Brexit and broadcasting

What does Brexit mean for international broadcasters in the UK?

As Brexit approaches, it becomes highly urgent for international TV channels operating under a UK license to make up their mind: stay in the UK or apply for a broadcasting license in one of the “remaining” EU countries. The so-called country of origin principle of the Audiovisual Media Services Directive of the EU means that a broadcaster needs a single license in one EU country to be allowed to broadcast in the entire EU. After Brexit – especially in a no-deal scenario – a TV channel with only a UK license will result in a black screen throughout the EU. This could potentially affect a large number of international commercial broadcasters now based in the UK.

Large multinational players including Discovery and Viacom have already applied for Dutch broadcasting licenses for their pan-European channels. Netflix moved its European headquarters to Amsterdam. Even the BBC chose the Netherlands as the basis for its commercial channels BBC Entertainment, BBC Brit and BBC Earth in many different languages. BBC Worldwide Holdings BV, a Dutch private limited liability company, was already established in Amsterdam in 2005 and is managed by a trust company. Apparently, it now also serves as a broadcast license holder for the BBC in the EU.

BBC Worldwide is on standby

On 9 April 2019 the Dutch Media Authority (“DMA”) granted BBC Worldwide Holdings BV a Dutch broadcast license for 33 of BBC’s commercial TV channels for a period of 5 years. When Brexit was postponed later that month, BBC Worldwide Holdings BV requested the DMA to postpone these licenses until Brexit has become final.

On 25 June 2019 the DMA established that the UK license with the British regulator Ofcom had not been withdrawn yet, which is a ground for rejection of the application in order to avoid “dual licensing” for the 33 BBC channels. However, the DMA accepted the requested postponement of the Dutch broadcast licenses and conditionally granted licenses to the 33 BBC channels, subject to the conditions that (i) the UK has left the EU no later than December 31, 2019 and (ii) BBC Worldwide Holdings BV has requested Ofcom to cancel the UK broadcast licenses within 48 hours after Brexit.

Why go to the Netherlands?

The Netherlands Foreign Investment Agency, set up by the Ministry of Economic Affairs, mentions the successful Dutch TV industry as a reason to settle here, in addition to a flourishing creative industry (with an annual net worth of $ 12.8 billion), excellent connections (physical and online) and an internationally oriented media authority (with currently 114 European broadcasting licenses).

The Dutch Media Act 2008, which applies to all broadcasters operating under a Dutch license, provides a clear set of rules for TV programs in accordance with the EU media directive. The revised Audiovisual Media Services Directive, adopted in November 2018, “creates a media framework for the 21st century”. This includes a strengthened country of origin principle, better protection of minors and against hate speech, regulation of video sharing platforms and more flexibility in the rules on advertising. These new rules will have to be implemented in a new Media Act in the Netherlands.

How to apply?

If the applicant provides all the requested information and there is no reason to suspect that the broadcaster will not comply with the Dutch Media Act, the DMA will grant the 5 year broadcast license upon request.

For an international broadcaster operating out of the Netherlands there may be one hurdle to take. In order to stimulate the Dutch and Frisian language, section 3.24 of the Dutch Media Act 2008 contains the provision that 40% of the programs of a channel operating under a Dutch license need to be original Dutch or Frisian productions. However, upon request, the DMA can make an exception to this rule, based on the nature of the TV channel, the target group and the territorial reach of the channel. A recent example was a decision of the DMA of 24 July 2019 that Viacom was released of this obligation for three foreign language versions of a Nickelodeon channel.

And action!

At this point it is not clear how many international broadcasters are still operating only under a UK license and are aimed at the entire EU. Unless they are willing to accept to lose all EU viewers outside the UK after Brexit, it is now time for immediate action and apply for a EU license asap (and why not in the Netherlands?).

 

Amsterdam, 16 September 2019

© Marc de Boer, Boekx Advocaten

Marc de Boer
Author: Marc de Boer
Marc is a very experienced media and IP lawyer. Since many years he is legal advisor to a large number of very prominent companies and individuals in the media and entertainment world.

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