Chinese firm loses radio licence in Rwanda

The government of Rwanda has revoked a radio communications licence issued to Star Africa Media Ltd, the Chinese firm controversially given control of broadcast content in Kenya.

Star Africa Media, trading as Pan Africa Media Kenya Ltd, became the automatic winner of the lucrative licence for a digital distribution license after the Procurement Appeals Tribunal dismissed an application by a consortium of local companies challenging plans by the Communications Commission of Kenya (CCK) to award the license to the Chinese.

The media industry is nervous about the award, particularly because of China’s record of censorship and repression.

In revoking the license, Rwanda Utilities Regulatory Agency said the Chinese company had failed to honour contractual regulations.

Chinese firms, supported by state-owned Export and Import Bank of China (EximBank) have lately assumed a high profile in the broadcasting sector, winning contracts and licences in Kenya, Uganda and Tanzania.

In Uganda, authorities last week stopped procurement of a $74 million facility from EximBank to purchase digital equipment to facilitate migration from analogue to digital broadcasting.

Opposition leaders in Uganda had argued that the prices of the digital equipment the Chinese company was offering under the EximBank loan were grossly inflated.

In Kenya, Mr Akich Okola, a member of the Appeals Tribunal, ruled that the consortium, made up of local broadcasters, the Nation Media Group and Royal Media, the owners of NTV and Citizen, respectively had presented a bid whose validity period did not meet the conditions of the tender.

But it has now emerged that the terms of the bid bond were ambiguous, leaving the tender conditions open to wide interpretation.
The terms of the tender were that each bidder had to put in a security bond of Sh500,000.

It has also emerged, according to the figures published in the ruling by the Appeals Tribunal, that all the four bidders presented conflicting validity periods for the bid bonds, a clear sign that bidders were groping in the dark.

Sent notice

NMG chief executive Linus Gitahi has already sent notice that the group will appeal the tribunal’s ruling in High Court.

The tender was not advertised internationally, raising questions as to how the Chinese company learnt of it and whether the original intention was to allow international players.

Neither did the Chinese firm present a tax compliance certificate as it was registered four days before the deadline for submitting expressions of interest.

Critics have also questioned why local broadcasters have been locked out of the deal despite the fact that the national information and communications technology (ICT) policy published in January 2006, commits the government to promote participation of local investors in companies that own critical telecommunications infrastructure.

Pan African Media is wholly owned by the Chinese, a breach of regulations, which require Kenyans to participate through shareholding. Conveniently, the regulations are currently suspended, for “revision”.

Distribution network

There is only one licensed broadcast distribution network, namely, the Kenya Broadcasting Corporation (KBC).

Pan Africa Media, a part of Star Times of China, has no experience or communications infrastructure in Kenya.

The tender was floated with the intention of getting two other signal distribution networks to bring competition to bear on the area of broadcast distribution.