The "Conseil constitutionnel" (French Constitutional Council) considered in its decision of August 9, 2012, that the "Loi de finance rectificative" (amending finance Act) could not impose a tax on the resale of television channels, which the frequency was granted free of charge by the State.

© thejournalofregulation

Regulation can evolve either abstract (pure ex ante), or in response to specific cases. The general question of the taxation of resale of television channels, activity performed by granting of free licences to do so by the State for the benefit of operator, is to insert into a still more general question: how do we do for that operators do not get in for free licensing, and then resell immediately for sell significant amounts television channels whose operation is permitted? This should be avoided because if the control system is put in place, including licensing, the sharing of the resource that is still rare, it is because the media are not like any other activity.

That is why the financialization of the sector is more clearly marked concern still concerning them to the other sectors of the economy of goods and services. The law is then used to discourage this financialization: the simplest is taxation, to become less profitable operation. Financial strategy, should meet the budgetary tool. The other way is the prohibition against simple resale. Why consider it now?

Because the "Direct 8" case came. This explains that in shortcut the tax under the Finance Act had been nicknamed: the "Bolloree tax". Indeed, in the allocation of digital terrestrial television channels (TNT), the Superior Council of the audiovisual the "Conseil supérieur de l’audiovisuel" (CSA - French Media Content Regulator) had attributed to the Group Bolloré two channels: Direct 8 and Direct Star.

The award was made free of charge, as for all other channels. But a few months later, in September 2011, the Bolloré group sold the two channels to the Vivendi group for € 450 million. To avoid that this speculative use of the mechanism of attribution not being incorporated, first, the contractual tool is now used. Indeed, it is necessary but it is sufficient that the agreement by which the "Conseil supérieur de l’audiovisuel" (CSA - French Media Content Regulator) awards the license determines the ownership of it to its storage for some time. It is not in fact to freeze the market, but to avoid the immediate resale. For the moment, the regulator has enclosed in the conventions now impose a retention period of 2 years and a half to 6 next television channels for which frequencies will be allocated in December 2012.

Moreover, Parliament had inserted into the amending Finance Act which was designated as the "tax Bolloré", requiring 5% to the seller, the resale of radio and television frequencies. It is not clear that a small amount can be deterrent, but we should also take into account the constitutional freedom of trade and industry. The intentions of the Bolloré group to be speculative or industrial, through its rise in the Vivendi group, the particular case reveals the general problem of financial speculation on the free frequencies assigned.

Indeed, there may only be perverse effects when it assigns free of charge which has great economic value to market operators. It is logical that they are acting to increase their profit, then put barriers of regulation. Thus, the decision of the French Constitutional Council on August 9, 2012 sanctions for non-compliance with the Constitution the tax, because it has no direct relationship with the amending Finance Act. Indeed, we have just seen, the tax has a greater ambition. If Parliament persists, appropriate that it adopts an autonomous text.