Live content rights: Government to allow PTV to make payment to Indian broadcasters

ISLAMABAD: The government is to allow PTV to pay over $ 0.632 million to Indian broadcasters for live content rights of support against agreements sign during a ban on trade with India and without prior approval of Cabinet, well-informed sources in Commerce Ministry told Business Recorder.

PTV Sports is the top Sports Channels within the territory of Pakistan. Most of the live content rights of sports are owned by the Indian broadcasters including Star India and Sony Pictures Indian Limited (Ten-Sports) for past 15 years including rights for the territory of Pakistan. Therefore, it becomes inevitable for PTV Sports (PTV Network) to sub-licence the rights for the relevant territory from these parent broadcasters.

The sources said Government of Pakistan imposed an embargo on payments to Indian parties in their account in India since August 2019. PTV inked agreements with Star India and Sony Pictures Indian Limited (Ten-Sports) on 3rd September 2019 and October 24, 2019, respectively. The Ministry of Information and Broadcasting argues that Pakistan Television currently not only needs to clear the pending payments to Indian broadcasters but also needs to ensure regular financial transactions on the rights that PTV acquired before and after September 2019.

Furthermore, PTV needs to acquire the ICC Rights (2019-2023) and make upfront payments and the bank guarantees. PTVC needs to make payments immediately for the following: (a) English Premier League 2019-2020 package (Star India). $ 235,000 + 10% tax (USD 258,500) to be made in two installments (USD 129,250) and ;(b) Pakistan versus Australia in Australia 2019-2020 (SPNI/ Ten Sports) USD 340,000 + 10% tax (USD 374,000).

The sources said, NOC for making payments to Indian Channels is given by Ministry of Commerce. This Ministry conveyed the request from PTV along with copies of the contracts.

Ministry of Commerce informed on July 25, 2020 that the federal cabinet had approved a ban on trade with India, which was notified by the Ministry of Commerce on August 9, 2019. The agreements of PTV were concluded after the ban on trade with India was notified by the Commerce Ministry. Hence approval of payment can only be approved by the Federal Cabinet. Ministry of Commerce has also underscored the need for consulting SBP before submitting the case to the Cabinet.

Ministry of Information and Broadcasting, on the advice of Ministry of Commerce, wrote a letter to Ministry of Finance. Deputy Secretary (IF-Banking), Ministry of Finance remarked that the matter does not relate to IF Wing.

Subsequently, Ministry of Information and Broadcasting conveyed to State Bank of Pakistan on August 11, 2020 about the matter to seek its views. On September 3, 2020, SBP apprised that pursuant to the notification of August 9, 2019, issued by Ministry of Commerce (MoC), the payment in favour of Indian Broadcaster Companies on behalf of Pakistan Television Corporation (PTVC), can be considered after specific NOC/approval from MoC or federal cabinet. SBP has further noted that formal request for payment can be submitted by PTV to Foreign Exchange Operations Department (FEOD) SBP BSC, through its authorized dealer of foreign exchange (bank) along with all necessary documents after securing NOC/ approval of MoC/Federal Cabinet.

Ministry of Information and Broadcasting has sought the approval of the Federal Cabinet as required for relaxation in embargo imposed on payments to Indian parties in their account in India, for the following payments, to be made by PTVC from out of its own resources and subject to observance of payment procedure as advised by SBP; (i) (a) English Premier League 2019-2020 package (Star India). USD 235,000 + 10% tax (USD 258,500) to be made in two installments (USD 129,250) and; (b) Pakistan versus Australia in Australia 2019-2020 (SPNI/Ten Sports) USD 340,000 + 10% tax (USD 374,000).

Secretary Information, however, has noted that "neither the matter was referred to Ministry of Information & Broadcasting nor any prior approval of the Cabinet was obtained before entering into the agreement with the mentioned Indian Broadcasters". If PTV had consulted the Ministry amendments in the agreements would have been advised regarding payments to Indian Broadcasters in their offices at Dubai/America. Hence, under present circumstances when agreements have been signed with these Indian companies and invoices have been raised, "we are left with no other option except making the payments to these Indian Broadcasters in India, as these Indian Companies have global rights of cricket till 2023".

Copyright Business Recorder, 2020