National Communications Commission (NCC) officials said yesterday that fines were likely after a preliminary investigation found that TV shopping channels used by the Eastern Home Shopping & Leisure Co (EHS) had been replaced by U-life shopping channels by cable operators in Taipei and Kaohsiung cities and Ilan county.
The Cable Radio and Television Act (有線廣播電視法) stipulates that channel changes made by cable operators must first obtain NCC approval, officials said, adding that fines could range from between NT$100,000 and NT$1,000,000.
In a statement, EHS said the changes took place at midnight on New Year’s Eve after 28 cable operators switched channels 35, 47, 48, 60 and 80 to the five U-life shopping channels.
The company estimates that the changes affected about 2.6 million viewers across the three areas.
The controversy has had many business analysts pointing their fingers at U-life founder and former Eastern Multimedia Group chairman Gary Wang (王令麟).
Wang — who in January last year was sentenced by the Taipei District Court to 18 years in prison and fined NT$700 million (US$21 million) for his involvement in the Rebar Asia Pacific Group (力霸亞太企業集團) embezzlement scandal — sold EHS to a Singapore-based group last year.
EHS chairman Mary Leong (梁馬利) said that a competition clause was included in the sales agreement prohibiting Wang from creating similar TV shopping companies and said that the company intends to recover NT$700 million in damages.
Both Wang and U-Life deny the allegations.
Wang said yesterday he never signed the so-called “anti-competition clause” and called on EHS to respect free-market economics.
U-life said the channels were switched because EHS was in the middle of negotiations with cable operators and had yet to sign contracts.
Huang Chin-yi (黃金益), deputy director of the NCC’s operational administration department, said that while the agency did not take into account business disputes, any changes to channel lineups must first be approved by the commission, which U-life had yet to do.
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