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The Government today (January 31) announced that the Chief Executive in Council had approved four disqualified persons - Mr Kevin Lo Chung-ping, Ms Christina Lee Look Ngan-kwan, Mr Chien Lee and Mr Anthony Lee Hsien-pin - to exercise control of Television Broadcasts Limited (TVB) as non-executive directors under the Broadcasting Ordinance (Cap. 562), subject to the condition that they comply at all time with their undertakings to act independently from any of their relatives in the media industry.
Mr Kevin Lo is a relative of Mr Lo Chung-wai, a director of Movielink (Hong Kong) Limited, an "other licensable television programme service licensee" under the ordinance which provides television service to hotel rooms. Ms Christina Lee, Mr Chien Lee and Mr Anthony Lee are relatives of Mr Peter Lee Ting-chang, a non-executive director of the SCMP Group Limited which is the proprietor of two local newspapers, South China Morning Post and Sunday Morning Post.
These four individuals are therefore "disqualified persons" under the ordinance from their respective family relationships with persons exercising control of an "other licensable television programme service" licensee or a proprietor of local newspapers, and require approval from the Chief Executive in Council for exercising control of TVB.
A spokesman for the Commerce and Economic Development Bureau said that in assessing the public interest and possible impact arising from approving the four persons, the Administration noted that they were only relatives to persons holding directorship in Movielink and SCMP Group, and none of them held editorial position in the media entities concerned, such as TVB, Movielink and SCMP Group. As such, there is little risk to editorial plurality and diversity. On the other hand, the four individuals concerned have extensive experience in the broadcasting industry and could contribute to TVB and the industry.
"The approval has an overall positive effect on the development of the broadcasting industry, but minimal risk of editorial uniformity and media concentration," the spokesman said.
The four people had been exercising control of TVB as disqualified persons without approval since various dates from 2001 to 2003. Also, the late Mr Lee Jung-sen had been the director of TVB as a disqualified person without approval from December, 2003, but retired in May, 2005.
Although TVB applied for retrospective approval for these five people, the Government decided only to grant an approval starting from August 31, 2007, when TVB submitted the relevant applications, with no retrospective effect.
"The onus of complying with the cross-media control provisions under the ordinance rests with the licensee," the spokesman said. "Against this background, we see no grounds to grant retrospective approval."
At the same time, the Chief Executive in Council rejected TVB's application for another disqualified person, Mr Robert Sze Tsai-to, to exercise control of TVB as a non-executive director from May, 2004, onward.
Mr Sze is disqualified from exercising control of TVB as he is an associate of two non-domestic television programme service licensees, Skywave TV Company Limited and Auspicious Colour Limited, arising from his non-executive directorship of Asia Satellite Telecommunications Holdings Limited (AsiaSat), the voting controller of more than 15% of the voting shares in these two licensees.
Mr Sze is a professional accountant. Listed companies, including TVB and AsiaSat, are required to appoint at least one person with appropriate professional qualifications or accounting or related financial management expertise as an independent non-executive director in compliance with the relevant rules of the Stock Exchange of Hong Kong. That said, the Government could not establish that there was a genuine need nor positive public interest gain to approve Mr Sze to concurrently exercise control of both companies according to the relevant factors stipulated under the Ordinance.
"With no approval from the Chief Executive in Council, Mr Sze could be appointed as a director of either TVB or AsiaSat, but not both. This is in line with the letter and spirit of the cross-media control provisions under the Ordinance, which disallow persons to hold cross-media directorship unless justified on public interest grounds," the spokesman said.
Under the ordinance, unless approved by the Chief Executive in Council, a person shall not exercise control of a domestic free television programme service licensee if he is an associate (including a relative) of a person who is exercising control of certain media businesses which, among others, include a proprietor of a local newspaper as well as another broadcasting licensee. These provisions aim to avoid media concentration and editorial uniformity across different media platforms. TVB is a domestic free television programme service licensee and is therefore subject to these cross-media control provisions.
The ordinance further provides that, in considering the public interest for approving a disqualified person application, the Chief Executive in Council shall take account of, but not limited to, the effect on competition in the relevant television programme service market; the extent to which viewers will be offered more diversified television programme choices; the impact on the development of the broadcasting industry; and the overall benefits to the economy.
On June 21 and August 31, 2007, TVB applied for retrospective approval for a total of six disqualified persons to exercise control of the company during various periods since July 2001. They were Mr Kevin Lo, Ms Christina Lee, Mr Chien Lee, Mr Anthony Lee, the late Mr Lee Jung-sen and Mr Robert Sze. Other than the late Mr Lee Jung-sen who retired from TVB in May, 2005, prospective approval was also sought for the remaining five disqualified persons from the respective dates of applications.
A summary table of the decisions of the Chief Executive in Council on all these applications are at Annex. Arising from these decisions, the Broadcasting Authority had imposed a financial penalty of $80,000 on TVB against its breaches of the relevant cross-media control provisions under the ordinance. The Broadcasting Authority also reminded TVB to avoid recurrence of similar incidents in future and TVB has implemented an internal compliance system to enhance vigilance on the statutory requirements.
Ends/Thursday, January 31, 2008
Issued at HKT 17:54
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