The BBC Charter and Agreement require Ofcom to consider the impact of the BBC’s activities on fair and effective competition. The BBC may only carry out commercial activities through subsidiary companies. The BBC’s commercial subsidiaries generate returns which can be reinvested in BBC programmes and services and supplement income from the licence fee.
One of Ofcom’s principal functions in regulating the BBC is to set requirements around the interaction between the BBC Public Service and its commercial activities.
In 2017, we published requirements aimed at addressing competition concerns that could arise from the relationship between the BBC Public Service and its commercial subsidiaries to ensure that commercial activities do not, as a result of their relationship with the BBC Public Service, trading activities or non-service activities, distort the market or create an unfair competitive advantage.
Following further work in this area, including looking at the processes and practices around the operation of the commercial subsidiaries and their relationships with the BBC’s Public Service, we consulted on and have published updated requirements and guidance.
Ofcom has also considered how we will hold the BBC to account on the commissioning requirements in the Agreement. We have published a statement that confirms we will not be imposing any additional requirements on the BBC in this area at this time. Our statement sets out our decision in full.