ETNO response to the consultation on Directive 2010/13/EU on audiovisual media services (AVMSD)

A media framework for the 21st century

Extract from Questionnaire

Please find the full questionnaire here.

Background and objectives
The Audiovisual Media Services Directive (AVMSD¹) has paved the way towards a single European market for audiovisual media services. It has harmonised the audiovisual rules of the Member States and facilitated the provision of audiovisual media services across the EU on the basis of the country of origin principle.

Since its adoption in 2007, the audiovisual media landscape has changed significantly due to media convergence². The review of the AVMSD is featured in the Commission Work Programme for 2015, as part of the Regulatory Fitness and Performance Programme (REFIT). In its Communication on a Digital Single Market Strategy for Europe³, the Commission announced that the AVMSD would be revised in 2016. Another REFIT exercise is being carried out, in parallel, in the field of telecoms with a view to come forward with proposals in 2016. Some of the issues treated in the current public consultation may have an impact on this parallel exercise and vice versa.

In 2013, the Commission adopted a Green Paper "Preparing for a Fully Converged Audiovisual World: Growth, Creation and Values"⁴ inviting stakeholders to share their views on the changing media landscape and its implications for the AVMSD.

On the basis of the outcome of this public consultation, the Commission has identified the following issues to be considered in the evaluation and review of the AVMSD:
1. Ensuring a level playing field for audiovisual media services;
2. Providing for an optimal level of consumer protection;
3. User protection and prohibition of hate speech and discrimination;
4. Promoting European audiovisual content;
5. Strengthening the single market;
6. Strengthening media freedom and pluralism, access to information and accessibility to content for people with disabilities.

Questions

1. Ensuring a level playing field

Services to which the AVMSD applies

The AVMSD regulates television broadcasts and on-demand services. It applies to programmes that are TV-like⁵ and for which providers have editorial responsibility⁶. The AVMSD does not apply to content hosted by online video-sharing platforms and intermediaries.

These platforms and intermediaries are regulated primarily by the e-Commerce Directive⁷, which exempts them from liability for the content they transmit, store or host, under certain conditions.

As a separate exercise, given the increasingly central role that online platforms and intermediaries (e.g. search engines, social media, e-commerce platforms, app stores, price comparison websites) play in the economy and society, the Commission Communication "A Digital Single Market Strategy for Europe" announces a comprehensive assessment of the role of platforms and of online intermediaries to be launched at the end of 2015.

SET OF QUESTIONS 1.1

Are the provisions on the services to which the Directive applies (television broadcasting and on-demand services) still relevant⁸, effective⁹ and fair¹⁰?

ETNO response: From a general viewpoint, ETNO considers of paramount importance that the EU elaborates and enacts in due course a comprehensive, coherent and consistent new regulatory framework for the Digital Single Market in order to ensure consistent protection standards for consumers and to foster the competitive position of European operators and providers all along the digital economy value chain. Such a new framework for the digital market should be aimed at enhancing the competitiveness of the European industry, at fostering investments and innovation, and at improving the benefits of a sovereign and genuine EU approach for consumers, the creative media and ICT sectors as well as for society at large.
Having this in mind, the framework for audiovisual services needs to (i) harvest the existing potential for deregulation, (ii) strive to become as effective as possible, (iii) seize the opportunity to ensure fair conditions for all who are active in the Internal Market, and (iv) successfully address the challenges and chances offered by new business models, new technologies and functionalities and new ways according to which services and content are offered and consumed, particularly in an on-demand and increasingly mobile environment. To this end, reflections on the future of rules relating to audiovisual services should both form an integral part of, and be properly integrated into, the abovementioned overall approach for the digital market.
In addition, it has to be stressed that if we want the European audiovisual market to develop soundly, particularly vis-à-vis the US market, a wider availability of legal European content should be provided for legal distribution to European online players at legally-sound, fair and proportionate conditions and on the basis of commercial negotiations reflecting the actual demand of consumers for attractive content. A specific and significant effort in this direction should be promoted by the Commission and Member States as a pre-condition of any further initiative at EU level.
More specifically on the definition of audiovisual media services given by the Directive, in the current digital market most of the services provided can be considered as TV-like, i.e. as competitive services of the traditional broadcasting services. Accordingly, they fall within the scope of the Directive. By contrast, other services present different features that need to be evaluated under the Directive’s criteria. In parallel, many new players and services have emerged – and continue to emerge – in the digital audiovisual market. However, ETNO believes that, in the context of this REFIT exercise, there are no elements to provide a different definition of what is an audiovisual media service, beyond the one already provided for in the AVMS Directive.
Policy-makers should, at this stage, rather assess whether the application of obligations imposed on different players is still justified. In doing so, one should consider the emergence of a number of services that are found to be functionally substitutable and have a significant impact on society. In this context, policy-makers should realize that in certain circumstances obligations are no longer justified (by way of example in the commercial communications field), do not need to be formulated in a sector-specific manner, or are properly complemented by self-regulatory initiatives (such as in the minor protection case).
Going beyond the context of this exercise, from a more general perspective, we agree with the Commission on the need to carry on a comprehensive, in-depth assessment on the role of platforms and intermediaries, which is taking place in parallel to the present exercise on the AVMS Directive.

Are you aware of issues (e.g. related to consumer protection or competitive disadvantage) due to the fact that certain audiovisual services are not regulated by the AVMSD?

ETNO response: ETNO believes that a review of the consumer protection rules, which are currently under the Commission’s scrutiny, is urgently required to ensure the modernisation and simplification of consumers rules for all digital products and services, in order to establish a sound level of consumer trust and protection and a level playing field amongst all players along the value chain of the digital economy.

Preferred policy option: Maintaining the status quo

PLEASE EXPLAIN YOUR CHOICE: In ETNO’s view, maintaining the status quo is the best option. Concerning the policy options proposed and specifically on the possibility to amend other laws such as the eCommerce Directive, ETNO reiterates that the scope of the two Directives is clearly defined by their respective provisions. Moreover, as of today, the increased convergence among services has not tested the relationship between their provisions, which, if correctly interpreted and applied, do not imply any overlap or confusion. In particular, the rules on intermediaries’ liability provided for in the eCommerce Directive still prove their effectiveness and strike the right balance amongst the different interests at stake, also thanks to subsequent important interpretations from the European Courts. Therefore, these rules are to be maintained, if we want to effectively promote innovation in European digital networks and services.

Geographical scope of AVMSD

The AVMSD applies to operators established in the EU. Operators established outside the EU but targeting EU audiences with their audiovisual media services (via, for instance, terrestrial broadcasting satellite broadcasting the Internet or other means) do not fall under the scope of the Directive¹¹.

SET OF QUESTIONS 1.2

Are the provisions on the geographical scope of the Directive still relevant, effective and fair?

ETNO response: ETNO considers of particular importance that a geographical level playing field is established also in the audiovisual services market. The Commission should seize any occasion to re-balance the strength of the EU industry and to re-establish its competitiveness in the global context.

This issue is of utmost importance. Today, platforms established outside the EU provide competing services within the European market without being subjected to European rules that are, by contrast, applied to their EU competitors. Therefore, ETNO believes that the geographical levelling of rules would allow to cover every company targeting European markets.

An increased harmonisation of rules (in particular, of those rules that are still justified within the current audiovisual market structure and dynamics) should be provided for. As a matter of fact, the existence of different implementing rules at national level have allowed competing players to implement practices of forum shopping, i.e. to establish their headquarters in the country where regulatory provisions are more favourable to their business activities (including from the fiscal point of view). Guaranteeing a better harmonisation of relevant rules would help solving the existing competitive concerns of EU companies. A full harmonisation effort should therefore be considered at EU level.

Are you aware of issues (e.g. related to consumer protection problems or competitive disadvantage) caused by the current geographical scope of application of the AVMSD?

ETNO response: Please refer to answer n. 1.2 above.

Preferred policy option: As already mentioned, ETNO believes that the Commission should seize any occasion to re-balance the strength of the EU industry and to re-establish its competitiveness at global level. The need of a level playing field in the global market is a top issue also in the framework of the TTIP negotiations, where the existence of different legislative and regulatory regimes is to be addressed also on a more general scale.

2. Providing for an optimal level of consumer protection

The AVMSD is based on a so-called "graduated regulatory approach". The AVMSD acknowledges that a core set of societal values should apply to all audiovisual media services, but sets out lighter regulatory requirements for on-demand services as compared to linear services. The reason is that for on-demand services the users have a more active, "lean-forward" approach and can decide on the content and the time of viewing.

In the area of commercial communications¹², the AVMSD sets out certain rules, which apply to all audiovisual media services and regulate, for example, the use of sponsorship and product placement. They also set limits to commercial communications for alcohol and tobacco.

It also lays down other rules that apply only to television broadcasting services and regulate advertising from a quantitative point of view. For example, they set a maximum of 12 minutes of advertising per hour on television, define how often TV films, cinematographic works and news programmes can be interrupted by advertisements and set the minimum duration of teleshopping windows.

SET OF QUESTIONS 2.1

Are the current rules on commercial communications still relevant, effective and fair?

ETNO response: Currently, the regulatory regime for commercial communications differs between linear and non-linear services. The provision of a more stringent regime for linear services may be still justified today by the difference in terms of choice and user control, even though convergent media usage has made these differences less important, in particular in the case of certain services. In any case, it is crucial not to impose rules that would prevent the development of new business models that could meet the interests of the viewers. This means that not all rules might be still relevant and that more flexibility should be granted in assessing whether these provisions are still needed in the current market context.

Are you aware of issues (e.g. related to consumer protection or competitive disadvantage) caused by the AVMSD's rules governing commercial communications?

Preferred policy option: Rendering the rules on commercial communications more flexible, notably those setting quantitative limits on advertising and on the number of interruptions.

PLEASE EXPLAIN YOUR CHOICE: To correctly address all the challenges raised within the digital market (including the level playing field-related concerns), the European regulation process could be lengthy; therefore, in a very rapidly changing environment, it runs the risk of being outdated soon after adoption. As a consequence, ETNO believes that any regulation in this area should focus on high level principles, guarantee more flexibility and consider (and leave room to) self-regulatory approaches.

(...)

Please find the full questionnaire here.

1 Directive 2010/13/EU of the European Parliament and of the Council of 10 March 2010 on the coordination of certain provisions laid down by law, regulation or administrative action in Member States concerning the provision of audiovisual media services. Hereinafter, "the AVMSD" or "the Directive".

2 https://ec.europa.eu/digital-agenda/en/media-convergence

3 Communication from the Commission to the European Parliament, the Council, the European Economic and Social Committee and the Committee of Regions, a Digital Single Market Strategy for Europe, COM (2015) 192 final, 6 May 2015.

4 Hereinafter, "The Green Paper" (https://ec.europa.eu/digital-agenda/node/51287#green-paper---preparing-for-a-fully-converged-audi)

5 Recital 24 of the AVMSD: "It is characteristic of on-demand audiovisual media services that they are ‘television-like’, i.e. that they compete for the same audience as television broadcasts, and the nature and the means of access to the service would lead the user reasonably to expect regulatory protection within the scope of this Directive. In the light of this and in order to prevent disparities as regards free movement and competition, the concept of ‘programme’ should be interpreted in a dynamic way taking into account developments in television broadcasting."

6 Article 1(1)(a) of the AVMSD. The Audiovisual Media Services Directive applies only to services that qualify as audiovisual media services as defined in Article 1(1)(a). An audiovisual media service is "a service […] which is under the editorial responsibility of a media service provider and the principal purpose of which is the provision of programmes, in order to inform, entertain or educate, to the general public by electronic communications networks within the meaning of point (a) of Article 2 of Directive 2002/21/EC". This definition covers primarily television broadcasts and on-demand audiovisual media services.

7 Directive 2000/31/EC of the European Parliament and of the Council of 8 June 2000 on certain legal aspects of information society services, in particular electronic commerce, in the Internal Market ('Directive on electronic commerce')

8 Relevance looks at the relationship between the needs and problems in society and the objectives of the intervention.

9 Effectiveness analysis considers how successful EU action has been in achieving or progressing towards its objectives.

10 How fairly are the different effects distributed across the different stakeholders?

11 Article 2(1) AVMSD – "Each Member State shall ensure that all audiovisual media services transmitted by media service providers under its jurisdiction comply with the rules of the system of law applicable to audiovisual media services intended for the public in that Member State." (emphasis added)

12 "Audiovisual commercial communication" is a broader concept than advertising and it refers to images with or without sound which are designed to promote, directly or indirectly, the goods, services or image of a natural or legal entity pursuing an economic activity. Such images accompany or are included in a programme in return for payment or for similar consideration or for self-promotional purposes. Forms of audiovisual commercial communication include, inter alia, television advertising, sponsorship, teleshopping and product placement. See Article 1(1)(h) AVMSD.

Please find the full questionnaire here.