Brussels, 4th August 2008
The European Commission has authorised, under the EC Treaty’s rules on state aid, a credit facility granted by the Danish Ministry of Culture to support TV 2 Danmark AS. The Commission concluded that the credit facility, which addresses the company's cash flow problems, constitutes rescue aid in line with the EU rules on state aid to companies in difficulty (see MEMO/04/172). In due time, the Commission will review whether the credit is fully reimbursed or whether appropriate restructuring measures to restore the long term viability of TV 2 Danmark AS are taken.
EU Competition Commissioner Neelie Kroes said: “Public broadcasting is a service of general interest that contributes to public information, democratic debate and cultural objectives in Europe. The rescue aid will enable TV 2 Danmark to continue its activities in the immediate future. I look forward to examining in due time measures that would ensure its long term viability”.
TV2 Danmark A/S was incorporated in 2003 as a private limited liability company wholly owned by the Danish State. TV2 Danmark A/S operates the public television channel TV 2 as well as a number of commercial channels including TV2 Zulu, TV2 Charlie and a news sport television channel TV2 Sports.
In the course of 2008, TV2 Danmark A/S experienced a deterioration of its operating results and liquidity problems. Emergency measures implemented by the management in January and April prove insufficient to generate sufficient cash-flow. The Ministry of Culture, authorised by the Parliament, thus plans to provide a credit facility to TV2 Danmark A/S. Draw downs on the credit are restricted to the minimum necessary to keep the company afloat and must be assessed by an independent accounting firm.
The aid measures address not only the company's public service mission but also its commercial activities altogether. The measures are thus considered as rescue aid, in line with the EU Guidelines on state aid for rescuing and restructuring firms in difficulty. Under these rules, rescue aid must be provided in the form of loans or guarantees and must be limited in time and amount. A specific control mechanism which involves an independent auditor ensures that the aid is restricted to the amount necessary to keep the company in business. In line with the rules, the Danish authorities have given a commitment to submit in six months a restructuring plan or proof that the credit has been reimbursed in full.
The non-confidential version of the decision will be made available under the case number N 287/2008 in the State Aid Register on the DG Competition website once any confidentiality issues have been resolved. New publications of state aid decisions on the internet and in the Official Journal are listed in the State Aid Weekly e-News.