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CJEU Debates Limits on TV Advertising in Europe

In its decision in Sanoma Media v Viestintävirasto the Court of Justice of the European Union signals a technical but potentially significant clarification in the application of the Audio Visual Media Services (AVMS) Directive.

This may trigger some national regulators to re-examine their approach and some broadcasters may, in turn, face pressure to adjust the amount of advertising content within their schedules or their presentation of that content.

The Directive, currently subject to possible review as part of the Digital Single Market initiative, is the foundation of much of the regulation of broadcast services across the EU. It includes provisions which set an EU wide maximum on the advertising content within commercial TV services. In essence, those rules require that:

  • advertising content must not exceed 20% of any individual hour
  • advertising and “editorial” content must be “kept quite distinct”.

However, the rules do recognize that broadcast sponsorship which is permitted by the local application of the AVMS regime is not to be counted in calculating the advertising content contributing to the 20% threshold.

The case arose from a challenge by Sanoma to decisions of the Finnish media regulator regarding the application of the minutage principles to Sanoma’s services in Finland.

The CJEU reached three potentially significant conclusions. Whilst these should be read in the context of the Sanoma case itself, they highlight potentially wider principles.

Firstly, the split screen which Sanoma used to show closing credits for a programme and to give details of future schedules was, in principle, capable of acting as separation between the programme and a subsequent advertising break. However, it is important to note that the Court expressly reiterated that, for this to be the case, the split screen segment must achieve the requirement that the advertising is “recognisable and distinguishable” from the editorial content. In addition, it is open to national regulators to impose more restrictive rules.

Secondly, “blank screen” moments (which Sanoma inserted between advertising spots within an advertising break and between an advertising break and the programme that follows) were to be treated as advertising for the purposes of the 20% figure. If the approach of the CJEU were taken to its limit it could be viewed as pointing in the direction of an approach under which the EU wide advertising threshold would be treated as a requirement that the proportion of “true” editorial content at 80% of each hour; whilst “true” advertising when aggregated with separation segments required by the Directive (possibly excluding a single segment which would naturally separate programming evening in the absence of advertising) must not exceed 20%.

Thirdly, whilst “sponsorship credits” within a programme segment (e.g. in the opening credits) which reference a sponsorship deal for that programme will not count toward the 20% advertising threshold, where references are made elsewhere to that sponsorship (e.g. in announcements or “trailers” for the sponsored programme) the CJEU took the view that they are to be treated as advertising counting toward the 20% cap.