The National Communications Commission (NCC) yesterday approved the China-based Want Want Group’s (旺旺集團) management take over of China Television Co (CTV, 中視) and CTiTV (中天電視), but warned that any violation of conditional clauses set by the NCC would invalidate the decision.
The conditional clauses prohibit management personnel, board directors and supervisors from either television station concurrently holding similar positions in the other station. The NCC gave CTV and CTiTV three months to ensure compliance.
CTV general manager Rao Sheng-hsiung (饒聖雄) also serves as chairman of CTiTV, while CTV supervisors Wu Ken-cheng (吳根成) and Ho Kuo-hua (何國華) are board directors of CTiTV.
The commission also ruled that each network should have at least one independent board director affiliated with neither the Want Want Group nor the China Times Group (中時集團), the two stations’ parent firm. The China Times Group was purchased by the Want Want Group last year.
The NCC clauses further stipulate that the two stations’ advertising, sales and programming departments must remain separate, and that programming must be generated by each network independently.
In addition, the two networks are not allowed to jointly bid for advertising contracts.
The NCC asked CTV and CTiTV to establish separate ethics committees within three months. The committees will be required to present an online report every three months on how they regulate program quality.
The stations are also required to have their own editorial and program review personnel and to submit a report on internal quality control procedures to the NCC within three months.
As foreign investment in television companies is prohibited, the NCC said it would rescind its approval of the two networks’ management reshuffles if they were to receive any investment from China.
In addition to these clauses, the NCC also listed several suggestions for improving CTV and CTiTV. The commission said that the two networks frequently rebroadcast programs produced by the other station, particularly on weekends, and that programs aired between 9am and 5pm on both networks had a high level of product placement.
The NCC said CTV, a terrestrial television service, airs locally produced programs in prime-time slots and that new productions should make up two-thirds of the network’s programming.
“We don’t want to see the network use the radio spectrum to air TV dramas produced in [South] Korea,” NCC vice chairman Chen Jeng-chang (陳正倉) said.
Chen said the commission looked at statements by former NCC commissioners, as well as opinions expressed at a May 8 hearing on the China Times Group’s application, to rule on the two stations’ management.
“We know from the testimony that we were not just dealing with a simple change of TV network ownership,” Chen said. “The transaction will have a huge impact on the media industry and could affect the diversity of public opinion.”
The ruling prompted defiant remarks from the Want Want Group, which accused the commission of abusing its authority.
“The NCC imposed these conditions without any legal basis,” the group said in a statement. “We will hold the commissioners accountable for any damage caused by their ruling.”
The statement added that the group’s operational capital came from the family of Want Want Group chairman Tsai Eng-meng (蔡衍明), not China.
“We cannot accept any of the conditional clauses if they are framed to target the Want Want Group,” the statement said.
The purchase of the China Times Group also gave the Want Want Group control over the China Times and China Times Weekly Chinese-language newspapers.
Chen said that although broadcasting laws do not have clear rules on cross-media management, the commission was authorized by Article 1 of the Organic Act of the National Communications Commission (通訊傳播基本法) to protect the interests of consumers and preserve cultural diversity.
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