Russia and Hungary finally appear to be backtracking on controversial TV advertising legislation.
Although the situation in the two countries is very different, it can be argued that in each case the target of the legislation has been foreign-owned services: international pay-TV channels in Russia and RTL Group in Hungary.
In Russia, the decision to effectively ban advertising on all pay-TV channels from the beginning of this year was quite probably political. It came alongside another move, due to come into effect in 2016, reducing the levels of foreign ownership permitted in Russian media, including TV services.
However, it soon became clear that the ad ban would also have a huge impact on Russian-owned pay-TV channels, with many facing the real prospect of closure.
The first cracks began to appear in the legislation when it was clarified that channels which had terrestrial licences, rather than just cable and/or satellite ones, would be exempt from the ban.
Now, this month, the Russian Duma (parliament) has gone a stage further by introducing, at breakneck speed, amendments that exempt from the ban channels carrying a minimum of 75% Russian content.
Perhaps not surprisingly, this move has not been entirely welcomed by the local industry. Some point out to the lack of local content and desire of viewers to watch foreign programming.
At the same time, international services continue to pull out, with the latest being NBCUniversal’s international channels.
There will inevitably be some solution to all this that is acceptable to all sides. The good news is that, though still some way off, it appears to be closer than this time last month.
Meanwhile in Hungary, the TV ad tax introduced by the government last year has put it in conflict with RTL Klub, the country’s leading broadcaster. It has also led to international protests, with the matter being referred to the European Commission.
This week it has been reported that the two sides are finally talking and that an agreement may be in sight. Indeed, on Thursday (January 29) one report said that RTL had agreed to soften criticism of the government in its news programming in exchange for the 50% of ad revenues it currently pays in tax being reduced to 5.3%.
Earlier, another report said that the government was pushing for the removal of RTL Klub’s CEO Dirk Gerkens before the level of tax payable by the broadcaster was reduced.
Although the picture in Hungary is still far from clear, these are promising signs that point to a possible resolution of the dispute between the two parties.
