Media

The Mediawet 2008 and the Commissariaat voor de Media form an important part of the regulatory framework for Dutch media businesses. The Commissariaat supervises, among other matters, rules on advertising, sponsorship and product placement and the independence of editorial content from commercial interests. The regulatory position of each media service, and the consequences of a change in the entity or its control, should be established early in a transaction, together with any open supervisory files. Where needed, we coordinate with specialist media counsel.

Concentration in media markets is assessed under the general competition regime, so merger control at the ACM or, above the European thresholds, at the Commission is the principal filter, with the Commissariaat's media expertise engaged alongside it. The European Media Freedom Act adds a further layer, requiring national assessment of media market concentrations for their effect on media pluralism and editorial independence. On a transaction of any scale, the media pluralism dimension and the competition analysis are prepared in parallel rather than in sequence. We plan the approval workstreams together and coordinate specialist competition and media advice where needed.

Under the Copyright Act, copyright in works created by employees in the course of their duties generally vests in the employer, and in certain circumstances a legal person that publishes a work as its own is treated as its author. Neither rule can be relied on as a matter of course for freelance contributions, while a transfer of copyright requires a deed, which is construed narrowly. Archives assembled over decades therefore frequently contain material licensed for the original medium and never for digital exploitation, syndication or onward licensing, which is a value question rather than a technical one where the archive is part of the consideration.

The copyright contract rules in the Copyright Act give individual makers mandatory protection, including a right to fair remuneration, in some circumstances a right to additional remuneration, a right to terminate for non-exploitation, and transparency obligations. Neighbouring rights protect performers, producers and broadcasting organisations, films have their own rules on the transfer of rights to the producer, and collective management organisations administer significant revenue streams. Each of these affects what a buyer acquires and what it must continue to pay.

A title is a bundle rather than a single asset, comprising the trade mark and masthead, the copyright in the archive, the contributor and freelance contracts, the subscriber base and its associated personal data, the advertising relationships and the goodwill. Each element moves by its own route, so copyright requires a deed identifying the rights conveyed, trade marks require a written assignment and, to be effective against third parties, registration, subscriber contracts require contract transfer or an equivalent mechanism, and employees engaged in the activity transfer by operation of law under the transfer of undertaking rules where the title constitutes an undertaking. That is why the perimeter is settled at term sheet stage in a carve-out of titles or activities.

A format is a contractual position more than a proprietary one. Dutch case law accepts that a format may attract copyright where the combination of its elements is sufficiently original, but the commercial value generally rests on the format bible, the production know-how, the track record and the option, licence and distribution agreements through which producers and broadcasters exploit it by territory. A production company, by contrast, is normally acquired as a company, which captures the library, the output and commissioning arrangements with broadcasters, the production financing and incentive positions and the talent contracts. Talent is a value driver in its own right, and exclusivity, term, change-of-control and tail provisions in presenter and creative contracts, together with portrait rights, are reviewed on the same footing as the rights themselves.

• Revenue quality is the central financial diligence question and it has a legal component. Advertising revenue is largely short-cycle and uncontracted, so the analysis covers the proportion held under framework agreements, agency commission and volume rebate arrangements, and, in digital media, dependence on platform intermediaries and the effect of consent rates on addressable inventory, since cookies and comparable techniques used for advertising require consent under the Telecommunications Act.
• Subscription revenue is assessed against the consumer rules on silent renewal in Book 6 DCC, under which a consumer subscription that renews automatically can generally be terminated at short notice once the initial term has passed, with separate rules for newspapers and magazines, together with the treatment of prepaid subscriptions as deferred revenue in the working capital and locked-box analysis.
• Where a listed media group is involved, the disclosure and governance rules for listed companies apply in addition.
• Employee and union consultation is a fixed feature of larger media transactions: works council consultation under the WOR, and notification of trade unions under the SER Merger Code.
• Editorial arrangements survive a change of control. Editorial statutes, editorial council rights and journalistic independence undertakings are contractual and constitutional positions that bind a buyer, and they are reviewed alongside the commercial contracts rather than treated as background material.
• Trade marks, domain names and archive material transfer separately from the corporate structure, and a transfer of an archive that contains personal data or third-party footage requires a data protection and rights clearance analysis before the closing deliverables are agreed.