On 12 June 2012, Advocate-General Yves Bot rendered his Opinion in the case of Sky Österreich GmbH v Österreichischer Rundfunk, which concerned the limitation of compensation between TV broadcasters for the use of short extracts of exclusive sports content such as football matches.
At the heart of the dispute was Sky Austria's exclusive acquisition of the rights to broadcast within Austria certain Europa League football matches for the 2009-2010 and 2011-2012 seasons. To obtain these exclusive rights, Sky Austria paid license and production costs reaching several million euros.
Under the provisions of the EU's Audiovisual Media Services Directive ("AVSD"), TV broadcasters are effectively allowed to acquire exclusive rights to such major sporting events provided that they allow other broadcasters in the EU (including competitors) to use short extracts thereof for the purposes of their own news reports. To that effect, exclusive content broadcasters must grant other broadcasters access to their signal. A compensation for that use may also be possible under Article 15(6) of the AVSD if it does not exceed the additional costs directly incurred as a result of the granting of that access.
In the present case, the ORF (the Austrian public broadcaster) had requested from the Austrian regulatory authority for communications, KommAustria, the right to transmit short extracts of competitor Sky Austria's Europa League games for its news reports. In December 2010, KommAustria decided that Sky Austria should indeed grant ORF the right to transmit short extracts of the games in question. On the facts, ORF was not required to pay any compensation to Sky Austria as the costs for access to the satellite signal equalled zero.
Sky Austria was of the view that the systematic prohibition of the payment of compensation to exclusive rights holders for short extracts was unfair and was putting them at a disadvantage. The dispute was brought before the "Bundeskommunikationssenat" (the Federal Communications Tribunal) which subsequently raised a preliminary question with the Court of Justice of the European Union (the "ECJ") on the compliance of the Directive with fundamental rights. In particular, the issue was whether the limits to compensation were justified in the light of the freedom to conduct a business and the right of property under the EU Charter of Fundamental Rights (the "EUCFR") and the European Convention on Human Rights (the "ECHR").
In his Opinion, AG Bot recognised that the freedom to conduct a business and the right of property were guaranteed by the EUCFR and the ECHR, and that Article 15(6) seemed to interfere with these fundamental rights, as exclusive rights holders such as Sky Austria could no longer freely exercise their economic activity related thereto. AG Bot did, however, recall that, in line with previous EU case law, these two fundamental rights were not absolute and that, as such, they should be viewed within their social function, i.e. restrictions could be imposed on these two fundamental rights if these restrictions corresponded to other EU objectives of general interest and did not constitute a disproportionate interference.
In the present case, AG Bot considered that the interference was justified and Article 15(6) of the AVSD was not contrary to EU fundamental rights law. A fair balance had been found between, on the one hand, the freedom to conduct a business and the right to property and, on the other hand, the freedom to receive information and media pluralism. In addition, AG Bot observed that the interference was greatly mitigated by certain conditions and limits attached to the right to transmit short extracts during news reports. These include extract duration limits, obligations to identify the source of the extracts, and the requirement that the events being reported are of "high interest to the public".
Finally, AG Bot also addressed the positions taken by both the "Verfassungsgerichtshof" (the Austrian Constitutional Court) and the "Bundesverfassungsgericht" (the German Federal Constitutional Court), which had taken the view that the right to use short extracts in news reports should give rise to the payment of a reasonable remuneration in view of the costs of acquiring the exclusive rights. According to AG Bot, "the balancing of the various fundamental rights concerned does not necessarily call for the same response at a national level as at an EU level". The underlying reason behind this is that concerns around the completion of the EU internal market would have an impact on the compromise between the free grant of rights to short extracts and the financial contribution of secondary broadcasters to the costs of acquiring exclusive rights of transmission.
It should be recalled that while the Opinion of the Advocate-General is not binding on the ECJ, it is followed in the majority of cases.
AG Bot's Opinion can be accessed at:
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