Financing contributions for media

As set out in Austrian law, funding for the expenses of the KommAustria media authority and the RTR Media Division is to come partly from the federal budget, with the other part to be contributed by companies in the media market under the responsibility of the authority. The financial contribution refers to the portion of funding contributed by those companies.

KommAustria and, with it, the RTR Media Division in its role as the authority’s administrative agency, have numerous responsibilities: these include issuing licences for radio and television, evaluating the media services notified to KommAustria, ensuring compliance with advertising regulations, introducing and further expanding digital radio broadcasting, legal supervision of the Austrian Broadcasting Corporation (ORF) and privately owned market participants, and addressing complaints against suspected breaches of legal provisions. The goal in meeting all of these responsibilities is to ensure fair conditions for all market participants and to safeguard a highly diverse media landscape for viewers, listeners and users.

All private television and radio broadcasters established in Austria and other media service providers offering products requiring licences or notification are obliged to contribute, as is the ORF.

The financial contribution is not a fixed amount but a percentage of a particular company’s revenue in relation to overall industry revenue.  In each individual case, the financial contribution is calculated by using the company’s net revenue as an initial base (excluding taxes and contributions not based on revenue).

How the financial contribution is calculated in each individual case is described in the following.  First, the authority’s and RTR’s funding requirements for the coming year are determined, with market participants entitled to state their position. In this case, a budget ceiling has been defined by law for RTR. The amount RTR receives from the federal budget and the revenue RTR directly generates are subtracted from the funding requirements. The remaining amount must be covered through the financial contributions provided by the companies obliged to contribute. Those companies are in turn required to provide an estimate of their expected revenue in the coming year (this figure is then verified in the following year by querying the amount of revenue actually achieved; any surplus contribution paid earlier is credited, or notice is given of any contribution amount subsequently due). Overall industry revenue to be expected in the coming year can also be predicted based on the individual revenue. This also allows a specific company’s share in the overall industry revenue to be determined. The amount the company is required to provide as their share of the financial contribution is then determined on a pro-rated basis.

For example: After net revenue of EUR 100,000 in 2017, the company was required to pay a net financial contribution of EUR 513, based on an evaluation of the actual revenue.

In general, all revenue generated in Austria from radio and television broadcasting, additional broadcasting services, or from providing an on-demand media service falls under the financial contribution. This similarly applies to the ORF, whereas the ORF programme fees, collected by Gebühren Info Service GmbH (GIS), are not counted as revenue. Such revenue is usually generated through advertising, sponsoring and product placement. Internet revenue is mostly achieved through the various types of banner and video advertising (including pre-roll, mid-roll and post-roll ads) shown in videos and in the context of providing videos.

A guide has been prepared to help determine the types of revenue falling under the financial contribution, while the list provided is not to be regarded as exhaustive (refer to the download link at the bottom of the page).

The payment obligation only applies above a specified minimum revenue level. In general, companies defined as falling under the obligation to pay the financial contribution are obliged to pay without exception. Nonetheless, this only applies above a specified revenue threshold that varies and is re-calculated every year. This threshold can be very roughly stated as having been around EUR 50,000 in previous years. In 2017, for example, the threshold was set at an actual revenue level of EUR 51,071. A company earning that amount of net revenue had to pay a financial contribution of EUR 262 in 2017.

The applicable legal provision states that no financial contribution is to be collected when the estimated amount an entity will be required to contribute is less than EUR 235, and that entity’s revenues are not to be taken into account when calculating the total revenue achieved in that particular industry. As of 2012, that amount is to be decreased or increased in proportion to the change in the 2005 Consumer Price Index (VPI) for the previous year or in the index replacing the VPI, as published by Statistics Austria.

As a result, the minimum amount was increased to EUR 262 in 2017.

Spot checks are done to verify the information provided by the companies on the revenues actually generated (query of actual revenue).