THE ROMANIAN PUBLIC TELEVISION WILL STOP PRODUCTION OF NEW SHOWS, IF ANAF DOESN'T UNFREEZE THE ACCOUNTS TVR - it's all reruns from here

• Lăzescu: "We can't make any new shows, we will go to broadcasting reruns"

• The head of the TVR is not considering resigning

Starting next week, the Public Television will stop production, if the National Tax Administration Agency (ANAF) doesn't unfreeze its accounts, which it froze a few days ago to recoup its claims, Alexandru Lăzescu, the chairman and CEO of the TVR. He said: "The ANAF has frozen the accounts of the Romanian Television before, but not completely and never in the midst of an electoral campaign".

TVR owes 308 million lei to the state, which have accrued since 2005, of which about one third are penalties, according to Mr. Lazescu. The freezing of the accounts is the first stage of the foreclosure, as the tax administration would impound the assets of the institution, if it doesn't pay off its debts. But the plot of land and the buildings do not belong to the TV station, according to its CEO: "TVR doesn't really have much to sell. Everything we have is leased through a gratuitous loan, we have no right of ownership over the land, nor over the buildings. We don't even have anything to use as collateral for a bank loan; only the equipment and the TV fee inflows".

The freezing of the accounts of the public television, will also lead to advertising losses, as well as affect the broadcasting of the Olympic Games, the European Football Championship and the electoral campaign, Alexandru Lazescu said.

The management of the TV station yesterday sent a request to the ANAF for the rescheduling of the outstanding tax payments. Alexandru Lazescu considers that the Tax Administration could grant the state television a grace period, and the debts would be repaid gradually, in small payments, over a long period of time. Mr. Lazescu also intends to negotiate the waiving of the accrued penalties, and he feels that in about six months, a new formula for the financing of TVR could be identified to finance TVR, such as indexing the TV fee or expanding it to certain categories of people which are currently exempt from it.

If the ANAF doesn't unlock the accounts of the institution, the public television will no longer be able to produce programs, according to the president of the TVR: "We can't produce any premieres, we will switch to reruns".

This manner of operation can only work in the short run. Mr. Lazescu did not discuss the long term solution, if he didn't reach an agreement with the ANAF.

The situation is contradictory. On one hand, since it does not have any money left, the institution will no longer be able to function, which, under normal circumstances, would mean bankruptcy for any corporation. On the other hand, TVR operates based on a special law which does not allow bankruptcy, as the Romanian Constitution and the Amsterdam Treaty prohibit the shutdown of the Public Television.

The head of the public television said that in spite of the critical state the institution is in and the fact that he "doesn't much support anymore" on the Board of Directors, he doesn't intend to resign: "I did not consider the possibility of a resignation, because I do not feel responsible for the current situation of the institution. Technically, I do not see how the problems the TVR is facing would go away if I left. But if the message of the ANAF is political, whoever wants my resignation must also accept the costs it comes with".

Alexandru Lazescu once again invoked "the huge pile of debt" he was saddled with by the former managers of the TVR, mentioning that he renegotiated some of the contracts concluded by the former CEOs of the TVR for humongous amounts, namely the ones with European Broadcasting Union (EBU) and movie distributor NBC Universal and has ended the "losing" cooperation with Splendid Media. Also, when the ANAF froze the accounts of the TVR, we were about to renew the renegotiation of the contract with the UEFA Champions League, according to Alexandru Lazescu. He said that during his term, some expenses were cut, but he emphasized the fact that he was unable to do much about salary costs, because the Collective Labor Contract does not allow them to be changed. On the other hand, the TVR hired between 50 and 60 people.

Mr. Lazescu considers that a news channel of the public television should exist, but that TVR3 shouldn't have existed: "It would be better if we had a children channel". He said that the state television would need to be restructured completely, to adapt to reality: "The legislative framework is completely outdated. It allows large scale interference in the activity of the institution. (...) I am resolute that by the end of my term, I will present the things that should really be done. We need to single out the critical areas and what should be done. Five years from now, television will be completely different. The manner in which people watch TV, the interface, everything will change. If it doesn't adapt, it will be hard for the public television to be relevant".

The head of the TVR also said yesterday that the Court of Accounts submitted a study of the last five years of operation of the TVR to him and to the Parliament, which reveals the situation it is currently in: "It is an accurate snapshot provided by a qualified public institution".

The Romanian Television is facing serious financial issues, posting losses of 160.8 million lei last year, and of almost 162 million lei in 2010, according to the reports it submitted to the Parliament.

Last year, the total revenues of the TVR stood at approximately 583 million lei, whereas the total expenses amounted to approximately 744 million lei. According to the report by the TVR, advertising revenues fell 24.06% in 2011 compared to 2010.

The receivables of the institution last year reached about 120 million lei, and short term debts amounted to 531 million lei. Debts payable in more than a year amount to 22.78 million lei. Aside from the 308 million lei it owes to the tax administration, the public television owes somewhere between 120 and 130 million to other institutions, according to Alexandru Lazescu.

At the end of last year, the TVR had about 7 million lei in its bank accounts.