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Friday, July 12, 2013
Rules and procedure matter, but not in Malik Riaz’s caseMedia Times Investigation Unit
LAHORE: The affairs of any institution in any country run under a set of rules and regulations, and the rule of law, transparency and correctness is only guaranteed by following the book. But all of it is overlooked if real estate tycoon Malik Riaz is involved in the business; at least his TV licence transfer case proves this.
The story of him getting a licence for a TV channel and then transferring it to another party (by means of what some describe as a ‘fake’ transaction) is really interesting, as the record shows the matter was dispensed very quickly, documents available to the Media Times Investigation Unit (MTIU) reveal.
Look at the affairs of Asia News Network (Jinnah TV), a company having directors Malik Riaz Hussain and Ahmad Ali Riaz Malik – as the Pakistan Electronic Media Regulatory Authority (PEMRA) record shows –applied for a licence to run a TV channel.
The authority issued Malik Riaz a licence on January 23, 2008, sending a letter that stated, “…hereby grants a non-exclusive licence to M/S Asia News Network (Pvt) Limited (hereinafter referred to as the licensee) to establish and operate an International Scale Satellite Television Broadcast Channel Station by uplinking from within Pakistan”.
The licence was issued with some terms and conditions that were to be followed by the licensee, failing which the licence was to be revoked by PEMRA. The Clause 3.1 of the terms and conditions reads: “The licensee shall commence its licensed service within 12 months of the issuance of the licence, and shall inform the authorities one month in advance of the start of its service.” While Clause 34 provides: “The licence shall be deemed to have been withdrawn and cancelled in case the licensee fails to commence broadcast operations within a period of one year from the date of grant of licence.”
The fact is that the company, Asia News Network (Jinnah TV), did not start its functioning till date and as per terms of conditions of the licence, PEMRA had to revoke the TV licence on 22.1.2009, as the agreed period lapsed on that day, but it never happened in the case of Jinnah TV, owned by a company of Malik Riaz.
The story does not complete here, as after five years, on 3 April, 2013, Asia News Network came out of hibernation and applied for a change of name of its licence from “Jinnah TV” to “Bol News”, which was given by PEMRA within 48 hours, on 5 April, 2013.
Pertinent to mention here is that the official procedure in such cases takes months, but in Malik Riaz’s case, it is matter of hours only. It is not the end, as the company, now Bol News, applied for a change of title/ownership of channel “Bol News” on April 8, 2013 to another company ‘Labbaik (Pvt) Limited’. The PEMRA administration was too kind that it approved the request of the company and allowed the transfer of ownership on April 30, 2013, perhaps within the shortest possible time.
It is worth mentioning that that no person can acquire a broadcasting licence either from PEMRA or from an existing licence holder without a written permission of PEMRA.
It is the responsibility of PEMRA that before giving such a permission, it has to make stringent scrutiny, examine financial strength and credibility of sponsors and get security clearance from the Ministry of Interior, but in this case, no rules or a set course of procedure was adopted by the authority.
The licence was transferred to a company having name “Labbaik”. The story of Labbaik (Pvt) Limited is also very interesting. On December 6, 2006, Labbaik company acquired a licence for a TV channel from PEMRA. The name of the channel was ‘Labbaik’. Later, PEMRA gave permission to Labbaik for changing of name of its licence to AKS.
The company on March 4, 2013 applied for induction of four new directors, giving justification that they wanted “to seek investment to have more financial liquidity” for the reliance. In fact, the company was sold to another company “AXACT group”, but the two – the buyer and the seller – concealed it from PEMRA. The authority on March 26, 2013 approved the induction of the ‘new management’ in the company. It is also worth mentioning that according to the PEMRA Ordinance, change of directors is also subject to approval of PEMRA. Separately, transfer of shares is also subject to PEMRA approval, but the entire shares of ‘Labbaik’ were sold without any approval from the authority.
The Labbaik is a sister concern of AXACT, with the same management, as according to the SECP record, until 27.3.2013, all the shares of Labbaik were divided between Siddique Ismael and his son Salman Siddique, but on that date, the company had new owners: Salman Siddique (original owner), Siddiq Ismael (original owner), Shoaib Sheikh (new owner) with 12,500 shares, Aisha Shoaib Sheikh (new owner) with 12,499 shares, Waqas Atiq (new owner) with 12,500 shares and Sarwat Bashir (new owner) with 12,499.
An interesting fact is that on the same date, i.e. 27.3.2013, Salman Siddique resigned as the CEO of the company and the company filed a new Form 29 with the SECP, showing that Shoaib Sheikh, who is the CEO of AXACT, shall be the new CEO of Labbaik on the same day.
It shows that on March 27, 2013, 99.9 percent of shares of Labbaik, as well as the control of the company, were transferred to persons who were not the original shareholders of Labbaik.
The transfer of a licence to another company is considered a new licence, and as per law, it is the duty of PEMRA to send new owners’ name to the Ministry of Interior for security, as the law reads: “The authority shall, within one hundred days from the date of its receipt, take decision on the application for grant of a licence subject to clearance from the Ministry of Interior.” But it did not happen in this case, as the authority overlooked so many factors and did all the work only in a few weeks without appropriate scrutiny, violating the rules.
Courtesy www.dailytimes.com.pk