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.
The BBC Charter and Agreement require Ofcom to consider the impact of the BBC’s activities on fair and effective competition. 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.
We have put in place 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.
We have also considered how we will hold the BBC to account on the commissioning requirements in the Agreement. We have decided not to impose any additional requirements on the BBC in this area at this time, but we will continue to monitor how the BBC’s commissioning process operates.