THE NEW BROADCASTING LAW:
OPPORTUNITIES FOR INVESTMENTS IN THE MEDIA SECTOR.
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We herein summarize the most relevant aspects of Law Nbr. 26,522 (the ¨Broadcasting Law¨) approved by the Argentinean Senate last October 10th and that comes to replace the previous one enacted during the last Argentinean dictatorship.
Purposes of the Law. Service of public interest
The law basically establishes a new series of rules for the regulation of open signal, cable, and satellite television and radio and it shall drastically reform the industry while forcing major players to downsize. In addition, it establishes minimum quotas for the airing of local music and films.
Audiovisual communication by any mean or support is an activity considered to be as of public interest and of essential nature for the social and cultural development of the community.
Monopolies
With the purposes of impeding the formation of monopolies and oligopolies, the law limits the amount of licenses to be granted depending on each type of media involved:
The changes will oblige conglomerates to sell existing operating units, thus creating an opportunity for investors.
Holders of licenses. Foreign participation
The granting of licenses shall be based on the criteria of experience and background in the activity. When the holder of a license is a company, only 30% of its capital stock can be held by a foreigner provided such participation does not imply control over the company. Foreign individuals are not entitled to hold licenses.
Term for the compliance with the law
All current holders of media licenses have only one year to adapt to the new regulation and therefore shall be forced to sell any license that may exceed the maximums allowed under this regulation or the maximum foreign stock participation allowed.
Term of the licenses
Licenses shall be granted for a period of 10 years (the previous law provided a 15 year period) and renewable for only one other period of 10 years.
Every two years, these licenses shall be subject to a control in order to avoid multiplication of signals by means of new technologies (i.e.digitalization).
More participation of state owned radios and televisions
It provides for the creation of a public national broadcasting company (¨Radio y Televisión Argentina Sociedad del Estado¨) that will group all existing broadcasting services run by the National Government.
Municipal and provincial media
Each Provincial State as well as the City of Buenos Aires shall be entitled to one FM radio, one AM radio and an open TV signal. Each local (municipal) state shall count with a FM frequency.
More participation for the community
33% of the radio-electrical spectrum shall be reserved for non-profit organizations. Likewise, native inhabitants shall be entitled to one FM radio, one AM radio and an open TV signal.
University and Educational media
National universities shall be able to hold media licenses provided they dedicate material spaces in their programming to the divulgement of scientific knowledge, to university related contents and to the artistic and cultural creations.
More national contents
A minimum quota for local productions, music and films is set forth. Open TV services shall include a minimum of 60% of national production which shall include not less than a 30% of own production including local news.
Among other requirements, non satellite TV cable must include at least one signal of own local production. Private owned radios must have at least a minimum of 50% of own production and must also include local news. As to music 30% of the music must be of national origin.
Likewise, open TV and cable must mandatorily show eight premiere national films per year.
Universal access for sports events transmissions
Universal access is guaranteed for contents of relevant interests and sports events (soccer, etc). Soccer or Olympic events of interests for the country shall be transmited by open TV with free access.
Authority of application and control
The Federal Authority of Audiovisual Communication Services (¨Autoridad Federal de Servicios de Comunicación Audiovisual¨) is the authority of application. Among other functions the authority of application shall issue all regulations related to this law, interpret the law and apply any eventual sanctions.
For additional information you may contact:
Alejandro Vandenbroele
vandenbroele@alfarolaw.com
