Economy
Hungary would lower ad tax for RTL if station cuts gov't criticism - paper
The details of the deal have been brokered by János Lázár, minister at the helm of the Prime Minister’s Office and Andreas Rudas, Executive Vice President overseeing RTL Group’s operations in Croatia and Hungary, the paper said. Lázár did not leave anything to chance and arrived in Berlin with a folder containing the sensitive personal business deals of Rudas, the paper added.
Lázár has managed to strike a deal with RTL in Berlin on Wednesday to ease the squeeze on the Hungarian broadcaster in exchange for a softer voice in its news progrmmes, Népszava cited unnamed sources as saying. For that success he did not refrain from applying ‘Orbanian’ measures, the paper said, claiming Lázár arrived to the negotiations with a dossier filled with documents that would sensitively affect Rudas’s personal business activities, putting serious pressure on him this way.
Rudas met Lázár twice last week in Budapest on Monday and Thursday, the paper said, adding that the meetings took place “behind the back" of RTL Klub chief Dirk Gerkens.
The meetings in Berlin have finally yielded results, the paper said. The cabinet promised to slash the upper rate of the advertising tax from a whopping 50% (on revenues!) to 5% as of 1 January 2016 at the latest. What it wants in exchange is that RTL Klub, for which the cabinet allegedly designed the tax specifically and which in turn harshly criticised the cabinet, would only have to soften its tone. According to the paper, the draft proposal has been sent to the legal department of RTL today.
The owners of the station also achieved that RTL will be able to collect a distribution fee from cable companies, something which the cabinet banned earlier despite the fact that the channel has a contract in force with the media authority. The prohibition would have stripped RTL from annual revenues of HUF 6-8 billion on top of the advertising tax amounting to over HUF 4.5 bn.
It seems the cabinet is willing to remedy a serious harm of interest for RTL but for the money the station will need to change its attitude and make less critical nightly news. The sources of the paper said RTL employees have been notified of the agreement, but there is no word on the reactions to the deal that could damage RTL’s credibility.
The sources also said that while peace was in the interest of both parties, the government was pushing harder to reach a deal before German Chancellor Angela Merkel arrives in Budapest for brief official visit on 2 February and so the months-long tension between the cabinet and RTL would not have to be discussed with her.
Luxembourg-headquartered RTL Group on Tuesday confirmed to local newspaper Népszabadság that several rounds of talks were held with Hungarian government officials on the advertising tax.
German media conglomerate Bertelsmann, the owner of RTL Group, has filed an official complaint with the European Commission over the cabinet’s measures and talked about its predicaments in Hungary to Merkel too.
Oliver Fahlbusch, head of corporate communications at RTL Group, told Népszabadság on Tuesday that it would help Hungary too if these negotiations resulted in a sensible solution, i.e. if the advertising tax was revised without European Union action. He did not wish to go into details, but noted that RTL Klub will continue its independent news services.
Speculation on the possible departure of Gerkens has not been commented either by the CEO himself or parent company officials.
Locall news portal 444.hu learned that Gerken’s contract is to expire soon and it should be extended shortly. He has been in this position since 2001.
In response to RTL’s harsh and persistent criticism, Fidesz politicians attack the station’s journalists at press conferences or refuse to answer their questions.
"They consider our news to be opposition news," CEO Dirk Gerkens told Bloomberg Businessweek a few days ago.
"But that’s not the case. Our news is independent. We’re not going to talk about the guys in opposition that are basically doing nothing."
The CEO estimates that RTL will pay 90% of the revenue raised by the tax, although it commands only 15% of the market. If the tax remains next year, it will wipe out the company’s profits.
Gerkens added that he has also received threats of violence, delivered via friends or e-mails. He’s moved his family out of the country, left his apartment for a luxury hotel in central Budapest, and hired bodyguards.
"It’s not Russia or Mexico. But better safe than sorry."
Népszava said the threats were made six months ago, speculating that if the agreement was in fact reached without him, rumours about his departure could resurface again.
Rudas met Lázár twice last week in Budapest on Monday and Thursday, the paper said, adding that the meetings took place “behind the back" of RTL Klub chief Dirk Gerkens.
The meetings in Berlin have finally yielded results, the paper said. The cabinet promised to slash the upper rate of the advertising tax from a whopping 50% (on revenues!) to 5% as of 1 January 2016 at the latest. What it wants in exchange is that RTL Klub, for which the cabinet allegedly designed the tax specifically and which in turn harshly criticised the cabinet, would only have to soften its tone. According to the paper, the draft proposal has been sent to the legal department of RTL today.
The owners of the station also achieved that RTL will be able to collect a distribution fee from cable companies, something which the cabinet banned earlier despite the fact that the channel has a contract in force with the media authority. The prohibition would have stripped RTL from annual revenues of HUF 6-8 billion on top of the advertising tax amounting to over HUF 4.5 bn.
It seems the cabinet is willing to remedy a serious harm of interest for RTL but for the money the station will need to change its attitude and make less critical nightly news. The sources of the paper said RTL employees have been notified of the agreement, but there is no word on the reactions to the deal that could damage RTL’s credibility.
The sources also said that while peace was in the interest of both parties, the government was pushing harder to reach a deal before German Chancellor Angela Merkel arrives in Budapest for brief official visit on 2 February and so the months-long tension between the cabinet and RTL would not have to be discussed with her.
Luxembourg-headquartered RTL Group on Tuesday confirmed to local newspaper Népszabadság that several rounds of talks were held with Hungarian government officials on the advertising tax.
German media conglomerate Bertelsmann, the owner of RTL Group, has filed an official complaint with the European Commission over the cabinet’s measures and talked about its predicaments in Hungary to Merkel too.
Oliver Fahlbusch, head of corporate communications at RTL Group, told Népszabadság on Tuesday that it would help Hungary too if these negotiations resulted in a sensible solution, i.e. if the advertising tax was revised without European Union action. He did not wish to go into details, but noted that RTL Klub will continue its independent news services.
Speculation on the possible departure of Gerkens has not been commented either by the CEO himself or parent company officials.
Locall news portal 444.hu learned that Gerken’s contract is to expire soon and it should be extended shortly. He has been in this position since 2001.
In response to RTL’s harsh and persistent criticism, Fidesz politicians attack the station’s journalists at press conferences or refuse to answer their questions.
"They consider our news to be opposition news," CEO Dirk Gerkens told Bloomberg Businessweek a few days ago.
"But that’s not the case. Our news is independent. We’re not going to talk about the guys in opposition that are basically doing nothing."
The CEO estimates that RTL will pay 90% of the revenue raised by the tax, although it commands only 15% of the market. If the tax remains next year, it will wipe out the company’s profits.
Gerkens added that he has also received threats of violence, delivered via friends or e-mails. He’s moved his family out of the country, left his apartment for a luxury hotel in central Budapest, and hired bodyguards.
"It’s not Russia or Mexico. But better safe than sorry."
Népszava said the threats were made six months ago, speculating that if the agreement was in fact reached without him, rumours about his departure could resurface again.
