In 2023, the Enforcement Directorate (ED) commenced an investigation into BBC World Service India under the Foreign Exchange Management Act (FEMA).
According to ET, this probe resulted in the ED levying a huge penalty of over Rs. 3.44 crore on BBC World Service India for purported breaches of foreign direct investment (FDI) regulations. Three directors of the broadcaster were individually fined more than Rs. 1.14 crore each. These penalties were issued following adjudication proceedings under FEMA.
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Responding to these developments, a BBC spokesperson shared with PTI, “As of now, neither BBC World Service India nor its directors have received any adjudication order from the Enforcement Directorate. The BBC is committed to adhering to the regulations in all countries where we operate, including India. We will carefully review any order when received and determine the appropriate course of action.”
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The adjudication proceedings were initiated after a show-cause notice was issued on August 4, 2023, to BBC WS India, its three directors, and the finance head for various violations under FEMA. BBC WS India, entirely foreign-owned, was involved in digital news and current affairs but did not reduce its FDI to the mandated 26%, maintaining it at 100% in contravention of Indian government regulations.
According to officials, the Department for Promotion of Industry and Internal Trade (DPIIT) issued a press note on September 18, 2019, capping FDI for digital media at 26% under the government approval route. The total penalty on BBC WS India is Rs. 3,44,48,850, plus a daily fine of Rs. 5,000 from October 15, 2021, until compliance with FEMA provisions.
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Three BBC directors, Giles Antony Hunt, Indu Shekhar Sinha, and Paul Michael Gibbons were each fined Rs. 1,14,82,950 for their roles in overseeing company operations during the period of violation. The Central Board of Direct Taxes (CBDT) noted that the income and profits reported by various BBC group entities did not match their operational scale in India, and certain foreign remittances had not been taxed.
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