Hong Kong broadcaster TVB to seek judicial review of whitewash waiver ruling by SFC

Television Broadcasts (TVB) intends to seek a judicial review of the ruling by the Securities and Futures Commission (SFC) on the majority shareholder’s application for an exemption in making a general offer to buy all the outstanding shares in the company.

“The company will apply to the High Court of Hong Kong for leave to commence a judicial review,” TVB, the city’s major free-to-air broadcaster, said in a statement on Wednesday evening.

The review will focus on the regulator’s decision that the granting of a whitewash waiver that allows the majority shareholder to be exempt from making a general offer should be conditional on the outcome of the shareholders’ vote “without adjustment”.

“We cannot meet the condition ... ‘Without adjustment’ means that we are not allowed to scale back the voting shares. That is against the Broadcasting Ordinance,” TVB chief executive Mark Lee Po-on said in an interview with the South China Morning Post.

The scaleback provision, introduced to the ordinance in 1991, requires the aggregate voting control exercised by a non-resident company with a domestic television programme licence to be scaled back to no more than 49 per cent if the company’s economic interest in the broadcaster exceeds that level.