Chapter 6 Greece
Content 1
A Market definition in competition and media law in Greece 3
I Introduction 3 II The general approach to market definition in Greek competition law 5 1. Relevant product market 6 a) Demand-side substitution 6 aa. Characteristics of the Product 7 bb. Intended Use 8 cc. The price of the products 9 dd. The Hypothetical Monopolist Test (SSNIP) 9 b) Supply-side substitution 10 2. Geographic dimension of the market 11 3. Evidence relied upon 12 III. Ex lege defined markets 13 IV. Other criteria 13 1. The structure of the markets 14 2. Actual and potential competition 16 3. Legal, economic and other entry barriers 18 B Repertoire of relevant product and geographic market in media sector in Greece 18
I. Publishing and books sector 18 II. Music-copyright 20 III. Broadcasting 21 IV. Film sector 21 V. Internet 23 VI. Advertising in the media 25 C Comparative analysis of market definitions adopted by the European Commission and those adopted by Competition Authorities in Greece 30
I General remarks 30 II. The general methodology followed by the Greek Competition Committee 31 III. Comparative analysis of the approach on the media sector market 32 1. Publishing and books sector 32 2. Film sector 33 3. Internet sector 35 4. Advertising in the media 37
1 D Impact of different regulatory frameworks on market definitions 39
I. The regulatory framework for the media sector in Greece 39 1. Constitutional provisions 39 2. Sector-specific regulation 39 II. Media Regulators 40 1. Ministry of Press and Mass Media 41 2. Ethniko Symvoulio Radiotileorasis (ESR = National Council of Radio – Television) 41 3. EETT (Ethniki Epitropi Tilepikinonion kai Tahydromion = National Telecommunication and Post Commission) 42 4. Other governmental bodies 43 a) National Book Centre: 43 b) Copyright Organisation: 43 III. Market Definitions and/or Criteria upheld for market perception in the relevant sector focused legislation 43 1. Publishing 43 a) Press 43 b) Books 44 2. Music-Copyright 44 3. Film 45 4. Broadcasting 45 a) Cross media ownership rules 45 b) Broadcasting products or services 46 c) Broadcasters and distributors 46 d) Categories of broadcasters (depending on area of coverage) 47 5. Internet 47 IV. Market definitions in the media sector, as upheld in sector specific practice of authorities and/or courts 48 V. Common factors and differences between the media (sector) specific market definitions and the market definitions used in application of competition rules. 49 VI. The impact of the non competition framework and practice on the work of the competition regulator, in particular when defining the relevant markets. 49
2 The present section follows a similar outline pattern as in the previous sections. 6.01 The first part (part A) starts with a short introduction of the legal provisions and the main institutions dealing with the implementation of competition law in Greece. It continues with (i) the general approach to demand and supply side substitutability for defining the relevant market, and (ii) other more specific criteria used to define the market. Then, under section (B) the work portrays the main markets delineated in the media sector by the Greek National Authorities. The third section (C) provides a comparison between the market definition applied at the EC level and the methodology adopted by the Greek Authorities. The last part (part D) provides a detailed analysis of all sector specific regulatory frameworks that have may have an impact on market definition in the media sector.
A Market definition in competition and media law in Greece
One might find differences in the way markets are defined for the purposes of 6.02 different competition law provisions in Greece, i.e. provisions dealing with infringements (agreements and abuse of dominant position), or provisions dealing with merger control cases. These differences follow from the fact that each provision serves a specific purpose. Thus, market definition is carried out corresponding to the diverse rationales these provisions enclose. However, these particularities with respect to market definition in different proceedings of competition law do not justify a separate analysis of the market definition approach under each provision. Without suggesting every course of action operates in an identical manner and according to identical standards, it can be said that different procedures do not result in completely different models for market definition approach. In the end, all competition law provisions reflect the same concern, i.e. the abuse or potential abuse of the economic power of the enterprises in a particular market. Hence, the present work will embrace an all- encompassing scheme while exploring Greek competition law approach to market definition, and only where it is considered to be significantly imperative, it will point out the differences.
I Introduction
In Greece, the legal framework regulating economic competition is based on 6.03 two assumptions, namely (i) certain inequitable commercial practices are not just for they employ “non ethical” means whilst competing for the same economic ends and shall, therefore, be prohibited by the legal order, and (ii) the economic competition shall be free, i.e. everyone shall have the right to freely enter and compete in the market of her/his choice and any non-legitimate obstacles restricting this right shall be prohibited. Thus, two legal regimes have emerged in Greece, namely unfair competition law based on the first principle, and free competition law based on the second one. The main legal provision regulating unfair competition is Act No. 146 of 1914 On Unfair Competition (“Peri Athemitou Antagonismou”). The disputes between the parties under Act No 146 of 1914 fall within the jurisdiction of Civil or Criminal Courts. We will
3 not elaborate further on unfair competition and will deal only with the free competition regime herein1.
The main legal provision regarding free competition law in Greece (from now 6.04 on referred to as competition law only) is Act No 703 of 26 September 1977 (from now referred to as Act 703/1977) on the Control of Monopolies and Oligopolies and the Protection of Free Competition (“Περί ελέγχου µονοπωλίων και ολιγοπωλίων και προστασίας του ελευθέρου ανταγωνισµού”) as it stands after the latest amendments brought about by Act No 2941 of 19 September 20012. According to Article 8b3 of Act 703/1977, the Competition Committee (Epitropi Antagonismou) has exclusive powers with regard to the implementation of the provisions of the Act. It functions as an administrative independent authority being at the same time economically self-sufficient. The Competition Committee upon its own initiative or upon a complaint filed by a third party or a request made by the Minister of Development may intervene when the free competition is distorted either by cooperative actions of undertakings or as a result of an abuse of the market power of a dominant firm or as a result of a merger between two or more firms. The decisions of the Competition Committee may be challenged on appeal to the Athens Administrative Court of Appeal (“Dioikitiko Efeteio”) and then to the Council of State (“Symboulio tis Epikratias“).
Following the EC Treaty pattern, namely Article 81, Article 1(1) of Act 6.05 703/1977 prohibits all agreements between undertakings, all decisions by associations of undertakings and concerted practices of whatsoever kind, which have as their object or effect the prevention, restriction or distortion of competition. However, according to paragraph (3) of the same article, derogations to the prohibitions referred to in paragraph (1) may be granted upon a decision made by the Competition Committee (or the Minister of Trade according to Article 8a of the Act), provided that certain conditions are fulfilled. Article 2 of the Act, which is the Greek equivalent to Article 82 EC Treaty, prohibits any abuse of the dominant position of the undertakings. Articles 4 to 4f deal with merger cases and are designed with Regulation No 4046/1989 (Merger Control Regulation) in mind (from now on ECMR)4.
1 For more on unfair competition law in Greece, see in general: Kotsiris, L., ∆ίκαιο Ανταγωνισµού Αθέµιτου Και Eλεύθερου [Law of Unfair and Free Competition], pp. 1-367; Marinos, M. T., Αθέµιτος Ανταγωνισµός [Unfair Competition]. For a more comprehensive account on free competition law in Greece, see in general: Kotsiris, L., ∆ίκαιο Ανταγωνισµού Αθέµιτου Και Eλεύθερου [Law of Unfair and Free Competition], pp. 367- 615; Vouterakos, Konstantinos Gr., Competition Law in Greece, in Vogelaar, Floris O.W./ Stuyck, Jules/ van Reeken, Bart L.P (ed.), Competition Law in the EU, its Member States and Switzerland. 2 Act No. 703/1977 [Official Gazette 278/A/26.9.1977] has been amended by Acts No 1934 of 8 March 1991, No 2000 of 24 December 1991, No 2296 of 2 February 1995, No 2323 of 13 July 1995, No 2741 of 28 September 1999, Act 2837 of 28 August 2000, and Act No. 2941 of 19 September 2001. 3 When article numbers of Greek legal provisions are provided, the original Greek letters are replaced with the Latin equivalent (e.g. instead of the Greek letter Γ we refer to as C). 4 Council Regulation (EEC) No 4064/89 of 21 December 1989 on the control of concentrations between undertakings, [OJ L 395, 30.12.1989] as amended by (EC) No
4 II The general approach to market definition in Greek competition law
Despite the major importance that market definition possesses for the correct 6.06 implementation of competition law, the Greek Competition Committee has not so far issued any particular informing material regarding the methodology and the strategies it will follow for defining the relevant markets. However, a sufficient decisional practice of the Greek Competition Committee does exist and the following analysis will show that Greek competition law and the Competition Committee case law follow in general the approach held at the EC level.
Nevertheless, it is important to make it clear from the very beginning that as far 6.07 as the media sector is concerned, the Greek Competition Committee has not had the chance to deal with any major case, yet. Several decisions have in fact involved issues related to the media sector, but for the most part, they do not provide for a comprehensive picture of the way market definition concept is applied in this sector. Moreover, media related markets have not constituted the main object of the decisions, but are elaborated upon rather incidentally. For this reason, the following analysis will attempt to provide the general methodology upheld in Greek competition law in respect to relevant market definition, and where appropriate, will seek to foresee how these trends will apply in the specific media markets.
The competition Act does not make any explicit reference to the relevant market 6.08 definition per se besides a few quotes only incidentally related to the concept. Thus, Article 4b paragraph 1(a) of Act 703/1977 while determining the market share threshold of the undertakings for the purpose of merger notification states: The market share of the products or services to which the concentration is concerned, as being defined in Article 4f, represents within the national market or in a substantial, with respect to the particular characteristics of the products or services, part of it, at least, a 35% of the combined aggregate turnover of the products or services which are regarded as identical because of their properties, their prices and their intended use5.
The wording makes it clear that the relevant market, in which the market share of the undertakings concerned will be evaluated, is seen to comprise all the
1310/97, [OJ L 180, 9.7.1997, p. 1]. The competition Act does not provide for a definition of “undertaking”. Nevertheless, it is in general accepted (at least in theory) that the meaning of undertaking applies to the same concept as the one currently accepted at the EC level (see Kotsiris, pp. 406 et seq.; Vouterakos, pp 577 et seq.). According to it, “the concept of an undertaking encompasses every entity engaged in an economic activity, regardless of the legal status of the entity and the way in which it is financed. (ECJ, Case C-41/90, Höfner, [1991] ECR 1979 para. 21, ECJ, Case C-67/96, Albany International, [1999] ECR 5751, para. 3). 5 The translated version of the Act 703/1977 is taken from the WWW homepage of the OECD at: www.oecd.org, and it is used for the most part unaltered, with exception of the parts amended by the Act No. 2941 of 19 September 2001. The translation of these parts is courtesy of the author and if used, will be marked with a footnote. Unless otherwise stated, all other translations are courtesy of the author. The latest Greek version of the unified Act can be obtained from the homepage of the Greek Competition Committee at: www.epant.gr. All WWW addresses were last visited on June 18, 2003.
5 goods or services that are considered to be similar6 [thereby interchangeable] on the basis of their characteristics, their price and their intended use. Those three elements seem to be the most crucial ones for defining the matters of interchangeability of the products or services in question as the work will show further on. The analysis will also show that in Greece, likewise the situation at the EC level,7 the demand side concerns hold the predominant position for defining the relevant market.
1. Relevant product market8
It was mentioned above that materials of general nature (i.e. guidelines, notices 6.09 etc.) dealing with the methodology and the tests the Competition Committee uses in order to define the relevant market are not available. Therefore, our primary source will be the very decisions made by the Competition Committee, especially the ones from 1995 on (i.e. the year when the Competition Committee first started to function as an independent authority).
In 1995, the Competition Committee published the notice Υποδειγµα 6.10 Προηγουµενης Γνωστοποιησης Συγκεντρωσης Επιχειρησεων [“Form related to Prior Notification of a Concentration between Undertakings,” from now on referred to as the Notification Form] determining the specific contents of the merger notification form (equivalent to form CO)9. In section 6 of the Notification Form, the Committee indicates that the relevant product and geographic market define the boundaries, within which the market power of the new emerging enterprise will be evaluated. The following paragraph (para. I) bears the title relevant product market and states: The relevant product market comprises all those products and/or services which are regarded as interchangeable or substitutable by the consumer, by reason of the products' characteristics, their prices and their intended use.10
It can be easily seen that the Competition Committee puts more weight on demand side considerations; nevertheless, it will be shown later on that in practise, the supply side characteristics play also an important role in its evaluations. a) Demand-side substitution
The analysis of demand-side substitution tests seeks to indicate the variety of 6.11 products, which are regarded as being interchangeable by the consumer. If two products are found to have a considerable degree of exchangeability, then a
6 The Greek term used on the paragraph 1(a) of Article 4b of the Act and 703/77, which is translated in the above extract as “identical“ is “οµοειδή”. Its exact meaning is “of the same kind”. 7 For more with regard to the situation at the EC level see Chapter 1 para. 1.10 et seq. 8 Where appropriate the term “products” refers to “service” as well. 9 The note can be found on the WWW homepage of the Greek Competition Committee under the name Εντυπο προηγούµενης γνωστοποίησης συγκέντρωσης [Prior Notification Form for Concentration] at: http://www.epant.gr/Entypa/a-000-Entipo4b.pdf. 10 Emphasis added.
6 conclusion is drawn that they belong to the same market. In other words, the relevant market should be delineated in such a manner as to include both products. The Competition Committee has not defined the degree of substitutability for two products to be considered as belonging to the same market. Nevertheless, it has pointed out in its decisions that a partial substitutability alone can not deem the products to be seen as belonging to the same market11. In appraising the substitutability of a product from the consumers’ point of view a range of different factors is taken into account by the Competition Committee. aa. Characteristics of the Product
In its Coca-Cola decision,12 the Competition Committee stated that the “non- 6.12 alcoholic carbonated soft drinks of the “cola” class can be distinguished from the rest of carbonated soft drinks and form a separate product market (...) based on their particular characteristics (taste) and their use”13. Characteristics of products may include any natural or human-made, physical or bio-chemical features, such as form, shape, taste, ingredients and chemical composition etc. In most cases, the Competition Committee uses the specific characteristics in connection with the purposes the product is meant to satisfy. However, there are certain types of products where their specific characteristics as such are enough to determine the existence of a sole relevant market. In the case of pre-toasted bread (Frygania),14 its particular characteristics namely, its “fine” and crunchy taste, frothy and low-calorie composition, as well as the kind of packaging that allows the consumers to calculate the amount of calories acquired, have shaped a complete separate market of its own, and the pre-toasted bread (Frygania) is thus in the eyes of the consumers not exchangeable with any other product.
The Competition Committee noted that the fact that the common properties of 6.13 the final products (cement) must fulfil international uniform standards, or national mandatory requirements, justify placing the very final product in the same market, in spite of the fact that manufacturers may use different raw materials to produce it.
Coming back to the media sector, the Committee has in two occasions15 6.14 expressed its opinion that the Internet market comprises the market for Internet access (service provider) and the market for the services available on the Internet (content markets), thus preserving the distinction between access and content that has prevailed at EC level as well16. Although the decisions do not
11 See decisions EA 18/1995, Ethyl corporation-Texaco Inc, EA 193/III/2001 Glaxowellcome AEBE, all decisions can be obtained from the homepage of the Greek Competition Committee at: http://www.epant.gr/Apofaseis.php3. 12 EA 56/II/1999 (see also supra note 11). 13 Ibid. 14 EA 40/1996 (see also supra note 11). 15 EA 129/II/2000, EA 184/III/2001 (see also supra note 11). 16 For a more comprehensive account on the situation prevailing at the EC level see Chapter 1 para. 1.166 et seq. See also Bird&Bird, Market Definition in the Media Sector, para. 321 et seq.
7 clarify the elements used for this demarcation, it is obvious that the two thus distinguished markets are based on clearly different types of services as regards their characteristics. The service provider is the “gateway,” the “physical connection” that leads to the Internet whereas the rest of the services may take a large variety of forms, such as advertising, media activities and so on. Hence, Internet services may, according to the Committee, take one of the following forms: a) the construction and maintenance of electronic websites, b) electronic commerce, c) electronic advertising, d) electronic publishing etc. (the list is not exhaustive)17. bb. Intended Use
Since the relevant market is thought to comprise all goods, which by reason of 6.15 their intended use are regarded as substitutable in the consumers’ view, the intended use test is also examined under the analysis of the demand-side reflections towards the products in question. The Competition Committee’s position is that if a product is needed for a specific purpose, that product will be within the same market only with other products which satisfy the same need. On the contrary, if products are intended to satisfy different needs, or the same need but are addressed at different groups of consumers (see Glaxowellcome)18 then they do not fall within the same market. In the Ethyl corporation-Texaco Inc19 decision, the Competition Committee found that the fact that both lubricants are used in the same machine at the same time presupposes that they satisfy different needs and should not be considered substitutes. On the other hand the existence of a “partial substitutability” in few cases between the two products at issue does not justify their inclusion in the same market20.
The Competition Committee has also used the concept in terms of “functional 6.16 substitutability”21. Here, the use for which the goods or the services analysed are intended seems to play the most crucial role, i.e. if other products can offer the same function or satisfy the same need the market is seen to comprise all of them although a group of consumers my have different preferences. Thus, in several cases the Committee has stated that the delineation of relevant markets should be based on the criterion of functional substitutability of the products (e.g. in terms of “quenching thirst”)22 and not in terms of the specific requests that a small group of consumers might have23.
17 EA 129/II/2000, EA 184/III/2001 (see also supra note 11). 18 Supra note 11. 19 Supra note 11. 20 Ibid. 21 According to the Committee’s decision in the case EA 57/1999, “the relevant market, which is delineated with the application of the functional substitutability criterion, comprises the services that are considered by the consumers substitutable on the basis of their properties, their prices, and the use for which they are intended.” See also EA 207/II/2002. 22 EA 207/II/2002, ΑΓΝΗ ΑΒΕΕ vs. Coca-Cola, (see also supra note 11). 23 EA 11/1995 (see also supra note 11).
8 However, the intended use of the products has not been taken into account in 6.17 isolation from other factors. The practice of the Committee has shown that products intended to fulfil the very same needs may belong to different markets due to differences regarding their other characteristics. Thus, in its decision Video Seven24 the Committee held that the market of videotapes for cinematographic (feature movies) or TV films is separate from the DVD market. Likewise, the Competition Committee has divided the market for books into the market of books intended to be sold to private consumers and the market of books intended to be sold to public institutions25. cc. The price of the products
The price of the products seems to be an important element in assessing 6.18 exchangeability between products. Diverging prices have been seen as a determinant factor in cases where the evaluation involves otherwise interchangeable products. In Kraft Hellas Α.Ε., the Committee decided that the market for croissants should be defined narrowly and should not include the croissants from the “croissanterie” stores on account of the “enormous higher selling price of them in comparison with the pre-packaged ones”26.
Price similarities are also taken into account usually in conjunction with the 6.19 characteristics of the products and its intended use. The committee seems to be very careful not to come to a conclusion of a shared market based only on the price match27. dd. The Hypothetical Monopolist Test (SSNIP)
Although the test can be employed to identify the relevant product as well as the 6.20 geographic market taking into consideration the constraints posed by both demand as well as supply side substitution,28 it is analysed in the present section for: (i) it evolves certain similarities with the price test (or the cross price elasticity test), and (ii) it is after all the end-consumers’ reaction towards a small (5-10%) but significant price increase the determinant factor for evaluating how this will affect the firms’ profit. According to the evidence gathered so far, it is safe to say that the Competition Committee has been very cautious in applying the so-called hypothetical monopolist test. In Chipita International Α.Β.Ε.Ε. – Kraft Hellas Α.Ε.,29 the Committee indicated that since the croissant is considered to be the pre-eminent snack especially to the young ages, this “renders the demand for it inelastic in relation to the prices and the relevant market, in which it belongs to, self-contained and independent from the market
24 EA 226/III/2002 (see also supra note 11). 25 EA 135/II/2000, (see also supra note 11). More on those decision will be discussed on part (B). 26 EA 23/1996, Chipita International Α.Β.Ε.Ε. – Kraft Hellas Α.Ε. (See also supra note 11). 27 Similar approach is followed at the EC level as well, see Chapter 1 para. 1.11 et seq. 28 See for more on Chapter 1 para. 1.13. 29 Ibid.
9 of the other snacks”30. This sort of “price elasticity test” is the only feature that one might found while reviewing the Competition Committee’s decisions. It follows that with reference to this particular test, the Greek Competition Committee seems to be more reluctant to employ it than the EC Commission or EC courts31. b) Supply-side substitution
Supply side tests do not as a rule possess the same crucial role as the demand 6.21 side evaluations. Nevertheless, the Committee looks at supply side features in order to identify the relevant market. Particularly interesting with regard to the Greek Competition Committee’s approach is the usage of the undertaking’s charter in order to identify the broad sector and subsequently the relevant market, in which it operates or it will operate in the near future32. Especially in the merger cases, where an ex ante analysis of the undertakings’ future conduct is called for, this test has been proven to be exceptionally effective for the Committee33. Nevertheless, the Committee seems to be cautious not to depend its analysis solely on the intention of the founders of the undertaking at stake as it stands for in its charter.
Other supply-side features that have been proven to be crucial in Committee’s decisions regarding market delineation are different marketing policies followed by undertakings, differences in policies related to pricing, advertisement expenditures etc34.
On the other hand, supply-side features are for the most part taken into 6.22 consideration while the Competition Committee analyses the markets structures, or the conditions of entry in the specific market, or in assessing the repercussions a concentration will have on competition in this particular market. When potential competitors may easily switch their technology to enter the particular line of product, then the impact the concentration will have on competition is presumed to be minimal. As far as the delineation of the market per se is concerned, the Competition Committee seems to be more confident relying on demand-side evaluations, mainly characteristics of the products and their intended use.
Thus, in Chipita-Kraft Hellas,35 the Competition Committee noted: 6.23 The large-scale production, on the other hand, requires high investments on buildings and machineries, as well as on distribution centres and means of
30 Similar conclusions were drawn by the committee in its decision EA 43 / 1996 (section VIII) regarding the demand for cement (see also supra note 11). 31 See Chapter 1 para. 1.14. 32 See for example EA 181/III/2001, Χρυσούλα Μανταδάκη Κατά Αργος Α.Ε., Ευρωπη Α.Ε. et. al. [sic], EA 187/III/2001, E-Ventures A.E. et al. [sic], EA 183/III/2001, BE-Business Exchange. (see also supra note 11). 33 EA 187/III/2001, (see also supra note 11). 34 See for example EA 56/II/1999, EA 207/III/2002, (see also supra note 11). 35 Supra note 16.
10 transportation, a matter that entails high fix costs. Moreover, the technology and the know-how for the production of long-life pre-packaged goods is, from the technical point of view, a difficult task, (...) an up to date automatic production line of croissant, which will be able to sufficiently compete with the big undertakings already existing in the market, requires an investments of the level of 1 milliard Drachmas. All the above facts, and also taking into consideration the enormously high cost of indispensable advertisement for promotion of the goods, constitute an important deterrent factor for the entry of new big undertakings into the market of the pre- packaged croissant.
It can be clearly seen, while one goes through the rest of the decision (which prohibited the merger), that the supply-side concerns are evaluated in order to assess the consequences the concentration was going to have on the competition.
2. Geographic dimension of the market
Regarding the definition of the relevant geographic market, the Greek 6.24 competition law applies within the area falling inside the territory of Greece. Article 32 of Act 703/1977 states the following: The present Act shall apply to all restrictions of competition that have effects or may have effects within the country, even where they are due to agreements between undertakings, decisions of associations of undertakings, concerted practices thereof or mergers, concluded, taken practised or effected outside the country or are due to undertakings or associations of undertakings having no establishment therein. The same shall apply in cases of abuse of dominant position or abuse of economic dependence that take place within the country36.
Article 2 of Act 703/1977 prohibits any abuse of a dominant position “within the national market as a whole or in a substantial part of it”. Moreover, Article 4c states that upon a decision taken by the Competition Committee of Act 703/1977 a concentration shall be prohibited if it is ascertained that it “may significantly impede competition in the national market or in a substantial, with respect to the characteristics of the products or services, part of it.”
In its Notification Form37 the Competition Committee notes the following with 6.25 respect to the relevant geographic market: The relevant geographic market comprises the area in which the undertakings concerned sell the relevant products or provide the relevant services, in which the conditions of competition are sufficiently homogeneous and which can be distinguished from neighbouring areas because the conditions of competition are appreciably different in those areas.
Among factors considered to be relevant in identifying the geographic 6.26 dimension of the market, the Committee includes the nature and the characteristics of the products and services, the existence of entry barriers,
36 See Article 32 of Act 703/1977 (emphasis added). For more on the geographical scope of the application of Greek competition law see Vouterakos, p. 579 et seq. [add the relevant provision] 37 Supra note 8.
11 consumers’ preferences, crucial differences on the market shares of the undertakings operating in adjoining geographic areas or differences with respect to the prices. In addition, other factors such as “difficult access to other areas on the ground of geographical distances or transport cost,”38 seem to have been decisive in delineating the relevant geographic market in narrower terms.
The committee has made a distinction, as far as the geographic dimension of the 6.27 relevant market is concerned, based on the consequences the merger will have on the competition for a particular group. In its decision AB-Basilopoulos- Tropho,39 the committee first drew a distinction between the upstream (whole- sale) and down-stream (retail) market of the supermarket products, with the wholesale relevant market being the entire territory of Greece. As far as the retail market is concerned, the committee indicated that if the criteria to be used were (i) the consequences the merger will have on the competition to the end- consumers, the relevant market shall be each administrative region, on which the super-markets concerned operate. On the other hand, if the criteria to be used were (ii) the consequences the merger will have on the competition to the whole-sale suppliers, then the market shall be again the entire territory of Greece, for the merger will strengthen the nation-wide “bargaining power” of the super-market network in charge, thereby “creating relations of economic dependency for their suppliers.”
In relation to the media sector, proximity and the geographic topography may 6.28 play a role in the market definition. On the other hand, the Committee held that telecommunications services markets are nation-wide markets due to the impressive developments in the sector, which have made possible for an overall coverage of all Greek territory. Knowing the fact that several activities falling within the media sector encompass similar infrastructures as the electronic communications sector, this line of argument seems to be of great relevance. Similar to the view accepted at EC level,40 the Greek Competition Committee holds language differences and shipment patterns to also be focal factors in defining the relevant geographic market. In its decision BE-Business Exchange,41 the Committee took those factors into considerations and gave the market for electronic commerce a national dimension rather than a global one42.
3. Evidence relied upon
From the evidence gathered it is safe to say that the Competition Committee 6.29 does not rely only on the materials provided for from the parties, but it uses frequently other sources, especially data published by independent statistics enterprises, qualified expertise etc. Moreover, it makes cross-references in its
38 See for e.g. EA 225/III/2002, Αρτοποιοί του Ν. Φωκίδας [emphasis added], (see also supra note 11). 39 EA 176/III/2001 Αλφα-Βητα Βασιλοπουλος-Τροφο Α.Ε., [AB-Basilopoulos-Tropho] (See also supra note 11). 40 See Chapter 1 para. 1.45. 41 EA 183/III/2001 (see also supra note 11). 42 See for more part (B) below.
12 decisions to its previous decisions and decisions of the EC Commission dealing with the same sector, or decisions of the European Court of Justice and the European Court of First Instance.
III. Ex lege defined markets
There are several cases where markets are “defined” a priori by the Greek law. 6.30 In most cases, this delineation concerns by and large the supply-side of the market at stake. The electronic communications sector and the media sector are the best example of such economic fields, in which the law often intervenes and imposes specific obligations on the suppliers. The rationale for that might be the lack of frequencies, objectivity related matters, the need for all voices to be heard and so on. The maintenance of a free competition per se has also been stressed as a reason for obliging the suppliers to not participate in more then one market. A good example of that is Article 2 paragraph 4 of Act 2644/1998, which regulates radio and TV services upon subscription (pay-TV). According to this provision: The owner of the licence of the present Act shall not posses at the same time a licence for radiobroadcast or television station of the Articles 6 and 1 paragraph 1 and 4 of Act 2328/1995 (free-to-air broadcasting stations). The participation of the owner of the licence of the present Act in an enterprise that has a licence for a free broadcasting station is possible upon the condition that such a participation is not in violation of free competition law and it does not provide for an abuse of the dominant position, which the undertaking in charge might have acquired in the market of radio broadcasting and television services, nor does it in any way infringe the political or cultural plurality in the media sector43.
IV. Other criteria
Before looking at the criteria scrutinized below, it needs to be emphasised that 6.31 as a rule, the Competition Committee uses these tests not to define the relevant market in a strict sense, but for the most part with a view on the competition in the very relevant market, which in most cases has already been defined. While dealing with competition issues, the approach of the Committee is somehow clear. First, it identifies the economic sectors, in which the undertakings in charge conduct activities. After having done that, and having identified the main products or services that the undertakings concerned engage in their main economic activities, the Committee carries onto identifying the relevant markets these products and services belong to. Next, the Committee evaluates the position of the undertakings in these relevant markets. At this point, the analysis differs regarding the legal regime that applies in each case and will be further elaborated below. Last but not least, the Committee deals with all other economic or other factors that might have an impact on the competition in the relevant market.
43 Emphasis added.
13 According to Article 4c paragraph 2 of Act 703/1977: 6.32 Within the scope of appraising the possibility of a concentration to constitute a significant impediment of competition within the meaning of paragraph 1 of the present Article, the following shall be taken into account, especially the structure of all the relevant markets concerned, the actual or potential competition from undertakings located either within or outside Greece, the existence of any legal or other barriers to entry, the market position of the undertakings concerned and their financial and economic power, the alternatives available to suppliers and users by the undertakings concerned as well as by actually or potentially competitive undertakings, their access to suppliers or markets, the supply and demand trends for the relevant goods or services, the interests of the intermediate and ultimate consumers and their contribution in the development of technical and economic progress provided that it is to consumers' advantage and does not form an obstacle to competition44.
It is clear from the above mentioned provision that the criteria stated therein are typically evaluated within the context of assessing the possibilities a concentration might have to impede the competition. Nevertheless, the Competition Committee seems to be willing to take these criteria into account for the purpose of delineating the relevant market as well. Thus, in its Notification Form for example, the Committee points to the terms of competition and the existence of entry barriers as necessary information that help defining the market and should therefore be provided by the undertakings45. Therefore, a close examination of the following criteria is considered necessary, for they might have an important influence in narrowing or broadening the relevant market, as previous decisional practice of the Competition Committee has shown46.
1. The structure of the markets
The structure of the market seems to be an important element frequently used in 6.33 the Committee’s case law. It is not clear whether the Committee relies on this factor only for the purposes of evaluating the effects an infringement or a merger has on competition, or it is also willing to use this element for the purpose of market definition. In most cases, the test is exploited for the first purpose, i.e. by analysing the structure of the market the Committee draws conclusions regarding the position and the market power of the undertaking at stake and the outcome its actions are expected to have on the competition47.
However, in one of its decision, the Competition Committee did stress the role 6.34 the market structures might have in classifying different energy sector activities as belonging to separate markets48. The Committee indicated that the energy
44 Emphasis added. 45 See section 6, para. I and II of Prior Notification Form (see footnote 8). 46 See decision EA 190/III/2001, Ακτωρ Α.Τ.Ε. - Ελληνικη Τεχνοδοµικη Α.Τ.Ε. -Τοµη Α.Τ.Ε, (see also supra note 11). 47 See for example EA 2/II/1998, EA 43/1996, EA 183/III/2001, 184/III/2001, (see also supra note 11). 48 EA 190/III/2001 Τοµη Α.Τ.Ε [Tomi] (supra note 46).
14 field comprises a variety of activities such as the production, high tension cable transportation, low voltage cable distribution, and finally the delivery of the electric energy to the ultimate consumers49. It went on saying that each one of those activities is capable of being a separate product market for it requires different installations, and “the structure of these markets and the terms of competition will be different in each one of them”50. From the latest remarks one may easily suspect that the Committee might employ in the future a similar approach in the media sector, since several media services, alike the energy sector, are markets based on network facilities that can easily be viewed as separate due to, among others, market structure and competitions terms51.
Coming back to the media sector, the Committee has made use of the market 6.35 structures test in order to identify the markets for publishing. In its decision Ιντερτυπ-Επιφανεια [Intertip-Epiphania],52 it defined the following markets based on different industry structures existing in the sector: a) the market for printing and publishing of newspapers and magazines, b) the market for printing and publishing of books, c) the market for printing and publishing of the remaining goods and the graphic designs market53.
Regarding the legal regime, the Committee is supposed to scrutinize the 6.36 structure of all relevant markets for the purpose of merger control (Article 4c of the Act). In this respect, the market structures test seems to be of greater relevance and a more helpful tool in merger cases for relevant market assessment is always ex ante and somehow speculative. Therefore, a good look on the structure of all the markets involved will provide a better understanding of where the new undertaking will operate on and the consequences this conduct
49 Similar position is held at EC level as well [see Commission Decision, Case IV/M.1346, 27 January 1999, EDF/London Electricity]. The case can be found at: http://europa.eu.int/comm/competition/mergers/cases/decisions/m1346_en.pdf See also Commission Decision, Case COMP/M.1720, 5 January 2001, Fortum /Elektrizitätswerk Wesertal, and Commission Decision, Case IV/M.1606, 19 July 1999, EDF / South Western Electricity. Each can be found respectively at: http://europa.eu.int/comm/competition/mergers/cases/decisions/m1720_de.pdf http://europa.eu.int/comm/competition/mergers/cases/decisions/m1606_en.pdf 50 One may interpret the wording of the Committee structure of the market (δοµή των αγορών) to mean the actual infrastructure of physical installations used for the purposes of energy distribution. Nevertheless, we consider this not to be the right interpretation for two reasons, first the committee has already stressed the installation differences in the beginning of the sentence (“διαφορετικές εγκαταστάσεις“ may be translated into “different infrastructures”, or “different installations”), and second and by far the most important, the element of competition that the committee points out together with the market structure leaves no doubts but for the interpretation we have suggested. Moreover, the fact that the same line of reasoning is held at EC level shows that Greek Competition Committee follows closely these developments. 51 See also EA 208/III/2002 where the Competition Committee reaffirmed its previous positions regarding the energy sector while dealing with the structure of the market (see also supra note 11). 52 EA 81 / II /1999 (see also supra note 11). 53 See also decision EA 135/II/2000 (supra note 21) where the Committee concluded that there are two separate markets for the same identical product (books) based on structure peculiarities of those markets (see also supra note 11). For more see below part (B).
15 might have on the overall competition54. However, the Committee has made use of the market structure test even in cases of infringements. In its decision Χ. Μανταδάκη [Madathaki]55 regarding press distribution, the Committee analysed the structure of the market in order to assess joint dominance. In particular, the Committee looked at the market structure for press distribution and indicated the existence of a duopoly. It went on saying that joint dominance shall be assessed when the following two conditions are satisfied, (i) the absence of competition between the two undertakings forming the duopoly and (ii) the absence of competition between the undertakings forming the duopoly and the outside competitors. The focal feature of its argument in this decision is the market structure. The Committee builds its case by only looking at the market structure without employing any other criterion. As a matter of fact, nowhere throughout the above mentioned decision does it essentially delineate the market using the conventional approach. After assessing the existence of a duopoly by only looking at the structure of the market, the Committee moves forward to the rest of its judgement giving the impression that, in the case at hand, the analysis of the market structure is sufficient evidence for the purpose of market definition and the assessment of dominant position.
2. Actual and potential competition
The Committee investigates the conditions of competition carefully in most of 6.37 its decisions. It has been illustrated above that this test is frequently used together with the analysis of market structures and entry barriers. In its Notification Form the Committee states that it will take into account the terms of competition for delineating the relevant product market56. Nevertheless, its practise shows that the Committee has been rather cautious in using competition conditions as an element for defining the relevant market. With the exception of the Τοµη Α.Τ.Ε. [Tomi] decision, the terms of competition are usually used to identify the effects an infringement or a merger will have on competition in the market at issue. The analysis of the Committee is twofold. First, it deliberates on the position of real competitors operating in the relevant market, then it goes on elaborating on the impact the outside (potential) competitors may have in the relevant market.
It must be stressed that the Committee examines the terms of competition on 6.38 both infringement and merger cases. Nevertheless, there are two key situations where the terms and the patterns of competition are the most crucial elements of the investigation. The first situation embraces cases where a dominant position needs to be established. It has been underlined57 that for the purpose of evaluating joint dominance, the Committee analysed the competition between the undertakings and between them and the potential competitors58. The second situation is linked to cases involving the appraisal of joint ventures. In order to
54 See Also Ea 184/III/2001, ∆ελτα Πληροφορικη – Singular, (see also supra note 11). 55 EA 181 / III / 2001 (see also supra note 11). 56 Section 6 § I of Prior Notification Form, (see supra note 8). 57 EA 181 / III / 2001, (see also supra note 11). 58 EA 181 / III / 2001 (supra note 11).
16 distinguish whether a joint venture is a genuine concentration or it merely coordinates the competitive behaviour of undertakings, thereby falling within the scope of Article 1, § (1) as a simple agreement, the Committee looks at two factors. First, whether the joint venture will perform on a lasting basis all the functions of an independent economic unit, and second, whether its founders continue their activities in the same market where the joint venture is also active. If the latter condition is fulfilled, which means that the new entity and the founder enterprises are all going to conduct business in the same market, in which the founder enterprises were actual (or potential) competitors prior to the emergence of the new entity, the Committee has judged that even though the joint venture will perform on a lasting basis all the functions of an independent economic unit, its establishment or operation shall be deemed to have as its object (or effect) the coordination of the entrepreneurial behaviour of the founders and therefore, shall not be regarded as a concentration59.
This approach can be awarded to the fact that the Greek competition law differs 6.39 with regard to merger control from the ECMR at least in two points, (i) according to the Competition Committee60, joint ventures with all the features of independent units or undertakings, whose founders continue their activities in the market where the joint venture is also active, and whose establishment or operation has the object or effect of coordinating the entrepreneurial behaviour of the founders, do not constitute concentrations, and (ii) according to Article 4c § (1) of the Act, the Competition Committee shall prohibit any concentration between undertakings that is subject to prior notification and may significantly restrict competition in the national market or in a substantial, with respect to the characteristics of the products or services, part of it, and particularly61 by creating or strengthening a dominant position. Moreover, the Committee includes in its ex ante investigations of merger cases the examination of the conduct of the undertakings under consideration in the separate but closely related neighbouring markets (so-called interdependent markets62), thereby following closely the development at the EC level63. It is interesting to note that in all cases under discussion the Committee does not investigate the undertakings’ conduct in the closely related markets for the purpose of assessing leverage of dominant position but rather for the purpose of
59 See EA 187/III/2001, E-Ventures A.E., (see also supra note 11). 60 See Comments of the Greek Competition Committee on the Green Paper, Regarding the review of Regulation (EC) No. 4064/89 on the control of concentrations, at: http://europa.eu.int/comm/competition/mergers/review/comments/ref103_hellenicauthoriti es.pdf See also Article 4, § 5 (a). 61 The wording of this passage is not exceptionally well formulated. The interpretation given by the Committee (see ibid. Comments) is that the creation or strengthening of a dominant position is the foremost but not the only indication of a significant lessening of competition on the relevant market and therefore a concentration might be prohibited although it does not make for a creation or strengthening of a dominant position. 62 EA 187/III/2001, EA 184/III/2001 EA 183/III/2001 (see also supra note 11). 63 Case COMP/M.2416, 30 October 2001, Tetra Laval/Sidel. See also Case IV/31043, 24 July 1991, Tetra Pak II; ECJ Case C-333/94P, Tetra Pak International SA v. Commission [1997] ECR I-05951.
17 assessing the existence of a coordination of the behaviour of the undertakings involved in establishing a joint venture. If the mother entities and the joint venture will continue to be active in the same market or in separate but closely related neighbouring markets the Committee draws conclusions that the creation of the joint venture is a mere coordination of competitive performance of the undertakings and shall therefore fall within the prohibition provisions of Article 1 § (1) of the Act.
3. Legal, economic and other entry barriers
This test is also frequently used by the Committee in close connection with the 6.40 conditions of competitions and the market structures. As a general rule, the Committee employs this test with a view on the competition as such. Especially in merger decisions, which constitute by far the large majority of all decisions, this test is ideal for assessing the outcome a concentration will have in a particular market. Where the market is thought to be open, competitive and free of legal or other barriers for undertakings that desire to enter into, a new concentration will not be able to put further constraints on the competition and the Committee is willing to clear the merger. Hence, the Committee has indicated on several occasions that the telecommunications markets are open and competitive markets, and there are no legal entry barriers64.
B Repertoire of relevant product and geographic market in media sector in Greece
This part is meant to provide a descriptive picture of the main media sector 6.41 markets as they have been defined by the practice of the Greek Competition Committee. It was mentioned in the beginning of the analysis (para 6.07) that the Greek Competition Committee has not dealt with a lot of cases regarding the media sector. Therefore, this part will endeavour to briefly present the main areas delineated in the media sector, and where possible, their sub markets as identified by the Committee. A more detailed examination of these areas will be carried out in section (D) of the work.
The main sectors that this part will look up within the media sector are (i) the publishing and books sector, (ii) music-copyright, (iii) broadcasting sector, (radio and television), (iv) the film sector, (v ) and the Internet.
I. Publishing and books sector
As far as publishing is concerned, in its decisions Ιντερτυπ – Επιφανεια [Intertip- 6.42 Epiphania],65 the Committee distinguished the following markets, a) the market for printing and publishing of newspapers and magazines, b) the market for
64 See for example EA 2/II/1998, EA 180/III/2001, (see also supra note 11). 65 EA 81 / II /1999, (see also supra note 11).
18 printing and publishing of books, c) the market for printing and publishing of the remaining goods and graphic designs market. The separation was based on different industry structures existing in the sector, i.e. the publishing companies operating in the press sector are for the most part vertically integrated and able to provide the final product themselves, whereas the book publishers limit their activity usually in publishing the books and delegate the printing to third parties. The third market comprises all those enterprises that undertake to print only for third parties, as well as those providing any kind of graphic designs services. In the case at hand, which involves a merger between two undertakings via acquisition of the first from the second thus creating a new entity, both companies Ιντερτυπ A.E. and Επιφανεια A.E. [Intertip and Epiphania] were conducting business mainly on the third market, i.e. the market for printing and publishing of remaining materials other than books, newspapers, and magazines, and the market for all sorts of graphic designs works. Regarding the geographic dimension of the relevant market, the Committee considered it to include the whole of the Greek territory66.
Based on market surveys conducted by independent sources,67 the Committee 6.43 indicated that in Greece the publishing-printing markets seem to be predominantly competitive. There are at least 145 active enterprises in the market for printing and publishing of newspapers and magazines, and some 329 in the two other markets, i.e. the market for printing and publishing of books, and the market for printing and publishing of remaining goods and graphic designs market. Moreover, the Committee found that in general publishing activities do not involve heavy investments allowing therefore new undertakings to easily access the relevant market68. As a result, the potential competition is expected to be strong as well. This lead the Committee to conclude that the competitive constraints the two undertakings at issue are facing from both actual and potential competitors, combined with the low market shares the two founder enterprises previously held in the relevant market, are as such not to allow the new entity to impede competition in any way, nor do they make for a creation or strengthening of a dominant position in the relevant market.
On another occasion, the Competition Committee divided the market for books 6.44 into the market for books intended to be sold to private consumers and the market for books intended to be sold to public institutions69. Here again the criterion for this demarcation was the markets’ structures combined with the impact that different regulations might have on the commercial performance of the undertakings in the market for books. The public institutions and undertakings acquire books after public tenders, organized according to specific rules, whereas the ultimate private consumers buy the books at their wish. Moreover, as regards the market for books intended for public institutions, the Committee rejected the view that each tender forms a separate market. It voiced the opinion that due to common characteristics that all public tender procedures
66 Ibid., Section 2 (b). 67 Ibid. 68 Ibid., Section 2 (a) para. 11. 69 EA 135/II/2000, (see also supra note 11).
19 entail, they should be viewed as a continuous process, and the market should be defined as a sole market comprising all of them. At this point the Committee refers to previous case law of EC Commission, which had come to similar conclusions70.
II. Music-copyright
The Competition Committee has dealt with copyright issues in the case of 6.45 AEPI.71 . The case involved a complaint brought by a group of lyricists and composers against AEPI, a copyright-management society entrusted with collecting of intellectual property rights in the field of musical works, which, according to the Committee, possesses a market share of 95% in the relevant market. The Committee found the relevant product market to be the market for the administration of intellectual property rights of authors (lyricists and composers) of musical works. The geographical dimension of the market was held to be national. Although an international cooperation with foreign organisations charged with the administration of intellectual property rights was in principle accepted by the Committee to be feasible, the Committee noted that language differences place this international cooperation not interchangeable with cooperation in the national market (here the Committee made a cross-reference to the decision of the EC Commission in “GEMA I”71a). The next competitor EMSE, a small copyright-management society, was found to possess only a very small market share, thus, placing AEPI in an extremely strong economic position within the relevant market, which, according to the decision, is a position of dominance. The case is an excellent example for showing how the Greek Competition Committee follows carefully the development of the case law at the EC level, and for also showing the will of the Committee to accept and to utilise the findings of the EC Commission and the EC courts. The Committee makes here several references to cases dealt by the EC Commission and EC Courts, namely, “Gema I” and “GEMA II”, “BRT/SABAM and Fonior”, “Banghalter & Homem Christo vs SACEM,”71b etc. Accordingly, as regards the finding of an abuse of the dominant position, the Committee emphasised the earlier findings of the EC Commission in “GEMA II”71c and rejected the claims of AEPI that a division between administration of
70 Commission Decision, Case IV/31.572 and 32.571, 5 February 1992, Building and construction industry in the Netherlands relating to a proceeding pursuant to Article 85 of the EEC. The case can be found at: http://europa.eu.int/smartapi/cgi/sga_doc?smartapi!celexplus!prod!CELEXnumdoc&numd oc=392D0204&lg=EN . 71 Case EA 245/ΙΙΙ/2003, [Σ. Ξαρχάκου, et al., vs “ΑΕΠΙ Ελληνικής Εταιρείας Προς Προστασία της Πνευµατικής Ιδιοκτησίας Α.Ε.“, (S. Ksarchakou et al., vs AEPI)] from now on referred to only as AEPI case, (see also supra note 11). 71a Commission Decision, Case IV/26.760, 2 June 1971, Entscheidung der Kommission vom 2. Juni 1971 betreffend ein Verfahren nach Artikel 86 des Vertrages (GEMA-I). 71b Commission Decision, Case COMP/C2/37.219, 12 August 2002, Banghalter & Homem Christo vs SACEM; Case 127/73, Belgische Radio en Televisie v SV SABAM and NV Fonior [1974], ECR 51. 71c Commission Decision, Case IV/26.760, 6 July 1972, Entscheidung der Kommission vom 6. Juli 1972 betreffend ein Verfahren nach Artikel 86 des EWG- Vertrags (GEMA-II).
20 mechanical rights and performance rights in the contracts – as required by the claimants – was not effective and economically inefficient, which in its turn would have had substantiated that an abuse has not occurred. It noted that the evaluation of whether the refusal on behalf of the AEPI to accept the administration of patrimonial rights separately as well as its insistence on all- rights clause is justified or not shall be evaluated on the basis of the analysis and the categories found in “GEMA II”. Ultimately, the Committee found that the refusal to carry out the administration of only some of the intellectual property rights without special justification constitutes, in principle, an abuse of the dominant position The Committee did not go further onto evaluating whether or not these individual intellectual property rights make for separate relevant markets for that was not necessary for the purposes of the case in hand.
III. Broadcasting
For the time being, there has not been any major decision regarding the 6.46 broadcasting sector. Section (D) will elaborate more on the relevant legal provisions that might also have an impact on the market definition concerning the broadcasting sector.
IV. Film sector
The Committee held in Video Seven vs. Top Video and Audio Visual,72 that the 6.47 market for reproduction and supply of cinematographic and TV films in forms of videotapes (VHS) is separate from the DVD (Digital Versatile Discs) market. The decision deals with a request made by Video Seven A.E. for provisional measures in accordance with Art 9 §(4) of the Act against Audio Visual Enterprises and its exclusive distributor D. Raptis A.E.-Top Video invoking claims that the latter two companies had abused their dominant position in breach of Art 2 of Act 703/1977.
The Committee found the relevant market to be the market for reproduction, 6.48 disposition [circulation] and the translation/subtitling of cinematographic and TV films72a in the form of VHS (videotapes) and DVD (Digital Versatile Discs). It went on saying that VHS and DVD belong to different relevant markets, however, the reason for this differentiation is not disclosed. Further on, the Committee made the following classifications as regards the films carried on by both mediums of video/audio content (VHS and DVD) within their respective relevant markets: (i) newly released movies, which are well-known for their successful conduct at the cinematographic theatres (block busters), (ii) films nominated for Academy Awards (Oscar) or that have already won the latter, and (iii) the rest of the movies, which are usually divided into further categories, i.e. romance, action, drama, social, fiction etc. The decision is short (for it involves issues related to provisional measures) and does not provide for more details
72 EA 226/III/2002, (see also supra note 11). 72a The Committee did not deal any further with TV films and the rest of the decision concerns mainly the feature films.
21 with reference to the above mentioned classifications. Therefore, it can not be said with certainty whether the Committee considers the identified categories of films to also be separate relevant product markets or just a mere genre classification. Nevertheless, this delineation chosen by the Committee seems interesting, and hopefully the expected final decision throws more light on the methodology used by the Committee.
In the second case, Europlex/Warner/Village Roadshow I,73 which also engages 6.49 a request made by Europlex for provisional measures in accordance with Art 9 § (4) of the Act against two companies Warner and Village for violation of Article 1 § (1) and Article 2 of the Act, the Committee briefly looked onto the film sector and acknowledged that Warner is active in films distribution within the national territory of Greece whereas Village conducts business activities on the market for feature films distribution within the national territory of Greece, and the market for movie theatres operation. Moreover, it is a shareholder of the Village radio station and it funds and takes part as a co-producer in the production of Greek films. Europlex engages activities related only to movie theatre operation and film exhibition therein (theatrical exhibition). The Committee did not analyse further the film sector for this was not considered necessary for the case in question and a strict definition of the relevant market was not given74. However, the Committee announced on May 23 and 27, 2003 two more decisions regarding respectively two requests made by Europlex for provisional measures in accordance with Art 9 § (4) of the Act against respectively Warner and Village75 in the first case and Odeon76 in the second. In both cases the business activities of the undertakings at issue involve the same areas as identified in Europlex/Warner/Village Roadshow I, i.e. the market for feature films distribution within the national territory of Greece, the market for movie theatres operation77 and theatrical exhibition of films, also activities related to radio station and production of Greek films. In both cases the Committee identified the relevant product market as being the market for feature film distribution. It went on saying that with exception of certain films that can be considered to be unique, documentaries and short length films, most of the movies provide 90 minutes of entertaining and therefore ought to be viewed as being substitutable in the viewers’ eyes as well as on the part the undertakings operating the movie theatres. The average viewer follows,
73 EA 230/ΙΙΙ/2003, (see also supra note 11). 74 The Committee rejected the claims of Europlex for provisional measures against the two above mentioned companies on the grounds that a probable general refusal to sell [and therefore a probable infringement of Articles 1 and 2] was not founded, and also the second assumption of an urgent need for an imminent and incurable damage to the complainant required by Art 9 §(4) in order to grant provisional measures was not fulfilled. Art 9 §(4) states the following with regard to granting of provisional measures: “The Competition Committee has the exclusive competence to take provisional measures, upon its own initiative or upon request of the person who brought the complaint […] where an infringement of Articles 1, and 2 of the present Act is most probable to occur and where there is an urgent need for an imminent and incurable damage to the complainant.” 75 EA 239/III/2003, Europlex /Warner / Village Roadshow II (see also supra note 11). 76 EA 240/III/2003 (see also supra note 11). 77 Odeon is active in this market as well.
22 according to the Committee, all kinds of films and does not pursue explicitly a particular type of films such as comedies, police action, Greek or foreign films. The geographic dimension was a local area within the territory of Greece in all cases. The discussion over the relevant product market stops here since both decisions deal with provisional matters and a detailed examination of the markets involved was not considered necessary78. It follows from the above that the Greek Competition Committee does not have, as yet, a quiet clear position vis-à-vis theatrical exhibition of feature films. It is not certain whether the Committee considers this activity to be a separate product market or simply a part of the general market for feature film distribution. More on the subject will be discussed later on.
V. Internet
In Eurobank-Infoquest-Unifon,79 the Committee drew a distinction between 6.50 access and content by stating: The provision of Internet services can be divided into the following activities, which, for the case at hand, are capable of comprising separate relevant markets of: a) Internet access (dial up and dedicated access) for home and business use, and b) advertising via Internet. The division is based mainly on the fact that revenues earned by these activities are derived from different sources, such as e.g. the revenues from “access to Internet” come from the users of Internet, whereas the revenues of the advertising market come from the person advertised on the websites of the internet.
It reaffirmed this position in the decision ∆ελτα Πληροφορικης-Singular [Delta- Pliroforikis]80 by stating that the Internet market is comprised of two distinguished parts, (i) the market of the Internet service providers, and (ii) the market for internet services. The latter may take according to the Committee the following forms: a) the production and maintenance of web sites b) electronic commerce c) electronic advertising d) electronic publishing etc. (the list is not exhaustive)81. The decision does not elaborate further upon the sector and the Committee did not attempt to offer a more comprehensive view of the relevant sub markets within the Internet sector, for that seemed to be unimportant for the issue at hand. Therefore, it is hard to conclude whether the above listed activities are seeing by the Committee as comprising separate relevant markets or simply different services within the same market. The Committee had taken however a clear position regarding the advertising via the Internet in Eurobank-Infoquest- Unifon,82 by considering this service to be capable of comprising a separate relevant market. Viewing the latter finding in conjunction with service classification made by the Committee in Delta-Pliroforikis, it can be assumed
78 The Committee rejected the claims of Europlex for provisional measures against the above mentioned companies on both cases. 79 EA 129 / ΙΙ / 2000 (see also supra note 11). 80 EA 184/III/2001, (see also supra note 11). 81 Ibid. Section III (para. 2). 82 See supra note 78.
23 that there is at least a tendency to consider the services listed therein as being separate relevant markets. Nevertheless, the issue has been left open for the time being. One thing is certain at this point that as far as the general division between access and content is concerned, the Committee has a clear position that Internet access and internet content services form two separate markets83. 6.51 In BE-Business Exchange84 the Committee identified the market for construction and maintenance of B2B electronic market places to be the relevant market. The Committee noted that this market can be divided into the following sub markets, (i) market for construction and maintenance of horizontal B2B electronic market places, i.e. the creation and maintenance of “places” where undertakings that do not belong to the same economic field may find other undertakings in order to trade, and (ii) the market for construction and maintenance of vertical B2B electronic market places, i.e. the creation and maintenance of “places” where companies belonging to a particular (specialised/vertically integrated) economic sector may come in contact with each other. The Committee indicated that since B2B markets’ sector is still in first stage of development, an exact conclusion of whether the services provided online by BE-Business Exchange form a separate relevant product market or are part of the broader services market comprised of online and traditional offline trading services can not be drawn at this point on time.
The geographic dimension of Internet related markets has been considered to be 6.52 national85. The Committee noted in BE-Business Exchange that, in principle, Internet markets could be seen as global markets since anyone may make use of a particular service from anywhere in the world. However, the mere fact that Internet has no physical “frontiers” does not, according to the Committee, justify “stretching” these services’ relevant markets beyond the limits of national market, and the market shall be considered national for (i) the language of the transactions in the electronic B2B market place will be Greek, and (ii) issues related to tax law, trade costumes, problems linked to physical delivery of the products also pose serious barriers for the trade with undertakings outside Greece. Moreover, the expressed intention of the founders of the new entity that the main aim of the new company is to serve as a starting point, the needs of local Greek firms and later on also Cypriot firms (due to the same language spoken in both countries) is, according to the Committee, another indication that the activities of the undertaking under discussion are limited within the borders of national territory86.
83 See e.g. EA 184/III/2001, EA 129 / ΙΙ / 2000 (see also supra note 11). 84 EA 183/III/2001 (see also supra note 11). 85 EA 183/III/2001, EA 184/III/2001 (see also supra note 11). 86 EA 183/III/2001 (see also supra note 11).
24 VI. Advertising in the media
In its decisions Berkeley Square-Κεµακο [Kemako]87, the Committee analysed 6.53 the advertising sector for the purpose of defining the relevant markets in which the notified entity was to operate88. The Committee identified the following markets as regards the advertising sector, (i) the market for the supply of advertising services (ii) the market for the production of advertisements (commercial films) destined for the movie theatres and the television. (iii) the market for public relations services, (iv) the market for representation and promotion of printed media organizations, and (v) the market for media houses, (the latter market consist of undertakings, which encompass as a main subject of their business profile activities linked to the purchase and supply of available TV or radio time, or place in the newspapers and magazines for other interested parties). It reaffirmed this position in Interpublic Group-Ashley & Holme89. Here, the Committee dealt with a merger between two companies operating within the broader sector of advertising and identified the following main markets within this sector, (i) the market for the supply of advertising services, (ii) the market for the production and trading of advertisements (commercial films) destined for the movie theatres and the television, and (iii) the market for public relations services.
It is evident that the Competition Committee follows a similar approach with regard to the advertising in the media as the pattern followed by the EC Commission90. According to this approach, films produced for advertisement purposes (commercial films) are not to be viewed as equal to the other means of advertising. As a consequence, commercial films ought to be placed under their own explicit market for the purpose of market definition (for more on the subject se hereto bellow para. 6.69).
87 EA 76 / 1997 (see also supra note 11). 88 The case involved a notified merger between several advertising companies. 89 EA 119/1998 (see also supra note 11). 90 See Chapter 1 para. 1.162.
25 Table
Media Markets
Publishing and Books Sector
Market Main Markets Submarkets Submarkets Submarkets Category (1st Level) (2nd Level) (3rd Level)
Printed Press / Market for printing and Publishing publishing of newspapers and magazines
Market for printing and publishing of books
Market for printing and publishing of the remaining goods and graphic designs market
Books Markets Book Market∗ Market for books intended to be sold to private consumers
Market for books intended to be sold to public institutions
Music/Copyright
Copyrights of Market for the musical works administration of intellectual property rights of authors (lyricists and composers) of musical works
∗ The reference by the Greek Competition Committee to the “market for books” in its EA 135/II/2000 decision is considered to ascribe to the market for the sale of books.
26 Broadcasting
There have been, as yet, no decisions related to this sector
Film
Market Main Markets Submarkets Submarkets Submarkets Category (1st Level) (2nd Level) (3rd Level)
Film Market for feature distribution films supply/ distribution
Market for reproduction, Market for disposition reproduction, [circulation] and the disposition translation/subtitling [circulation] and the of cinematographic translation/subtitling (and TV) films in of cinematographic form of videograms (and TV) films in (VHS & DVD) the form of VHS
Market for reproduction, disposition [circulation] and the translation/subtitling of cinematographic (and TV) films in the form of DVD
Market for theatrical exhibition of feature films∗
∗ Indicates that the issue whether this makes for a separate markets has been left open.
27 Internet Markets
Internet Access Internet access Markets market (dial up and dedicated access) for home and business use
Internet Content Market for Internet Markets advertising
Market for construction Market for and maintenance of construction and B2B electronic market maintenance of places to be the horizontal B2B relevant market electronic market places
Market for construction and maintenance of vertical B2B electronic market places
Advertising in the Media
Market Main Markets Submarkets Submarkets Submarkets Category (1st Level) (2nd Level) (3rd Level)
Market for the supply of advertising services
Market for the production of advertisements (commercial films) destined for the movie theatres and the television
Market for public relations services
28 Market for representation and promotion of printed media organizations
Market for media houses
29 C Comparative analysis of market definitions adopted by the European Commission and those adopted by Competition Authorities in Greece
I General remarks
The present analysis will examine the Greek Competition positions regarding 6.54 relevant market definition in the media sector vis-à-vis the positions held at the EC level. Due to the lack of adequate decisional practice, it seems to be extremely hard to come to rigorous conclusions for all media sectors. Therefore, attention is paid only on the sub sectors, with reference to which the Greek Competition Committee has had the opportunity to express its views. Before going into details, a few general remarks regarding the performance of the Greek Competition Committee are considered necessary at this point.
With Act No 2296 of 2 February 1995 the Competition Committee, which had 6.55 been functioning as an executive organ within the framework of the Ministry of Trade, became an independent administrative authority. Nevertheless, it faced organisation problems and lack of economic independence (until Act 2837/00), thus, making its task particularly hard during the first years of its existence91. This can be easily noticed in its decisional practice. More recent decisions tend to be improved to a great extent with regard to the quality. They are longer and better structured, provide further details and incorporate additional test-criteria, and their number has significantly increased in comparison to the lesser amount of older decisions, which were more laconic and not so deeply elaborated upon.
Regarding the content of the decisions, it is safe to say that, in principle, the 6.56 Competition Committee follows closely the development at the EC level. The Competition Committee makes frequently cross-references in its decisions to the decisions of EC Commission or EC courts, which had dealt with similar issues. On occasions, the Committee substantiates its claims on the fact that the same conclusions were also drawn at the EC level as regards the delineation of the particular market at stake, consequently, there exists no reason for the same kind of market to be regarded as being different in Greece from the ones defined at EC level or in other individual EC member states92. On the other hand, the Greek competition Act follows a similar approach with EC competition law with exception of a small number of minor differences93.
91 See Competition Committee’s annual report for the year 1996-1997 for more. 92 See for example EA 207 / III / 2002, (see also supra note 11). 93 See Comments of the Greek Competition Committee on the Green Paper, Regarding the review of Regulation (EC) No. 4064/89 on the control of concentrations, at: http://europa.eu.int/comm/competition/mergers/review/comments/ref103_hellenicauthoriti es.pdf See also: Kotsiris, pp. 401 et seq; Vouterakos, pp. 585 et seq.
30 II. The general methodology followed by the Greek Competition Committee
While examining the principles applied and the conclusions drawn by the Greek 6.57 Competition Committee as regards the relevant market definition in competition cases one can easily perceive that for the most part they reflect the approach adopted by the European Commission in its antitrust and merger proceedings. The analysis of the relevant markets carried out by the Committee in the media related sectors discloses a general consistency of the Greek approach with the principles applied by the EC Commission.
The Committee appraises the relevant market on both its product dimension and 6.58 its geographic dimension. In defining the relevant product market the Committee regards the consumers’ standpoint as the most influential factor for its findings, and so does the EC Commission, which has in its turn emphasised the crucial role of demand-side substitutability tests (see Notice on relevant market definition94). At first sight, a divergence between the Greek approach (as derived from the examination of the decisions of the Competition Committee) and the EC Commission views expressed in the Notice on relevant market definition 95 seems to exist with reference to the price factor and the use of the so-called SSNIP test. The Notice of the EC Commission considers the price factor and specifically the SSNIP test to be the most important feature of the demand-side substitutability test, whereas the Greek Committee gives the price test an equal role with the other factors and has been exceptionally cautious not to say reluctant to employ the SSNIP. (It has been mentioned above that the Greek Competition Committee has so far not issued any particular informing material regarding the general methodology and the strategies it will follow for defining the relevant markets. For that reason, any conclusion on the general position of the Committee towards the use of a particular test is derived from the analysis of its case law).
However, a closer examination of the Greek Committee’s and EC Commissions’ 6.59 practice shows that these discrepancies are much smaller as what appears to be the case at first glance. With reference to the first element, the price test plays in practice not more than an equal role with the other factors (product characteristics, intended use and others) at the EC level despite its considerable value for the definition of the relevant market96. This is also the case with regard to the media related sectors. Therefore, the Greek position vis-à-vis the price test is by and large similar not to say identical with the practice prevailing at the EC level. With reference to the second element, the use of the SSNIP or the so- called “hypothetical monopolist test,” it is safe to say that there is a gap between the EC Commission’s practise and the Greek Competition Committee’s practice concerning the actual use of this test. Whereas the EC Commission does
94 Notice on the definition of the relevant market for the purposes of Community competition law, OJ C 372 9.12.1997, Para. 13. 95 Ibid. 96 See hereto Part B of the Chapter I of this study for an account of the EC Commission’s practice at the EC level.
31 employ the SSNIP test while dealing with market definition issues,97 the Greek Committee does not show the same trust vis-à-vis this test. As a matter of fact, none of the decisions explored for the purpose of this work contains any explicit reference to the SSNIP test98.
The other elements of demand-side substitutability tests, i.e. product characteristics and intended use, as well as the other criteria, such as potential competition, entry barriers, market structures etc., seem to have played the same role in the Committee’s practise and are employed in a similar manner as they are at the EC level. As the above analysis has shown, the Greek Competition Committee monitors closely the developments at the EC level, and has shown a comparable attitude with reference to the importance of these factors and the extent they need be evaluated.
The supply-side substitutability assessments on the other hand are being used by both the Committee as well as the EC Commission to a more restricted degree, i.e. either they are employed when rendered necessary by the facts of the case, or are merely used as supplementary tests to that of the demand-side substitutability tests when the latter alone do not provide a clear image of the situation in the market at issue99.
As far as geographical dimension of the market is concerned, the Greek position has shown by and large consistency with the approach at EC Level. The Committee has considered the relevant markets linked to media sectors to be national in scope. The Committee restricts the geographic dimension of relevant markets to the boundaries of the national territory or to sub-regions within these boundaries taking usually as a determinant factor the distinctiveness of the Greek language. A similar approach has been also embraced by the EC Commission in its decisions100.
III. Comparative analysis of the approach on the media sector market
1. Publishing and books sector
The Committee has identified the following market with regard to this sector, a) 6.60 the market for printing and publishing of newspapers and magazines, b) the market for printing and publishing of books, c) the market for printing and
97 For an account on the use of the SSNIP test at the EC level see Chapter 1 para. 1.13 et seq. 98 See also hereto above para 6.19. For the purpose of this work 357 decisions of the Greek Competition Committee (from 1995 on) were looked up. 99 See also herein para 6.20 et seq. and for an account on the situation at the EC level see Chapter 1 para 1.32 et seq. 100 See for e.g. Commission Decision, Case IV/M.432, 14 March 1994, Newspaper Publishing, Para. 17; Commission Decision, Case IV/M.665, 29 November 1995, CEP/Groupe de la Cite, Para. 11; Commission Decision, Case IV/M.1445, 20 April 1999, Gruner + Jahr/Financial Times/JV, Para 21 (for the market of the sale of newspapers to readers) as well as Commission Decision, Case IV/M.553, 20 September 1995, RTL/Veronica/Endemol, Para 27-28; Commission Decision, Case IV/M.1401, 1 February 1999, Recoletos/Unedisa, Para. 29 (for the market for television advertising).
32 publishing of the remaining goods and graphic designs market101 This delineation was based on supply side considerations (industry structures), i.e. the publishing companies operating in the press sector are for the most part vertically integrated and able to provide the final product themselves, whereas the book publishers limit their activity usually in publishing the books and delegate the printing to third parties. This approach corresponds to the one on the EC level where, as far as horizontal segregation of publishing sector is concerned, a distinction is made between books, written press and other publication markets102.
As far as the geographic dimension of the market is concerned, the Committee 6.61 holds that the market for publishing and distribution is a national market. The crucial factor does not seem to be the country’s administrative territory as such but the uniqueness of the Greek language, which has been a focal factor on the Committee’s judgement on several other occasions103. The EC Commission has come to the same results by emphasising the determinant role of the language factor for defining the geographic dimension of the market. Consequently, relevant markets are seen to be either national, or confined to a particular language area104.
In Ελευθερουδακης/Library-Service/Απολλων Πρωτοπορια [Elefteroudakis- Library Service-Apollon Protoporia]105, the Committee made explicit reference to the case law of EC Commission for deciding whether the tender procedures for acquiring books for public institutions constitute a continuous process and therefore the relevant market shall be defined as a sole market comprising all of them together, whether each one of them shall comprise a distinct market. The EC Commission had pointed out in that decision that such tenders shall be seen as a continuous process106. The decision is important for its shows that the methodology of the EC Commission is followed closely by the Greek Competition Committee.
2. Film sector
The Greek competition Committee has identified the existence of a market for 6.62 feature film distribution within the national territory of Greece,107 a market for reproduction, disposition and the translation/subtitling of cinematographic
101 EA 81 / II /1999, (see also supra note 11). 102 For more details see Chapter 1 para. 1.142. 103 See for example 183/III/2001, (see also supra note 11). 104 See, for instance, Commission Decision, COMP/JV.51, 1 September 2000, Bertelsmann/Mondadori/BOL ITALIA, para. 14. For more details and possible exceptions see Chapter 1 para. 1.149 et seq., para. 1.154, para. 1.164. 105 EA 135/II/2000 (see also supra note 11). The Committee refers to Commission Decision, Case IV/31.572 and 32.571, 5 February 1992, Building and construction industry in the Netherlands. 106 Ibid. (Commission Decision, Case IV/31.572 and 32.571), para. 73. 107 EA 239/III/2003, Europlex /Warner / Village Roadshow II; EA 240/III/2003 (see also supra note 11).
33 [feature] films in form of videotapes, a market for reproduction, disposition and the translation/subtitling of cinematographic films in form of DVD108. Regarding the theatrical exhibition of feature films the Greek Committee has not taken a clear position whether this is a separate market or it simply falls as a distinguished activity within the film distribution market. Indeed, the Committee has recognised movie theatre operation and theatrical exhibition of films as a distinguished activity within the film business in three of its decisions,109 however, it did not take a position on whether this activity can be sufficiently qualified as a separate relevant market. On the other hand the Committee does not separate the movies as mainstream (foreign) and Greek production movies. The geographic dimension of the market was considered to comprise areas within the national territory of Greece.
The EC Commission has dealt quite thoroughly with film-related issues in 6.63 Seagram/Polygram110. The EC Commission pointed out that the film entertainment can be divided into three principal activities, i.e. the production of feature motion pictures (‘films’), the distribution and licensing of films, and the exhibition of films. According to the notifying party, films are distributed through several so-called exhibition windows, namely theatrical exhibition, video rental and sell-through, pay-per-view ("PPV"), pay-TV, and free-to- air-TV. The Commission accepted this view but left open the question of whether or not the distribution to these windows actually constitute separate product markets, since the operation would have not lead to the reinforcement or creation of a dominant position even on the basis of the definition of such separate markets. Whilst analysing the theatrical exhibition, the Commission acknowledged that although films may be intended for exhibition in many countries, they are still distributed within national boundaries through national distribution offices of distributors, mainly because distribution licences are granted for a national territory, under the protection of copyright laws. Thus, the marketing campaign of the new film has to take into account national tastes of the audience. The original film copy either is dubbed or receives subtitles, so that the audience can enjoy a film in their native language. Films which have been successful in one country may however fail in other countries and, therefore, might not be exhibited in such countries. The fact that certain different distributors are present in different countries, that the integrated distributors of the Hollywood majors apply different condition in different EEA countries, and also that the market shares of the distributors vary from one country to another, are according to the Commission indicators that national markets exist for the distribution of films111. However, the exact definition of the product market was left open since it was considered unnecessary for the case at issue. The Commission followed consistently this line of reasoning on Vivendi/Canal+/Seagram where it found that filmed entertainment can be divided into different activities from production to distribution via the licensing
108 EA 226/III/2002 (see also supra note 11). 109 EA 230/III/ 2003; EA 239/III/2003, Europlex /Warner / Village Roadshow II; EA 240/III/2003 (see also supra note 11). 110 Commission Decision, Case IV/M.1219, 21 September 1998, Seagram/Polygram. 111 Ibid. section 2, (aa).
34 of rights. The distribution of films to theatres is generally carried out at different stages. First, film producers license the distribution rights for one country or a territory to a local distributor or to international distributors who acquire the rights for some countries. Secondly, local distributors or international distributors sub-license directly the exhibition rights to exhibitors, i.e. theatre operators. The distribution of films to theatres is the last stage of the cinema chain and can be regarded as a separate product market112. This market is essentially for cultural reasons national in scope. Regarding the distribution through video rentals and/or sales, the Commission, although it has analysed it as a distinguished activity within the film entertainment sector, has not so far so far taken a clear cut position on whether or not this is a separate market113.
As a conclusion it can be said that the EC Commission’s findings and the Greek 6.64 Competition committee’s relevant market definition seem quite similar with reference to the existence of national markets for movie distribution. A few minor differences with reference to the different exhibition windows (theatrical and video rental/sales) do exist, i.e. whereas the Commission recognises theatrical exhibition as being a separate market the Greek Committee has not taken a clear position, on the other hand, whereas the Greek Committee recognises the distribution through video [or DVD] rentals and/or sales to be a separate market the Commission has left this issue open. On the other hand the distinction between “mainstream” films and “arthouse” seems to be irrelevant in Greece. However, it seems that both EC Commission and the Greek Competition Committee are aware of the fact that these activities can be distinguished within the overall film distribution markets which might lead to future convergence.
3. Internet sector
The Competition Committee has on several occasions noted that the Internet 6.65 sector in Greece is still in its embryonic stage, counting for only a small percentage of value added services. Nevertheless, the sector has shown lately an enormous boost and its expecting to be one of the major sectors of economic activities in the near future.
As regards Internet markets, the Committee distinguished in Eurobank- Infoquest-Unifon,114 and ∆ελτα Πληροφορικης-Singular [Delta-Pliroforikis]115 between the market for Internet access on the one hand and the market for internet content services on the other. This follows clearly the established line of the EC Commission, which has defined in a number of its decisions the Internet content services market as being separate from the Internet access markets116.
112 Commission Decision, Case IV/M.2050, 13 October 2000, Vivendi/Canal+/Seagram, para. 17. 113 See Commission Decision, Case IV/M.1219, 21 September 1998, Seagram/Polygram, part B section 1, b (ii) and 2, b (ii). 114 EA 129 / ΙΙ / 2000, (see also supra note 11). 115 EA 184/III/2001, (see also supra note 11). 116 See Commission Decision, Case IV/JV. 1, 27 May 1998, Telia/Telenor/Schibsted, Commission Decision, Case IV/M.1838, 27 March 2000, BT/Esat. See also Commission
35 Moreover, the distinction of the advertising via Internet as being a separate market117 reflect the approach of the EC Commission, which has consistently 6.66 stated that this market represents a market in its own right118. Although the Committee has mentioned that the market for internet services may take the form of production and maintenance of web sites, electronic commerce, electronic advertising, electronic publishing etc.119, it has not elaborated on this issue and has not, as yet, decided on further sub-division of the services market.
In BE-Business Exchange120 the Committee identified the market for 6.67 construction and maintenance of B2B electronic market places, and decided on its further subdivision into the market for construction and maintenance of horizontal B2B electronic market places, and into the market for construction and maintenance of vertical B2B electronic market places. The EC Commission has also dealt with the issue of B2B marketplaces on a number of occasions121. However, contrary to the cases decided by the Committee, the EC Commission has not decided in any of its merger-related cases on the precise definition of the relevant market with regard to the B2B marketplaces122.
As far as the geographic market is concerned, the Committee has noted that the 6.68 mere fact that Internet has no physical “frontiers” does not justify “stretching” these services’ relevant markets beyond the limits of national market123. The EC Commission, however, has showed considerable flexibility with regard to the different media content markets, identifying them as being national (e.g. internet advertising), based on linguistic area (e.g. online computer games), comprising at least the whole EEA (e.g. online music), or even global (e.g. audio/video players software)124.
Decision, Case IV/JV.48, 20 July 2000, Vodafone/Vivendi/Canal plus, para. 27; Commission Decision, Case IV/JV.5, 4 August 1998, Cegetel/Canal+/AOL/Bertelsmann, para. 12 (by referring to Commission Decision, Case IV/M.973, 15 September 1997, Bertelsmann/Burda - HOS Lifeline); Commission Decision, Case IV/JV.11, 15 September 1998, @Home Benelux B.V., para. 14; Commission Decision, Case IV/M.1551, 23 July 1999, AT&T/Mediaone. For a full account on the Internet markets at EC level see Chapter 1 para. 1.166 et seq. 117 Eurobank-Infoquest-Unifon, EA 129 / ΙΙ / 2000 (see also supra note 11). 118 Commission Decision, Case IV/M.1439, 13 October 1999, Telia/Telenor, para. 107. 119 ∆ελτα Πληροφορικης-Singular [Delta-Pliroforikis], EA 184/III/2001 (see also supra note 11). 120 EA 183/III/2001 (see also supra note 11). 121 E.g. Commission Decision, Case COMP/M.1969, 4 August 2000, UTC/Honeywell/i2/My Aircraft.com; Commission Decision, Case COMP/M.2096, 6 October 2000, Bayer/Deutsche Telekom/Infraserv; Commission Decision, Case COMP/M.2027, 13 July 2000, Deutsche Bank/SAP. 122 Graham, J.H. Smith, Internet Law and Regulation, Sweet and Maxwell, 2002, p. 617. 123 EA 183/III/2001, (see also supra note 11). 124 For more details see Chapter 1 para. 1.181 et seq.
36 4. Advertising in the media
The Committee has identified in Berkeley Square-Κεµακο125 the following 6.69 markets as regards the advertising sector, (i) the market for the supply of advertising services (ii) the market for the production of advertisements (commercial films) destined for the movie theatres and the television. (iii) the market for public relations services, (iv) the market for representation and promotion of printed media organizations, and (v) the market for media houses. A year later, in its decision in Interpublic Group-Ashley & Holme,126 the Committee reaffirmed this position by identifying (i) the market for the supply of advertising services, (ii) the market for the production and trading of advertisements (commercial films) destined for the movie theatres and the television, and (iii) the market for public relations services to be distinct markets within this sector. This delineation contains certain dissimilarities when compared to the approach held at the EC level. Thus, the EC Commission has identified in this respect127 two main market groups: a) the market for marketing communication services, and market for media buying. The latter, which according to the Commission might constitute a separate market within the advertising sector for such activities satisfy a particular demand from customers that can be performed separately from the creation of advertising campaign, encompasses planning and purchasing time and/or space in various media, including television, radio, newspapers, magazines, billboards and the Internet, it is carried out by specific agencies128, and basically corresponds to the market for media houses as identified by the Committee129. The difference in the approach of the both institutions, however, can be seen with regard to the market for marketing communication services, as defined by the EC Commission. The EC Commission has decided that this market includes a range of activities like advertising (development of marketing and branding campaigns as well as production and design of advertisements), information and consultancy (conducting consumer, media, corporate communications and policy research, pre-testing, tracking and evaluation of advertising and promotions design as well as management of international market studies and new product development and testing), public relations (providing advice and services with respect to corporate, financial and marketing communications, government lobbying, crisis management and public affairs) and others, and that all these services belong to a single relevant products market130. The Committee, in its turn, has ruled that supply of advertising services, production and trading of advertisements, as well as public relations services constitutes markets on their own.
125 EA 76 / 1997 (see also supra note 11). 126 EA 119/1998 (see also supra note 11). 127 Commission Decision, Case IV/M.2000, 24 August 2000, WPP Group/Young&Rubicam, para. 8 et seq.; Commission Decision, Case COMP/M.2558, 4 September 2001, Havas/Tempus, para. 8 et seq. For more details see Chapter 1 para. 1.162 et seq. 128 Commission Decision, Case COMP/M.2558, 4 September 2001, Havas/Tempus, para. 9. For more details see Chapter 1 para. 1.162 et seq. 129 For more details see part B.VI. of this Chapter. 130 Commission Decision, Case IV/M.2000, 24 August 2000, WPP Group/Young&Rubicam, para. 9 et seq.
37 5. Music-Copyright
In the AEPI case,130a the Committee defined the relevant market as the market 6.69a for the administration of intellectual property rights of authors (lyricists and composers) of musical works, with the relevant geographic market being the national territory of Greece. The Committee did not go further onto evaluating whether or not the administration of mechanical rights and performance rights constitute separate relevant markets, as this was not necessary for the purpose of the decision. The EC Commission has taken a similar view in the Bertelsmann/Zomba130b decision. Here, the Commission noted that the administration of the authors’ patrimonial rights constitute one of the main activities of music publishing market. Music publishing consists mainly of the acquisition by publishers of rights to musical works and their subsequent exploitation upon remuneration. Publishers’ revenues derive therefore from the commercial exploitation of musical works, be it reproduction-based exploitation (mechanical and synchronisation rights), performance-based exploitation (performing rights) or distribution-based exploitation (printing rights). These rights can be divided, according to the Commission, into mechanical, performance, synchronizations and printing rights. The Commission acknowledged that the administration and licensing of mechanical and performance rights are mostly carried out by collecting societies on behalf of their members (i.e. publishers and/or authors). It went on stating that as it had been found earlier in Seagram/Polygram decision, the exploitation according to the different sources may lead to the definition of separate product markets for each one of the above-referred categories of rights. This, by implication, means that the market for the administration of intellectual property rights of the authors by collecting societies – found to be the relevant market in the decision of Greek Competition Committee – may be considered to be a separate relevant product market at the EC level as well. Nevertheless, the issue on whether or not these rights constitute separate product markets were left open by the Commission for the time being130c.
6. Conclusion
During the course of this work, no inconsistency was found in the approach of 6.69b the Greek Competition Committee towards relevant market definition as compared with the approach taken by the European Commission. On the contrary, there are many features, which can be considered as being similar or even identical in the work of both institutions. Cross references made by the Greek Competition Committee in its assessments to the decisions of the EC Commission and to the case law of the EC courts are another evidence of the will and effort of the Committee to keep the respective case-law in Greece in conformity and consistency with the principles applied at the EC level. As
130a Case EA 245/ΙΙΙ/2003, Σ. Ξαρχάκου, et al., vs “ΑΕΠΙ Ελληνικής Εταιρείας Προς Προστασία της Πνευµατικής Ιδιοκτησίας Α.Ε.“, (S. Ksarchakou et al., vs AEPI). 130b Commission Decision, Case COMP/M.2883, 2 September 2002, Bertelsmann/Zomba. 130c Commission Decision, Case COMP/M.2883, 2 September 2002, Bertelsmann/Zomba, para. 12-17. See also Commission Decision, Case IV/M.1219, 21 September 1998, Seagram/Polygram.
38 mentioned in the preceding analysis, the existing case law pertaining to the media sector is somehow limited thereby not allowing at this point in time for a thorough evaluation of all relevant markets in the media sector for the purpose of competition law. Regardless of this fact, the work has clearly shown that the methodology of the Greek Competition Committee with reference to relevant market definition is the same as the methodology applied at the EC level. Moreover, whenever a situation relevant to the media sector has come into play, the findings of the Committee are similar to the findings of the EC Commission and the EC courts.
D Impact of different regulatory frameworks on market definitions
I. The regulatory framework for the media sector in Greece
1. Constitutional provisions
The 1975/1986 Greek Constitution, after its modification in April 2001, contains 6.70 two articles concerning the media that, to a considerable extent, provides for indication with view to media market definition:
(i) Article 14 enounces the freedom of expression in general (para. 1) and is related especially to the press; however, in paragraphs 5 and 9 we can find provisions relating to the right of reply and to the promotion of transparency and pluralism in the media sector (press and broadcasting).
(ii) Article 15 para. 2 enounces that radio and television shall be under the direct control of the State and defines the competent authority and the purpose of this control.
2. Sector-specific regulation
The principal characteristic of the Greek legal framework in audiovisual matters, 6.71 it might be argued, are instability and lack of applicability – ineffectiveness. Eight years after having been published, the basic law no. 2328/1995 concerning private radio and television is still not applied in its entirety, and only a small part of the television stations (essentially those transmitting on national level) have obtained a licence issued under the status of the previous law no. 1866/1989 the provisions of which have continuously been kept in force by way of transitional dispositions. The law is also enforced in respect of all those stations who “are considered as legal” – provided that they had participated in the procedure of allocation in 1997131. However, it seems rather doubtful to formulate a presumption according to which there would be no 'pirate stations' left, even in the region of Athens. As regards the regulation of sound
131 Article 17 of 2644/1998 law.
39 broadcasting (radio), the procedure foreseen by law no. 2328/1995 has been completed only in the Attika department, where thirty five (35) stations are holding a licence. Certainly, the law nevertheless will to a large extent be applied to all other stations, which “are considered as legal” today if they were in an operational status on 1 November 1999132, but this precarious situation might be considered as contributing to the creation of a climate that could be characterised by a 'non-regular' development of the market.
Concerning encrypted radio and television services, the law no. 2644/1998 has 6.72 introduced a regime for the market's organisation but, however, in view of the actual stand, there is only one digital service by satellite that has been legally licensed. The procedure of allocation in encrypted television delivered by means of terrestrial transmittance has not been completed, the existing analogous service operating under a licence that was obtained according to the former legal regime.
Public service radio and television has been regulated by the law no. 1730/1987 6.73 but a great number of provisions of the law no. 2328/1995 are applicable in addition.
Except for the status of freedom enshrined in the relevant constitutional 6.74 provision, the regulation of the press mainly consists of the obligation of “nominalization” of press companies' shares and the notification of any modification of their capital133, the submission of an annual declaration on the financial situation of the company134, its shareholders and members of administration.
II. Media Regulators
Most of the essential regulatory tasks in the media sector (i.e. rules of general 6.75 importance) are exercised by governmental authorities in Greece. The control of compliance with existing regulation by operators is exercised by an independent authority, furthermore it issues mostly personal-directed decisions. As an exception to this, the EETT (Ethniki Epitropi Tilepikinonion kai Tahydromion = National Telecommunication and Post Commission) has important regulatory tasks on all relevant issues of its competence.
It must be stressed that in relation to matters connected to the safeguard of open 6.76 competition, the central position belongs to the Competition Committee (National Authority on Competition in Greece), which collaborates with other authorities in charge of specific economic sectors but decides as the authority being exclusively competent for the application of the basic law on competition135.
132 Article 53 of 2778/1999 law. 133 Article 24 of 1746/1988 law. 134 Article 24 of 2429/1996 law (an English translation being available at http://www.observaonline.net/partners/aree/attika/investmentlaw.pdf). 135 Article 8f of the law 703/1977, added by 2837/2000 law.
40 1. Ministry of Press and Mass Media
According to the law, the Ministry of Press and Mass Media “takes all 6.77 necessary legislative and regulatory measures concerning the wider sector of mass media”136. This Ministry (as recently established as in 1984) has an important function in regulating the media sector, essentially by managing the frequencies for radio and television, task exercised in collaboration with the Ministry of Transports and Communications. Although the attribution of such competence shows similarities with the existing or past situation in several other European countries, it might be argued, however, that the Ministry has elaborated an approach towards the interpretation of the provision as represented above, as to regulate on further audiovisual issues (even of presumably secondary importance), too. It therefore might be taken into account, if such finding would be upheld, that the remit of the independent media authority (ESR, see infra) as foreseen by other legislative acts, could become affected.
2. Ethniko Symvoulio Radiotileorasis (ESR = National Council of Radio – Television)
Established in 1989 as an independent authority, the ESR (Ethniko Symvoulio 6.78 Radiotileorasis = National Council of Radio and Television) has changed its legal status three times. Only recently, following the publication of the law no. 2863/2000, the ESR has been attributed the powers to grant licences and impose sanctions on broadcasters infringing the legislation in force (advertising, production rules etc).
Since 2001, ESR is recognised as the only competent body with regard to the 6.79 preservation of the following purposes: pluralism, respect of the value of the human being, protection of childhood and youth, and transparency of the economical elements of the media companies, as stipulated by the Constitution137. Its decisions are no longer subject to the supervision of their compliance with legislation exercised until 2000 by the Minister of the Press and the Mass Media. The particular legal status of an “independent authority” has been attributed to it by the Greek Constitution and consists of the personal and functional independence of the seven members of the ESR and the existence of a parliamentary control over its activity (art. 101A of the Constitution)138.
However, there is arguably still room for considering whether or not some of the 6.80 elements defining its competencies would make it difficult to characterise ESR as a regulatory authority (stricto sensu), because of the lack of important consultative or regulatory powers, which might in general contribute to such categorisation. However, in relation to the last consideration, two exceptions should be made, namely that ESR delivers its opinion before the nomination of the members of the Administration Council of the public radio and television
136 Art. 10 para. 1 of 2863/2000 law. 137 Art. 15 par. 2 sect. b of Constitution. 138 A new law 3051/2002, concerning all independent authorities with constitutional recognition, has partially modified existing regulation on ESR.
41 organism [ERT]139 and elaborates the Codes of Deontology on news and entertainment programs as well as on advertisements, which finally get the form of presidential decrees140.
As far as competition is concerned, art. 4 of law no. 2863/2000 vested the ESR 6.81 with the competence to control “the compliance of free competition rules on the framework of the activation of enterprising organisations in the larger sector of media”. Especially in encrypted services, the law is less restrictive on ownership limitations and gives power to ESR “or other entities” to establish that the activity of a licensed-supplier of encrypted radio and/or television services constitutes an anti-competition behaviour141. In this context, it becomes rather foreseeable that there is a possibility for collision of competencies between the two regulatory authorities (ESR and Competition Committee) and the solution may, apparently, not be derived neither directly by interpretation of the relevant legal texts nor in an alleged exercise of domination of the most active part. The collaboration of the two authorities (already elaborated by Competition Committee) appears as the only possible solution to this situation, with a certain primacy of the Competition Committee which is more competent in competition issues.
3. EETT (Ethniki Epitropi Tilepikinonion kai Tahydromion = National Telecommunication and Post Commission)
EETT is an independent self-funded decision-making body, which supervises 6.82 and regulates the telecommunications as well as the postal services market. Among its functions, the control of the use of frequencies of radio and television is of particular interest142, a task it exercises in collaboration with ESR. The foundation law gives power to EETT to regulate Internet-related issues and especially to allocate domain names.
As far as competition in the telecommunications sector is concerned, EETT can 6.83 precise which is the market share of a company that should be considered as constitutive for holding a dominant position143, by adopting common competition regulation as applied by the Competition Committee. This is another example where a given factual situation may give rise to concerns that, according to the competencies of two different independent authorities as they have been granted to them by the legislator, the results of its legal assessment may prove difficult or, even, that there is a risk of diverging findings. It might
139 Art. 3 para. 4 of 1886/1989 law, as modified by art. 1 par. 2 of 2173/1993 law. 140 Art. 3 par. 13 of 2328/1995 law. ESR publishes also the invitation to tender for radio and television stations (art. 19 of 3051/2002), but this must be made in accordance with a presidential decree related to all documents to be submitted for the application procedure. 141 Article 8 par. 8 of 2644/1998 law. In this disposition elements are enumerated that can be used in order to establish whether or not there exists a dominant position of a company: viewer ratings, number of subscribers, share of participation in the market of audiovisual programs, share of participation in the advertising expenditures etc. 142 Article 3 para. 14 (r) of 2867/2000 law. 143 Art. 8 par. 7 of 2867/2000 law.
42 be suggested that any attempt to eliminate such difficulty would best be based on an approach following the spirit as evoked above.
4. Other governmental bodies a) National Book Centre:
This organisation (which receives subvention by the Ministry of Culture) aims 6.84 to mediate in the operation of the market place in a regulatory way. Without interfering to a large extent with its proper mode of functioning, the Centre is entitled, however, to pursue its tasks in order to ensure that cultural diversity is sustained, that competition should not undergo detriment with regard to book production and distribution, and, in order to ascertain that the Retail Price Maintenance Law is properly applied. b) Copyright Organisation144:
This organisation has been vested with legal personality in accordance with 6.85 private law and operates under the supervision of the Ministry of Culture. Its principal aim is the protection of authors and the titulaires of related rights, the supervision of collecting societies and the implementation of the legislation on copyrights and related rights.
III. Market Definitions and/or Criteria upheld for market perception in the relevant sector focused legislation
Greek legislation does not contain definitions being directly of main relevance 6.86 for the present study subject (product/geographic – supply/demand) and this can be explained, at least partly, when recalling that respective legislation follows essentially policy goals, rather than competition law approaches.
Nevertheless, provisions on media ownership aggregation limits may have an 6.87 impact on the definition of the relevant markets. We could mention here the prohibition of participation in more than two categories of media (newspapers, radio and television)145, provision related to more than one category of activities examined in this report.
1. Publishing a) Press
A definition of a newspaper and a magazine based mainly on the criterion of 6.88 frequency of edition (once a month and thrice a month, respectively) is included in a legal text of 1938146. More recent legal texts refer to definitions of economic
144 Art. 69 of 2121/1993 law and 311/1994 Presidential Decree. 145 Art. 1 para. 10 sect. b of 2328/1995 law for free-to-air television, art. 6 para. 8 of 2328/1995 law for free-to-air radio and art. 2 para. 3. sect. b of 2644/1998 law for encrypted radio and television services 146 Art. 4 of Emergency Law 1092/1938.
43 newspapers147, to categories of newspapers having the right to publish legal announcements148, to other kinds of magazines or newspapers being entitled to post facilities149; all these elements could give some basic information on product definitions.
Finally, one of the most interesting references is the one relating to article 13 6.89 par. 10 of law no. 2328/1995 on ownership aggregation limits. According to this disposition, nobody can possess or control more than: (i) Two daily newspapers (one morning, one evening) edited in Athens or Thessaloniki. (ii) One daily financial and sport newspaper edited in Athens or Thessaloniki. (iii) Two daily provincial newspapers belonging to two different departments. (iv) One Sunday edition of a daily newspaper or an independent newspaper edited on Saturdays. b) Books
There is no legal definition of what conditions have to be met in order to 6.90 establish the existence of a book but it seems that the one regarding the book as an edition with more than thirty two pages and using glue for its bookbinding is generally accepted. Besides, a tax law regulation provides for a special taxation regime for value added tax (8 %) concerning books where photographs and drawings dominate.
A recent law sets up a mandatory fixed price regulation which is applicable to 6.91 the sale of books in Greece, approach already taken in other EU-countries. Every publisher must fix a price for the sale of all books published under its control to the public. This price must be applied by all distributors, subject only to a possible (maximum) 10 % discount150.
2. Music-Copyright
Greek regulation on copyright issues ensures a high level of protection of right 6.92 holders. Principles such as the subject of the right is the natural person who is the author, or the possibility of transferring the economic right and the untransferable nature of the moral right are recognised in the law. It should be noted that related rights are established in favour of performers, of producers of sound and visual recordings and of radio and television organisations.
Authors and holders of related rights may assign the administration and/or 6.93 protection of their rights to a collecting society established exclusively to engage in the functions of administering and protecting all or parts of the economic rights. Before commencing operations, each society must file a statement to the Ministry of Culture together with a copy of its rules. The approval of the
147 Co-ministerial (Development – Press and Mass Media) Decision 3840/23.4.1997. 148 Ministerial (Press and Mass Media) Decision 20814/E/5589/13.10.1999. 149 Co-ministerial (Financial – Transport and Communication – Press and Mass Media) Decision 14750/7.8.1997. 150 Art. 3 of 2557/1997 law.
44 society’s operations is granted by the Minister of Culture after consultation with the Copyright Organisation. These authorities control on a continuous basis whether compliance is secured in respect of copyright regulation, but this operation is restricted to some legal issues having no relation with competition issues. In this case, the competence of the Competition Committee is very useful.
3. Film
Regulation of the film industry concerns in essence the financial support of 6.94 Greek films, of the companies operating the cinema theatres showing Greek films and of companies distributing Greek films, a concept which is probably more often retrieved in small markets dominated by non domestic films151.
The relevant law enumerates some criteria of a Greek film: production by 6.95 Greeks, scenario in Greek, film director possessing Greek nationality or being of Greek origin etc.152. The qualification of a film as Greek gives rights to state financing, which is managed by the Greek Film Centre, an organisation under the auspices of the Ministry of Culture.
The economic support of cinema theatres takes the form of return of a 6.96 percentage on the special tax collected in the cinema tickets for Greek films. This special tax finances a state aid that is given to companies having distributed more than three Greek films during a normal film period (1st October till 30 April)153.
4. Broadcasting
In the broadcasting sector, four types of distinctions can be made. We must have 6.97 in mind that even though these categories are not apprehended from a pure market perspective, the differences between their respective regimes may be an element to conclude the existence of a different market. a) Cross media ownership rules
The way that the legislator refers to media ownership aggregation limits can 6.98 sometimes have an impact on media market definition. Article 14 para. 9 of Greek Constitution (1975/1986/2001) disposes that concentration of more than one electronic information media of the same type is prohibited (the same provision exists already in art. 1 para. 10 sect. b of law no. 2328/1995 for television, art. 6 par. 8 of law no. 2328/1995 for radio and art. 2 par. 5 of law no. 2644/1998 for encrypted radio and television services). This considerably very strict regulation which follows an approach different to the ones taken in other European rules that are based essentially on the 'real' power in the market of each media, attributes towards what especially media companies might
151 Greece has a low penetration of theatres with about 29.197 inhabitants per screen, compared to 18.138 inhabitants per screen for the European average. 152 Art. 5 of 1597/1986 law. 153 Recent regulations in art. 4 of 2557/1997 law.
45 already consider a negative climate, since Greek legislation cannot accept companies with, for example, more than one television or radio station.
The situation appears to be less restrictive in encrypted television where the 6.99 participation of the licensee to the capital of a free-to-air television company is not prohibited since the rules of pluralism are not attacked. b) Broadcasting products or services
Apart from definitions of the broadcasting product154, some specific provisions 6.100 referring to obligations of broadcasting independent productions (10 % of the total part of programs except for news, games, sport events, advertisements and teleshopping155), Greek productions (25 % of the total part of programs, same exceptions as above156) and European origin programs (51% of the total part of programs, same exceptions as above157) for free-to-air broadcasters, could present some important elements of the television market.
In addition, some specific regulation concerning the obligations of the encrypted 6.101 services is available. The licensee for digital broadcasting must give free time to public bodies158 and conclude with new entrant companies under equal and reasonable terms159 (must carry regulation); the public television and radio have a priority position on the electronic guide of these services160. c) Broadcasters and distributors
The distinction between broadcaster and distributor has an interest only in the 6.102 encrypted television services domain161. Here, the licensee can be a distributor
154 A definition of “television broadcasting” and “broadcaster” is contained in article 2 of the presidential decree 100/2000: “the initial transmission by wire or over the air, including that by satellite, in unencoded or encoded form, of television programmes intended for reception by the public. It includes the communication of programmes between undertakings with a view to their being relayed to the public. The term does not include communication services providing items of information or other messages on individual demand such as telecopying, electronic data banks and other similar services, given that such services do not transmit audiovisual works of any form”; «broadcaster»: “the natural or legal person who has editorial responsibility for the composition of schedules of television programmes within the meaning of the previous definition (a) and who transmits them or has them transmitted by third parties, the Hellenic Radio-Television S.A. (ERT-S.A. the public service broadcaster), the licensee of private free-to-air television stations, the licensee of pay television services and the administrators of television programmes within the meaning of article 3 Law 2644/1998”. 155 Art. 10 para. 7 of 100/2000 Presidential Decree. 156 Art. 3 para. 18 of 2328/1995 law. 157 Art. 10 para. 1 of 100/2000 Presidential Decree. 158 Art. 9 para. 1 of 2644/1998 law. 159 Art. 9 para. 2 of 2644/1998 law. 160 Art. 9 para 3 of 2644/1998 law. 161 In non encrypted television the broadcaster can charge a third person with the production of a part of his program that can not exceed 30 % of the total time in a month (art. 1 para. 12 law 2328/1995).
46 (i.e. the person entering into contractual relationships with content editors (broadcasters)) or a broadcaster (i.e. person having the responsibility of his program). However, the law makes it an obligation for the licensee to respect the rules on pluralism when construing the final program162. Services related to encrypted (digital) television such as conditional access, electronic programme guide, subscriber management, can be offered to the licensee by undertakings in which the latter holds shares, but not in a way that could create a falsification of free competition163. d) Categories of broadcasters (depending on area of coverage)
As has already been mentioned, in Greece, the main media operators work on 6.103 free-to-air terrestrial television. In this sector, considering the area that has to be covered, three categories of broadcasters can be established. The national broadcaster, the regional broadcaster (covering in general an area that comprises of more than two departments) and the departmental broadcaster (maximum of two departments).
Concerning private radio stations, there is only one category: the local (one 6.104 department) radio, which can distribute the program of another radio station only for a maximum of five hours a day. Recently, government announced its intention to authorize the functioning of national or regional radios.
5. Internet
There are several activities in internet market: internet service providers, internet 6.105 news portal, construction and maintenance of internet sites, electronic advertising etc. Because of the non-existence of a special regulation on electronic media services, the principal function of the independent authority EETT in a market that has been liberalised since 1 January 2001, is to ensure that there are no obstacles towards accessing the network of the dominant company, OTE.
The recent law no. 3021/2002 contains a definition of an internet news portal 6.106 company, which is considered as media164: i.e. an undertaking offering audiovisual news content, including information on political, social, economical, cultural or sport events, as well as articles, comments, interviews or discussions on these matters. In the same provision, the law does not consider as media any company providing access to the internet.
162 See art. 3 law 2644/1998- 163 Art. 2 para. 9 of 2644/1998 law. 164 Art. 1 para. 1 d. Please take note that with this law the incompatibility of such capacities as owner, partner, main shareholder or management executive of an information media with the capacity of owner, partner, main shareholder or management executive of an enterprise that undertakes towards the Public Administration or towards a legal entity of the wider public sector to carry out works or supplies or to provide services is pronounced.
47 IV. Market definitions in the media sector, as upheld in sector specific practice of authorities and/or courts
In accordance with what has been indicated above, audiovisual regulation in 6.107 Greece is characterised by a certain degree of instability and inapplicability. The outbreak of private radio and television stations in a period when legislation was rather not in existence yet (1989), has created a situation of unusual development of the media market, with a great number of stations operating on national, regional and department level. Besides, there are no cable operators in Greece and the penetration of digital television is still restricted.
The effective control of these operators by ESR cannot be easily achieved for the time being because of the impossibility to have a clear legal view on what is applicable or not to each category of radio and television society and because of the fact that this independent authority has to deal with institutional matters (i.e. in its relationship with the Ministry of Press and Mass Media) and many infra- structural challenges (lack of personnel, building and equipment).
In this context, which has direct effects on other media sectors (such as 6.108 newspapers, film, music and internet), one principal source of explanation can be identified why there is only a restricted number of decisions or other acts of non-jurisdictional authorities providing for elements of market definition. The aim of each authority for the time being may be seen in an attempt to contribute to companies achieving a proper operation according to the existing law. In other words, questions of competition issues may only be taken into consideration after such initial stage of market development and functioning has been exceeded and where all parties concerned have succeeded in market participants having resolved elementary problems of legality, which to a considerable extent can be said as not yet being the case in Greece.
A dispute opposing a group of poets and composers and a collecting society, 6.109 AEPI, is pending in the Competition Committee since 2001 and the final decision is to be published before June 2003. It is not the first time that the two parties are opposed to each other in legal proceedings; in 1993 the Competition Committee, despite of results showing that AEPI administers 94 % of the copyright of poets and composers in Greece, did not establish an abuse of a dominant position165.
In another case, the Ministry of Culture refused to grant an approval to AEPI 6.110 concerning the administering and the protection of related rights, invoking the principles of upright administration and state of law, “which in the public economic sector must take into account the preservation of the terms of sound competition. In the field of protection of copyright rights and related rights, these principles exclude the simultaneous development in managing and protection activity in both copyright and related rights fields, because the protection and the assertion of the former goes against the protection and the
165 EA 59/1993, in Koutsoukis/Tzouganatos, p. 78.
48 assertion of the latter”166. Unfortunately, the Council of State (Highest Administrative Court) did not enter into extensive examination of this specific argument of the ministerial decision and did not annul this part of the decision relying on another formal argument.
V. Common factors and differences between the media (sector) specific market definitions and the market definitions used in application of competition rules.
After having established that definitions in the media sector are mainly based on 6.111 the analysis of specific legislation of each media, the existence of common factors between the media (sector) specific market definitions and the market definitions used by the Competition Committee while applying competition rules is inevitable167.
VI. The impact of the non competition framework and practice on the work of the competition regulator, in particular when defining the relevant markets.
The impact of the non competition framework and practice on the work of the 6.112 Competition Committee must be significant. Especially on audiovisual matters, this is due to the fact that considerations of audiovisual law prevail over those based on the free competition in Greece. In fact constitutional dispositions of art. 15 are oriented to the achievement of pluralism of views through which citizen could freely create his own view. All regulations on competition matters pursue different scope: this of effective functioning of the market. Sometimes these two scopes may coincide, but in most cases the maintain or extension of pluralism is realised through regulations that have no relation with economic scopes and sometimes imply restrictions to free competition168. In this context, the competition regulator has to evaluate, in particular when defining the relevant markets, any consideration based on the organisation of the market as it results through regulations on restrictions of economic participation on audiovisual companies. The situation is less clear in the market of encrypted services, where limitations are mostly established through general considerations; in this case the scope of preserving pluralism is not evident and the collaboration with the media regulatory authority is indispensable.
166 Council of State 950/2000, sect. 5 in fine (judgement found in the Data Bank “Nomos”). 167 See examples cited in Chapter 3, B. 168 For example references in article 12 par. 10 of 2328/1995 law (relations between audiovisual undertakings and advertising companies) or in article 8 par. 8 of 2644/1998 law (dominant position in encrypted radio/television market) are of second importance in the whole legal system where consideration of preservation of pluralism are prevailing.
49