New Delhi: The Enforcement Directorate (ED) has imposed a penalty exceeding Rs 3.44 crore on BBC World Service India, citing alleged violations of foreign direct investment (FDI) regulations, officials reported on Friday. Additionally, three company directors have each been fined over Rs 1.14 crore as part of an adjudication order issued under the Foreign Exchange Management Act (FEMA).

The investigation stems from a show-cause notice issued on August 4, 2023, to BBC WS India, its three directors, and its finance head for multiple infractions under FEMA. BBC WS India, a 100% FDI entity, was found to have failed to comply with Indian government regulations requiring a maximum 26% foreign ownership for digital media companies engaged in uploading or streaming news and current affairs. Despite this restriction, the broadcaster allegedly continued operating with 100% foreign investment, an action authorities described as a “gross violation” of India's FDI policy.

The Department for Promotion of Industry and Internal Trade (DPIIT) had introduced Press Note 4 on September 18, 2019, explicitly capping FDI in digital media at 26% through the government approval route. However, BBC WS India did not reduce its foreign ownership, prompting the ED to initiate adjudication proceedings.

As a result, the total penalty imposed on BBC WS India amounts to Rs 3,44,48,850. Additionally, the company has been ordered to pay a daily fine of Rs 5,000 for every day of non-compliance beyond October 15, 2021, until it adheres to FEMA provisions.

Three BBC WS India directors:
• Giles Antony Hunt
• Indu Shekhar Sinha
• Paul Michael Gibbons

Have each been personally fined Rs 1,14,82,950 for their roles in overseeing company operations during the period of non-compliance.

This action underscores the Indian government’s strict enforcement of its FDI regulations in the digital media sector, signaling heightened scrutiny on companies operating outside regulatory limits.