Government approach to HKTV has backfired
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.