Media & Telecoms Update: Broadcasting and Brexit - Ireland as a Location
14 September 2018
On 12 July 2018, the UK Government published its White Paper on the future relationship between the UK and the EU. As expected, the White Paper confirms that, following Brexit, the ‘country of origin’ principle will no longer apply to UK-based broadcasters.
The UK hosts hundreds of pan-European broadcasters and, with Brexit edging ever closer, these organisations now face the possibility of losing access to the EU market. Ireland’s thriving creative sector, light-touch regulatory regime and business friendly environment could offer the perfect alternative base for such broadcasters.
For international media organisations with pan-European operations, the ability to broadcast throughout the EU is an indispensable component of doing business. This right is guaranteed by the 2010 Audiovisual Media Services Directive (AVMSD), under which TV and on-demand service providers need just one ‘country of origin’ authorisation in one Member State in order to broadcast across the EU.
To date, the UK has led the EU as a creative media hub, hosting hundreds of EU-wide broadcasters.
Following Brexit, however, UK-based broadcasters will no longer be able to rely on the ‘country of origin’ principle and, with the prospect of losing access to their EU market, many are actively seeking to relocate. Such broadcasters may find Ireland a uniquely attractive option.
Broadcasting and regulatory landscape
Ireland boasts a flourishing creative sector with a considerable talent pool and highly-trained workforce. Well established post-production infrastructure, supportive industry bodies and considerable industry investment offer significant further incentives.
From a regulatory perspective, Ireland provides a stable and transparent regulatory environment. Its similarity to the UK regulatory regime makes it unique amongst EU Member States vying for UK broadcasting business post Brexit. Indeed, in some ways the Irish regime is even more ‘light touch’ than that of the UK - for example, in terms of its approach to non-linear and OTT services. Also, unlike the UK, Ireland does not currently impose licence fees on the majority of broadcasters or on non-linear services.
In comparison with other jurisdictions, Ireland opted to take a minimum transposition approach to the AVMSD. Also, unlike many continental European countries, Ireland imposes no minimum language requirements on content output and considerably less onerous advertising restrictions.
The Irish corporate tax rate of 12.5% is significantly lower than that of many EU Member States. This rate applies to companies which are tax resident and ‘trading’ in Ireland. Trading for this purpose requires activity in Ireland - for example, the presence of employees. This is likely to apply to broadcasters subject to Irish jurisdiction in accordance with the AVMSD, particularly in light of its proposed amendments.
UK-based organisations will find that Irish company law is very similar to, and to an extent based on, UK company law. In addition, company establishment requirements and procedures would be familiar to any organisation which has undertaken a similar process in the UK, facilitating a relatively painless transition.
Ireland’s employment law regime is also highly attractive. Incoming broadcasters are under no obligation to recognise trade unions, nor to contribute sick-pay or pension payments. Sophisticated employment dispute resolution mechanisms allow for speedy determination of employment issues, and the long-established employment legislative regime ensures certainty and predictability.
The familiarity of Ireland’s common law system, stemming from and largely reflecting that of the UK, also offers UK-based broadcasters the advantage of minimising the business disruption inevitably associated with aspects of relocation.
Finally, as the EU’s soon-to-be last official English-speaking country and with its proximity to and excellent transport links with the USA, UK, Europe and elsewhere, Ireland will be very well placed to attract international talent, and may offer an appealing option for UK-based employees relocating with their organisation.
With Brexit edging ever closer, time is running out for UK-based broadcasters wishing to ensure access to the EU market. Ireland is well placed to provide a suitable alternative base from which to continue pan-European broadcasting operations.
Given the multifaceted issues involved in such a move, expert legal advice is a must. We have extensive experience advising interested parties on this issue, and can offer specialist legal advice across the spectrum of challenges in play.
For more information on the impact of Brexit on your business, contact a member of our Media & Telecoms team.
The content of this article is provided for information purposes only and does not constitute legal or other advice.