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FM channels seek time for licence fees

09-March-2004
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FM channels seek time for licence fees

Private FM radio companies have sought an extension of the April 29 deadline for paying their annual licence fees, till a decision on the recommendations of the Amit Mitra committee is taken.

The committee has suggested a switchover from the present licence fee regime to a revenue sharing method. It has recommended a share of 4 per cent of the gross revenue in the revenue sharing regime.

In the existing regime, the licence fee is determined by a bidding process and it escalates by 15 per cent every year. For example, the annual licence fee for the Delhi circle in the first year was Rs 7.18 crore, and it will go up by 15 per cent this year.

“We have communicated to the government that the deadline should be extended as a policy decision is awaited,” said an industry source. The government is yet to take a view on the Amit Mitra committee recommendations submitted in November last year.

The fate of the recommendation in the immediate future is uncertain as the government will not announce any new policy decision since the code of conduct for the elections is in place.

Sources in the information and broadcasting ministry said the government was in the process of studying the recommendations. The government had circulated the recommendations among industry players to seek their views.

Private FM radio firms have told the government that such a steep licence fee is unviable and most of the companies are not making enough money to pay for it.

The companies have also petitioned the government that the restrictions on content and advertisements are hindering the functioning of the companies.

Also, for migration to the new regime, the committee has come out with a cut-off date of July 24, 2003. While recommending that bidders for new licences should not be blacklisted on the basis of their default in the first phase.

Existing licence holders, wanting to migrate to the new regime, are required to pay the original licence fee till the cut off date.

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