C-56/96

VT4 v VLAAMSE GEMEENSCHAP

OPINION OF ADVOCATE GENERAL LENZ delivered on 6 February 1997

A — Introduction ' 1 . Each Member State shall ensure that all television broadcasts transmitted

— by broadcasters under its jurisdiction, 1. This reference for a preliminary ruling concerns Council Directive 89/552/EEC of 3 October 1989 on the coordination of certain provisions laid down by law, regulation or administrative action in Member States con- cerning the pursuit of television broadcasting or activities ('the Television Directive'). ' Two judgments of the Court of 10 September 1996 are of particular importance for the present case. Both were delivered in actions for failure to fulfil Treaty obligations brought by the Commission against the — by broadcasters who, while not being United Kingdom 2 and the Kingdom of under the jurisdiction of any Member Belgium. 3 State, make use of a frequency or a satel- lite capacity granted by, or a satellite up-link situated in, that Member State,

Relevant provisions of Community law

comply with the law applicable to broadcasts intended for the public in that Member State.

(d) consultations with the transmitting State and the Commission have not produced an amicable settlement within 15 days of the notification provided for in point (c), and the alleged infringement persists. 4. Article 22 of the Directive is concerned with the protection of minors. It requires the Member States to ensure that television broadcasts by broadcasters under their juris- diction do not include programmes 'which might seriously impair the physical, mental or moral development of minors, in particu- The Commission shall ensure that the sus- lar those that involve pornography or gratu- pension is compatible with Community law. itous violence'.

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Legal position with regard to the television Community may be licensed to transmit sector in the Flemish Community advertising. In 1987 a licence for that pur- pose was issued to VTM for a term of 18 years. In Flanders, therefore, VTM holds a monopoly in commercial television and television advertising.

4 _ Belgisch Staatsblad, 19 March 1987, p. 4196. 5 — Belgisch Staatsblad, 14 August 1991, p. 17730. 8 — N o w Articles 105, 107 and 112 of the Decree of 25 January 6 — Belgisch Staatsblad, 4 June 1994, p. 15434. 1995. 7 — Belgisch Staatsblad, 30 May 1995, p. 15058 (corrected in Bel- 9 — Sec footnote 3. The text of these provisions is reproduced in gisch Staatsblad, 31 October 1995, p. 30555). paragraph 69 of the judgment.

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10 — For the definition of this term, see the judgment in Case C-222/94 (footnote 2 above, paragraph 10). 12. The main action relates primarily to the 11 — T h e terms used are not quite uniform. VT4 refers to a 'department' ('afdeling'), whereas the Flemish Executive interpretation of Article 2 of the Television uses the term 'branch' ('filiaalvestiging'). These distinctions Directive. Before the Raad van State, VT4 are, as will be shown below, not material to the present case. argued, on the basis of Article 59 of the

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VT4 v VLAAMSE G E M E E N S C H A P

Whereas the establishment of a television 'The broadcasters under the jurisdiction of a broadcasting organization, for the purpose of Member State are those established in the Directive 89/552/EEC, as amended by this territory of that Member State, in which they Directive, may be determined by a series of must have a fixed establishment and actually practical criteria such as the location of the pursue an economic activity.' head office of the provider of services, the place where decisions on programming policy are usually taken, the place where the 12 — Proposa] for a European Parliament and Council Directive programme to be broadcast to the public is amending Council Directive 89/552/EEC on the coordina- finally mixed and processed, provided that a tion of certain provisions laid down by law, regulation or administrative action in Member Sutes concerning the pur- significant proportion of the workforce suit of television broadcasting activities (OJ 1995 C 185, p. 4). required for the pursuit of the television

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(b) if a broadcaster has its head office in one Member State but editorial decisions 'At the time of the contested decision, may regard be had, for the purposes of interpret- 13 — As the Commission explained at the hearing before the ing Article 2 of Council Directive Court, this is only a provisional statement. Tne Common 89/552/EEC of 3 October 1989 with regard Position was adopted by the Council only on 8 July 1996 ( C o m m o n Position (EC) N o 49/96, OJ 1996 C 264, p. 52). to its scope ratione personae, to the above- A comparison of the text cited by the national court and that adopted by the Council in July 1996 does not differ mentioned report and proposal of 31 May significandy with regard to the passage in question. There- 1995 of the Commission and to the above- fore I shall refer to the version of the Common Position of 8 July 1996, as published in the Official Journal. mentioned text provisionally adopted by the

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Council of Ministers on 20 November 1995? challenged in the main action was adopted If so, what meaning overlapping the three on the basis of a provision which had now different texts must be inferred for the pur- been held to be unlawful. It followed that poses of that interpretation?' the said decision must also be unlawful and there was no need to answer the question.

B — Analysis

18. I cannot agree. It must be left to the national court to decide what specific con- clusions concerning the main action are to be drawn from the judgment in Case C - l l / 9 5 . 16. VT4, the Flemish Executive, VTM, the So far, at least, as the present case is con- French and German Governments and the cerned, it must be observed that the Raad Commission have taken part in the proceed- van State did not withdraw its request for a ings before the Court. preliminary ruling after judgment in that case was given. It follows that the national court still appears to consider that a reply t o the question is necessary. In my opinion, therefore, the Court must give that reply.

'at the time of the contested decision', i.e. on Interpretation of 'establishment' for the pur- 16 January 1995, to take account of docu- poses of the Television Directive ments which were not published until a later date. Above all, however, it must be observed that they are merely preparatory acts. Only the proposed amending directive itself would have had binding effect. It has also been correctly observed that these pre- paratory acts could still have been altered at any time, which is 'what in fact happened. 15 21. Nevertheless, it is clear from the order for reference that the Raad van State has requested a preliminary ruling in connection with determining the jurisdiction within which VT4 falls. In other words, the national court wishes to know how 'establishment' is to be construed in this particular situation. The Court should therefore examine this aspect in more detail in order to provide an answer which is as helpful as possible for the national court.

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lishment may lead to difficulties because a the problems arising from the fact that a broadcaster may have more than one estab- broadcaster may have establishments in more lishment in the Community. I9 However, than one Member State. these difficulties may be overcome. As the Court observed in the abovementioned judg- ment, the Commission had explained that Member States could find a solution to this problem 'by interpreting the criterion of establishment as referring to the place in which a broadcaster has the centre of its activities, in particular the place where deci- sions concerning programme policy are 25. In any particular case, therefore, the first taken and the programmes to be broadcast question is whether a broadcaster has an are finally put together'. The Court observed establishment at all in a Member State. For at the same time that this point had not been this purpose, it is necessary to refer to the contradicted by the United Kingdom as case-law relating to Articles 52 and 59, defendant. 20 according to which, as I have already men- tioned, the concept of establishment within the meaning of the EC Treaty involves the actual pursuit of an economic activity through a fixed establishment in another Member State for an indefinite period. 21 If a broadcaster has such an establishment in only one Member State, the broadcaster is subject to the jurisdiction of that State pur- suant to Article 2(1) of the Television Direc- tive. To this extent there is no difficulty. 22

supervision of the broadcaster underlying 28. As the French Government and the the Television Directive would be jeopar- Commission correcdy observe, the answer to dized. the question of the Member State having jurisdiction over VT4 depends to a large extent on the assessment of factual matters which the national court alone is competent to undertake. The Court can, however, give the Raad van State some guidance in this connection which may be helpful to it. For example, it must be emphasized that the fact that VT4's programmes are aimed at 27. In the present case, VT4 says that it is a Flanders is in itself of no significance. An company incorporated under English law undertaking established in one Member State and that its registered office is in London. may be exercising its freedom to provide ser- The central administration and the place vices even if it is not offering services in the where programming decisions are taken are State of establishment itself. 24 The distinc- also said to be located in the United King- tion between services envisaged by Article 59 dom. In addition, a large part of the work- and establishment under Article 52 of the force is said to be employed in the United EC Treaty, to which VTM attached so much Kingdom. importance at the hearing before the Court, is likewise of no significance for the present case. In particular, the fact that VT4's broad- casting activities are permanent activities cannot justify the conclusion that VT4 does not supply services and that Article 52 is rel- evant. The Court has consistently held M — and quite rightly — that the transmission of television signals must be regarded as a The Flemish Executive, on the other hand, provision of services within the meaning takes the view that all the essential activities ofArticle 59 of the EC Treaty. 26 Yet it is also of VT4 are carried out in Belgium. The com- pany management is also located there. The staff of VT4 also work in Belgium. 23 VT4 programmes are said to be made in Belgium and then taken to the United Kingdom, from where they are transmitted. VTM takes the same view. It claims that the decisions on VT4's programmes are taken in Belgium, which is where all its senior executives work. The final mixing and processing of pro- grammes also take place in Belgium. In the United Kingdom VT4 has only a letterbox 24 — I shall consider below the limits which may arise from the Court's case-law on circumvention of national legislation. address. Both parties add that VT4's pro- 25 — For the first time in the judgment in Case 155/73 Sacchi grammes are aimed exclusively at the Flem- [1974] ECR 409, paragraph 6. 26 — It may be noted in passing that the Flemish Executive's ish public. allegation that the competent United Kingdom ministry did not include VT4 in a fist, which was sent to the Commis- sion, of television broadcasters under the jurisdiction of that Member Sute, has no probative force. As the Court recently decided, 'whether directives apply to particular bodies cannot turn on statements made by the Member 23 — The Flemish Executive claims that 35 employees of VT4 Sute concerned' (see the judgment in Case C-302/94 British work in Nossegcm. Télécommunications [1996] ECR 1-6417, paragraph 37).

clear that the issue of a licence by a Member determines the Member State having juris- State cannot confer jurisdiction over the tele- diction. These are the head office of the vision broadcaster if it is not established in broadcaster, the place where decisions con- the Member State concerned. cerning programme schedules are taken and the place where programmes are finally mixed and processed. A further criterion is the place where a significant part of the workforce is employed. In fact, these may well be the appropriate criteria in the present connection. However, VT4 rightly points 29. Without wishing to anticipate the judg- out that the Commission's proposals differ ment of the Raad van State, it may in any somewhat from those of the Council. The event be inferred from the order for refer- Common Position of the Council lays down ence and from the parties' submissions that a clear hierarchy, whereas the Commission VT4's activity has connections with both the basically gives only a list which does not give United Kingdom and Belgium. Even if the priority to any one of the criteria. Further- contentions of the Flemish Executive and more, the place where programmes are VTM were correct, the fact would remain finally mixed and processed, to which the that VT4 is a company incorporated under Commission refers in its proposal, is men- English law having its registered office in the tioned by the Council in the tenth recital of United Kingdom and that it broadcasts from the preamble to the Common Position, but there. Consequently, even if all the other not expressly referred to in the relevant pas- activities were carried out in Belgium, in my sage in the text itself. 27 opinion VT4 would have an establishment in the United Kingdom within the meaning of the case-law to which I have already referred, even if — as VTM contends in the alternative — it is only a branch. Under the Treaty, however, a branch also constitutes an establishment (see Article 52, first paragraph, of the E C Treaty). Therefore the Flemish Executive's claim that this is a purely domes- tic matter to which Community law does 31. I am unable to see a natural, virtually not apply seems to me unfounded in any predetermined order of precedence for these case. criteria. Any such order can only be laid down by the legislature. Therefore I think it is clear that the sequence in the Common Position cannot be used for determining the Member State having jurisdiction for the purposes of the Television Directive before the Council's views have become law. Other- 30. With regard to the criteria to be applied, wise, one would be applying a substantive if necessary, by the Raad van State, I think I new rule before it enters into force, which can be brief. The Commission's proposal of would be highly objectionable from the 31 May 1995 and the Common Position of the Council refer to respectively three and four auxiliary criteria for ascertaining, in 27 — See Article 2(3) of the Directive in the form proposed by cases of doubt, the 'establishment' which the Common Position.

34. For this purpose I think it best to con- 32. In my opinion, the test suggested by the sider the Member State where the broad- Commission in Case C-222/94 and men- caster begins transmission in the technical tioned by the Court in its judgment is par- sense. This would also satisfy the require- ticularly appropriate for this purpose ment of legal certainty which VT4 is quite because it summarizes what the abovemen- right to demand. If, therefore, a broadcaster tioned criteria should do — ascertain the decides to transmit from a particular Mem- Member State in which the broadcaster has ber State, it must at least expect that it could the 'centre of its activities'. Although this be subject to the jurisdiction of that State. Of phrase does not expressly refer to the head course, this would apply especially in the . office of the undertaking or the question of present case, as this criterion would mean where broadcasting staff are employed, I that the United Kingdom, from which VT4 think these aspects may easily be inferred transmits, has jurisdiction. The general appli- from the basic test. It seems to me, therefore, cability of this criterion as an aid to reaching that where a broadcaster has establishments a decision in cases of doubt which could not in more than one Member State, the Member otherwise be resolved is shown by the fact State having jurisdiction for the purposes of that the Common Position adopts a similar the Television Directive is the one where the standpoint. 2S broadcaster has the centre of its activities and, in particular, the one where decisions on programme policy are taken and where the final mixing and processing of programmes to be broadcast takes place.

36. In its judgment in Case-11/95 Commis- 38. In the present case, I cannot see, from sion v Belgium the Court left open the ques- the information available, that any such tion 'whether, in the light of Directive abuse has occurred. It may well be that VT4 89/552, a Member State is still entitled, on has become established in the United King- the basis of Article 59 of the Treaty, to take dom simply to order to evade the Flemish measures to prevent a person providing ser- legislation concerning the activity of televi- vices whose activity is entirely or principally sion broadcasters, but it must be remem- directed towards its territory from exercising bered that this does not of itself constitute an the freedoms guaranteed by the Treaty for abuse. Anyone exercising his freedom of the purpose of avoiding the rules which establishment under the EC Treaty is quite would be applicable to him if he were estab- certainly not perpetrating an abuse on that lished within that State'. 29 The question here account alone. For this, the national provi- is whether the relevant case-law, which the sions being evaded must protect important Court last affirmed in 1994 in the TV 10 30 legal interests that are also recognized in case, is still applicable after the entry into Community law. The TV10 case concerned a force of the Television Directive. national Law intended to establish and main- tain a pluralistic, non-commercial radio and television broadcasting system and thus to safeguard freedom of expression. In the TV10 case, the broadcaster in question had the right to broadcast its programme from the Netherlands provided that it fulfilled the requirements of Dutch law. This would not be possible in the present case because n o 37. In Case C-11/95 my reply to this ques- other commercial broadcaster can operate in tion was in the affirmative. At the same time, Flanders by reason of VTM's monopoly. I made it clear that this case-law is applicable Consequently there can be no question of an only if there is any abuse on the part of the abuse in the present case.

(2) Where a television broadcaster has establishments in more than one Member State, the Member State having jurisdiction over it is the one in whose terri- tory the broadcaster has the centre of its activities, in particular where deci- sions concerning programme policy are taken and the programmes to be broadcast are finally put together. If there is any remaining doubt, the Member State having jurisdiction is the one in whose territory the television broad- caster began his transmission activities in the technical sense.

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