The European Court of Justice (ECJ), in UTECA v. Administración General del Estado C-222/07, has reviewed the compatibility of Spanish funding of cinematographic films and European films made for television with the 1989 Television Broadcasting Directive (Council Directive 89/552/EEC).
Spanish legislation requires that 5 per cent of revenue from the previous year be dedicated to European films and of that, 60 per cent must be reserved for the production of films where the original language is one of the official languages of Spain. However, Unión de Television Comerciales Asociadas (UTECA) claimed that this policy contravened the Television Broadcasting Directive and was therefore inapplicable. The Spanish Tribunal Supremo referred the question of compatibility to the ECJ.
The ECJ held that although the policy restricted the fundamental freedom to provide services, freedom of establishment, free movement of capital and the free movement of workers, it was justified on the grounds that the defence of Spanish multilingualism constitutes an overriding reason in the public interest.
The ECJ noted that the measure went no further than was necessary to achieve the desired objective and that the apportionment of revenue in this case does not constitute State aid in favour of the cinematographic industry.