(CN) - TV networks with exclusive licenses to broadcast special events cannot gouge other networks for using clips of more newsworthy events, an adviser to the European Union's high court said.
The case arose after the Austrian division of Sky Broadcasting acquired the exclusive rights to broadcast Europa League soccer matches in 2009.
Austria's media regulators ordered Sky to let the Osterreichischer Rundfunk, a national public broadcaster, play short clips of games involving Austrian teams in news reports. The decision said Sky could charge only for the costs of access to the satellite signal, but Sky balked because such access was free.
The company appealed the decision to Austria's federal communications tribunal, saying that it was unfair to give another broadcaster free access after it paid millions of dollars for exclusive rights.
EU's high court took up the tribunal's question on EU audiovisual media regulations.
Advocate General Yves Bot explained Tuesday that European law allows for the freedom to conduct business and own property, but said the law must strike a fair balance between business and the freedom to receive information and media pluralism.
"It is clear from the case-law of the court that the right to property, like the right freely to exercise an economic activity, is one of the general principles of law of the Union," Bot wrote. "However, those principles are not absolute but must be viewed in relation to their social function."
"Consequently, restrictions may be imposed on use of the right to property, and the right to freely pursue an economic activity, provided that those restrictions correspond to objectives of general interest pursued by the Union and do not constitute, with regard to the objective pursued, a disproportionate and intolerable interference affecting the very substance of the rights thus guaranteed," he added.
Bot reminded Sky that the EU law in question requires license holders to let other broadcasters freely choose clips for news reporting, either by providing them with a signal or allowing them access to the event.
"It is clear that such a constraint on television broadcasters who hold exclusive rights of transmission has the effect of limiting the manner in which they might wish to exploit such rights," Bot wrote.
Limiting how much license holders can charge other broadcasters infringes on business rights, but the restriction is justified to facilitate the freedom of information, the adviser found.
"By framing one of the ways in which the right to short extracts may be exercised, namely the compensation payable to the primary broadcaster, [the law] pursues the ... the freedom to receive information and media pluralism," Bot wrote. "These objectives are themselves closely related to one of the more general objectives of the directive, which ... is to facilitate the emergence of a single European information space."
Compensation limits put all television broadcasters on an equal footing, he added.
"To leave determination of the amount of compensation to free negotiation between the primary and secondary broadcasters would have the disadvantage of putting the holders of exclusive rights in a position of strength, especially when the event in question is of particular importance," the decision states. "In addition, in the light of the increased prices they have to pay to acquire exclusive transmission rights, there is a risk that the price charged to secondary broadcasters who wish to produce short news reports may reach such proportions as to deter them from exercising that right. This could be detrimental to the objective of informing as many persons as possible about events of high public interest. In addition, the exclusion of television broadcasters from coverage of such events would have a negative effect on the pluralism of information, because it would limit the collection and dissemination of information to the largest organizations, to the detriment of their smaller competitors and viewers."
The also protects license holders by limiting how many broadcasters can use clips, Bot found.
Use of licensed programming is limited to short news reports of "events of high interest to the public," and such rights are limited to news agencies, which must identify the licensee as the source onscreen, according to the opinion.
Bot refused to heed decisions by two Austrian courts that said Sky deserved proper compensation for news clips.
"I would recall that fundamental rights within the Union must be protected within the framework of its structure and objectives," he wrote. "It follows that the weighing of the different fundamental rights at stake does not necessarily call for the same response at national or EU level. In the present case ... the requirements relating to the completion of the internal market and to the emergence of a single information area militated in favor of the adoption by the EU legislature of a compromise between the granting of a free right to short extracts and the financial participation by secondary broadcasters to the costs of acquisition of exclusive transmission rights."
The Court of Justice in Luxembourg will take Bot's nonbinding opinion under advisement when it renders a judgment on the case at a later date.
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