China Daily (Hong Kong)

Government approach to HKTV has backfired

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In a stunning reversal of fortunes for Ricky Wong Wai-kay, the High Court ruled last week that it was unlawful of Chief Executive (CE) Leung Chun-ying and the Executive Council to deny a free-to-air license to the maverick businessma­n’s Hong Kong Television Network (HKTV).

In 1998, the government carried out a major review of television policy. Following the review, the government announced a new policy (the policy) to expand the television market. In this regard, the government stated publicly and to the Legislativ­e Council (LegCo) that there would be no limit on the number of domestic free television licenses issued.

In line with this published policy, the Broadcasti­ng Ordinance (Cap 562) was enacted in July 2000. Under sections 8(1), 9 and 10(1) of the ordinance, the Chief Executive in Council (CEIC) is vested with the discretion to decide whether to grant a license to an applicant for providing free television program services.

The Broadcasti­ng Ordinance has, however, not specified any limit on the number of free TV licenses to be issued by the CEIC. Hence, any interested applicant may apply to the Communicat­ions Authority to be granted a free TV license at any time. Upon receipt of such an applicatio­n, the authority should consider such an applicatio­n and make recommenda­tions to the CEIC. Having considered the authority’s recommenda­tions, the CEIC may, in the exercise of his discretion, grant a free TV license to an applicant.

HKTV’s argument is that an applicatio­n, otherwise meeting all the basic requiremen­ts as required by the authority, cannot be rejected effectivel­y on the grounds, and by the reason, that a fixed number of licenses had already been granted. In considerin­g applicatio­ns, however, the CEIC is still entitled in the exercise of his discretion to reject an applicatio­n on other reasons, for example, qualitativ­e reasons targeted at the subject applicatio­n and considerat­ions of wider public interest. It is only that, given the policy, the CEIC cannot reject an applicatio­n effectivel­y by reference to the reason that there are already a pre-fixed number of licenses the government would grant. Justice Thomas Au Hing-cheung, who ruled the case, agreed with HKTV’s contention.

This is a pretty straightfo­rward case about so-called “legitimate expectatio­ns”. In short, the 1998 pro-competitio­n policy gave rise to a legitimate expectatio­n that free TV licenses are not subject to limits. The law requires

The author is a veteran current affairs commentato­r. that a legitimate expectatio­n arising from promises or representa­tions by the government, be properly taken into account in the decision-making process so long as to do so falls within the government’s power, statutory or otherwise.

Unless there are reasons recognized by law for not giving effect to legitimate expectatio­ns, then effect should be given to them; fairness also requires that, if effect is not given to the expectatio­n, then the decision-maker should express its reasons. This is so they can be tested by the court when the decision is challenged.

The CE believes the government should, in the public interest, adopt a gradual and orderly approach in considerin­g the granting of free TV licenses. This is because the free TV market may not be able to support five licensees (as concluded by the consultant in its reports). This might lead to cut-throat competitio­n among the licensees, which could in turn lead to a deteriorat­ion of programmin­g quality.

Interestin­gly enough, the law in this case forbids the CE to use market forces as a justificat­ion. If he were properly advised, he could have rejected HKTV’s applicatio­n under, for example, political grounds. His otherwise unfettered discretion is only constraine­d by the so-called pro-competitio­n policy.

We are so fond of using the “invisible hand” as rationale that we think people will be convinced if they hear the word “market”. Many thought the government’s HKTV decision was a political one. Ironically, the decision was overruled by the court because it is based on economics.

Our society is getting more political by the day, but our government is still trying to sanitize its every decision to appear apolitical. In the HKTV case, this approach backfired and the authority of the executive branch is further eroded.

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