw up a list of events (national or other) which are to be broadcast in uncoded form only, even if the exclusive rights have been bought by pay-TV channels; on the basis of the principle of mutual recognition, they shall ensure that the different channels respect each of these lists; - Measures for the promotion of European programmes: the system for promoting the broadcasting of European productions, which was put in place in 1989, is confirmed (television channels will reserve a majority share of their transmission time for European productions, when this is feasible); a degree of flexibility is always allowed for the implementation of this measure. The definition of European productions is extended to include co-productions with certain non-member countries; - European productions: productions which are not of European origin but which are produced within the framework of bilateral co-production agreements between Member States and non-member countries, are to be regarded as European productions if the Community co-producers are making the majority contribution to the total cost of production and if the production is not controlled by one or more producers who are based outside the territory of the Member States; - Independent productions: the Member States shall introduce a definition of "independent producer" in order to facilitate the implementation of the ruling which involves reserving 10% of the broadcasting time, or alternatively 10% of the programming budget, to independent productions; - Televised broadcasting of films: the minimum periods set for the televised broadcasting of cinemagraphic productions are annulled; Member States must simply ensure that the periods agreed between television broadcasters and legal claimants are respected; - Television advertising: the limit of 20% of the transmission time each hour is adjusted. Self-promotion is included under advertising and is subject to most of the provision of the directive. Public service announcements and charity appeals are not included in the maximum transmission time for advertising; - Teleshopping: a definition of teleshopping is introduced and the latter is subject practically to the same rules as advertising. Teleshopping windows on non-specialised channels are to last for at least 15 minutes and shall be clearly identifiable. Their number shall not exceed 8 windows per day and their total duration may not exceed 3 hours per day. Teleshopping must not encourage minors to enter into contracts for the sale of goods or services; - Sponsorship: pharmaceutical companies may in future sponsor programmes but may still not promote specific medicinal products or medical treatments; - Protection of minors and public order: programmes likely to prove detrimental to the development of minors are prohibited. Those which may simply prove harmful to minors must be preceded by an acoustic warning or be clearly identified, throughout their duration, by a visual symbol. Programmes must not contain incitement to hatred on grounds of race, sex, religion or nationality. The Commission is to submit, within a period of one year, an in-depth study of "v-chip" (anti-violence chip) filtering systems which are designed to facilitate parental controls on programmes which their children are able to see (the directive does not prejudge the conclusions of this study); - Follow-up dialogue: a contact committee is set up to examine the implementation of the directive and the developments in this sector, in order that an exchange of views can take place. DATE OF ENTRY INTO FORCE: 30/07/1997 DEADLINE FOR TRANSPOSITION: 30/12/1998.

The rapporteurs pointed out that Parliament’s main aim of ensuring that the general interest prevailed over specifically economic interests had been achieved. They also welcomed the fact that some of Parliament’s proposals, particularly on tele-sales, the definition of the concept of public services, the protection of minors and the updating of the regulation on advertising, had been included in the final text. Finally, they urged the Commission to set up the contact committee provided for by the directive as quickly as possible. Commissioner Fischler welcomed the excellent cooperation between the institutions. Finally, he assured Members that his institution intended to set up the contact committee without delay.

The co-rapporteur, Mr Galeote Quecedo (EPP, E), presented the compromise amendments that had been tabled again at second reading. In his view, the setting of European quotas did not constitute an indispensable condition for guaranteeing the development of the broadcasting industry. In fact, the EU’s decision to set up barriers could serve as an example for non-European competitors and this could well make it difficult for the European broadcasting industry to penetrate future markets, such as that of Latin America. On the other hand, the European industry could benefit from direct financial aid under the Media programme or by way of the Guarantee Fund. As regards the new interactive services the two co-rapporteurs thought it premature to include in the regulations those services that were still at the start-up stage. Concerning the placing of restrictions on the amount of advertising being broadcast, the Committee on Culture had sought to achieve a balance between the needs of the market and consumer protection. As regards major sporting events, however, limitations had been imposed on the exclusive rights of broadcasters in order to allow television viewers live access to events such as the Olympic Games and the World Cup. Finally, with regard to the protection of minors from broadcasted images of violence and pornography, the co-rapporteur pointed out the deficiencies in the common position. The co-rapporteur also proposed, firstly, that broadcasters should set up bodies to classify programmes and, secondly, that television sets be fitted with a coding system for parents and guardians. The second co-rapporteur, Mr Hoppenstedt (EPP, A), took the view that the same minimum standards should be applied irrespective of the technical means used for transmission or broadcasting. Moreover, as regards advertising, he thought that this issue was simply a matter of viewers’ choice, stating that people could change channels if they were annoyed by too much advertising. Finally, he thought that discussions should be held with consumers, as regards the provision of protection for minors, and with sports organisations, with regard to the broadcasting of major sporting events. The Chairman of the Committee on Culture, Mrs Castellina (GUE/NGL, I), pointed to the fact that most of the amendments adopted at second reading had been the result of a compromise and went on to state that the European cultural market should protect future generations from the impoverishment of imagination and the loss of cultural identity. With this in mind the Committee on Culture had excluded ‘video on demand’ from the application of the quota system for European broadcasted works and for investment. While declaring that the Commission backed Parliament in its support for a European broadcasting policy, by way of the ‘Television without Frontiers’ Directive, Commissioner Oreja pointed out that he was not in a position to accept some of the amendments tabled. To be precise, he rejected Amendment No 10 (recital), No 15 on teleshopping, which was a contractual activity, and Nos 16, 17, 51 and 53, which were incompatible with the criteria for the sovereignty and legal competence of the Member States; he also rejected in part Amendments Nos 16 and 17, which contradicted the recent legal precedent set by the Court of Justice (ruling of 10/9, Comm. v. UK); Amendment No 19 was also incompatible with Article 189(a) of the Treaty, since a directive providing for financial penalties for the non-respect of quotas would have an excessively restrictive impact at Member State level, while Amendment No 26 was unacceptable because the ten-year deadline for assessing the impact of the Directive was considered too long. As far as television advertising was concerned, the Commissioner did not agree with the very restrictive quantity limits proposed for teleshopping. Finally, as regards the protection of minors, Mr Oreja agreed with the amendment on filtering devices, but thought that the one-year period for obtaining compliance was too short. In brief, he stated that he was prepared to accept 28 of the amendments.

The co-rapporteur, Mr HOPPENSTEDT (EPP, D), approved the broad outline of the Commission’s proposal, though he wanted to see a number of improvements made to it. There was a need to clarify the scope of the Directive, to strengthen the competitiveness of the European broadcasting industry and to provide protection for consumers. Believing that future developments in television should not be regulated in advance, the co-rapporteur was opposed to extending the Directive to cover new services, such as special interest channels, video on demand and teleshopping. In opposing the Committee on Culture’s proposal that the quota system should be strengthened, Mr Hoppenstedt wanted to see a separate directive for cinema and for television, emphasising that it would be difficult to regulate the two sectors by means of a single text. The co-rapporteur also stressed the importance of protecting minors from scenes depicting pornography and violence. The chairman of the Committee on Culture, Mrs CASTELLINA, said that the purpose of the Directive was to introduce rules according to which the television stations were to plan their transmission quotas for ‘European productions’. While she did not particularly like the word ‘quota’, she did maintain that the Directive would provide for a right of representation for each culture. The speaker also wanted the scope of the Directive to apply to the new services, so as avoid any imbalance in the regulations. Commissioner OREJA stated that the Commission would accept a large number of the amendments tabled by Parliament, namely seven in total and 26 in part. Amendments posing problems mainly comprised those that sought to include the new services, given that the latest novelties, such as ‘pay per view’ and ‘new video on demand’, were already covered by the Directive currently undergoing revision. As far as the applicable legislation was concerned, the Commissioner pointed out that the underlying principle was the mutual recognition of the monitoring system applied at the place of origin. The broadcasting body should come under the legal responsibility of one Member State alone. As regards the promotion of European works, the Commissioner thought that the amendments went further than necessary and he considered them unacceptable, since they were incompatible in the long term with the prime objective of freedom of movement. In respect of advertising and teleshopping, the Commission could not accept those amendments that were aimed at reducing the volume of advertising in relation to the reference year 1989. Finally, as regards the protection of minors, the Commission considered that studies were needed to look into problems such as the impact of advertising and the use of filtering devices for programmes with a potentially harmful content.

The ESC welcomed the Commission’s concern to submit a draft Directive aimed at harmonising and coordinating certain legal and administrative provisions in the Member States relating to the pursuit of television broadcasting activities. It wondered, however, whether the new quota measures were appropriate. It would like to see a more flexible and progressive system dovetailing with the gradual impact of the Media II programme. It therefore proposed that the Directive leave it up to the broadcasting organisations to choose between meeting either broadcasting or investment quotas, irrespective of whether they were a general or special interest channel. The ESC also proposed that these quotas - of whichever type - be progressive and that intermediary stages be fixed after which the effectiveness of the measures would be assessed before moving on to the next stage. For instance, the objective would have to be met after two or three two-year stages. The ESC stressed that the proposed measures should help to upgrade the quality of European audiovisual production. Having stressed the need to take account of economic and cultural realities and to introduce a progressive system for achieving the targets for the proportion of European works, the ESC wondered whether consideration might not be given to financial assistance measures through a fund, possibly as part of the European Investment Fund. It also emphasised the importance of preparing a stable and clear regulatory framework in preparation for the Information Society. This comment applied equally to regulation of media concentration. In this connection, the ESC was awaiting the forthcoming Green Papers on new services and reserved the right to take up the matter again then.