European works quotas on on-demand services in the UK: Ofcom releases guidance

posted on 08 September, 2022 (public)

European works quotas and prominence: new guidance in line with the European Commission's guidelines

Since the transposition of the AVMS Directive in UK law on 1 November 2020 – required under the terms of the EU Withdrawal Agreement –, European works quotas and prominence requirements apply to on-demand programmes services. On 7 September 2022, following a public consultation launched in January, Ofcom released new guidance for on-demand programme service (ODPS) providers on their new obligations related to European works. This guidance complements the ODPS Rules and Guidance document, released by Ofcom in December 2021, setting out all the statutory requirements for on-demand services providers and explaining how Ofcom understands these requirements.

As detailed in the Rule 15 of the ODPS Rules and Guidance document, on-demand services providers shall make sure, on a yearly basis, that at least 30% of their programmes are European works while ensuring the prominence of such content. The definition of European works includes works originating both from the European Union Member States and from States part of the European Convention on Transfrontier Television (Council of Europe) – such as the United Kingdom.

The new guidance aligns with the European Commission definitions and guidelines 2020/C 223/03 – annexed to the UK regulator's guidance – and details Ofcom's approach to ensure compliance:

The 30% quota: Ofcom complies with the European Commission approach to define and calculate the share of European works (based on the total number of titles in a catalogue, a TV film or one season of a TV series corresponding to one title, except exceptional circumstances).
A flexible approach towards prominence: acknowledging the complexity and diversity of online services, the assessment of this requirement will focus on the relevance of the measures put in place by the provider depending on the nature of the service and its user interface.
Exemptions: on-demand services can be exempted if their service has a low turnover, a low audience, or where requirements are impracticable or unjustified because of the nature or theme of a service. For the implementation of these exemptions, Ofcom aligns with the European Commission's approach (based on the same annual turnover threshold of 2 million euros - £1.7m - and on the number of sales of a service).
Enforcement powers: based on yearly reporting from the providers, in case of failure and if judged appropriate by the regulator, Ofcom underlines its "power to open an investigation, to issue an enforcement notification and, where appropriate, to impose a financial penalty that is proportionate to the contravention and not exceeding 5% of annual turnover or £250,000 (whichever is the greater amount)".