On 24 July 2009, TF1 notified the Autorité of its acquisition of a share of the AB group that provides it with 100% of the capital of the NT1 station and 80% of the TMC station1. After an initial investigation phase, the Autorité de la concurrence decided to launch an in-depth examination of the operation on 26 August.
On the basis of a "market test" involving all of the sector’s professionals (holders of rights, advertising agencies and advertisers, advertising networks, media planning agencies, competing television stations, etc.), this examination considered all of the markets that are likely to be affected by the operation: on the one hand, the markets for the acquisition of broadcast rights for television programmes and, on the other hand, the television advertising market.
The Autorité considers that the operation will serve to strengthen the TF1 group’s position in the markets for rights and advertising
These strong positions on the market for rights and for television advertising mutually strengthen one another and encourage a spiral effect that is likely to further amplify the operation’s effects
The combination of strong buyer positions on the markets for rights and of a dominant position in the television advertising market is likely to amplify the operation’s effects insofar as any growth of advertising revenues would increase the ability to purchase attractive programmes that support the audience numbers, which then serves to attract even more advertising investments. The new digital terrestrial television (DTT) channels, other than TMC and NT1, that must continue to stimulate competition in terms of free television offerings, appear to be particularly fragile when faced with such a strengthened position, since their buying power for programmes remains limited.
To remedy the risks of adverse effects on competition, the TF1 group has undertaken a series of substantial commitments before the Autorité de la concurrence
These commitments are undertaken for a period of five years as of the decision that authorizes the operation, and will have to be implemented upon the decision’s notification. They may be re-examined at the request of TF1 or if so decided by the Autorité, in the event of substantial changes to the legal or factual circumstances considered at the time of the authorization.
Regarding the markets for rights and audience issues, the commitments are intended to facilitate the circulation of rights for the benefit of competing channels, in order to avoid that certain rights remain locked within the group, and to limit the programme broadcast possibilities to a maximum of two free-to-air channels within the TF1 group.
TF1 has further undertaken to renounce to any kind of crossed promotion on TF1 of the programmes shown on the acquired stations.
On the advertising market, these measures are intended to maintain the independence of the advertising offers between TF1, on the one hand, and TMC and NT1, on the other: TF1 notably undertakes to avoid any type of coupling, subordination, advantage or compensation between the advertising airtime on TF1 and those on the TMC and NT1 stations. The group further undertakes that the advertising airtime on the TMC and NT1 stations will be marketed independently, by a company other than the one that looks after marketing the advertising on TF1.
An independent trustee, approved by the Autorité de la concurrence, will monitor the proper performance of all of these commitments.
Press contact: Virginie Guin / Tel 01 55 04 02 62 / Contact
APPENDIX / SUMMARY OF TF1’S COMMITMENTS
TF1 undertakes to take measures intended to bring about better circulation of rights relating to proprietary works2 originally filmed in the French language (hereinafter FL) and FL cinematographic works, so as to facilitate the access to these rights on the secondary markets.
- fictional works produced for television: controlling the exercising of the rights of first and last refusal in order to prevent any strategies that would lock in the rights
With regard to FL audiovisual proprietary works, TF1 undertakes, firstly, that when the current contracts or any new contracts call for it to be entitled to a right of first or last refusal, this right will be understood as a right of priority under conditions that are at least equivalent with those of a competing offer. In particular, TF1 will consequently seek the deletion of the second sub-paragraph of article 9 of the agreement signed on 22 October 2008 between itself, on the one hand, and the Syndicat des Producteurs de Films d’Animation and the Union Syndicale de la Production Audiovisuelle, on the other hand. Indeed, this clause indicated that TF1 could, in certain cases, exercise this right subject to compensation that could be set in the initial contract. There was therefore no guarantee that TF1 would have to align itself with the terms proposed by a third party in order to make use of this right of first and last refusal.
Secondly, to prevent TF1 from using such a clause in order to improperly limit the access to rights by competing stations, the exercising of this right of first and last refusal is conditioned by TF1’s commitment to broadcast the works in question within a certain timeframe, and in the daytime or in the evening.
- Movies: same commitments for exercising the pre-emptive right
As for audiovisual proprietary works, TF1 undertakes to actually broadcast the pre-empted films. The exercising of this pre-emptive right is conditioned by TF1’s commitment to broadcast the works in question within a certain timeframe, and in the daytime or in the evening.
- Sports programmes
For sports rights, TF1 undertakes not to respond to a given invitation to tender for the acquisition of broadcast rights for sporting events for any more than two of the group’s free-to-air stations.
- Other programmes
For American series, FL broadcasting proprietary works, FL series and throwaway programmes, TF1 undertakes not to broadcast these programmes on more than one other of the group’s free-to-air stations.
This commitment relates to programmes broadcasted on TF1 as of 1st January 2007 and that will be broadcast during the term of the commitments: it therefore relates to broadcast rights already held by the TF1 group, as well as to rights that will be acquired in the future.
TF1 undertakes not to carry out any crossed promotion on the TF1 channel of the programmes shown on the TMC and NT1 stations. The group also undertakes not to broadcast, on TF1, any television advertising intended to promote the programmes shown on the TMC and NT1 stations.
So as to ensure that the operation does not allow the TF1 group to support the sale of advertising airtime on TMC and NT1 by building on its strong market position, TF1 undertakes firstly not to make use of any kind of coupling, subordination, advantage or compensation between the advertising airtime on the TF1 channel and the advertising airtime on the TMC and NT1 stations.
Secondly, the group undertakes that the advertising airtime on the TMC and NT1 channels will be marketed independently, by a company other than the one that looks after marketing the advertising on TF1. Only certain "back office" functions can be pooled, while information on customers, rates and commercial data must under no circumstances be shared between TF1 Publicité and the independent advertising structure.
> See the ordinance of the Conseil d’Etat (French Supreme Court for Administrative Law) regarding the ruling of April 22nd, 2010,
> See decision of the Conseil d’Etat (French Supreme Court for Administrative Law), 30th December 2010