A help much needed, say Mumbai OOH media owners on licence fee relief

Bombay High Court has issued an interim order instructing BMC not to impose licence fee on hoardings for May in wake of the losses suffered by OOH companies during COVID-19 pandemic

e4m by Noel Dsouza
Updated: May 27, 2020 1:07 PM

The out of home (OOH) industry, which has been facing severe financial distress due to the nationwide lockdown caused by COVID-19 pandemic, has heaved a sigh of relief. The Bombay High Court has issued an interim order instructing Maharashtra's civic body Brihanmumbai Municipal Corporation (BMC) not to impose the licencing fee on hoardings for the month of May. The court has also instructed the corporation to not initiate any penal action against media owners. The relief came after OOH media owners approached the court for a waiver of licence fees considering the financial setbacks they have received due to the pandemic. The appeal was led by Bright Outdoor Media and Creation Publicity.

The industry has faced major economic impact due to the nationwide lockdown caused by COVID-19 pandemic. With the country staying indoors, the hoarding business took a beating. Another cause of concern for some media owners was an order issued on March 16 that made it compulsory for all 1200 hoardings across Mumbai to display only COVID-related social messages.

Expressing happiness over the court order, Yogesh Lakhani, CMD, Bright Outdoor Media, said, stated, "Bombay HC has given a temporary stay order, and will be hearing the matter again on June 2. It will be the best relief for the OOH industry in the city of Mumbai."

"There has been a decline in transport on the road, so it doesn’t seem fit for BMC to charge the licence fee. The licence fee is for advertising, and advertising is for the public. So this is not the right way (to charge the fee). The Bombay High Court has issued a stay order after hearing the matter. Mostly there are chances of relaxation of the licence fee in the coming months," he shared.

Talking about the bone of contention, Lakhani said," The BMC had relaxed the licence fee for March in the month of April. Then in May, they were asking for fees with compensation charges. For this month, they have been demanding the fees in advance, and if we don’t pay, they will charge compensation. So, we decided to appeal for a four-month relief for all OOH media owners.

Lakhani is hopeful that the court will rule in favour of OOH media owners.

Earlier, Municipal Corporation of Greater Mumbai (MCGM) had waived the licence fee for the month of April 2020 on approximately 1,250 hoardings that displayed awareness messages on COVID-19. For these messages, MCGM had agreed to pay the printing charges at Rs 5.50 per sq.ft and 18% GST, adding up to Rs 70 lakh-80 lakh.

OOH industry leaders feel the relief from the court could well be a gamechanger in the present scenario.

According to Dipankar Sanyal, CEO, Platinum Outdoor, it is a wonderful reprieve for the media owners. "OOH is the worst affected media due to the lockdown. Mumbai garners the maximum share of the outdoor pie among the top 10 cities and that has gone down to zero. Moreover, with the city seeing such a high number of COVID-19 cases, it may take a bit longer than the rest of India to start the bills rolling here. This help was much needed," he said.

Parag Pandya, Sr. Vice President, OOH - West & East, The Social Street, sees the interim relief as a very positive and encouraging step taken in favour of media asset owners who are facing difficult times. "This will not only help in sustaining but also ensuring the longevity of the business, resulting in better options for advertisers post the lockdown," he opined.

The sentiment was echoed by Fabian Cowan, Director, Posterscope India, who termed it a "significant and positive development".
"It indicates that the civic body is forward-looking and understands the situation on the ground well. This augurs well for the out of home ecosystem as the progressive mindset of the current administration will only help all stakeholders going forward," he shared.

Atul Shrivastava, CEO, Laqshya Media Group stated his views on the verdict: "The Bombay High Court's order has given media owners some respite in these difficult times. We would like to appeal to other states, as well, to take some measures to help media owners’ tide through the difficult times. It’ll save the employment of lacs of employees in the industry across the nation. We have great faith in the government and the concerned authorities for this business."

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