Public funds for commercial broadcasters in limbo over EU state aid concerns
Coimisiún na Meán
was to distribute the funds, which were to be split between
Virgin Media Television
, Ireland's only commercial television broadcaster, and the commercial radio stations operating in the State, this year.
However, officials at the Department of Culture, Communications and Sport told Minister Patrick O'Donovan in March that there were 'some state aid issues arising' that the department is 'seeking to resolve'.
The remarks are contained in the minutes of a meeting between the Fine Gael TD and representatives from Virgin Media Television on March 6th. The document was released to The Irish Times as part of a freedom of information request.
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In a briefing note prepared for the minister in advance of the meeting, officials separately raised concerns about the application of state aid rules to disbursements from the Government's planned media fund.
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Virgin Media received 'nothing' after requesting €30m from State
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The fund, which will replace the existing Broadcasting Fund, is a component of the Broadcasting Amendment Bill, which is currently at the committee stage in the Dáil. Through various Coimisiún na Meán initiatives, the new scheme will provide funding to all media outlets regardless of platform, to support the production, distribution and archiving of public service media output.
Officials told the minister that once the new fund is created, Coimisiún na Meán will still be required to get 'clearance or exemption' from EU state aid rules to distribute the money. This is 'challenging', the minister was told.
In response to questions this week, a spokeswoman for the department said all Coimisiún na Meán schemes are designed to comply with the state aid exemption framework.
Under the EU rules, funds can only be used to 'incentivise new activity' while the 'subsidisation of existing costs or activities' is prohibited, the spokeswoman said.
This condition will also be attached to disbursements from the converted media fund to be established by the Broadcasting Bill and was criticised as being too restrictive by Virgin Media Television managing director Áine Ní Chaoindealbháin in an Oireachtas committee last month.
Concerning the €6 million due to be distributed to commercial broadcasters this year, the spokeswoman for the department said the matter 'remains under consideration', and 'it is the intention that funds will be disbursed by Coimisiún na Meán before year end'.
In a letter to Mr O'Donovan in late March, Tony Hanway, chief executive of Virgin Media Ireland, reiterated the company's request for €30 million to fund its public service broadcasting.
The commercial broadcaster has argued it is entitled to the funds to ensure it can compete with RTÉ, given that the State broadcaster receives €200 million in annual Government funding, along with 'annual multimillion-euro taxpayer-funded top-ups', as Ms Ní Chaoindealbháin told the Oireachtas committee in June.
The former Sky News and UTV Ireland executive said at the time that Virgin Media Television had received 'nothing' from the Government despite its requests against a backdrop of rising costs.
Ms Ní Chaoindealbháin said that the broadcaster had been forced to make 'some difficult decisions' last year, including cutting the Tonight Show from four to two nights a week, due to 'the commercial situation that we were in'.
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