EC Investigates Channel 4 Switchover Grant
The European Commission has opened an investigation into a planned government grant worth £14 million, intended to help Channel 4 complete the switch to digital TV.
A report on MediaGuardian.co.uk says that Channel 4’s subsidy will be investigated by the commission to see whether it breaches European Union rules on state aid and would distort competition.
In October, UK authorities told the commission that they planned to give the broadcaster £14 million to aid the switchover process, which is due to be completed by 2012 (see NewsLine).
MediaGuardian.co.uk quotes the commission as saying it had “serious doubts” as to whether the grant would meet the terms of its 2001 Broadcasting Communication, “that the aid is necessary and proportional and does not overcompensate Channel 4”.
“In particular, the information provided so far by the UK does not enable the commission to assess whether, given the costs of its digital switchover obligations, and taking into account its commercial revenues, C4 will have in the short term a net public service cost which would allow it to receive state aid,” the commission added.
A Channel 4 spokesman said: “This is a step we always recognised the commission might decide to include in the process.
“As their statement makes clear, this is a specific proposal to examine the government’s plan to fund Channel 4’s switchover costs and they do not oppose state funding for broadcasters in principle.”
Channel Four: 020 7396 4444 www.channel4.com