The controversial proposal has been characterised by podcasters and web media specialists as an attempt to impose television-like state regulation on new media. The proposed Directive has been changed to allay those fears.
Proposed by the Commission as a way to extend regulation beyond traditional television and into some online video services, the new proposal was significantly amended by the European Parliament last December.
The Parliament passed a heavily-changed document which made it clear that regulation must apply only to commercial television-like services and not to user generated content such as that found on YouTube.
The proposed Directive says that a heavier regulatory burden must rest on material delivered to a schedule, in the style of traditional television. On demand services will also be regulated, but significantly more lightly, it said.
A crucial element of the consolidated text of the AVMS proposal is the maintenance of the 'country of origin' principle contained in the TV Without Frontiers Directive, which was passed in 1989. This means that a television station will be regulated according to the laws of the country where it is established, and saves it the burden of being bound by the laws of all 27 EU member states.
The Commission hopes that the plan will be adopted as a common position by Parliament and the Council on 24th May.
"Thanks to the ambitious work of the European Parliament and the intense efforts of the German Presidency over the past months, Europe's new legal framework for a more competitive, more diverse and more pluralistic audiovisual media sector is now within reach," said Information Society and Media Commissioner Viviane Reding. "I am confident that we will now achieve political agreement on the new 'Audiovisual Without Frontiers' Directive by the end of May. Europe's internal market would then be truly open for providers and consumers of audiovisual services by the end of 2008 at the latest."
The proposal still has its critics, though. The House of Lords European Union Committee recently urged opposition to the proposal, saying that it was a way for established broadcasters to protect their advertising market against new competition.
"We firmly reject the idea that regulators should act to preserve the market dominance of established players from new entrants," said a report produced by the Committee. It said the Committee was "unconvinced of the need for any quantitative restrictions on advertising in a market which is now clearly open to competition".
The proposed Directive will also open the door for more flexibility in advertising in traditional television. "New forms of commercial such as product placement have the potential to provide significant revenues for TV broadcasters and the audiovisual industry as a whole," said Reding. "We need to support the competitiveness of European film, while at the same time clearly excluding product placement from children's programmes, news, documentaries, and current affairs programmes."