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Wed, June 21, 2006 : Last updated 19:47 pm (Thai local time)



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Home > Headlines > 'Time to give iTV back to people '





TV CONTROVERSY
'Time to give iTV back to people '

Television station's fate hangs in the balance as court prepares to rule on Bt70-bn-plus debt

Outgoing Bangkok senator Jon Ungpa-korn suggested yesterday the time was ripe for the government to return iTV plc to its original role as an independent public broadcaster.

He urged civic organisations, academics and iTV employees to explore legal possibilities of restoring the network's status now that it appeared to be facing financial hardship.

The permanent secretary's department in the Prime Minister's Office, which holds the iTV concession, is demanding the network pay more than Bt70 billion in concession fees and fines to the government, raising the possibility of bankruptcy.

The final verdict will soon be delivered by the Supreme Administrative Court. Earlier, the lower court ruled that sharp reductions in iTV's concession fees, decided by an arbitration committee, were illegal. If the ruling was upheld by the upper court, iTV would then be subject to a huge financial burden. Jon said: "I hope the government will help iTV return to its original intentions when it was established. For the past few years, the role of this important broadcaster has been distorted by political intervention."

Supinya Klangnarong, general secretary of the Campaign for Popular Media Reform, said the group would wait to see how the case between iTV and the permanent secretary ended.

"We'll see if Temasek sells iTV

in response to the broadcaster's gloomy outlook. If iTV declines to pay the penalty, the PM's Office could revoke the concession contract," she said.

Supinya said if the government seized the iTV concession, the group would launch a campaign to promote the broadcaster as an independent station that would work for the people.

It should not be sold to private investors, she said, adding the government must ensure iTV was re-launched as an independent station.

Shin Corp is iTV's major shareholder, with a 53-per-cent stake. Singapore's state investment arm Temasek Holdings controls more than 96 per cent of Shin, which was previously owned by caretaker Prime Minister Thaksin Shinawatra's family. Earlier this year it sold its majority stake to Temasek.

Temasek's spokeswoman Rachel Lin said yesterday it was inappropriate to comment on iTV while the case was active.

Outgoing Ubon Ratchathani senator Niran Pitakwatchara said he believed the upper court would uphold the Central Administrative Court's ruling on iTV.

The Office of the Attorney General (OAG) had already told the PM's Office permanent secretary that the lower court's ruling on May 9 on the concession fee case came into immediate effect.

This apparently prompted the PM's office to plan to deliver a demand to iTV on Friday for the immediate payment of Bt76 billion in penalties, Bt1.7 billion in backdated concession fees and this year's concession fee of Bt1 billion, despite iTV's pending appeal with the upper court.

The broadcaster insisted it would not pay the fees immediately, pending its court appeal.

It cited Article 70 of the law governing the establishment of the Administrative Court, which states the court's ruling would only be enforced when the case is completely at an end.

This week Permanent Secretary Rongphol Charoenphan said iTV must pay the Bt76 billion fine because of its programming adjustments since 2004, carried out without the consent of the PM's office.

But iTV calculates that the fine should be only Bt100 million per year.

Under the concession, the PM's Office is allowed to fine iTV 10 per cent of its concession fee of about Bt1 billion for each day of the contract's violation.

Some brokerage houses believe iTV, which has a cash flow of Bt1 billion, will seek negotiations with the PM's Office to revise the penalty fee.

In May, the lower court overturned a 2004 decision by an arbitration committee that had significantly cut iTV's concession fee. As a result, iTV filed an appeal to the upper court earlier this month.

The lower court's decision means iTV must resume payments of the annual concession fee rate of 44 per cent of revenue, or Bt1 billion per year, whichever is greater, to its concession owner: the PM's Office.

At present, iTV pays only 6.5 per cent of revenue or a minimum of Bt230 million, granted by the ruling of the arbitration panel in 2004.

The court's ruling also called for backdated concession fees of about Bt1.7 billion to be paid to the government. It also voided an easing in programming requirements under the arbitration decision, which allowed iTV to adjust its prime time news-entertainment ratio to 50:50 from the original 70:30.

The lower court's ruling decided that the arbitration panel's decision on iTV exceeded its authority in changing the details of the contract between the broadcaster and the government.

iTV recently argued it had adjusted its news and entertainment ratio to 65:35, nowhere near the 50:50 permitted under the arbitration decision.

The dispute between iTV and its concession owner began when iTV asked the permanent secretary for compensation, reasoning that it had been overcharged for its concession fee. However, the administration refused to revise the demands.

Moreover, iTV said its operation was adversely affected by cable television operators who were running disguised commercials in defiance of their contracts.

As a result, the broadcaster filed the case with the arbitration panel and later won the legal battle, which allowed it to pay a lower annual concession fee and enjoy flexibility to adjust its programmes in 2004.

The permanent secretary's department awarded a 30-year concession to iTV in 1995.







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'Time to give iTV back to people '


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