Spain approves new TV legislation

From David Del Valle in Madrid

The Cabinet has approved a law that will oblige pay TV and commercial TV channels and telco operators to finance the state-owned group RTVE with a great amount of their annual revenues. All those players will have to dedicate 1.5 per cent, 3 per cent and 0.9 per cent of their annual revenues, respectively, to financially support RTVE to compensate its loss of advertising, representing a loss of E478 million for the group.

To complete RTVE's budget, apart from an annual state subsidy of around E555 million, the Government will dedicate 80 per cent of the tax that operators pay for the use of spectrum, around E250 million.

The Government has also imposed content limits on TVE by limiting its access to sport and cinema content and by increasing from 5 to 6 per cent the amount of money dedicated to national and European films.

The Vice president of the Government, Maria Teresa Fernandez de la Vega, said they were hoping for a BBC model: "it will strengthen the economic independence of the corporation, guarantee the budgetary balance and pave the way for a quality and successful public TV model".

At the same time, the Administration hopes to help the TV industry to ride out the recession storm as the broadcasters will be able to take advantage of a larger TV advertising pie (without RTVE) that amounts to E3 billion every year.

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