Hong Kong’s telecoms regulator to examine TVB’s shareholding structure

Television Broadcasts, Hong Kong’s dominant free-to-air television broadcaster, will be examined by the telecommunications regulator to make sure it is in compliance with the Broadcasting Ordinance amid concerns that a minority shareholder may have an undue influence on its management.

The Communications Authority, which is responsible for licensing and regulating the broadcasting and telecommunications industries in Hong Kong, said on Thursday that it had engaged a Queen’s Counsel to examine the relevant licence conditions and the statutory declarations and deeds of undertaking submitted by TVB and the relevant parties.

The regulator stepped in after the Securities and Futures Commission (SFC) flagged concerns over the influence of China Media Capital (CMC), controlled by Chinese media tycoon Li Ruigang.

TVB is majority-owned by Young Lion Holdings, which bought a 26 per cent stake in the broadcaster from the late Sir Run Run Shaw in 2011. CMC became an indirect investor in TVB when it bought an undisclosed stake in Young Lion in April 2015. Other shareholders in Young Lion include TVB chairman Charles Chan Kwok-keung and HTC Corp chairwoman Wang Hsiueh-hong.

The SFC said Li, dubbed as China’s Rupert Murdoch, ultimately held about 20 per cent of TVB, making him the single largest shareholder.

CMC had great influence over the appointment of directors at the broadcaster, the SFC said in a ruling on Young Lion’s application for a whitewash waiver to allow the company to be exempted from making a general offer to buy all the outstanding shares in TVB.