"The department of company affairs (DCA) agreed with the information
and broadcasting ministry view that there is a problem with the
equity structure of MCCS as per the guidelines that exist now,"
a senior government official said today after a meeting of the IMG
that includes officials from the ministries of information and broadcasting
and law and DCA.
MCCS is the company that has applied for permission to uplink content
for Star News from India. The present guideline for foreign investment
in news channels, amongst other things, says that foreign holding
cannot be over 26 per cent and that the editorial control of the
channel should rest with Indians.
Though the official was not forthcoming with details, he did admit
that one of the problem areas lay in lack of clarity on editorial
control and the shareholders agreement does not throw any light
on the fact that editorial control would be in the hands of resident
Indians or the Indian shareholders in MCCS.
Asked if the IMG would recommend a review of the foreign investment
policy, the official said that would be a decision of the GoM after
it has studied the case. Without detailing the exact stand of the
I&B ministry, the official said the IMG has been conveyed of the
opinion of the ministry.
Pointing out that DCA had been asked for some technical information
relating to the veto power of an investor holding 26 per cent and
more shareholding in a company, the official said that a "final
view" on the issue would be taken by a group of ministers (GoM)
after IMG has prepared note for them.
Information on a meeting of the GoM is not known as of today. But
it is expected that with the IMG submitting its report to the GoM,
consisting of the ministries of I&B, law and finance, soon and with
the Parliament adjourned till 13 August, the ministers can meet
sometime next week.