Page 169 - MEDIASET ESPAÑA / 2013. Financial Statements, Management and Corporate Governance Report

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MEDIASET ESPAÑA COMUNICACIÓN, S.A. AND SUBSIDIARIES
NOTES TOTHE CONSOLIDATED FINANCIAL STATEMENTS AT DECEMBER 31, 2013
(Expressed in thousand of euros)
• Regarding the sale ofTV ad space: Mediaset España agreed that it would not jointly place advertisements with Cuatro
and Telecinco or groups of channels whose overall audience topped 22%. Specifically, commitment (ii) prohibited
formal or de-facto joint sales of advertising space withTelecinco and Cuatro. Among other stipulations, commitment
(iii) established a functional split between Publimedia and Publiespaña, in order to handle free-to-air and pay TV
separately.
• Limits were imposed for the acquisition of audiovisual contents from third parties. Commitment (vi) limited exclusive
contracts to three year durations (in general terms), also excluding automatic renewal and other similar terms,
while commitment (xii) prevented exclusive rights or first options on the entirety of national contents production/
products.
The commitments were later developed unilaterally as part of the CVC-imposed Action Plan, which also set certain
obligations regarding informing the authorities, to guarantee their compliance.
The Action Plan’s interpretation of the commitments was strict to the point that it substantially modified its content,
thereby significantly making Mediaset España’s commitments more difficult to assume; this affected advertising as well
as content acquisition. For example, the duration of contracts for acquiring content was to be calculated at their signing
date, rather than when the rights commenced; thus, this was legally disputed, and a sentence is still pending.
Mediaset España did not fail to comply with any of its commitments with the CNC.
• Mediaset España did not violate commitment (ii) after the merger finalized: in 2011, it lowered its share of the
advertising market as well as the average per-ad price, while managing to keep its audience numbers constant.
Reports prepared by external advisors conclude that Publiespaña has not failed to meet its commitments, and that
it has not violated anti-trust laws.
• As regards commitment (iii), Mediaset España was careful to ensure that positions in Publimedia and Publiiespaña
were not duplicated. Likewise, there has been no indication whatsoever of a failure to meet the obligation to
guarantee the functional or commercial independence of both companies.
• With respect to commitment (vi), Mediaset España has been charged with delay in granting suppliers the right
to reduced contracts, and renouncing extension or preferential acquisition rights which never really existed,
considering the deadlines established to that effect as well as legal suspension periods, as a result of Mediaset’s
legitimately filed appeals. No effect would have been felt on the market, as no suppliers exercised any of the
granted rights.
• With respect to commitment (xii), Mediaset España renounced all the pertinent option rights included in contracts
with producers, while fulfilling its other related obligations; thus, it did not fail to comply with any of the stated
conditions.
Mediaset España provided information in conformance with the Action Plan, responded to CNC requirements, and took
all the necessary steps expected of it. None of the supposed delays or problems in delivering information represent a
material failure to comply with the established commitments.
Therefore, Mediaset España filed an appeal and prepared a resolution before the National Court of Justice, to request
the suspension of the fine, which was agreed.
As in the previous dossier, the accompanying consolidated balance sheet does not include a provision for this contingency,
as the directors and legal advisors do not consider it likely that this risk will arise.