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Channel 5 settles terms of trade with Pact

Viacom-owned terrestrial broadcaster Channel 5 has signed a new terms of trade agreement with UK producers’ association Pact covering its work with independent producers.

Sara Geater

The agreement takes effect today and runs for an initial period of three years. The two parties described it as a “fair deal” that reflects “industry developments, audience expectations and the wider commercial landscape for content.”

For C5, it secures UK exhibition rights on its main public service channel as well as rights to carry programmes on its secondary networks and the pay and free channels of Viacom International Media Networks (VIMN) in the UK and Ireland.

In addition, the deal grants rights across associated VoD services and viewer functionalities across all platforms, amongst other benefits.

For producers, the terms provide opportunities to create more value in their content IP across secondary and international markets, including a shorter holdback position in Ireland and on VoD, as well as a more advantageous position in music ownership and publishing revenue participation, plus enhanced VoD royalty payments.

Only fully funded commissions from qualifying independent producers for the main channel will be governed by the new terms.

James Tatam, VP of commercial, digital and operations, said: “Independent production companies are the lifeblood of Channel 5, so it is vital we operate a terms of trade that benefit broadcaster and producer alike.”

Pact chair Sara Geater added: “Pact’s recent census showed that Channel 5 is a significant commissioner of programming from smaller producers from around the UK. They, along with other qualifying indies commissioned by Channel 5, will benefit greatly from these new terms of trade that are easy to understand and reward success.”

UK productions are covered by the terms of trade set out in the Communications Act of 2003 which sees production companies retain the rights to shows commissioned by the UK terrestrial broadcasters (BBC, ITV, Channel 4 and Channel 5).

The terms, long campaigned for by Pact, have seen production groups in the UK amass significant IP ownership, making them attractive to investors and buyers and leading to a rush of M&A activity in the sector over the past decade.

The 2014 deal that saw VIMN buy Channel 5 from previous owner Northern and Shell had caused some tension with Pact, with VIMN keen to exploit original commissions on C5 on its many channels around the world.

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