The scheme furthers the EU Digital Single Market objectives without unduly distorting competition.
Margrethe Vestager, Commissioner in charge of competition policy, said: ''Today's decision shows how Member States can support the freeing-up of much needed spectrum for wireless services in line with EU state aid rules. The French aid scheme will ensure that affected households can continue watching free-to-air TV without extra costs through the technology they choose.''
Faced by significant and growing demand for wireless broadband services in the European Union, the Commission in February 2016 proposed legislation aimed at boosting mobile internet services with high-quality radio frequencies. The proposal provides for better coordination at European level and calls on all Member States to reallocate the 700MHz spectrum band, which is currently used for TV broadcasting, to wireless broadband. This will improve internet access for all Europeans and help develop cross-border applications.
France plans to start migrating from April 2016 onwards, with the 700 MHz band effectively released for wireless broadband by June 2019.
France has put forward a national support scheme to facilitate reaching this goal, with an overall budget of €56.9 million. The scheme aims to compensate the households most affected by extra costs linked to the reallocation of the 700 MHz band. It provides for aid to buy the necessary equipment, for technical assistance and for maintaining reception of free-to-air TV channels after the reallocation of frequencies.
The Commission assessed the aid scheme under Articles 107(2)(a) and 107(3)(c) of the Treaty on the Functioning of the European Union (TFEU), that allow Member States to support certain disadvantaged consumers or certain economic activities, respectively, under specific conditions.
Its investigation showed that the measure will mostly benefit households that currently receive their TV signal exclusively via Digital Terrestrial Technology (DTT), based on the so-called MPEG-2 ISO norm. The households will have the choice to either continue receiving the signal through DTT or switch to an alternative means, such as satellite, cable, optic fibre, ADSL, etc. The Commission therefore concluded that the aid scheme does not favour any technology over another, in line with EU state aid rules.
This decision also provides useful guidance to Member States on how such schemes can be designed in line with EU state aid rules.
The ultra-high frequency (UHF) band comprises the range 470-790 MHz and is mainly used for TV broadcasting services. Europe is witnessing significant growth in the demand for wireless broadband services and by 2020 internet mobile traffic is expected to grow by nearly eight times compared to today's traffic. Increasing mobile data traffic puts pressure on demand for additional radio wave spectrum. The Commission's proposal presented on 2 February 2016 will provide for more spectrum for broadband in the 700 Mhz band (694-790 MHz) in all EU countries at the latest by 30 June 2020.
On the basis of national law, Member States may consider the adoption of cost compensation measures to mitigate the impact of this change in order to ensure their continued access to free-to-air TV services. State support to public broadcasters fulfilling the criteria of a service of general economic interest has been possible in the context of the release of the Digital Dividend (800 MHz band). In order to avoid any undue distortion of competition in the Single Market, such schemes need to be notified to the Commission for an assessment under EU state aid rules. This is to ensure that they are necessary for the continuity of TV services, appropriate and proportionate for reaching this objective and technologically neutral.
The non-confidential version of the decision will be made available under the case number SA.42680 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.