Govt plans to restrict cross-holding in media

A newspaper firm won't be able to hold 100% in a TV or radio company.

The information and broadcasting ministry is considering cross-holding equity restrictions in the media.

This means, a newspaper company will not be allowed to hold the entire equity in a television or a radio broadcasting company and vice versa. Also, a television broadcaster will not be able to own the whole of a cable distribution company.

At present, similar cross-holding restrictions exist in direct-to-home (DTH) broadcasting, wherein a broadcaster can hold only up to 20 per cent in a DTH company.

A detailed policy framework to this effect will be worked out soon and will be taken to the Union Cabinet for its consideration. The exact holding restrictions will then be worked out.

According to a senior information and broadcasting ministry functionary, the proposed policy will include not only the broadcasting companies but also print media companies.

"This will be a part of a comprehensive policy. The cabinet will take a call on the issue as it will have serious ramifications," said the official, adding that the measure, on the lines of restrictions in some other countries including the UK, is designed to prevent any build-up of monopolies in the sector.

Information and broadcasting minister S Jaipal Reddy had proposed a similar move during his earlier stint as the minister in 1997. But the proposal was withdrawn following protests from media companies.

"We want to have a consensus on the issue, before going ahead. Stakeholders will be consulted before taking such a step," the functionary said.

Government sources said the idea came into being after recent incidents where certain media companies violated rules in spirit to start DTH ventures.

The officials also said the government was likely to permit private FM radio companies to have foreign direct investment up to 20 per cent.

Under the current norms, only portfolio investments up to 20 per cent are allowed in private radio companies.

Government officials also said that the information and broadcasting ministry was not in favour of allowing news and current affairs programming in private FM radio companies. A proposal to this effect has already been sent to the cabinet.

End of monopoly

• A newspaper firm won't be able to hold 100% in a TV or radio company
• Its holding in other media firms too will be restricted
• Also, a TV broadcaster won't be able to own 100% of a newspaper firm or a TV station
• Private FM radio to have FDI up to 20%