Zee, TV18 group channels violate the 26% foreign holding cap norm.
As many as six television channels, belonging to the Zee and CNBC TV18 families, are in violation of the government's uplinking guidelines, which put a 26 per cent cap on foreign equity and bar foreign institutional holding. The deadline to comply with the norms was September 30.
The government has extended this deadline on six occasions in the last two years. Information and Broadcasting Minister S Jaipal Reddy said last month the government would not grant another extension.
“The deadline for the channels to meet the revised guidelines is September 30. The channels have to get government approval before this. If they fail, their licences will be cancelled,” he had said.
The foreign equity in both the groups is well above 26 per cent. The fact that the two groups are listed puts them in a unique position. FIIs freely buy into them and the foreign equity holding changes with stock market trading.
The two groups appear to be counting on the forthcoming new uplinking norms to solve the problem. Industry sources say they have been pressing the government to give them interim permission till the new policy to comply with the norms.
According to government officials, Zee Telefilms has presented a revised equity format for the government's approval. However, the government is yet to clear it.
A Zee executive confirmed: 'We have applied to the government with the new equity structure. We have met the requirement and expect them to clear the application.'
CNBC chief executive officer Haresh Chawla said the company was waiting for the new uplinking guidelines to be announced before applying to the government. 'There are new uplinking norms coming. We are waiting for them,' he said.