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Note 25. Contractual obligations and other commitments
Ref.
Context
Characteristics (nature and amount)
Expiry
(d)
Divestiture of NC Numericable (March 2005)
€151 million counter-guaranteed by Orange, expired as of December 31, 2014.
2014
Acquisition of EMI Recorded Music (September 2012)
p
p
Commitments relating to full pension obligations in the United Kingdom
assumed by Citi; and
-
p
p
Guarantees relating to losses stemming from taxes and litigation claims, in
particular those related to pension obligations in the United Kingdom.
-
(j)
Divestiture of Xfera (2003)
Guarantees amount to €71 million.
-
Other contingent assets
Cumulated amount of €86 million (compared to €70 million as of December 31,
2013).
-
The accompanying notes are an integral part of the contingent assets and liabilities described above.
(a)
As part of the French Competition Authority’s approval of the acquisition of the Direct 8 and Direct Star channels (renamed D8 and D17, respectively)
on July 23, 2012, Vivendi and Canal+ Group gave certain commitments. These commitments provide for restrictions on the acquisition of rights for
American movies and television series from certain American studios and for French movies, the separate negotiation of certain rights for pay-TV and
free-to-air movies and television series, limitations on the acquisition by D8 and D17 of French catalog movies from Studiocanal, and the transfer of
rights to broadcast major sports events on free-to-air channels through a competitive bidding process. These commitments are made for a five-year
period and are renewable once if the French Competition Authority, after having performed a competition analysis, deems it necessary. In addition,
on September 18, 2012, the French Broadcasting Authority (
Conseil Supérieur de l’Audiovisuel
) approved the acquisition of these channels, subject
to certain commitments relating to broadcasting, investment obligations, transfer rights, and the retention by Canal+ Group of the D8 shares for a
minimum period of two and a half years.
On December 23, 2013, the French Council of State annulled, with a delayed effect as from July 1, 2014, the French Competition Authority’s
approval of the acquisition of the Direct 8 and Direct Star channels (renamed D8 and D17, respectively), which had been approved on July 23, 2012.
On January 15, 2014, Vivendi and Canal+ Group submitted a new notification to the French Competition Authority. On April 2, 2014, the French
Competition Authority reapproved the transaction, subject to compliance with commitments given by Vivendi and Canal+ Group. These commitments
are similar to the ones contained in the previous 2012 authorization except for an additional commitment relating to the acquisition of broadcasting
rights covering second and third exhibition windows for French films. All commitments are binding for a period of five years starting July 23, 2012.
In 2017, the French Competition Authority will have the opportunity to request a renewal of these commitments for the same duration, if deemed
necessary, after a new competitive analysis.
(b)
On August 30, 2006, the merger between TPS and the Canal+ Group was authorized, in accordance with the merger control regulations, pursuant
to a decision of the French Minister of Economy, Finance and Industry, subject to Vivendi and Canal+ Group complying with certain undertakings for
a maximum period of six-years, with the exception of those commitments concerning the availability of channels and VOD, which could not exceed
five-years.
On October 28, 2009, the French Competition Authority opened an enquiry in respect of the implementation of certain undertakings given by Canal+
Group in connection with the merger of Canalsatellite and TPS.
On December 21, 2012, the French Council of State rejected Vivendi and Canal+ Group’s filed motions requesting the annulment of the French
Competition Authority’s decisions of September 20, 2011 and July 23, 2012. Under the first motion, the €30 million fine imposed on Canal+ Group
was reduced to €27 million. Under the second motion, the transaction was once again cleared, subject to compliance with 33 injunctions.
Canal+ Group has implemented a number of these injunctions, some since July 23, 2012 and others since October 23, 2012. The injunctions mainly
focus on:
p
p
acquisition of movie rights:
–– by limiting the duration of output deals to three years, requiring separate agreements for different types of rights (first pay-TV window, second
pay-TV window, series, etc) and prohibiting output deals for French films, and
–– by the Canal+ Group divesting its interest in Orange Cinéma Séries – OCS SNC or by adopting measures limiting its influence over Orange
Cinéma Séries – OCS SNC. On February 4, 2013, at the request of Multithématiques and to comply with injunction 2(b) ordered by the French
Competition Authority on July 23, 2012, the members of Orange Cinéma Séries–- OCS SNC’s Board of Directors resigned from their positions. As
a result, Multithématiques appointed by letter with an effective date of February 4, 2013, two independent representatives with no affiliation to
Multithématiques to the Board of Directors of Orange Cinéma Séries – OCS SNC;
p
p
distribution of pay-TV channels:
–– by the distribution of a minimum number of independent channels, the distribution of any channel holding premium rights, and by drafting a model
distribution deal relating to independent channels included in the Canalsat offer,
–– by the obligation to promote, in a transparent and separate manner, the distribution of exclusive independent channels on each owned platform
serving more than 500,000 subscribers, and
–– by making all its own movie channels distributed by Canal+ Group (Ciné+ channels) available to third-party distributors (unbundling);
p
p
video-on-demand (VOD) and subscription video-on-demand (SVOD):
–– by separating contracts entered into for the purchase of VOD and SVOD rights on a non-exclusive basis, and not combining them with rights
purchased for linear distribution on pay-TV,
–– by offering Studiocanal’s VOD and SVOD rights to any interested operator, and
–– by forbidding exclusive distribution deals for the benefit of Canal+ Group’s VOD and SVOD offers on Internet Service Providers platforms.
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