Wed, Nov 09, 2005 - Page 8 News List

Editorial: The law applies to everyone

The Government Information Office's (GIO) probe into cable network TVBS has recently become a cause for concern in the local media, as well as the US. Will this be the first domino to fall in the collapse of Taiwan's hard-won press freedoms?

It will not, for the nation's democratic system is not so fragile. However, the case has highlighted a number of important issues.

The question of TVBS' ownership has arisen at a time when the network has been especially critical of the government, so the government's response has been viewed by some as revenge. But TVBS is also trying to blur the issue.

Whether TVBS has violated regulations to such an extent that its operating license should be revoked is a legal question. Claiming that the government is taking revenge appears paranoid, especially as the matter is far from settled. And it was inappropriate for President Chen Shui-bian (陳水扁) to announce, at this early stage, that no TV network would have its license revoked, for the law should be allowed to take its course.

At the heart of the dispute is the question of whether or not TVBS has violated Article 10 of the Satellite Broadcasting Law (衛星廣播電視法), which says that "The total shares of a satellite broadcasting business directly held by foreign shareholders shall be less than 50 percent of the total shares issued by the said business."

TVB in Hong Kong has used Bermuda TVB Investment Co to set up a sister company, Countless Entertainment (Taiwan) Co, in Taiwan. Countless Entertainment holds a 53 percent stake in TVBS, and the Hong Kong-based Bermuda TVB holds the remaining 47 percent. Although the amount of shares that TVB holds in TVBS through Countless Entertainment exceeds 50 percent, that stake is indirectly held, and this would seem to avoid prohibition against a foreign company directly holding a majority of shares.

A careful look, however, reveals that the shareholders in Countless Entertainment are the same as those in Bermuda TVB Investment, and that both companies are registered at the same address. Although TVBS says that Bermuda TVB Investment owns shares in TVBS indirectly through Countless Entertainment, the fact is that the Hong Kong-based shareholders in Bermuda TVB Investment own 100 percent of TVBS.

Although many have sought to defend TVBS on legal technicalities, we must remember that the spirit of Article 10 of the Satellite Broadcasting Law is to "protect local Taiwanese culture and avoid a foreign-owned media monopoly." TVBS has attempted to duck the accusation of being fully Hong Kong-owned by talking of indirect ownership, but its actions clearly conflict with the intention of the law.

There are clearly some problems in TVBS' share structure, and the law provides for a variety of measures, varying in severity, that can be employed against the organization. Revoking the network's broadcast license should only be resorted to if TVBS is found to have presented false documentation in its license application, or refuses to restructure despite the NT$1 million fine imposed by the GIO. At the same time, the persons responsible for the renewal of TVBS' license in July, given its ownership structure, should also be found and the matter investigated.

At any rate, legal proceedings have only just begun and numerous options remain -- so there is no need for the public to assume that a withdrawal of TVBS' broadcasting license is in any way inevitable.

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