After tax searches, FDI questions, BBC hives off newsroom in India as separate company

After tax searches, FDI questions, BBC hives off newsroom in India as separate company

LESS than a year after being questioned by Income Tax authorities for alleged violations, the BBC has hived off its newsroom in India, handing over its publishing license to a private limited company established by its Indian employees — a first for the public service broadcaster’s global operations anywhere in the world.

Under this new arrangement, starting next week, a private limited company called the “Collective Newsroom” has been set up by four former BBC employees. Its India offices will produce all of the India content in seven languages for the BBC’s digital services in Hindi, Gujarati, Marathi, Punjabi, Tamil, and Telugu.

The BBC is learnt to have applied to the Indian government for a 26% stake in this private limited company.

Speaking to The Indian Express, Rupa Jha, Chief Executive Officer of the Collective Newsroom, said, “It’s unprecedented for the BBC to grant their license to publish to another entity…We will not compromise our journalism and the BBC is solidly behind us.”

Jha, who was the senior news editor at BBC India, is one of the four founding shareholders of Collective Newsroom.

The restructuring of the BBC’s India operations was prompted by the new Foreign Direct Investment (FDI) rules, introduced in 2020, that imposed a 26% FDI limit in India’s digital media sector.

Previously, the BBC’s editorial operations in the country were managed by BBC India, more than 99 percent of which was owned by the UK-based broadcaster itself. However, once the investment cap was introduced, companies exceeding the 26 percent FDI limit were required to reduce their foreign investment to comply with this regulation by October 2021.

The BBC’s India bureau, comprising around 200 people, is its largest operation worldwide outside the United Kingdom. It began broadcasting in India in May 1940. In February last year, its offices in Delhi and Mumbai were searched by income tax authorities days after it aired a documentary that featured the 2002 Gujarat riots.

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The new FDI rules cast a cloud over the BBC’s operations in India. “There were a number of options before us. Considering that the BBC didn’t want to lose its presence in India or cut jobs, and they didn’t want it to become financially unviable, this forced us to think out of the box. Based on the legal advice the BBC was receiving, everyone was veering towards this as the viable option (of setting up the Collective),” Jha said.

For now, almost 200 employees of BBC India have moved over to the Collective Newsroom.

Said Jonathan Munro, Deputy CEO, BBC News: “The BBC’s presence in India is steeped in a rich history that has always put audiences first, so we warmly welcome the formation of Collective Newsroom which continues that progression.”

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