On 14 March 2013, the PRC National People’s Congress endorsed a legislative proposal submitted by the State Council regarding the restructuring of government institutions (the “Proposal“). Under the Proposal, two separate State regulators for press and publication, and broadcasting and television will be merged into a new administration overseeing all of these sectors..

Background

Currently, the General Administration of Press and Publication ("GAPP") is responsible for implementing policy and regulation of the press and publishing activities, including content regulation of the print and internet publications. It is also responsible for administering copyright management through the National Copyright Administration, a governmental body directly under GAPP.

On the other hand, the State Administration of Radio, Film and Television ("SARFT") sets policies and regulates the radio, film and television industry, including content regulation and management of film, radio and television sectors, including internet broadcast of audio-visual programmes.      

Under the Proposal, the two existing media regulators will be merged into a single entity, the State Administration of Press, Publication, Radio, Film and Television ("SAPPRFT"), with overall responsibility for all of these sectors.    

Reasons for change

According to the State Commission Office for Public Sector Reform (the State body responsible for institutional reform), the key reasons for combining SARFT and GAPP are to reduce the overlap of responsibilities of the existing regulators and to manage the respective sectors more efficiently.  It is also expected that the merger will assist in promoting different forms of media through greater integration of public resources in the related sectors.

What are the implications for the industry?

After the merger, it should be noted that a number of existing regulatory bodies directly under the State Council will remain potentially relevant for the PRC media industry. A summary of the overall regulatory responsibilities is set out below:

Points to note

• Notwithstanding the merger between two State regulators, the relevant foreign investment prohibitions and restrictions would still apply. This include, for instance, sectors relating to publication of books, newspapers and magazines, film production and distribution, the production and publication of audio-visual product and electronic publication, as well as any television and radio broadcasting business. 
• Pursuant to a recent proposal of the State Council, a nation-wide cable television network company is set to come into operation in order to develop the convergence of the telecom, radio & television and internet networks, and will be set up by SARFT according to recent press reports. The effect of the merger on the establishment of this fourth telecom operator (after China Mobile, China Unicom and China Telecom) will be much observed. 
• Lastly, although the creation of SAPPRFT will increase the overlap between the related sectors (eg, television and publication), whether this will result in greater regulatory certainty remains to be seen. Industry players should therefore be aware of which applicable regulator might be potentially relevant in different circumstances.