The Government plans to regulate BSkyB from next July. The Minister for Communications, Mr Ahern has said he will seek to regulate the satellite broadcaster by using a number of new European Union directives.
The minister has warned that if BSkyB resists this move, then Ireland will use its coming Presidency of the European Union to re-examine the Television Without Frontiers directive that is the basis of BSkyB's claim that it is exempt from regulation everywhere in Europe apart from Britian.
Television Without Frontiers is a directive on European broadcasting that has enabled satellite operators to avoid regulation in the states in which they broadcast services. Rather, it placed the burden of regulation on the state where a firm was based.
BSkyB, which operates the Sky television services and has 272,000 Irish subscribers, has relied on the Television Without Frontiers directive to consistently resist regulation - including price controls - in the Republic. It has argued that because it is based in Britain it should not be subject to regulation by the Commission for Communications Regulation (ComReg), but rather be regulated by the British authorities.
In an interview with The Irish Times, the Minister for Communications, Mr Dermot Ahern, said the Government was determined to create a more level playing field for broadcasting firms.
He said there was a desire to bring BSkyB under the regulatory umbrella of ComReg. This should be possible through the transposition of new European directives that come into force in July, added Mr Ahern, who is also engaged in a bitter dispute with the FAI over its decision to sell broadcasting rights to BSkyB.
If BSkyB is regulated by ComReg, it will have to pay an annual levy to the regulator, which could cost up to 0.5 per cent of its revenues. In some circumstances it may also face price and service quality controls.
BSkyB's rival cable firms Chorus and NTL will welcome Mr Ahern's statement. Last week they threatened to sue the Government over the current levy of 3.5 per cent of revenues which they have to pay to ComReg.