#e4mBreaking:  MIB relaxes eligibility norms for rating agencies, deletes key cross-holding restrictions

In a significant shift, the Ministry of Information and Broadcasting (MIB) has relaxed key eligibility criteria for television rating agencies by deleting two critical clauses—1.5 and 1.7—from the Policy Guidelines for Television Rating Agencies in India, originally notified in 2014.

The relaxations are a part of MIB’s proposed amendments to the Policy Guidelines for Television Rating Agencies in India. The government has invited public and stakeholder feedback on the proposed changes within 30 days.

The deleted provisions had previously barred board members of rating agencies from being involved in broadcasting, advertising, or media buying businesses.

Clause 1.5 of the original policy said, “Any member of the Board of Directors of the television rating company shall not be in the business of broadcasting/ advertising/advertising agency.”
Clause 1.7, in particular, had served as a firewall against undue influence by restricting substantial equity cross-holdings and enforcing promoter-level scrutiny. Its deletion marks a clear policy pivot away from earlier concerns around independence and governance in audience measurement.

The clause laid down the following rules for companies to comply requirements-

(a) No single company/ legal entity, either directly or through its associates or interconnected undertakings, shall have substantial equity holding in rating agencies and broadcasters/advertisers/ advertising agencies.

(b) No single company/legal entity, either directly or through its associates or interconnected undertakings, shall have substantial equity holding in more than one rating agency operating in the same area.

(c) The cross-holdings restriction will also be applicable in respect of individual promoters, besides being applicable to legal entities.

(d) A promoter company/member of the board of directors of the rating agency cannot have stakes in any broadcaster/ advertiser/advertising agency either directly or through its associates or inter-connected undertakings.

The clause had an explanation that said, “For the purpose of para 1.7, substantial equity shall mean equity of 10% or more of paid-up equity. Having a substantial equity holding in companies shall constitute a cross-holding. Provided that the eligibility conditions stipulated at 1.5, 1.6 and 1.7 will not be applicable in the self-regulation model where the industry-led body, such as, Broadcast Audience Research Council (BARC) itself provides the rating.”

By removing these clauses, the government has eased entry and operational norms for entities in the television measurement space. The move allows for greater ownership flexibility, enabling stakeholders from across the media and advertising ecosystem to potentially invest in or serve on the boards of rating agencies something that was previously disallowed to prevent conflicts of interest.

The revised provisions come into immediate effect and apply to both existing and new applicants in the television rating business.