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The Government today (January 20) announced that the Chief Executive in Council (CE-in-Council) had approved two disqualified persons, Mr Liu Changle and Mr Yu Tung-ho, to continue to exercise control of Asia Television Limited (ATV) under the Broadcasting Ordinance.
The CE-in-Council also approved ATV to exercise control over its wholly owned subsidiary, Gangya, an advertising agency to be established on the Mainland.
"The approval would have some positive impact on the development of the broadcasting industry. It would not have any adverse effect on competition, programming choices or result in editorial uniformity in the Hong Kong television market," a spokesman for the Commerce and Economic Development Bureau said.
"We note that a prudent expansion of business outside Hong Kong is likely to help draw in more advertising revenue and strengthen the financial position of ATV. Also, the continuing service of Mr Liu and Mr Yu in ATV will make a positive contribution to the company. The overall local broadcasting industry will stand to benefit," the spokesman continued.
Mr Liu and Mr Yu are disqualified persons by virtue of their association with Phoenix Satellite Television Company Ltd, a non-domestic television programme service licensee, which is a wholly-owned subsidiary of Phoenix Satellite Television Holdings Limited.
Mr Liu, a director of Phoenix Holdings, has been exercising control of ATV as an indirect voting controller since he was granted prospective approval in 2006 by the CE-in-Council as a disqualified person. However, when seven companies under Phoenix Holdings become operative "advertising agencies" on the Mainland in early 2009, Mr Liu will become a disqualified person in a new capacity as an associate, i.e. a director of a company exercising control of advertising agencies.
Mr Yu, a non-executive director of ATV, will be appointed as Senior Vice-President of Phoenix, hence also a disqualified person by virtue of his being a principal officer of a non-domestic television programme service licensee (Phoenix) and an associated corporation of a company (Phoenix Holdings) exercising control of advertising agencies.
The spokesman said that in assessing the public interest and possible impact arising from approving the application, the Administration noted that ATV and the concerned advertising agencies were operating in different markets with different target audience. Moreover, Mr Liu and Mr Yu did not participate in any day-to-day business operation including programming in ATV.
"It is unlikely that their association with the Mainland advertising business will have any adverse effect on the programming choices nor result in editorial uniformity in the Hong Kong television market," the spokesman said.
Under the Broadcasting Ordinance, unless approved by the CE-in-Council, no disqualified persons shall exercise control of a domestic free television programme service licensee, or vice versa. In relation to a domestic free television programme service licence, disqualified persons include an advertising agency and their controllers as well as their associates and associates of their controllers. The restriction on the cross-control of advertising agencies and domestic free television programme service licensees is mainly to avoid potential conflicts-of-interest.
The ordinance further provides that in considering the public interest for approving a disqualified person application, the CE-in-Council shall take account of, but not be limited to, the effect on competition in the relevant 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.
Ends/Tuesday, January 20, 2009
Issued at HKT 16:30
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