European Commission: Funding for public television in Portugal is not state aid

IRIS 1996-10:1/9

Ad van Loon

European Audiovisual Observatory

The government funds received by the Portuguese public television station RTP ( Radiotelevisao Portuguesa ), and particularly the compensatory payments - averaging some 35 million Ecus a year from 1992 to 1995 - associated with its public service function, do not constitute state aid.

This is the European Commission's conclusion, after careful consideration of a complaint submitted by a private station in Portugal.

Essentially, the Commission takes the view that compensation to cover certain services which RTP is required to provide, and private channels are not, cannot be regarded as state aid. Thus, RTP is required:

- to cover the entire national territory

- to cover the autonomous regions of Madeira and the Azores

- to keep audio-visual archives

- to co-operate with countries where Portuguese is the official language

- to carry religious programmes

- to operate an international channel

- to fund a public theatre

- to keep representatives and correspondents in various regions which the private channels do not cover. State funding of these activities cannot be regarded as state aid, since it is not an ex gratia privilege, but a payment made for something definite - the non-competitive services listed above, which RTP is required to provide. Close auditing procedures are used to ensure that funding does not exceed the cost of these activities. RTP is required to include the exact cost of each in its annual budget. Funding is granted on the basis of these estimates, and vouchers must be submitted before the State pays.

The total funds provided in this way by the State amount to 15%-18% of RTP's annual budget. Apart from the obligations detailed above, the State imposes certain programme requirements (cultural, educational content, etc.) on the two public channels. Because of these constraints, their share of the audience (+/- 38%) is considerably less than that of their main private competitor, SIC, whose programming is dictated by commercial considerations.