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“Disqualified person” application by DBC approved

The Government today (January 20) announced that the Chief Executive in Council (CE-in-Council) had approved the application of Digital Broadcasting Corporation Hong Kong Limited (DBC) for Professor Arthur Li Kwok-cheung, a “disqualified person” (DP) under the Telecommunications Ordinance, to exercise control of the company as a Chairman and director .

Professor Li is a DP under the Ordinance by virtue of his being a relative of a director (namely Dr Hon David Li Kwok-po) of an associated corporation (namely PCCW Limited (PCCW)) of a domestic pay television programme service licensee (namely PCCW Media Limited (PCCW Media)).

“Since DBC and PCCW Media are operating in two separate and distinct broadcasting markets, and Dr David Li as an independent non-executive director of PCCW does not have control or influence over the daily operation of PCCW or PCCW Media, the approval will not undermine the competition landscape in the broadcasting industry,” a spokesman for the Commerce and Economic Development Bureau said.

“DBC, as a new player in the market, should be able to benefit from the expertise and experience of Professor Arthur Li with his appointment as a Chairman and director in terms of enhancing the company’s governance and development. This should have a positive impact on the development of digital audio broadcasting services in Hong Kong,” the spokesman said.

He added that Professor Arthur Li would give an undertaking that in his role as a Chairman and director and a shareholder of DBC, he will act independently from any of his relatives in the media industry; exercise due care and attention to avoid editorial uniformity across different media platforms (including PCCW Media specifically); and abstain from discussions and decisions in connection with matters concerning both DBC and PCCW Media.

Under the Ordinance, no DP, other than a person in respect of whom the reason for his being a DP was disclosed in the application of a licence, shall exercise control of a corporation that is a sound broadcasting licensee. A DP is defined under section 13A of the Ordinance which includes, among others, an “associate” of a domestic pay television programme service licensee within the meaning of the Broadcasting Ordinance. The provisions are to minimise the risks of media concentration, conflict of interest and editorial uniformity across different media platforms. The Ordinance further provides that the CE-in-C may, if he is satisfied that the public interest so requires, permit the licensee to enable a DP to exercise control of the licensee. In considering the public interest for approving a disqualified person application, the CE-in-C has taken account of 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.

Friday, January 20, 2012