Press Release of SEBI Regarding
Mandatory disclosures by the media of its stake in
SEBI had taken up with Press Council of India its concerns on
practice of many media groups entering into agreements, such as ‘Private
Treaties’, with companies. Typically, such arrangements are with companies
which are listed or which proposes to come out with public offerings. These,
in general, entail a company giving stake in it (shares, warrants, bonds
etc.) in return for media coverage through advertisements, news reports,
advertorials etc. in the print or electronic media.
It was felt that such agreements may give rise to conflict of
interest and may, therefore, result in dilution of the independence of
press. This may consequently compromise the nature, quality and content of
the news/editorials relating to such companies. Needless to say, biased and
motivated dissemination of information, guided by commercial considerations
can potentially mislead investors in the securities market. Such journalism
would not be in the interest of securities market.
SEBI, given its legal
mandate to protect the interest of investors felt that such brand building
strategies of media groups, without appropriate and adequate disclosures may
not be in the interest of investors and financial markets. There are
prescribed norms of Journalistic Conduct that require journalists to
disclose any interest that they may have in the company about which they are
reporting. However, there are no equivalent requirements in the case of
media companies holding a stake in the company which is being reported /
Press Council of India has
informed SEBI that in its meeting held on 22.02.2010 at New
it has accepted the following suggestions of SEBI and has mandated the
regarding stake held by the media company should be made in the news report/
article/ editorial in newspapers/television relating to the company in which
the media group holds such stake.
on percentage of stake held by media groups in various companies under such
'Private Treaties' on the website of media groups should be made.
other disclosures relating to such agreements such as any nominee of the
media group on the Board of Directors of the company, any management control
or other details which may be required to be disclosed and which may be a
potential conflict of interest for media group, should also be mandatorily disclosed
The copy of the Press
Release sent to SEBI by
Press Council of India in the matter, is enclosed.
The above is for
information and necessary compliance by all concerned.
August 27, 2010
Please read our earlier stories related to" Paid
News" &'‘Private Treaties’'
1).Paid News: A Cancer
Paid news: Press Council's sham report to
hide Indian media's shame.
3).Paid news undermining democracy:
Press Council report
an electoral malpractice, demands political parties.
5).‘Paid News’ issue raised in Rajya Sabha under Calling
6)."Paid news" culture is only a symptom of a
deeper disease says,
chairperson Mrinal Pandey.
7).Editors Guild condemns paid news
news turned media into a 'lap dog'?
News" Scandal Blotted Out by Press Lords.
harm fair, unbiased news: SEBI.
11).'Paid news' a major threat to
electoral democracy: P.Sainath
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