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A Change of Scenery in the Greek Media Industry – The Ambitious Plan of the Government to Restore the Sector’s Integrity

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Following six months of slow-track negotiations between Greece and its international creditors, an agreement between the parties on a new bailout program has now reached the finish line. In witness of the agreement, Greece’s government submitted at the negotiating table a list of overhauls and policy commitments to be implemented in consultation with the EC, ECB, and IMF, including, inter alia, major reforms in the current broadcast licensing procedure.

In an attempt to speed up and secure the direct applicability of the new regulatory framework in the media industry, the Minister of State announced the submission of a bill on broadcast licenses and the introduction of an international public tender procedure for the acquisition of television licenses in return for a fee for the acquisition and use of the relevant frequencies; the bill is currently placed under public consultation until late August. 

The Greek government actually proposes to topple a well-established 25-year practice in the sector and restore legality in the operation of TV channels, which have been broadcasting since their launch, back in the 90s, under the regime of “provisional licenses” and within a poor legislative framework and licensing process. With respect to requests for tenders (RFTs), although a law enacted in 2007 explicitly provided for the acquisition of television licenses through tenders, all tenders offered over the last eight years for national and regional broadcasts as well as terrestrial pay-tv services have either been frozen or were never implemented, confirming the quasi-legal state of operation in the Greek media industry.

The new regulatory framework sets stricter evaluation criteria and higher standards on the licensing procedure and the operation of digital television channels, providing for a transparent two-stage procurement and tendering process (shortlisting and RFT). The supervisory body of tendering will be the Greek National Council for Radio and Television (NCRTV), an independent administrative authority that supervises and regulates the radio and television market. Potential bidders must comply with minimum capital requirements, origin of wealth, tax record, and shareholding structure standards, and they must ensure integrity on the technical and program content side. 

In addition to regulating the licensing process, the Greek government eyes to restructure, through the enactment of the bill, the activities of the Hellenic Telecommunications and Post Commission (the national regulatory authority for the telecommunications and postal services market), ensuring its transparent and smooth operation and tackling long-standing monopoly policies in the Greek digital frequency management sector. To this end, the new legislative framework provides for the establishment of a subsidiary of ERT S.A. (the Hellenic Broadcasting Corporation public broadcaster), which will operate as a service telecommunications provider, securing a high-quality national network infrastructure, full digital coverage, and equal and fair network access terms within Greece. The presence of a new network provider will break up the current monopoly of DIGEA, which is, at the moment, the only carrier of Greek digital channels and sole participant in tenders for the acquisition of licenses with respect to terrestrial digital broadcasts. 

Although the Greek Government states that the new licensing scenery will boost full-time employment and secure low unemployment rates in the media market, television station owners have reacted to the implementation of the new regulations, arguing that the number of licenses to be issued and granted under the new regime will be reduced and current television stations will need to undergo the competition process anew, instead of being assessed through the implementation of a point system for existing television stations. In this respect, they threaten not to participate in the new licensing process, claiming that it imposes unreasonable financial demands against their business interests, leading the government to consider revoking their operating licenses.

The extent to which the government’s bill on broadcast licensing and tendering will end up as an antitrust policy safeguarding consolidation and stability in the sector or will, instead, serve unannounced plans of the government to ultimately gain complete control of the television landscape will be seen in the days following its enactment. Until then, it remains a bone of contention, triggering endless debates between the State and television owners and major shareholders.

By Panagiotis Drakopoulos, Partner, and Mariliza Kyparissi, Senior Associate, Drakopoulos

This Article was originally published in Issue 2.4. of the CEE Legal Matters Magazine. If you would like to receive a hard copy of the magazine, you can subscribe here.