PART V: LEARNING TO DEAL WITH DEMANDS FOR PARTICIPATION
V. BROADCASTING LIBERALIZATION
the German Regulatory Authority,March 2001). Successive Commission implementation reports charted steady progress toward competitive markets.
The Commission’s eighth such report stated that‘‘after four and a half years of liberalization of telecoms services,the regulation put in place at national level [was] very substantially compliant with the EU framework. Licensing and interconnection regimes ha[d] permitted large-scale market entry. . .’’
(Commission of the European Communities,2002,p. 6). The regular imple- mentation reports,produced by a special unit in DG XIII,had themselves served as a mechanism of policy transfer,in that they subtly‘‘named and shamed’’poor performers and transferred knowledge about the best regula- tory practice (Humphreys,2002,p. 72).
verging with telecoms,was viewed as strategic for Europe’s competitiveness in the global information society (Humphreys,1996,pp. 293–294).
The‘‘Europeanization’’of broadcasting policy occurred through a mix of coercive and negotiated policy transfer. As in telecoms,the ECJ actually opened up the way for the Commission to draft its broadcasting policy. The key European court rulings were the 1974 Sacchi and the 1980 Debauve rulings,which defined broadcasting as a tradable service subject to the EC treaties and specified the illegality of discrimination against broadcasting services from other member states (Humphreys,1996,p. 262). The commis- sion explicitly referred to these key ECJ rulings in its 1984 Green Paper as confirming the treaty-based legal basis for its involvement in a sector on the grounds of free economic competition freedom (culture not being an EU competence until the 1992 Maastricht Treaty). Subsequently,there followed a long period of intergovernmental negotiation leading in 1989 to the enactment in the Council of Ministers of the market-liberalizing EU Televi- sion Without Frontiers (TWF) Directive (Council of the European Commu- nities,1989).4TWF opened up the European TV market by mandating the free reception and establishment of broadcasting services from other member states subject to the observation of fairly liberal minimum content and advertising regulations that were harmonized at the EU level by the directive.
Adopted by qualified majority,against the votes of Belgium and Denmark and conditionally supported by France,the TWF Directive had involved intense intergovernmental negotiation,mainly over the details about the rules governing television advertising but also over cultural protectionism. Al- though the TWF Directive was mostly deregulatory,aimed at an industry- friendly and commerce-friendly market liberalization,it provided one element of significant ‘‘upward’’ regulation,namely the introduction,at France’s insistence,of protectionist measures to reduce the cultural and economic impact of U.S. audiovisual imports. The introduction of a majority‘‘made- in-Europe’’ program quota and also a quota to promote the European independent production sector by the TWF Directive was a very clear case of policy transfer via the EU of a key element of the protectionist French cultural policy model to other member states. The French also pushed the EU to protect l’exception culturellein the GATT/WTO General Agreement in Trade in Services (GATS) negotiations on the treatment of audiovisual services,defending the Europeans’ right to apply protectionist program quotas and to subsidize audiovisual production through national and EU TV audiovisual support funds (Humphreys,1996,pp. 272–284). The result was formally a stalemate between Europe and the United States. Strictly speaking,a ‘‘cultural exception’’ was not established,but the Europeans nonetheless successfully defended their policies,albeit provisionally,against the far-reaching kind of liberalization sought by the Unites States; in 2003,
the EU has once again indicated that it is not prepared to negotiate further audiovisual liberalization through GATS.
The main effect of the EU’s TWF Directive,however,was to reinforce the liberalization pressure that globalization,technological change,and regulatory competition were already exerting,through transferring liberal- ization to those (mainly smaller) member states with weaker media industries, which were still reluctant to rush down the liberalization route. Since the first enactment of the TWF Directive (in 1989) in a number of clear-cut cases,the European Court of Justice has obligated the policy transfer on member states whose laws interpreted the directive in too lax a manner. Thus,the court ruled in 1989 that The Netherlands was not entitled to impose its own strict advertising rules on foreign advertising-based services (Humphreys,1996, p. 278). Moreover,the court deemed incompatible with community law the requirement that foreign companies granted air time on the national broad- casting network should purchase Dutch programming (Harcourt,2000,p.
102). Again,in 1992,the court ruled against Belgium for retaining a number of protectionist measures that breached the TWF Directive’s requirements, including a provision that had required the new commercial broadcaster in Flanders to be majority-owned by the Flemish press (Harcourt,2000,p. 103).
These rulings against culturally protectionist policies of small countries with relatively weak indigenous media industries clearly supported TWF’s dereg- ulatory thrust.
Rather than providing a real shield against globalization,TWF argu- ably stimulated (de)regulatory competition pressure within Europe (Har- court,2002). Alongside Luxembourg,whose comparative lack of media regulation was clearly attractive to international media investors (such as the investors in the SES-Astra satellite company,and its customers),the UK set the pace through the Thatcher Government’s creation of a lightly regulated category of‘‘nondomestic satellite licensee.’’As Levy (1999,pp.
34–35) has explained,companies‘‘could obtain a nondomestic licence from the ITC [Independent Television Commission] more or less on demand.’’
Thereby,BSkyB,although it was based in the UK,could be deemed to escape the country’s strict domestic cross-media ownership rules by virtue of not using UK-allocated satellite frequencies (BSkyB used a Luxembourg-based SES-Astra satellite). As Levy notes,the UK became an attractive location as this state of affairs was‘‘quickly seized on by other TV stations keen to beam their signals into neighboring EU territories while escaping the tighter regulatory regime that was often applied to them in those states.’’5However, in response to complaints from other countries,the Commission took the UK to the ECJ in 1994,challenging this UK interpretation of what TWF actually allowed. As Harcourt (2000,pp. 105–106) explains,essentially,the commis- sion objected to the UK’s claiming of control over nondomestic broadcasters,
which amounted to a failure to embrace the principle of mutual recognition that underpinned the European single market created by TWF. The ECJ accepted the commission’s case. Subsequently,the 1997 revision of the TWF Directive clarified that a member state only had jurisdiction over broadcasters when they had their headquarters in that member state and the editorial decisions about their schedules were taken in that member state (Harcourt, 2000,pp. 105–106). The UK duly abolished its previous distinction between
‘‘domestic’’ and ‘‘nondomestic’’ satellite broadcasters,retaining the light touch regulatory regime for all satellite broadcasters (Gibbons,1998,p. 140).
Nonetheless,this latter Commission and ECJ intervention could be seen as an attempt to‘‘upwardly’’regulate against an activity that some saw as an unfair gambit of (de)regulatory competition.