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Bharti Telemedia to obtain fresh FIPB for DTH

Indiantelevision.com Team

(18 February 2009 9:45 pm)

NEW DELHI: Bharti Telemedia Ltd has been advised to seek Foreign Investment Promotion Board (FIPB) approval separately for indirect foreign investment coming into the licensee company before it can get clearance for direct-to-home (DTH).

In its meeting held on 9 January, the FIPB had recommended the proposal subject to compliance with the guidelines of the Information and Broadcasting Ministry and compounding of the violation, according to information given to Parliament by Minister for State for Information and Broadcasting Anand Sharma.

Sharma said the shareholding pattern furnished by Bharti Telemedia revealed that the DTH licensee did not have any FIPB approval for foreign investment coming into it through investing companies, and this was not in accordance with the existing policy governing foreign direct investment (FDI). The licensee was, thus, required to show cause why action should not be taken against it for violation of DTH license conditions.

DTH guidelines provide that total foreign equity holding including FDI/NRI/OCB/FII in the applicant company should not exceed 49 per cent and the FDI component within the foreign equity should not exceed 20 per cent. The quantum represented by that proportion of the paid up equity share capital to the total issued equity capital of the Indian promoter company, held or controlled by the foreign investors through FDI/NRI/OCB investments, will form part of the FDI limit of 20 per cent. FIPB approval is required under the rules for foreign investment into a DTH company.