Cable TV Industry Files Suit to Overturn Broadcasting Development Fund Levy, Says Market Conditions Have Changed
IT DAILY ·
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The cable TV industry has filed a lawsuit to overturn the 2026 Broadcasting and Communications Development Fund levy.
The suit targets the 2026 broadcasting development fund levy notice issued at the end of last month, and the complaint was filed that day.
The industry says the 1.5% collection rate exceeds the industry's total operating profit and has raised the exercise of discretion, proportionality, and equality principles as key issues.
The cable TV industry has filed an administrative lawsuit against the Korea Communications Agency (KCA) to overturn the 2026 Broadcasting and Communications Development Fund levy, arguing that the burden is excessive. The industry is objecting to the levy, citing the burden of the broadcasting development fund, which exceeds the industry's total operating profit.
The Korea Cable TV Association held a press briefing in Mapo-gu, Seoul, on the 8th and announced that 13 multiple-system operators (SO) had filed a lawsuit with the Seoul Administrative Court. The suit targets the 2026 broadcasting development fund levy notice issued at the end of last month, and the complaint was filed that day.
The plaintiffs in the suit are the 13 multiple-system operators (SO). Through the lawsuit, the industry plans to contest the legality of the current system in court.
The Broadcasting and Communications Development Fund is a statutory fund established in 2017. It was created by the Ministry of Science and ICT and the Broadcasting and Media Communications Commission (formerly the Korea Communications Commission), and its purpose is to promote the broadcasting and communications industries and enhance the public interest. Photo source: Pixabay.
Shin Ho-cheol, head of policy at the Korea Cable TV Association, said the collection rate applied to SOs has not changed since 2017, when the broadcasting development fund was launched. The collection rate applied to SOs is 1.5% of broadcasting service revenue. Shin Ho-cheol, head of policy at the Korea Cable TV Association, argued that the amount exceeds the industry’s total operating profit.
Shin Ho-cheol, head of policy at the Korea Cable TV Association, presented materials disclosed at a National Assembly forum on the broadcasting development fund in April this year. The materials showed that over the past 10 years, the SO industry has seen a pronounced deterioration in profitability. Operating profit fell from KRW 405.2 billion in 2015 to KRW 14.9 billion in 2024, a decline of 96.3%.
The number of businesses in the red rose from 11 to 38 over the same period. Based on this, the industry raised the issue of the exercise of discretion as a key point of contention regarding the collection system. It also identified violations of the principle of proportionality and the principle of equality and fairness as key issues.
Article 12 of the Enforcement Decree of the Framework Act on Broadcasting Communications Development stipulates that competition conditions in the broadcasting market must be taken into account when calculating the levy. Article 12 of the Enforcement Decree of the Framework Act on Broadcasting Communications Development also requires a comprehensive consideration of operators' profitability and financial conditions when calculating the levy.
The industry says the government could have adjusted the levy rate by taking into account competition in the broadcasting market, SO profitability, and financial conditions, but kept the rate at 1.5% since 2017. The industry argues that the government's decision to maintain the 1.5% rate was an improper exercise of discretion.
The industry believes the same rate has been applied even to companies with worsening profitability or losses. It also says that applying the same rate has resulted in an excessive burden relative to operators' ability to bear it.
The industry считает that applying the same rate violates the principle of proportionality. It also argues that differences in each operator's business conditions and market environment compared with other pay TV operators were not sufficiently considered, and that a uniform levy rate does not align with the principles of equality and fairness.
Meanwhile, Shin, the policy chief, explained that the competitiveness of the cable TV market has weakened as new media services such as IPTV and OTT have spread. He also said there have been no cases of levy reductions or exemptions being implemented, adding that court review of the legality of the levy amount is needed through the lawsuit.
Source: IT DAILY · Seong Won-young
Original: https://www.itdaily.kr/news/articleView.html?idxno=242100
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Source: IT DAILY
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