French CSA withdraws Numéro 23 licence

posted on 30 October, 2015   (public)

French CSA withdraws Numéro 23 licence

The French CSA (Conseil supérieur de l’audiovisuel) has, during its plenary on 14 October 2015, decided to proceed with a withdrawal of the licence granted on 3 July 2012 to the company Diversité TV in order to broadcast its channel Numéro 23. This decision was announced following the disciplinary proceedings opened on 23 June 2015 against the society and is based on the substantial modification of the data based on which the licence had been previously granted, namely, the entry requirements of the society UTH in the Diversité TV capital and the shareholders' agreement signed on 21 October 2013.

The CSA noted that the provisions of the pact, which was signed between the majority shareholder and UTH during the period of two and a half years forbidding from a change in the control in which the company had previously committed, actually aimed at a quick sale of its capital. Moreover, this operation was hidden to the regulator despite its multiple reminders. The agreement has finally been received on 25 May 2015.

Thus, the amount of the announced company's project sale amounts to 88.3 million euros. According to the documents sent to the CSA, the valuation of the company Diversité TV appears to be due in particular to the value of the licence which it had been granted.

Therefore, the provisions of the shareholder’ agreement of 21 October 2013 reveal that the majority shareholder of the company Diversité TV has, since May 2013, and in contradiction with the aims affirmed in its licence application, sought above all to value the obtained licence for his own benefit and in order to be able to accomplish a quick sale.

The Council has considered that such a step constituted an abuse of law doubled by a fraud and is contrary to the objective pursued by the legislature. Indeed, the principle of free occupancy of the broadcasting public domain, protected by a constitutional imperative, meets the fundamental principle of pluralism enshrined in the Act of 30 September 1986, and is not intended to fortify the financial value of the legal person holding a licence granted by the CSA.

All these elements were considered as likely to challenge the choice made by the CSA following the call for applications, guided solely by the principle of equality of the candidates, and therefore justify the withdrawal of the licence issued to Diversité TV.

To ensure the protection of all principles and interests of which the regulator is responsible, the repeal will take effect from the 30 June 2016. This period will also allow the company Diversité TV to abandon the conditions of the shareholders’ agreement and the foreseen sale which generated the withdrawal of its licence.

Source: CSA Website