The Communications Authority (CA) approved the application of Digital Broadcasting Corporation Hong Kong Limited (DBC) for proposed changes in its shareholding structure.
On 10 January 2013, DBC applied as per the relevant licence requirement for the CA’s approval for a proposed transfer of all the 40% of DBC’s shares owned by Mr Albert Jinghan Cheng, Mr Morris Ho Kwok-fai and Mr Ronald Joseph Arculli to Mr Wong Cho-bau. DBC submitted that upon completion of the transaction, the financial dispute among DBC’s shareholders, which had caused the disruptions to/cessation of DBC’s broadcasting service since October 2012, would be resolved. Before completion of the transaction, Mr Wong had already injected further funding into DBC, enabling DBC to resume broadcasting music from 11:00 am on 11 January 2013. DBC submitted that it would provide a full-fledged broadcasting service with effect from 7:00 am on 28 January 2013.
Having taken into account DBC’s submissions above, the CA was satisfied that with the changes in its shareholding structure, DBC would be able to comply with the applicable regulatory requirements, and to provide a sound broadcasting service in accordance with its licence. Accordingly, the CA approved DBC’s application for changes in its shareholding structures.
DBC resumed limited service from 11 to 28 January 2013 by broadcasting music only. In this connection, DBC has as per the licence requirement applied for the CA’s approval for its broadcasting service to deviate from the programming requirements set out in its licence (Note1). DBC submitted that the application was to allow DBC sufficient time to prepare for the resumption of its full-fledged broadcasting service with effect from 28 January 2013. While the proposed broadcast of only music during the period fell far short of being a good use of the spectrum assigned to DBC, the CA noted that DBC had taken immediate steps to resume a limited broadcast upon availability of further funding. Also, as DBC resumed a full service on 28 January 2013 as undertaken in its application, the waiver was but temporary in nature. Accordingly, the CA approved DBC’s application in order that DBC might be afforded the time to make the necessary staffing and other arrangements for resumption of its service step by step.
As to DBC’s breaches of the licence conditions arising from the disruptions to/cessation of its broadcasting service from 11:30 pm on 21 October 2012 to 11:00 am on 11 January 2013, the CA decided in December 2012 to consider initiating the procedure to suspend DBC’s licence for a period of 30 days as a sanction for such breaches and invited DBC to make representations on the proposed suspension of its licence. Having considered DBC’s representations, including its commitment to resuming a service in full compliance with the licence requirements from 28 January 2013 onwards, the CA took the view that a decision to suspend DBC’s licence under the circumstances would cause interruption to DBC’s resumed service and would not be in the interest of the listening public. The CA also noted that once the problem of financing had been resolved, DBC had taken immediate steps to resume broadcasting service, albeit on a limited scale. In the circumstances, the CA considered it justifiable to impose a financial penalty on DBC in lieu of a suspension of its licence in order to enable DBC to continue providing service in accordance with its licence. In view of the severity, nature and duration of the breaches, the CA decided to impose on DBC a financial penalty of $200,000, which was the maximum amount of financial penalty that might be imposed on the second occasion a penalty was so imposed on a sound broadcasting licensee (Note2). Furthermore, the CA had clearly communicated to DBC that the disruptions to/cessation of DBC’s broadcasting service for more than two months was very unsatisfactory and a contravention of very serious nature, and reminded DBC of its obligations to maintain a broadcasting service in accordance with all applicable provisions at all times. In case of further interruptions to DBC’s service, the CA would consider imposing more serious sanctions.
Communications Authority
Secretariat
28 January 2013
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