This press release summarises the Communications Authority ("CA")'s decisions following its 45th meeting in September 2015:
Competition Complaint Lodged by Hong Kong Television Network Limited ("HKTVN") Against Television Broadcasts Limited ("TVB")
The CA considered a competition complaint lodged by HKTVN alleging that TVB had abused, and continued to abuse trade mark law and procedures as part of a concerted campaign to prevent HKTVN from obtaining a domestic free television programme service licence and to foreclose or delay its entry to the television programme service market in Hong Kong, which had the purpose or effect of preventing, distorting or substantially restricting competition in the television programme service market in Hong Kong.
Having considered the findings of the Preliminary Enquiry conducted by the Office of the Communications Authority, the CA concluded that there was no case for TVB to answer and that the matter being complained of had no substantial effect on competition. As such, there was no justification for proceeding to a Full Investigation pursuant to the Competition Investigation Procedures issued by the CA in April 2012. For details, please refer to the CA's Decision which is published on the CA's website.
Non-compliance with the Licensing Requirement to Submit Annual Audited Accounts by Asia Television Limited ("ATV")
The CA decided to impose a financial penalty of $100,000 on ATV for its failure to submit the audited accounts for the accounting year of 2014 ("2014 Audited Accounts") by 31 July 2015, which contravened Condition 25.1 of its domestic free television programme service licence ("the Licence").
The CA decided in July 2015 to impose a financial penalty of $50,000 on ATV for its failure to submit the 2014 Audited Accounts by the stipulated deadline of 30 April 2015. The CA also decided to direct ATV under Condition 25.1 of the Licence to submit the 2014 Audited Accounts by 31 July 2015. However, ATV did not furnish the CA with the 2014 Audited Accounts by the new deadline. ATV attributed its failure to submit the outstanding audited accounts to the need to provide supplementary information requested by its auditor before the commencement of the audit and submitted that the unforeseen difficulties and uncertainties during the transitional period of its shareholding change had caused the delay in its submission of the 2014 Audited Accounts. ATV further requested for an extension of the submission deadline to 31 October 2015.
The CA took a serious view over the breach of ATV as the submission deadline of 31 July 2015 was in fact requested by ATV. ATV was informed of the CA's provisional decision on 19 June 2015 that it would be required to submit the outstanding audited accounts by the deadline of 31 July 2015. The CA considered that ATV should have taken into account the time required for making the submission and raised with the CA the difficulties which might impede its compliance with the submission requirement. However, ATV did not notify the CA that it would not be able to comply with the stipulated deadline until 10 August 2015. The non-compliance had clearly reflected negligence on the part of ATV's management and the absence of effective corporate governance of ATV.
Taking into account the above, the CA decided to impose a financial penalty of $100,000 on ATV for the contravention. As ATV has yet to submit the 2014 Audited Accounts to the CA, ATV is required under Condition 25.1 of the Licence to submit the outstanding audited accounts by 31 October 2015 and that any failure to do so will lead to the imposition of heavier sanctions by the CA.
Non-compliance with the Licensing Requirement on Provision of Subtitling by TVB
The CA decided that TVB was in breach of Condition 3.1 of the First Schedule to its domestic free television programme service licence due to its failure to provide Chinese subtitles in certain part of the programme "Scoop" (東張西望) broadcast on Jade Channel on 13 July 2015.
The CA noted that the lapse was mainly due to an operational error and that the presentation and viewers' comprehension of the 30-minute programme concerned was not seriously affected by TVB's failure to provide Chinese subtitles for about 1.8 minutes in duration. Although TVB had taken the initiative to report the lapse to the CA and pledged to exercise greater care to prevent recurrence of similar lapses in future, the CA noted that this was the second breach of TVB of the same requirement within a space of four months. The recurring breaches reflected the lack of effective monitoring on the part of TVB to ensure its compliance with the subtitling requirement. Having considered the above, the CA decided that TVB should be advised to observe the relevant condition more closely.
Communications Authority
Secretariat
29 September 2015