Ministry must be alert for foreign capital violations by broadcasters

The Yomiuri Shimbun

12:45 JST, April 10, 2021

Airwaves are public property, and foreign capital should not be allowed to influence the management of broadcasting stations. The Internal Affairs and Communications Ministry should strengthen its monitoring of shareholdings.

Fuji Media Holdings, Inc., which has Fuji Television Network, Inc. and other businesses under its umbrella, has revealed that it was found to be in violation of the foreign capital restriction under the Broadcast Law from September 2012 to March 2014.

The Broadcast Law limits the percentage of voting rights held by foreigners to lower than 20%. However, due to an error in the counting process on Fuji’s part, the percentage is said to have stood at from 20.00042% to 20.00083%.

Even if it came from a practical mistake, it was a violation that should not be taken lightly.

Fuji noticed the error, and reported it to the ministry in December 2014, after correcting the voting rights. The ministry’s section in charge of the issue did not revoke its certification as a broadcasting holding company because the illegal situation had been resolved at that time, but only issued a strict warning.

At a press conference on Friday, Internal Affairs and Communications Minister Ryota Takeda again declined to revoke its certification as a broadcasting holding company and stressed that he still considers the decision made at that time to be appropriate.

On the other hand, the ministry has decided to revoke the business certification of the satellite broadcasting channel for a subsidiary of broadcasting-related company Tohokushinsha Film Corp. over the issue of the company’s violation of the foreign capital restriction.

In the case of Tohokushinsha Film, the ministry argues that this is because the company was in an illegal state when the certification application was submitted and should not have originally received the certification.

Is it appropriate that the ministry’s responses to the two companies differed? The ministry needs to provide an easy-to-understand explanation so that the fairness of the broadcasting administration will not be questioned.

The Fuji side finally made an announcement on Monday. As a listed company, it cannot be said that it has fulfilled its responsibility to explain the situation to shareholders in a timely manner. The response of the ministry, which has failed to make an announcement, is also questionable.

The restrictions on foreign capital under the Broadcast Law are aimed at preventing foreign capital from distorting broadcasters’ programs, which have a strong influence on public opinion.

It must be said that lack of awareness by the ministry and the broadcasters led to the fact that the illegal situation was left unchecked.

It is possible that foreign investors will continue to purchase shares of broadcasters in the future. There must be no loopholes in the foreign capital regulations.

The ministry is considering establishing a system to monitor the ratio of foreign capital on a regular basis and a new section in charge of checking the ratio. It is hoped that broadcasters themselves will also reexamine their systems.

In the wake of the wining and dining scandals involving Tohokushinsha Film and NTT Corp., relationships between the ministry and businesses have come to be viewed sternly. It is essential to strictly enforce the laws and regulations and to eliminate collusion.

— The original Japanese article appeared in The Yomiuri Shimbun on April 10, 2021.