Government to Murdoch: Disinvest you must

However, after granting six extensions, the Government decided to give Star News channel a month to rejig its corporate structure.

This is the second time the Information and Broadcasting Ministry has had to revise its uplink guidelines for news channels. In both cases, the government was forced to rethink after Star’s shell company Media Content and Communication Services (in which Star had 26 per cent stake with the remaining 74 per cent in different Indian shareholders with varying equity) applied for permission to uplink its news channel.

Today’s decision was taken at a two-hour meeting attended by the Prime Minister, Deputy Prime Minister, Law Minister, Information and Broadcasting Minister and Principal Secretary Brajesh Mishra.

I&B Minister Ravi Shankar Prasad said the inclusion of the clause pertaining to a dominant 51 per cent Indian partner, absent in the March 26 guidelines, was to obviate creation of a shell company with a series of dummy shareholders.

‘‘We have incorporated the print guidelines but have gone beyond that to put in adequate safeguards for news channels,’’ Prasad said.

Prasad also said two specific pre-conditions were being incorporated in the new guidelines—all appointments of key personnel, namely editorial and senior executives shall be made by the applicant company without referring such matters to the foreign company; the applicant company must have complete operational independence and control over its resources and assets and adequate financial strength for running a news channel.

As for the dominant shareholder, the new rules stipulate that he can be an individual and in case of a company or a group of companies, the stake of the shareholder, Indian/ Hindu undivided family or relative as defined in the Company’s Act under Section 6 either singly or in combination must hold 51 per cent.

‘‘We will insist on a dominant Indian partner with 51 per cent equity, barring Indian public Financial institutions,’’ Prasad said.

The applicant group must be under the same management and control, the director has to be Indian and representation on the board has to be proportional to the equity in the company.