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Brussels (pte024/22.02.2005/11:15) - The European Commission http://europa.eu.int is set to launch a formal inquiry next week into German public television and radio's use of licence fee money to fund internet and other services. As the Media Guardian http://www.mediaguardian.co.uk reports, the investigation could have serious consequences for other publicly funded broadcasters such as the BBC in Britain. It comes after complaints from private channels two years ago that their state-owned rivals, ARD and ZDF, used illegal subsidies.
Last week, attempts were made by senior officials from four German states - Bavaria, Rhineland-Palatinate, North Rhine-Westphalia and Saxony Anhalt - to avert the investigation in talks with Neelie Kroes, the competition commissioner. It is understood that Kroes conceded that the licence fee itself was not an illegal subsidy under EU rules - partly because that is a matter for national authorities alone. However, the Dutch Liberal and her adviser believe that using public money to fund internet-based services and win a slice of the growing market appears to be unlawful. ARD.de and ZDF.de, which offer sports and financial news as well as advice, are expanding. It is thought that the four German states have shown Kroes the financial details of ARD and ZDF, which are undisclosed even in Germany. However, according to Der Spiegel magazine http://www.spiegel.de , she wants more transparency over funding subsidiaries, including internet services.
According to Carl Eberle, ZDF's lawyer, the commission's view that broadcasting based on licence fees limits competition and "undermines the principles on which Germany's broadcasting system is based". As the Media Guardian reports, the two channels, which were set up after the Second World War, are in effect under party political control. The system was set up to ensure pluralism after the Nazi dictatorship, but the channels are now moving into sponsorship. Many politicians believe that they should be pared back to their core broadcasting role.
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