Case Details

Citation

TELEVISION BROADCAST LTD v. COMMUNICATIONS AUTHORITY AND ANOTHER, HCAL 151/2016

Case Number

HCAL 151/2016

Court

Court of First Instance

(CFI)

Decision Date

31 December 2020

Parties

Applicant(s):

TELEVISION BROADCAST LIMITED

Respondent(s):

COMMUNICATIONS AUTHORITY, THE CHIEF EXECUTIVE IN COUNCIL

For Applicant(s):

Mr Gerard McCoy SC; Mr Timothy Parker

Judges

Au (sitting as an additional of the Court of First Instance

TELEVISION BROADCAST LTD v. COMMUNICATIONS AUTHORITY AND ANOTHER

[2020] HKCFI 3180

Court of First Instance31 December 2020

Judges:Au (sitting as an additional of the Court of First Instance

HCAL151/2016 TELEVISION BROADCAST LTD v. COMMUNICATIONS AUTHORITY AND ANOTHER

HCAL 151/2016 and HCAL 47/2017

[2020] HKCFI 3180

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTITUTIONAL AND ADMINISTRATIVE LAW LIST

NO 151 OF 2016

_______________

BETWEEN
	TELEVISION BROADCAST LIMITED	Applicant
and
	COMMUNICATIONS AUTHORITY	1^st Respondent
	THE CHIEF EXECUTIVE IN COUNCIL	2^nd Respondent

_______________

and

IN THE HIGH COURT OF THE

HONG KONG SPECIAL ADMINISTRATIVE REGION

COURT OF FIRST INSTANCE

CONSTITUTIONAL AND ADMINISTRATIVE LAW LIST

NO 47 OF 2017

_______________

BETWEEN
	TELEVISION BROADCAST LIMITED	Applicant
	and
	COMMUNICATIONS AUTHORITY	Respondent
	and
	THE CHIEF EXECUTIVE IN COUNCIL	Interested Party

_______________

(heard together)

Before: Hon Au JA (sitting as an additional judge of the Court of First Instance) in Court

Dates of Hearing: 16 - 18 May 2018

Date of Applicant’s Further Written Submissions: 8 June 2018

Date of Judgment: 31 December 2020

_________________

J U D G M E N T

_________________

A. INTRODUCTION

1. The applicant (TVB) is a free-to-air television licence (“FTA Licence”) holder broadcasting free-to-air television programmes in Hong Kong. It derives its principal revenues from airing commercials.

2. It is common ground that as a FTA Licence holder, TVB is subject to the conditions imposed under its licence and the various statutory regulations provided under the relevant ordinances, including the Broadcasting Ordinance (Cap 562) (“the BO”) and the Broadcasting (Miscellaneous Provisions) Ordinance (Cap 391) (“the BMPO”).

3. The Communications Authority (“the CA”) is a statutory body created under the Communications Authority Ordinance (Cap 616) (“the CAO”), which has all the functions conferred to it under, amongst others, the BO and the BMPO. In other words, the CA is the statutory regulator to overlook and regulate, amongst others, FTA Licence holders for their compliance of all the licensing conditions and statutory regulations.

4. For the present purposes, in relation to FTA Licence, the CA has issued the following two codes of practice (collectively, “the Codes”):

(1) The Generic Code of Practice on Television Programme Standards (“the TV Programme Code”); and

(2) The Generic Code of Practice on Television Advertising Standards (“the TV Advertising Code”).

5. Under paragraph 1 of Chapter 8 of the TV Advertising Code, a licensee may only place advertising material at the beginning or end of the programme or in a natural break occurring therein unless otherwise permitted by the CA.

6. An exception to this is provided at paragraph 10 of Chapter 9 of the TV Advertising Code. Specifically, it is provided at paragraph 10(a) (“Paragraph 10(a)”) that a licensee may include one or more product(s) or service(s) within a programme in return for payment provided that their exposure or use is “clearly justified editorially, not obtrusive to viewing pleasure and not gratuitous”.

7. In these proceedings, TVB seeks to judicially review:

(1) The CA’s decision dated 24 May 2016 (“the KFC Final Decision”) in finding that TVB had breached paragraph 1 of Chapter 11 of the TV Programme Code and Paragraph 10(a) by displaying fried chicken and soft drinks from Kentucky Fried Chicken (“KFC”) that were presented to guests in a segment of TVB’s annual TV awards show (“the TV Awards Presentation”). The CA also imposed a financial penalty of $150,000 by way of the decision. This is the application made under HCAL 151/2016 (“the KFC Judicial Review”).

(2) The CA’s decision dated 22 November 2016 (“the Scoop Final Decision”) in finding that two editions of the TVB infotainment programme Scoop had breached paragraph 1 of Chapter 11 of the TV Programme Code and Paragraph 10(a) through the hosts’ discussion of “myTV SUPER”, a paid over‑the‑top (“OTT”) service offered by TVB.com Ltd, a wholly‑owned subsidiary of TVB. This is the application made under HCAL 47/2017 (“the Scoop Judicial Review”).

8. TVB has lodged an appeal to the Chief Executive in Council (“CEIC”) pursuant to section 34 of the BO against the KFC Final Decision (“the Appeal Proceedings”). The Appeal Proceedings are presently stayed.

9. In these judicial reviews, TVB has raised various grounds of challenge under the respective Amended Forms 86.

10. The grounds that are common to both applications are in gist that:

(1) Ground 1: The scheme of determination of breach of the relevant code by the CA (with an appeal to the CEIC) does not comply with Article 10 (“BOR10”) of the Hong Kong Bill of Rights (“BOR”) and is thus unconstitutional.

(2) Ground 2: paragraph 1 of Chapter 11 of the TV Programme Code and Paragraph 10(a) (collectively “the Relevant Paragraphs”) amount to an unconstitutional intrusion on the right of freedom of expression, protected under Article 16 of the BOR (“BOR16”), and Articles 27 and 39 (respectively “BL27” and “BL39”) of the Basic Law (“BL”), and they are in any event ultra vires the BO.

(3) Ground 3: the CA erred in law in finding, in respect of both cases, that paragraph 1 of Chapter 11 of TV Programme Code applied.

11. The additional grounds that are raised specific to the KFC Final Decision are:

(1) KFC Ground 4: The decision is irrational, Wednesbury unreasonable, and/or the CA had failed to give adequate reasons for it.

(2) KFC Ground 5: The $150,000 financial penalty imposed on TVB under this decision is either manifestly excessive or not supported by sufficient reasons.

12. The additional grounds raised specifically in relation to the Scoop Final Decision are:

(1) Scoop Ground 4: The CA erred in law in finding that the references to myTV SUPER and its programming constituted “advertising” or “advertising material” and was therefore wrong to find that TVB was in breach of the Relevant Paragraphs.

(2) Scoop Ground 5: The decision is irrational, Wednesbury unreasonable or that the CA has given insufficient reasons to support it.

13. The relief sought in the KFC Judicial Review is:

(1) Quashing of the KFC Final Decision and the Appeal Proceedings.

(2) A declaration that the Decision and the Appeal Proceedings contravene BOR10 and BL39.

(3) A declaration that the Relevant Paragraphs are unconstitutional and/or ultra vires the BO.

14. The relief sought in the Scoop Judicial Review is the same as in the KFC Judicial Review, save that there is no challenge to any appeal proceedings.

15. TVB is represented by Mr McCoy SC[1], and the CA by Mr Johannes Chan SC[2]. The CEIC[3], who is only involved in relation to the challenge made under Ground 1, is represented by Mr Benjamin Yu SC[4].

16. Before I deal with each of these grounds in detail, it is necessary to set out the brief relevant background to put the arguments in proper context. This is largely not controversial and can be summarized as follows[5].

B. BACKGROUND

B1. The regulatory regime concerning broadcasting standards

17. The CA is an independent statutory body established under the CAO which is independent of the Government: section 3(3) of the CAO. Although its members are appointed by the Chief Executive, the Chief Executive is not a CA member and the majority of its members, including its chairperson, must not be public officers: sections 8(1) - (2) and 9(1)(a) of the CAO.

18. The role of the CA is to regulate the broadcasting and telecommunications industries in Hong Kong[6]. Its functions are set out in, amongst others, section 9 of the BMPO which include the securing of proper standards of television broadcasting with regard to programme content and advertisements. See section 9(1)(d) of the BMPO.

19. The CA is specifically empowered to approve and issue codes of practice under section 3(1)(a) of the BO. In so doing, the CA is required to consult with the licensees: section 3(8) of the BO.

20. The Codes were issued by the CA pursuant to the aforesaid power.

21. Once issued, a licensee is required to comply with all provisions in the codes of practice that are applicable to it: section 23(2)(d) of the BO. Compliance with the codes of practice is also a condition in the licences granted in respect of domestic free television service[7].

22. Separately, a licensee is required to secure proper standards for its licensed service with regard to, amongst others, television programme content. See: section 23(2)(e) of the BO.

23. Failure to comply with either of the above requirements could result in enforcement action taken by the CA. See section 28(2) of the BO.

24. Since the CA does not pre-censor broadcast content, the regulatory approach it adopts is post-broadcast complaint‑driven. In other words, it relies on the good sense and judgment of the licensees (who are required to observe the applicable standards), and will only intervene if there are complaints from the public[8].

25. Where complaints are received and are considered not to be trivial or frivolous (section 11(3) of the BMPO), they must be referred to the Broadcast Complaints Committee (“the BCC”): see section 11(1) of the BMPO. This applies to all complaints concerning contravention of codes of practice and licence conditions but do not apply to competition contraventions[9]: section 11(2)(a) of the BMPO.

26. The BCC is appointed by the CA, and comprises three members of the CA as well as members co-opted from the public covering a range of backgrounds including education, journalism, youth service and social welfare[10].

27. In considering a complaint made, the BCC:

(1) is mandated to provide a reasonable opportunity to the licensee concerned to make representations both orally and in writing: section 11(4)(a) of the BMPO;

(2) is required to consider any representations made by the licensee: section 11(4)(b) of the BMPO; and

(3) can consider any evidence placed before it which it considers relevant to the complaint, without reference to the Evidence Ordinance (Cap 8) or any rule of law relating to admissibility of evidence: section 11(4)(c) of the BMPO.

28. After the aforesaid process, the BCC would make recommendations concerning the complaint to the CA: section 11(4)(d) of the BMPO.

29. Thus, before any finding of contravention of the Code of Practice is made by the CA, the matter would have been investigated by the BCC, with full rights given to the licensee concerned to file evidence, make submissions and have an oral hearing.

30. Further, in the present cases as will be seen below, although not prescribed by the BO or the BMPO, the CA has taken the additional step that after it had come to a preliminary view on the complained contraventions, to provide its preliminary findings to TVB and invite it to make representations thereon. It was after considering TVB’s further representations that the CA finalized its view on the complained contraventions and issued the KFC Final Decision and the Scoop Final Decision with reasons given.

31. To regulate the conduct of the licensees, the CA has power, under Part 6 (sections 24 - 35) of the BO (intituled “Enforcement of Licences”), to issue directions to require a licensee to comply with a Code of Practice (section 24), to obtain information from the licensee and third parties to ascertain whether there has been contravention (sections 25 - 26), and in case of contravention, to impose financial penalty (sections 28 - 29), to require the licensee to issue a correction or apology (section 30), and in more serious cases, to suspend or recommend to the CEIC to revoke the licence (sections 31 - 33).

32. Specifically, in relation to section 28:

(1) It applies where the licensee has contravened (a) a licence condition; (b) an applicable requirement under the BO; (c) a direction, order or determination under the BO that is applicable to it; or (d) a Code of Practice provision (sub‑section (2)).

(2) The penalty in question shall not exceed $200,000 for the first occasion of breach (“the first occasion on which a penalty is imposed”, in other words only the first time, regardless of whether the penalty relates to the same or different types of breach); $400,000 for the second occasion, and $1 million for any subsequent occasion (sub-section (3)).

(3) Further, the penalty imposed must be proportionate and reasonable in relation to the failure or series of failures concerned giving rise to it (sub-section (5)), and must satisfy procedural fairness in that the licensee must be given a reasonable opportunity to make representations on it (sub‑section (6)).

33. A licensee aggrieved by the decision of the CA so made may appeal to the CEIC by way of petition under section 34 of the BO, whereunder the CEIC:

(1) has power to receive information and advice from the CA and other persons considered appropriate;

(2) must observe procedural fairness in that a reasonable opportunity must be afforded to the licensee concerned to make representations on any such information and advice received; and

(3) has power not only to confirm, vary or reverse the decision, but also to direct that the relevant provision of the Code of Practice be amended if appropriate: section 35 of the BO.

B2. The Codes

34. There is no dispute that FTA television service forms a significant part of life of Hong Kong. It is the most pervasive form of TV broadcasting as it has a household penetration of almost 100 per cent in this densely-populated city. Dramas and entertainment are the two most popular types of programmes. As graphically described by Mr Chan, at the height of enjoying the romance of a love story or at the exciting of following an action drama, if the actor, suddenly out of context, described how good the food of a restaurant is, the viewers will naturally feel frustrated if not offended. And for the less sophisticated viewers, they may even believe the complimentary remarks without knowing that it is, in fact, an advertisement within a programme. It is against this background that the Codes are issued[11].

35. Condition 24 of TVB’s FTA Licence provides that the licensee “shall monitor and ensure strict compliance with the Codes of Practice, and technical standards and directions issued by the [CA]”.

36. “Code of Practice” is defined in the FTA Licence as “a code of practice which bears the same meaning given in section 2(1) of the [BO]”, which effectively means it is a Code of Practice issued and approved by the CA under section 3 of the BO. It is the CA’s case the Codes are issued and approved by it under section 3[12].

37. In relation to placing advertisement or advertising materials by a licensee, the following provisions in the Codes are relevant for the present purposes.

38. Under the TV Programme Code:

“Chapter 1 Preamble

…

3. Due to the difference in characteristics, pervasiveness and degree of influence of the television programme services, each category of television programme service is subject to a level of control appropriate to that particular type of services. As a general principle underlying television programme regulation, the degree of restriction applied must be related to the likely audience of the television programme service and their expectations.

…

9. The CA, as the regulator, does not review or pre-censor any programmes. The editorial responsibility lies with the licensees themselves. The code sets out the factors which should be taken into account when making editorial judgement. It is the responsibility of the licensees to ensure that any programmes delivered on their licensed services will comply with the Code. Judgement will always be called for by the licensees …

10. The Code deals in general principles. Licensees would be required to draw up their own guidelines in the light of the particular interests of the organisations and their audiences so as to provide practical guidance to their staff on how these general principles would be applied in specific circumstances. Licensees must reflect the general effect of this Code in their own guidelines.

…

Chapter 11 Indirect Advertising

DOMESTIC FREE AND DOMESTIC PAY TELEVISION PROGRAMME SERVICES

Separation of Programme and Advertising Material

1. Indirect advertising in television programmes refers to the mingling of programme and advertising material or the embedding of advertising material within programme content, whether inadvertently or by design. As a matter of principle, advertisements should be recognizably separate from the programmes. The underlying rationale for the prohibition of indirect advertising is that viewers should not be confused as to whether they are watching a programme or a paid advertisement. Advertising material must be clearly identified as such so that viewers could attach appropriate weight to such material according to their own assessment.

2. As a general rule, the placement of advertising material should be confined to paid-for advertising time. Exceptions may be made in the following circumstances:

(a) it may be necessary in a news or factual programme to include a reference to or extract from a particular advertisement. This should give it no greater prominence than is necessary to make the required point; or

(b) a television programme may refer to or use extracts from advertisements provided that the choice and range of advertisements are subject only to the editorial requirements of the programme. In particular, they may in no circumstances be influenced by advertising considerations.

Undue Prominence

3. No undue prominence may be given in any programme to a product, service, trademark, brand name or logo of a commercial nature or a person identified with the above so that the effect of such reference amounts to advertising. Such references must be limited to what can clearly be justified by the editorial requirements of the programme itself, or of an incidental nature. For the avoidance of doubt, product/service sponsorship as permitted under paragraph 10 of Chapter 9 Programme Sponsorship of the Generic Code of Practice on Television Advertising Standards will be subject to the rules stipulated therein.” (emphasis added)

39. Under the TV Advertising Code:

“Chapter 2 Definition of Advertisement

1. Advertisement or advertising material means any material included in a television programme service which is designed to advance the sale of any particular product or service or to promote the interests of any organization, commercial concern or individual; whether by means of words, sound effects (including music) and/or of visual presentation and whether in the form of direct announcements, slogans, descriptions or otherwise, as well as any promotional reference in the course of a programme to any products or services.

2. For the purpose of this Code the term advertisement or advertising material does not include:

…

(c) material for the promotion of the licensee’s station and/or programme services. For the avoidance of doubt, the promotion of advertisement or advertising material included in a television programme service is advertisement or advertising material for the purpose of counting the aggregate advertising time allowed for domestic free television programme services under section 11(1) of Schedule 4 to the Broadcasting Ordinance (Cap. 562);

…

(g) incidental or natural references to products or services in the course of a programme which are justifiable in programme context or product/service sponsorship as permitted under paragraph 10 of Chapter 9 Programme Sponsorship of this Code and do not obtrude on viewing pleasure or entertainment; and

…

Chapter 3 General Advertising Standards

…

SPECIFIC APPLICATIONS FOR DIFFERENT CATEGORIES OF SERVICES

DOMESTIC FREE, DOMESTIC PAY AND OTHER LICENSABLE TELEVISION PROGRAMME SERVICES

…

Identification of Advertisements

4. Advertising material should be clearly identifiable as an advertisement. Distinctions must be maintained between advertisements and programmes.

…

Chapter 8 Advertising Breaks

DOMESTIC FREE, DOMESTIC PAY AND OTHER LICENSABLE TELEVISION PROGRAMME SERVICES

1. Unless otherwise permitted by the CA, advertising or non‑programme material may be placed only at the beginning or end of a programme or in a natural break occurring therein. For the purpose of this Code, ‘non-programme material’ excludes advertising material but includes materials for the promotion of the licensee’s station and programme services and such announcements as the CA may require to be included in the licensee’s television programme services pursuant to the Broadcasting Ordinance (Cap.562) or the relevant licence. This rule does not apply to a service or part of a service that comprises of home shopping material where the nature of the service or part of a service is, in the opinion of the CA, clearly identified to viewers.

…

Chapter 9 Programme Sponsorship

GENERAL PRINCIPLES FOR ALL CATEGORIES OF SERVICES

...

2. A core principle of this Code is the preservation of programme integrity by not allowing programme agendas to be distorted for commercial purposes. Where a programme is sponsored, the licensee should remain responsible for its content.

SPECIFIC APPLICATIONS FOR DIFFERENT CATEGORIES OF SERVICES

DOMESTIC FREE TELEVISIONPROGRAMME SERVICES

…

Product/Service Sponsorship

10. The licensee may include one or more product(s) or service(s) within a programme in return for payment or other valuable consideration, provided that

(a) their exposure or use is clearly justified editorially, not obtrusive to viewing pleasure and not gratuitous;

(b) the sponsor for the product or service featured must be clearly identified in the front and/or end sponsor credits of the programme. The content of the front and/or end sponsor credits must comply with the rules set out in paragraphs 5 to 7 of this chapter;

(c) the product or service featured in a programme must not be unacceptable for advertising under this Code; and

(d) the advertising standards set out in other chapters of this Code shall apply to product/service sponsorship where appropriate, including but not limited to the provisions governing substantiation of factual claims and disparagement of competitors.” (emphasis added)

40. Hence, under the Codes, it is the general principle that the licensee should maintain a separation of television programmes and advertisements. It could place advertisements or advertising materials before and after a programme and during the natural break therein. In other words, the licensee is not permitted to place advertisements or advertising materials within a programme unless that fulfils any of the criteria provided under paragraph 10 of Chapter 9 of the TV Advertising Code as an exception.

B3. The KFC Final Decision

41. The TV Awards Presentation was first broadcast on 13 December 2015. It was a livecast of TVB’s annual awards presentation ceremony and was shown during prime broadcasting hours on a Sunday evening.

42. During the broadcast of the awards presentation ceremony, several people marched onto the stage and delivered trays stacked with boxes of food and drinks from the fast food restaurant chain, KFC (“the KFC Segment”). KFC’s logo was clearly shown on food boxes and soft drink cups and there were medium to close-up shots showing the artistes eating and passing the food around enthusiastically. There were close-up shots showing KFC’s brand logo conspicuously in the livecast. The female host of the programme twice made the remark “食好嘢” when referring to the sponsor’s products. The KFC Segment lasted for about 1 minute and 12 seconds.

43. TVB received payment from KFC for exposing its products during the KFC Segment, which was clearly designed to advance the sale of KFC’s products. TVB’s position is that as KFC was a product sponsor, the broadcast of the KFC Segment should fall within the provisions of paragraph 10 of Chapter 9 of the TV Advertising Code. There is no dispute between the CA and TVB that the KFC Segment complied with paragraphs 10(b) ‑ (d) of Chapter 9 of the TV Advertising Code, in that:

(1) KFC was identified as the product sponsor in the end credits of the programme (paragraph 10(b));

(2) KFC’s products are acceptable for broadcast within the meaning of the TV Advertising Code (paragraph 10(c)); and

(3) The KFC Segment did not breach the advertising standards set out in other chapters of the TV Advertising Code (paragraph 10(d)).

44. However, for the KFC Segment to fall within the exception provided in paragraph 10 of Chapter 9 of the TV Advertising Code, it must also be “clearly justified editorially”, “not obtrusive to viewing pleasure” and “not gratuitous” within the meaning of Paragraph 10(a).

45. Initially, the CA received 13 public complaints about the TV Awards Presentation. Subsequently, the CA received one further public complaint about the original broadcast of the TV Awards Presentation on 13 December 2015 and one further complaint about the re-run of the TV Awards Presentation, which was broadcast on 9 February 2016. The complaints about the TV Awards Presentation necessitated the initiation of the complaint handling procedures.

46. The preliminary view of the CA was that the substance of the complaints was not trivial or frivolous. Accordingly, in accordance with section 11(1) of the BMPO, the complaints were referred to the BCC.

47. Thereafter, there were exchanges of correspondences and submissions between BCC and TVB, in which the complaints were conveyed to TVB and was invited to make, and it did later provide, representations regarding the complaints.

48. In particular, TVB provided its written representations by a letter dated 1 February 2016 (“the KFC Initial Representations”).

49. The KFC Initial Representations focused on the duration of the exposure of KFC’s products and argued that such exposure was “brief and subtle” (paragraph 4). TVB claimed that the exposure was “necessary” and that there was no “obtrusion on viewing pleasure”. TVB also set out its general dissatisfaction with the rules on product sponsorship in Hong Kong which it considered to be out of step with international standards.

50. On 30 March 2016, after consideration of the KFC Initial Representations, the CA sent TVB its provisional findings (“the KFC Provisional Findings”). The CA found provisionally that TVB was in breach of the Relevant Paragraphs. In summary, the KFC Provisional Findings were that:

(1) The programme host made verbal complimentary remarks twice regarding the sponsored product;

(2) There were continuous and gratuitous medium to close up shots, with the KFC brand logo displayed in the middle of the screen; and

(3) The programme was deliberately designed to include the segment referring to the sponsored product. This served no editorial purpose except to draw the viewers’ attention to the sponsored product and blatantly promote it.

51. The CA emphasised that TVB had repeatedly breached the provisions governing indirect advertising and product and service sponsorship and the CA had repeatedly reminded TVB that indirect advertising was strictly prohibited under the TV Programme Code. The CA explained that it was minded to impose a financial penalty of $150,000 on TVB and it invited TVB to provide further written or oral representations.

52. The solicitors for TVB made further representations to the CA in a letter dated 29 April 2016 (“the KFC Further Representations”).

53. It is the CA’s position that TVB did not in these representations put forward any substantive editorial justification for the KFC Segment, or explain how it complied with Paragraph 10(a)[13].

54. After considering the KFC Further Representations, the CA issued its final decision on 24 May 2016 (ie, the KFC Final Decision). The CA found that TVB breached the Relevant Paragraphs (ie, paragraph 1 of Chapter 11 of the TV Programme Code and Paragraph 10(a)). The CA imposed a financial penalty of $150,000 on TVB for the breach. The CA set out in six pages its findings and responded to the position that had been taken by TVB in the KFC Further Representations.

55. On 22 June 2016 TVB filed an appeal to the CEIC under section 34 of the BO (ie, the Appeal Proceedings), which has been stayed in light of the KFC Judicial Review.

B4. The Scoop Final Decision

56. The Scoop Final Decision arises from the CA’s consideration of public complaints against several episodes of the television programme “Scoop” broadcast by TVB on its “Jade” Channel from 7:30pm to 8:00pm during the period from 15 March 2016 to 18 May 2016 and the programme “Extra” broadcast on the same channel from 12:00am to 12:15am on 26 April 2016. In total, 17 episodes of “Scoop” / “Extra” in this period contained segments which featured myTV SUPER. In 13 episodes, myTV SUPER was identified as either the only product sponsor or one of the product sponsors of the programme.

57. “Scoop” is an infotainment programme covering both social issues and showbiz gossip. “Extra” is an entertainment programme featuring only showbiz gossip. The CA received seven complaints from members of the public regarding the exposure of myTV SUPER within various episodes of “Scoop” and one public complaint about an episode of “Extra”.

58. The CA considered all of the episodes in relation to which complaints were made. In the 19 April Episode of “Scoop”, there was a presentation of a prize to the 800,000^th subscriber of HKBN, which is a business partner of myTV SUPER. The programme hostess made favourable remarks about myTV SUPER. A HKBN staff member was seen holding a placard bearing the logo of HKBN with congratulatory remarks. When the two female artistes and the prize winning customer of HKBN chatted about the TV programmes they were watching, the female artiste briefly talked about the upcoming programmes of myTV SUPER that she was most looking forward to watching. In the 18 May Episode of “Scoop”, a female artiste mentioned the name of myTV SUPER and talked about how she downloaded the myTV SUPER mobile app on her phone, followed by shots of a screen of a mobile phone showing the icon and user interface of the myTV SUPER mobile app, and trailers for a particular drama to be shown on myTV SUPER. The male host also invited viewers to download the myTV SUPER app at any time in the voice-over. For convenience, the above-mentioned segments in these two episodes are called collectively the “Subject Scoop Segments”.

59. The CA was of the preliminary view that the substance of the complaints was not trivial or frivolous. Accordingly, in accordance with section 11(1) of the BMPO, the complaints were referred to the BCC.

60. Thereafter, there were exchanges of correspondences and submissions between the BCC and TVB, in which the complaints were conveyed to TVB and TVB was invited to make, and it did later provide, representations regarding the complaints.

61. TVB provided its written representations by a letter dated 1 July 2016 (“the Scoop Initial Representations”).

62. After carefully considering the Scoop Initial Representations, the BCC made its recommendations to the CA.

63. On 28 September 2016, the CA sent TVB its provisional findings (“the Scoop Provisional Findings”). The CA found provisionally that TVB was in breach of the Relevant Paragraphs in respect of the 19 April Episode and the 18 May Episode (collectively “the Subject Scoop Episodes”). The CA explained the considerations which had led it to the Scoop Provisional Findings including that:

(1) The 19 April Episode contained commercial promotional content which did not fit in the context of an infotainment programme. The CA considered this to be not clearly editorially justified, obtrusive to viewing pleasure and gratuitous;

(2) The 18 May Episode included content which amounted to a solicitation to download the myTV SUPER mobile application. The CA considered it to be gratuitous and not clearly justified editorially.

64. Accordingly, the CA explained that it was minded to warn TVB to observe more closely paragraph 1 of Chapter 11 of the TV Programme Code and Paragraph 10(a) (ie, the Relevant Paragraphs). The CA gave TVB a further opportunity to provide written or oral representations.

65. The solicitors for TVB made further representations to the CA by their letter dated 18 October 2016 (“the Scoop Further Representations”).

66. It is the CA’s position that TVB did not seek to put forward any substantive editorial justification for the exposure of myTV SUPER in the Subject Scoop Episodes, or explain how it considered that it had complied with Paragraph 10(a)[14].

67. After considering the Scoop Further Representations, the CA issued its final decision on 22 November 2016 (ie, the Scoop Final Decision). The CA found that TVB had breached the Relevant Paragraphs. The CA warned TVB to observe more closely the relevant provisions of the Codes. The CA further set out eight pages of analysis explaining its approach and responding to the position that had been taken by TVB in the Scoop Further Representations.

68. It should also be noted for completeness that a re-run of the Subject Scoop Episodes was also shown on TVB Network Vision Limited (“TVBN”). The CA and TVBN then exchanged correspondence concerning the re-run. The CA reached the same findings that the Subject Scoop Episodes had breached the Relevant Paragraphs. By way of sanction, the CA warned TVBN to observe more closely the relevant provisions of the Codes. TVBN appears to have accepted this decision and did not appeal or challenge it.

69. Later, TVB respectively took out these judicial review applications challenging the KFC Final Decision and the Scoop Final Decision (collectively “the Decisions”).

C. THESE JUDICIAL REVIEWS

70. As mentioned above, TVB raises a number of grounds challenging the Decisions. I will deal with them in the order as advanced by TVB at the hearing, starting with Ground 2 first.

C1. Ground 2

71. Under this ground, TVB says the Relevant Paragraphs amount to an unlawful infringement of TVB’s right to freedom of speech and free expression protected under BOR16(2), BL27 and BL39[15]. For convenience, I would generally refer these rights collectively as the right to freedom of expression.

72. BOR16 relevantly provides as follows:

“Article 16

Freedom of opinion and expression

(1) Everyone shall have the right to hold opinions without interference.

(2) Everyone shall have the right to freedom of expression; this right shall include freedom to seek, receive and impart information and ideas of all kinds, regardless of frontiers, either orally, in writing or in print, in the form of art, or through any other media of his choice.

(3) The exercise of the rights provided for in paragraph (2) of this article carries with it special duties and responsibilities. It may therefore be subject to certain restrictions, but these shall only be such as are provided by law and are necessary—

(a) for respect of the rights or reputations of others; or

(b) for the protection of national security or of public order (ordre public), or of public health or morals.” (emphasis added)

73. It is common ground that the right to freedom of expression under BOR16 (and BL27) is not an absolute right and may be subject to lawful restriction if it satisfies (a) the prescribed by law requirement; and (b) the proportionality requirement[16].

74. Mr Chan for the CA has fairly accepted that BOR16 right is engaged in the present case vis-à-vis the Relevant Paragraphs.

75. At the same time, Mr McCoy also has rightly accepted that TVB as a FTA Licence holder is and should be subject to regulation, and that the CA has the power to so regulate. He also accepts that TVB does not have the right to broadcast anything it likes. Mr McCoy therefore has made it clear that TVB accepts that paragraphs 10(b) - (d) of Chapter 9 of the TV Advertising Code are constitutionally compliant. However, he says the Relevant Paragraphs are not as it cannot satisfy the prescribed by law requirement or the proportionality requirement.

76. Mr McCoy submits that the Relevant Paragraphs do not comply with prescribed by law requirement for the following reasons.

77. First, Mr McCoy says the criteria (“the Criteria”) set out under Paragraph 10(a), namely the advertisement permitted to be placed within a programme has to be “clearly editorially justified”, “not obtrusive to viewing pleasure” and “not gratuitous”, are all matters that by their own nature and meaning predominantly subjective and conceptually vague. They are not capable of having well defined objective meaning. In the premises, they lack the legal certainty as required under the prescribed by law test.

78. Counsel further says this is indeed buttressed by the CA’s own statement in evidence that, in applying the Codes, it takes into account changing public expectations[17]. This shows that the benchmark is not fixed by any written rules, but draft with currents of public opinions, as observed by the CA. It is all subject to the subjective standards adopted by the CA, who as an authority effectively acts as a “pleasure police” or “pleasure adjudicator”. It amounts to a changing goal post or standard, which clearly cannot satisfy the legal certainty requirement.

79. Second, paragraph 1 of Chapter 11 of the TV Programme Code states that its underlying rationale is “that viewers should not be confused as to whether they are watching a programme or a paid advertisement”. However, Paragraph 10(a), by contrast, demands subtlety and understatedness in indirect advertising, as that must not be “gratuitous” or so unsubtle as to be “obstructive to viewing pleasure”.

80. These two provisions are therefore in tension and indeed pulling at different directions, leaving broadcasters to walk the tightrope between them. They similarly cannot meet the legal certainty required under the prescribed by law test.

81. With respect, I do not agree.

82. Most recently, the Court of Appeal in Chee Fee Ming has reiterated again that to satisfy the prescribed by law test, the degree of precision required to achieve the necessary legal of certainty and foreseeability is flexible and contextually based. It does not require absolute precision or certainty, and the ultimate question is whether the provision under challenge is able to enunciate some boundaries which create an area of risk to guide conducts of the affected individual, with legal advice if necessary. Thus, Lam VP observed at [52] - [57] as follows[18]:

“52. As has often been recognized, absolute precision or certainty is not achievable. In the context of a challenge to a common law offence, Sir Anthony Mason NPJ said in Mo Yuk Ping v HKSAR supra, at [61] to [63]:

‘[61] … Hence it is recognised that a prescription by law inevitably may involve some degree of vagueness in the prescription which may require clarification by the courts.

[62] … In any event, with the common law, as with the interpretation of statute law, it is inevitable that questions continue to arise which require clarification by judicial decision. That is one reason why absolute certainty is unattainable and why some degree of vagueness is inherent in the formulation of laws, especially laws expressed in general terms.

[63] It is also to be expected that, in the case of a general offence expressed in broad and abstract terms, that the degree of vagueness will be perhaps greater than that to be expected in the case of a specific offence directed to a particular situation or particular situations.’

53. As regards the degree of precision, Ribeiro PJ said in Winnie Lo v HKSAR supra, [75]:

‘The central requirement is therefore that the offence must have a sufficiently clearly formulated core to enable a person, with advice if necessary, to regulate his or her conduct so as to avoid liability for that offence. At the same time, the principles recognise the need for both flexibility and development.’

54. The same principle applies in respect of the extent of precision for discretion in licensing context. Hong Kong Television Network Ltd v Chief Executive in Council, supra, was a case on broadcasting licence. Cheung CJHC (as Cheung PJ then was) said at [98]:

‘Quite inevitably, there will be marginal or fringe cases where there are doubts. But as Ribeiro PJ emphasised in Winnie Lo, what is important is whether there is ‘a settled core’ of meaning of the norm in question. If the answer is in the affirmative, the mere existence of debatable issues surrounding the settled core does not make the norm legally uncertain …’

55. Au J, in the first instance judgment in Hong Kong Television Network Ltd v Chief Executive in Council, supra, summarized the relevant propositions in two sub-paragraphs at [121]:

‘(5) Further, where the issue is the exercise of a discretionary power conferred by statute, the degree of precision required of the law will also be adjusted, depending on the particular subject matter of the discretion (Leung Kwok Hung v HKSAR (2005) 8 HKCFAR 229 at [29], p.251), the content of the instrument in question, the field it is designed to cover, and the number and status of those to whom it is addressed. The law needs only to be formulated with sufficient precision to enable the individual, with appropriate advice when necessary, to regulate his conduct (Hasan v Bulgaria (2002) 34 EHHR 55 at [84]).

(6) Ultimately, the question is answered by whether the law is able to enunciate some boundaries which create an area of risk. There will be conduct that falls along the boundaries of the area of risk for which no definite prediction or answer can be given in advance; but the identification of the area of risk will provide guidance to citizens and that suffices for the purpose of certainty: see Sunday Times at [52]; R v Nova Scotia Pharmaceutical Society [1992] 2 SCR 606 at [62].’

56. The judgment of Justice Gonthier in the Supreme Court of Canada in the last case cited by Au J at (6), R v Nova Scotia Pharmaceutical Society [1992] 2 SCR 606, provides some illuminating discussion on the scope of precision. At p.638‑640, the learned judge said:

‘Legal rules only provide a framework, a guide as to how one may behave, but certainty is only reached in instant cases, where law is actualized by a competent authority. In the meanwhile, conduct is guided by approximation. The process of approximation sometimes results in quite a narrow set of options, sometimes in a broader one. Legal dispositions therefore delineate a risk zone, and cannot hope to do more, unless they are directed at individual instances.

By setting out the boundaries of permissible and non-permissible conduct, these norms give rise to legal debate. They bear substance, and they allow for a discussion as to their actualization. They therefore limit enforcement discretion by introducing boundaries, and they also sufficiently delineate an area of risk to allow for substantive notice to citizens.

Indeed no higher requirement as to certainty can be imposed on law in our modern State. Sematic arguments, based on perception of language as an unequivocal medium, are unrealistic. Language is not the exact tool some may think it is. It cannot be argued that an enactment can and must provide enough guidance to predict the legal consequences of any given course of conduct in advance. All it can do is enunciate some boundaries, which create an area of risk. But it is inherent to our legal system that some conduct will fall along the boundaries of the area of risk; no definite prediction can then be made. Guidance, not direction, of conduct is a more realistic objective. …

A vague provision does not provide an adequate basis for legal debate, that is for reaching a conclusion as to its meaning by reasoned analysis applying legal criteria. It does not sufficiently delineate any area of risk, and thus can provide neither fair notice to the citizen nor a limitation of enforcement discretion. Such a provision is not intelligible … and therefore it fails to give sufficient indications that could fuel a legal debate. It offers no grasp to the judiciary…’

57. The learned judge explained the need for general enactments in the modern world at p.641-3. In particular:

‘… Often the State attempts to realize a series of social objectives, some of which must be balanced against one another, and which sometimes conflict with the interests of individuals. The modern State, while still acting as an enforcer, assumes more and more of an arbitration role.

This arbitration must be done according to law, but often it reaches such a level of complexity that the corresponding enactment will be framed in relatively general terms. In my opinion the generality of these terms may entail a greater role for the judiciary …

… One must be wary of using the doctrine of vagueness to prevent or impede State action in furtherance of valid social objectives, by requiring the law to achieve a degree of precision to which the subject-matter does not lend itself. A delicate balance must be maintained between societal interests and individual rights…

What becomes more problematic is not so much general terms conferring broad discretion, but terms failing to give direction as to how to exercise this discretion, so that this exercise may be controlled. Once more, an unpermissibly vague law will not provide a sufficient basis for legal debate; it will not give a sufficient indication as to how decisions must be reached, such as factors to be considered or determinative elements. In giving unfettered discretion, it will deprive the judiciary of means of controlling the exercise of this discretion…’”

83. Further, Ribeiro PJ in HKSAR v Fong Kwok Shan Christine (2017) 20 HKCFAR 425 at [78] and [91] also recognised that language has its inherent ambiguities and emphasized that in such an exercise to inquire as to whether the prescribed by law requirement is satisfied, the proper approach is to ascertain the meaning of a provision in light of its purpose and context, and to adopt a rational and common approach.

84. Bearing these principles in mind, for the following reasons, I agree with Mr Chan for the CA that Paragraph 10(a) clearly meets the prescribed by law test.

85. As submitted by Mr Chan, the Criteria are couched in plain English words which are to be understood objectively in the proper context of the Codes relating to advertising materials. In relation to this, it is pertinent to note that:

(1) It is an expressly stated general principle that advertisements should be recognizably separate from the programmes and the rationale for the prohibition of indirect advertising is that viewers should not be confused as to whether they are watching a programme or a paid advertisement (see paragraph 1 of Chapter 11 of the TV Programme Code).

(2) Further, for that principle, it is also expressly stated that no undue prominence may be given in any programme to a product, service, trademark, brand name or logo of a commercial nature so that the effect of such reference amounts to advertising. It is also stated that such references must be limited to what can be “justified by editorial requirements of the programme itself or of an incidental nature” (see paragraph 3 of Chapter 11 of the TV Programme Code).

(3) Under Chapter 2 of the TV Advertising Code (which relates to the definition of advertisement), it is expressly provided under its paragraph 2(g) (quoted above) that the term advertisement or advertising material does not include “incidental or natural references” to products or services in the course of a programme which are justifiable in programme context or permitted under paragraph 10 of Chapter 9.

86. When read objectively with the above general context and other paragraphs of the Codes, it is reasonably clear that the Criteria will be met if the reference or remark to, or the showing of, the sponsored material[19] within a programme can be regarded objectively as a natural or incidental one, which is not prominent and is consistent with the programme content itself. This also accords with the natural and ordinary meanings of those words.

87. Further, a licensee is also able to ascertain the above meaning of the Criteria by reference to[20]:

(1) The CA’s decisions and reasons on complaint cases, including contravention of Paragraph 10(a), which the CA publishes.

(2) The communications and consultations that the CA has had with the licensees in formulating and revising the Codes.

88. Insofar as paragraph 1 of Chapter 11 of the TV Programme Code is concerned, the words there are plain and clear, and a licensee cannot seriously suggest that it will not be able to ascertain a sufficiently clear meaning from it to guide its own conduct.

89. There is also no merit in TVB’s contention that the Relevant Paragraphs lack the necessary certainty as they are contradictory to each other, since Paragraph 10(a) is in direct opposite to the principle stated in paragraph 1 of Chapter 11 of the TV Programme Code.

90. As submitted by Mr Chan, there is no inconsistency between paragraph 1 of Chapter 11 of the TV Programme Code and Paragraph 10(b). Paragraph 1 relates to the general principle on separation of advertisement and programme, which is to facilitate and protect programme integrity and hence viewing pleasure in the interest of the public[21]. Paragraph 10(b) on the other hand relates to an exception, which exception has already been recognised under paragraph 3 of Chapter 11 of the TV Programme Code. Given the above meaning of the Criteria to qualify for this exception, Paragraph 10(a) is consistent with the policy to protect programme integrity and viewing pleasure stated under paragraph 1 of Chapter 11 of the TV Programme Code.

91. Once understood this way, it is clear to me that both Relevant Paragraphs have a sufficiently and clearly formulated core or meaning to enable a licensee, with legal advice if necessary, to regulate its conduct so as to avoid liability for breaching either of them.

92. I therefore reject TVB’s contention that the Relevant Paragraphs fail to meet the prescribed by law requirement.

93. Mr McCoy next submits that the Relevant Paragraphs also fall foul of the proportionality requirement. His submissions run as follows.

94. It is now firmly established that the proportionality test involves the following four-step enquiry[22]:

(1) The measure must pursue a legitimate aim.

(2) There must be a rational connection between the measure and the aim pursued.

(3) It must be shown that the measure is necessary, and no more than necessary, to accomplish the aim.

(4) Viewed in the round, the arrangement must be proportionate, in that, in the court’s judgment, it strikes a fair balance between the interests of the community and the rights of the individual.

95. Mr McCoy says in order to satisfy the proportionality test, the Relevant Paragraphs have to pursue a legitimate aim that falls within those matters expressly set out under BOR16(3), which are respectively (a) for the respect of the rights or reputations of others, or (b) for the protection of national security or of public order (ordre public), or of public health or morals.

96. In this respect, it is the CA’s position that the restrictions provided under the Relevant Paragraphs are to pursue the legitimate aims of consumer protection and protection of viewers’ interests:

(1) For consumer protection, the requirement for advertisements to be recognisably separate from programmes ensures that consumers could attach appropriate weight to advertising material and prevent them from being misled (see paragraph 1 or 3 of Chapter 11 of the TV Programme Code. It prevents a subliminal effect on the audience)[23].

(2) For protection of viewing interests, the CA also serves the important function of securing proper standards of television programming and advertising. In the television broadcasting industry, the viewing interest and pleasure of the television audience should be the foremost consideration[24].

97. The CA submits that these aims fall within BOR16(3)(a) as they are in relation to the protection of the rights of others.

98. Mr McCoy however says the purported aims are not legitimate for the purpose of BOR16(3). The “respect for rights of others” listed under BOR16(3)(a) has been held to apply to restrictions on speech aimed at protecting others’ rights to privacy, reputation, a fair trial, or religious freedom. They therefore do not cover the CA’s purported aim.

99. Further, counsel has also submitted at the hearing that the grounds respectively set out under BOR16(3)(a) and (b) must be read together and consistently. In other words, he says on a proper construction of BOR16(3), the “respect for the rights of others” must be something in relation to some rights or matters that acquire similar importance or significance as that of the protection of national security, ordre public, public health or morals.

100. In particular, Mr McCoy says the authorities show that “rights of others” include ICCPR rights, together with other rights that are (a) supplied by domestic law, and (b) indispensable imperatives. See: R (ProLife Alliance) v British Broadcasting Corp [2004] 1 AC 185 at [123]; Chassgnou v France (1999) 29 EHRR 615, at [113]; Connolly v DPP [2008] 1 WLR 276 at [23] - [28]; and R (on the Application of Boots Management Services Ltd) v The Central Arbitration Committee [2014] EWHC 65 (Admin) at [30].

101. In the written reply submissions, Mr McCoy then clarifies TVB accepts that consumer protection is a legitimate aim. It has also never disputed the fact that measures protecting the public from subliminal advertising or other perfidious, fraudulent, false or defamatory advertising tactics can be readily justified within BOR16(3). By itself TVB has no objection to the requirement that placement advertising be clearly identifiable as such.

102. Counsel however submits that the Criteria under Paragraph 10(a) are more to deal with the aim of protecting viewing pleasure and programme integrity, as they seek to ensure that any in‑programme indirect advertising has to be done subtly and incidentally. In other words, without noticing it. However, viewing pleasure or programme quality is a highly subjective and personal matter, any right to it can hardly be regarded as such important right (ie, indispensable imperatives) to justify encroachment of the fundamental right freedom of expression as anticipated under BOR16(3)(a).

103. With respect, I am unable to accept these submissions:

(1) As submitted by Mr Chan, the ground of “respect for the rights… of others” are drafted in general and plain words. There is simply no rational reason to confine this phrase only to privacy, reputation, fair trial and religious freedom of others only.

(2) Further, BOR16(3)(a) and (b) are provided in a disjunctive form with the word “or”. On an objective construction, as a matter of grammar and syntax, it is clear to me that they are not intended to be read conjunctively in the way as submitted by Mr McCoy.

104. Further, as submitted by Mr Chan, R (ProLife) indeed supports the proposition that right of television viewers not to be subjected to unnecessary materials when viewing a programme is recognised as a “right of the others” under the Article 10 of the European Convention on Human Rights (“ECHR”) (equivalent of BOR16). See the speeches of:

(1) Lord Hoffman at [21]:

“21 The power of the medium is the reason why television and radio broadcasts have been required to conform to standards of taste and decency which, in the case of any other medium, would nowadays be thought to be an unwarranted restriction on freedom of expression. The enforcement of such standards is a familiar feature of the cultural life of this country. And this fact has given rise to public expectations. The Broadcasting Standards Commission puts the point with great clarity in paragraph 2 of its Code on Standards (Codes of Guidance, June 1998):

‘There is an implied contract between the viewer, the listener and the broadcaster about the terms of admission to the home. The most frequent reason for viewers or listeners finding a particular item offensive is that it flouts their expectation of that contract—expectations about what sort of material should be broadcast at a certain time of day, on a particular channel and within a certain type of programme, or indeed whether it should be broadcast at all.’”

(2) Lord Scott at [91]:

“91 It was not contended by counsel for the Alliance that a restriction barring the televising of a programme likely to be offensive to public feeling was, per se, incompatible with article 10. Nor should it have been. The reference in article 10(2) to the ‘rights of others’ need not be limited to strictly legal rights the breach of which might sound in damages and is well capable of extending to a recognition of the sense of outrage that might be felt by ordinary members of the public who in the privacy of their homes had switched on the television set and been confronted by gratuitously offensive material.” (emphasis added)

(3) Lord Walker at [121]-[123]:

“121 Counsel agreed, to my mind correctly, that the various phrases describing offensive material are best taken as a single composite expression. That takes some of the pressure off ‘good taste’. The composite expression must in my view be interpreted in accordance with contemporary standards. The broadcasters’ two published codes show that in practice the obligation to avoid offensive material is interpreted as limited to what is needlessly (or gratuitously) shocking or offensive. Here the context is of crucial importance, and what could not possibly be justified as entertainment may be justified (in news or current affairs programmes) as educating the public about the grim realities of life. Your Lordships were referred to a number of adjudications by the BSC (some mentioned in the judgment of Simon Brown LJ, paras 61 and 62) which show that the BSC takes the same view of its statutory duty under section 110 (2)(b) of the 1996 Act. I do not regard the broadcasters or the BSC as having failed in their duties by not imposing the more stringent standards which might have been appropriate 50 or more years ago.

122 So when Mr Pannick rightly reminded your Lordships that PEBs are not immune from the obligation to avoid offensive material, that obligation must be understood as directed to matter which is likely to cause much more than mild discomfort. Even material which causes a significant degree of revulsion may be justified by the serious purpose of the context in which the material is broadcast. I would if necessary invoke section 3(1) of the 1998 Act to arrive at that conclusion, but I do not think it is necessary to do so. It can be arrived at by applying ordinary principles of statutory construction. It would be absurd to test offensiveness by the standards which prevailed in or before the middle of the last century.

123 Nevertheless the citizen has a right not to be shocked or affronted by inappropriate material transmitted into the privacy of his home. It is not necessary to consider whether that is a Convention right (Mr Pannick made a brief reference to article 8, but did not seek to develop the point). Whether or not it is classified as a Convention right, it is in my view to be regarded as an ‘indisputable imperative’ in the language of the European Court of Human Rights in Chassagnou v France (1999) 29 EHRR 615, 687, para 113. Neither the existence of the ‘watershed’ nor any specific warning broadcast before a programme can be relied on to provide protection, as the BBC and the independents recognise in their published codes.” (emphasis added)

105. This shows that protection of viewing pleasure and programme integrity can be recognised as a right of the others under BOR16(3)(a) to justify limitation of the freedom of expression.

106. Further, as pointed out by Mr Chan, a FTA TV service has important social functions. As Condition 17.1 of the FTA Licence provides:

“The Licensee shall:

(a) entertain, inform and educate; and

(b) ensure that its programming is balanced in content and provides an adequate and comprehensive Service which is responsive to the diverse needs and aspirations of the community.” (emphasis added)

107. At the same time, the CA recognises the commercial interest of television broadcasters like TVB to enhance advertising revenue. Chapter 11 of the TV Programme Code and Chapter 9 of the TV Advertising Code are therefore an attempt to strike a balance between:

(1) The protection of the interests of consumers from being subjected to subliminal advertising material, and the interests of the TV viewing audience to enjoy quality television entertainment; and

(2) The commercial interests of television broadcasters to earn advertising income from product and service sponsorship.

108. I will therefore accept that the Relevant Paragraphs pursue the legitimate aims of consumer protection and protection of viewers’ interests.

109. TVB then argues that the restrictive measure under the Relevant Paragraphs does not rationally connect to the legitimate aims or it is not necessary (and thus is disproportionate) to connect to them as:

(1) The measure is discriminatory and places an irrational distinction between locally-made and foreign acquired content;

(2) Even without the two challenged provisions, there are ample protections against the nefarious misuse of product placement or programme sponsorship, so that the additional conditions stipulated in these two rules are excessive and unnecessary;

(3) FTA television broadcasters rely on advertising revenues to produce high quality local content, and the CA’s heavy-handed restriction on product placement and programme sponsorship is contrary to the public interest and fails to accord with the CA’s duties under section 4(4) of the CAO; and

(4) The CA’s stance on product placement is overbearing and infantilises the viewing public.

110. In relation to [109(1)] above, TVB further points out that paragraph 20 of Chapter 9 of the TV Advertising Code provides an exception in relation to “Acquired Programmes”. It states:

“Films made for the cinema and acquired programmes covering sporting and other events taking place outside Hong Kong may deviate from the standards in this chapter only when this is unavoidable.”

111. It also refers to paragraph 2 of Chapter 8 of the TV Advertising Code which provides:

“Advertisements (including sponsorship and product placement) built into programmes of channels acquired for direct re‑transmission which are produced primarily for reception outside Hong Kong but which do not contribute to any advertising revenue of the licensee may deviate from the standards set out in paragraph 1 where the licensee can demonstrate that compliance is not feasible without interrupting the licensee ‘s television programme services.”

112. Hence, if such a channel is directly re-broadcast on FTA television, the CA deems it sufficient protection for viewers that (per section 2A of Chapter section 8):

“announcements, which may be in the form of superimposed text, are displayed to adequately inform viewers that advertisements may be placed within programmes. Such announcements shall be displayed for 15 seconds at the start of each programme and at regular intervals for 15 seconds once every 30 minutes”.

113. Indeed, as can be seen at paragraph 6 of Chapter 3 of the TV Advertising Code, such foreign channels may be re-broadcast in Hong Kong notwithstanding that they deviate from the general rule that advertising material should be clearly identifiable as an advertisement. Distinctions must be maintained between advertisements and programmes.

114. TVB emphasizes that, as a matter of fact, foreign content is very frequently re‑broadcast in Hong Kong with product placement.

115. Mr McCoy therefore submits that the above different treatment of foreign content is important in the context of necessity and proportionality, for at least three reasons:

(1) It is incongruous to say that pursuit of necessary public protections requires heavy-handed limitations on product placement, and yet allow the practice unfettered in various types of foreign-generated content. One is bound to ask: if such measures are not necessary to protect Hong Kong viewers when they watch foreign films or re-broadcast foreign channels, how can it credibly be said they are necessary to protect them when watching locally produced content? That such wide exceptions exist demonstrates the lack of a rational connection between the measure and its stated objective and further shows that the measure is unnecessary for the accomplishment of the legitimate aim;

(2) It is very difficult to see how it could be maintained that the Hong Kong viewing public is somehow more susceptible to, or in need of protection from, placement advertising and programme sponsorship. Even allowing for the inevitable margin of regulatory difference between jurisdictions, there is no basis in fact for suggesting that viewers here require some additional protections that their overseas peers do not; and

(3) The policy is disproportionate because, whatever else it achieves, it results in discrimination against local content producers in favour of foreign-made content. FTA broadcasters rely heavily on advertising revenue in order to generate high quality local content. The heavy‑handed approach of the CA towards product placement and sponsorship cripples licensees’ ability to compete with overseas content, and to produce the highest quality local programming, which the viewing public is entitled to expect. In this connection, section 4(4) of the CAO sets out certain matters which the CA is to take into account in the discharge of its functions:

“(4) Without limiting any other matters to which the Authority may have regard, in performing its functions, the Authority must have regard to such of the following as appear to it to be relevant in the circumstances—

(a) the fostering of an environment that supports a vibrant communications sector to enhance Hong Kong’s position as a communications hub in the region;

(b) the encouragement of innovation and investment in the communications market;

(c) the promotion of competition and adoption of best practices in the communications market for the benefit of the industry and consumers; and

(d) acting in a manner consistent with the provisions of the Hong Kong Bill of Rights Ordinance (Cap 383).”

116. With respect, I am also not persuaded by these submissions.

117. In terms of rational connection, with the clear meaning of paragraph 1 of Chapter 11 of the TV Programme Code and the meaning of the Criteria understood as above, plainly, these restrictions are connected to the aims of protecting consumer interests and viewing pleasure.

118. The distinction drawn between locally-made content and foreign acquired content to say that there is no rational connection between the Relevant Paragraphs and the legitimate aims is more apparent than real. It ignores the fact that, as expressly provided in those relevant provisions, the existing exceptions for foreign acquired content are justified by the lack of editorial control of the licensee over such content and are only devised to address the practical difficulty in editing foreign content. As highlighted by Mr Chan, the exceptions allowed are limited in scope to reflect these practical difficulties. Hence:

(1) Acquired foreign programmes are subject to the same rules governing indirect advertising, product and service sponsorship, as other locally produced programmes. The exception is that in paragraph 20 of Chapter 9 of the TV Advertising Code, which provides that:

“Films made for the cinema and acquired programmes covering sporting and other events taking place outside Hong Kong may deviate from the standards in this chapter only when it is unavoidable.” (emphasis added)

(2) The exception only applies to specified categories of programmes and permits deviation when it is “unavoidable”, which is a high threshold to meet. Furthermore, the exception is in place because, as a matter of practicality, licensees do not have control over advertising material in certain programmes. For instance, licensees cannot control or edit shots of advertising on a football player’s clothing[25].

(3) As for the direct re-transmission of TV channels produced primarily for reception outside Hong Kong, but which do not contribute to any advertising revenue of the licensee (as permitted under paragraph 2 of Chapter 8 of the TV Advertising Code)[26]. Again there are only limited exceptions. For instance, they may deviate from the standards in Chapter 9 of the TV Advertising Code “only when the licensee can demonstrate that this is unavoidable” (see paragraph 20A of Chapter 9 of the TV Advertising Code).

(4) It is clear that such exceptions for foreign content, which are put in place for practical reasons unique to foreign content, simply cannot diminish the clear rational connection between Chapter 11 of the TV Programme Code and Chapter 9 of the TV Advertising Code and the legitimate aim of protecting the rights of the audience as consumers and as the viewing public.

119. TVB has urged the court to adopt a stringent scrutiny in assessing whether it is proportional for the measure in Paragraph 10(a) to achieve the legitimate aims. This is so as it relates to infringement of a fundamental right not by legislations enacted by a legislature with a democratic mandate[27].

120. In this respect, Mr Chan has rightly reminded the court that in considering the proportionality of the restriction imposed by a regulatory regime on television broadcast, it is necessary to bear in mind its unique nature and the special duties and responsibilities imposed on a television broadcaster. This is particularly so in the context of FTA broadcast given its pervasiveness.

121. Hence, in considering the proportionality of the restriction imposed by a regulatory regime on television broadcasting, it is necessary to bear in mind its unique nature and the special duties and responsibilities imposed on a television broadcaster. Article 10(1) of the ECHR expressly states that the protection of the right to freedom of expression does not prevent States from requiring the licensing of broadcasting, television or cinema enterprise. While this provision does not give the States a carte blanche power to regulate broadcasting and television, it does acknowledge that the limited resources of television spectrum and frequencies and the penetration of television broadcasting requires regulation in a way distinct from other sectors of the media.

122. Indeed, BOR16(3) refers to “special duties and responsibilities” in the exercise of the right to freedom of expression, a unique phrase in the restriction clauses in the BOR. This clause is an acknowledgement of the powerful influence of the media, which calls for special duties and responsibilities to come with such power. This is particularly pertinent when FTA TV service is involved, given its high household penetration rate in Hong Kong. As explained by Manfred Nowak, this statement was intended to “offer States parties an express tool to counter abuse of power by the modern mass media” and to “reinforc[e] the obligation of States to ensure that interference did not take place at the horizontal level”[28]. The object of this statement was indeed the mass media, as the travaux preparatoires demonstrate:

“Those supporting [this statement] were of the opinion that freedom of expression was a precious heritage as well as a dangerous instrument, and they maintained that, in view of the powerful influence the modern media of expression exerted upon the minds of men and upon national and international affairs, the ‘duties and responsibilities’ in the exercise of the right to freedom of expression should be especially emphasized.”[29]

123. Further, it has been held that less justification is required for restrictions on the right to freedom of speech where only commercial speech is at stake. In other words, such restrictions are more easily justifiable than restrictions on more serious aspects of speech, such as political speech:

(1) As a general proposition, where commercial gain is involved, less justification is required for restrictions than would otherwise be the case where more serious aspects of the freedom of expression were at stake: Kwok Hay Kwong v Medical Council of Hong Kong [2008] 3 HKLRD 524, at paragraphs 30 - 31 (per Ma CJHC, as he then was): Chen Hei Ling Helen v Medical Council of Hong Kong [2009] 4 HKLRD 174 at paragraphs 56 ‑ 57 (per Le Pichon JA); Medical Council of Hong Kong v Helen Chan (2010) 13 HKCFAR 248, at paragraph 75 (per Bokhary PJ (as he then was)).

(2) The proportionality test does not require that the least possible intrusive means of attaining the objective be searched out and adopted as long as it is “from the range of means which impairs [the right] as little as is reasonably possible”: Chen Hei Lin Helen v Medical Council of Hong Kong [2009] 4 HKLRD 174 at paragraph 51 (per Le Pichon JA).

(3) While commercial speech such as advertisement does serve an important public interest by enhancing the ability of consumers to make informed choices, it is necessary to consider the context of the advertising: Rocket v Royal College of Dental Surgeons [1990] 2 SCR 232 at 246i ‑ 248e (per McLachlin J, as she then was).

(4) Thus, there would not appear to be any discernible advantage to the public in receiving advertising material about a brand from a doctor when each brand may encompass a wide range of products of different nature and when the advantages and disadvantages of a brand may differ from product to product: Chen Hei Ling Helen v Medical Council of Hong Kong [2009] 4 HKLRD 174 at paragraph 57 (per Le Pichon JA).

(5) In the regulation of commercial advertising, a substantial latitude should be given to legislation that acts to protect a vulnerable group, or to mediate between competing groups, distinguishing this type of legislation from that in which the state appears as antagonist to the individual (such as traditional criminal law): Rocket v Royal College of Dental Surgeons [1990] 2 SCR 232 at 246i ‑ 248e (per McLachlin J, as she then was). A broad “margin of appreciation is essential in an area as fluctuating as that of commercial broadcasting”: Demuth v Switzerland (2004) 38 EHRR 20 at paragraphs 40 - 42, cited with approval in Hong Kong Television Network Ltd, supra, at paragraph 102 per Cheung CJHC (although in that case the issue of applying a less stringent standard does not arise because only partial commercial speech is involved). See also Mouvement Raelien Suisse v Switzerland (2013) 56 EHRR 14 at paragraph 61.

124. Bearing these approaches in mind, whether the restrictions imposed under Relevant Paragraphs are proportionate to achieve the legitimate aims of protection of consumers and the viewing public must be considered against the following contexts:

(1) The starting point is that under BOR16(3) there are “special duties and responsibilities” attached to the exercise of the right to freedom of speech. As such, the right may be restricted insofar as it is necessary to protect the rights and freedom of others.

(2) In light of the high household penetration rate of FTA TV service (almost 100%), a holder of a FTA Licence is clearly subject to “special duties and responsibilities” which are set out in the licence conditions. In particular, it has to exercise its editorial judgment in a way that complies with the spirit, purpose and requirements of the Codes in order to entertain, inform and educate the viewing public.

(3) The restriction in question specifies the way in which a FTA Licence holder may include sponsored product or service in part of its programmes in return for advertising revenue. The Relevant Paragraphs do not impose any prohibition on product or service sponsorship. The court has to balance, on the one hand, the exercise of a right to express commercial speech for gain, and on the other, the strong public interest of consumer protection and safeguarding viewing pleasure.

125. Once so considered, and affording a margin of appreciation to the CA, I accept Mr Chan’s submissions it is clear that the restrictions are proportionate measures:

(1) The restrictions are limited in scope. The CA does not pre‑censor TV programme content, and the Relevant Paragraphs do not impose any blanket ban on product/service sponsorship. Nor do they affect TVB ‘s right to put on advertising material. Indeed, the Relevant Paragraphs do permit indirect advertising, so long as they comply with the requirements, namely the exposure or use of sponsored product or service should be “editorially justified”, and should not be “gratuitous” and “obtrusive to viewing interest”. In short, they only impose restrictions on the manner and form and not the content, of advertising[30].

(2) There is only a limited value of the speech being restricted. There is a need to scrutinise the kind of commercial speech at stake here, bearing in mind the interest of enabling consumers to make informed choices. Products or service sponsorship mingled with or embedded in television programme, given its very nature, may affect consumer choices. In the present case involving the subject segments of programmes, there did not appear to be any discernible advantage to the public in receiving advertising material about a fast food chain (KFC) or an OTT service (myTV SUPER) in the particular manner of indirect advertising. Little information was provided in the KFC Segment to enable consumers to make an informed choice, and the manner in which the information was presented in the Subject Scoop Episodes may lack balance, objectivity, and impartiality: Chen Hei Lin Helen v Medical Council of Hong Kong [2009] 4 HKLRD 174 at paragraph 57 by Le Pichon JA.

(3) There is overwhelming public interest to protect consumers and viewing interests. The right to make informed choices free from subliminal influences, as well as the right of the viewing public to enjoy quality entertainment programmes, are of paramount importance, particularly when compared to the relatively limited value of the commercial speech at stake. In this regard, (a) the CA, under the Codes, has the duty to secure proper standards of television programming and to have regard to consumer interests, whereas (b) TVB, under its FTA Licence conditions, has the duty to entertain, inform and educate, and provide programme content that is balanced and comprehensive having regard to the needs of the community. The special duties and responsibilities of TVB, particularly given the pervasiveness and influence of its Free TV service, to protect the interests of consumers and viewers should be given great weight in the proportionality exercise.

(4) Owing to the differences in culture, social values and boarding landscape, overseas experience has to be considered in context and with caution. Rules governing product or service sponsorship should not be considered in isolation, but they have to be considered holistically in light of the regulatory regime. For instance, in Korea and in the Mainland, advertising breaks within certain types of programmes including dramas are not allowed whereas in Taiwan, advertising breaks are permitted only when the programmes last for 30 minutes or more.

126. For all these reasons, I agree that the restrictions imposed under the Relevant Paragraphs also satisfy the proportionality test.

127. TVB then further submits that the Relevant Paragraphs are ultra vires. The arguments as advanced by Mr Parker can be summarized as follows.

128. First, counsel says the CA has the power to issue a Code of Practice under section 3(1) of the BO, which relevantly provides as follows:

“3. Approval of codes of practice by Authority

(1) Subject to subsection (8), for the purpose of providing practical guidance for licensees in respect of any requirements under this Ordinance imposed on licensees or in respect of licence conditions, the Authority may—

(a) approve and issue such codes of practice (whether prepared by it or not) as in its opinion are suitable for that purpose; and

(b) approve such codes of practice issued or proposed to be issued otherwise than by it as in its opinion are suitable for that purpose.

(2) Where a code of practice is approved under subsection (1), the Authority shall, by notice in the Gazette—

(a) identify the code concerned and specify the date on which its approval is to take effect; and

(b) specify for which of the requirements under this Ordinance or licence conditions the code is so approved.

…”

129. Hence, under section 3(1), the CA can only issue a Code of Practice which is (a) in respect of any requirements that are (b) imposed under the BO, or (c) in respect of licence conditions.

130. However, the Relevant Paragraphs are not in relation to any requirements imposed under the BO, nor are they related to licence conditions. In the premises, the CA does not have the statutory power to issue the same. They are therefore ultra vires.

131. I am unable to accept the contention.

132. As submitted by the CA, the Codes are issued under section 9(1)(d) of the BMPO, which provides the CA shall have the functions:

“to secure proper standards of television and sound broadcasting with regard to both programme content (including advertisements) and technical performance of broadcasts including, without limitation, restrictions on the time of day when programmes and advertisements may be provided, whether for the same or different licensees or broadcasts”.

133. The CA further submits that section 3(1) of the BO provides that that CA may approve the issue of Code of Practice “in respect of any requirements ... in respect of licence conditions”. In this respect, the applicability of the BMPO is part of the conditions of TVB’s FTA Licence:

(1) Condition 2.2 of the FTA Licence (under the heading “Terms of Licence”) provides:

“This Licence is renewed subject to:

(a) the provisions from time to time in force of the Broadcasting Ordinance, the Telecommunications Ordinance, the Communications Authority Ordinance (Cap.616), the Broadcasting (Miscellaneous Provisions) Ordinance (Cap.391) and, including without limitation, any other Ordinance, and any Ordinance enacted in place or substitution in whole or in part thereof and all subsidiary legislation, regulations, technical standards, directions and codes of practice made thereunder:

(b) the terms and conditions set out in this Licence and as any of them may be amended from time to time; and

(c) the performance and observance of the several terms and conditions contained in the licence from time to time in force before the period of validity (‘the Previous Licence and on the Licensee’s part to be performed and observed, and of the provisions from time to time in force of the Broadcasting Ordinance, the Telecommunications Ordinance, the Communications Authority Ordinance, the Broadcasting (Miscellaneous Provisions) Ordinance, and any Ordinance enacted in place or substitution in whole or in part thereof and all subsidiary legislation, regulations, technical standards, directions and codes of practice made thereunder during the term ofthe Previous Licence.” (emphasis added)

(2) Further, Condition 12 of the FTA Licence provides that:

“The Licensee shall ensure that the officers, employees and associates of the Licensee, and any other person acting for or on behalf of the Licensee, shall not act or permit any contravention of:

(a) any provision of the Broadcasting Ordinance, the Telecommunications Ordinance, the Communications Authority Ordinance or the Broadcasting (Miscellaneous Provisions) Ordinance;

(b) any provision of any Code of Practice; or

(c) any condition of this Licence,

and shall not be relieved from any liability notwithstanding that the contravention is due to the act or omission of the officers, employees or associates of the Licensee or any other person acting for or on behalf of the Licensee.” (emphasis added)

134. In short, TVB’s FTA Licence is subject to the provisions in the BMPO. Under section 9(1)(d) of the BMPO, the CA is clearly entitled to “secure proper standards of television and sound broadcasting with regard to both programme content (including advertisements) and technical performance of broadcasts”. This brings the CA’s power to issue the Codes within the “in respect of licence conditions” limb in section 3(1) of the BO.

135. Mr Parker however submits that the reliance on Conditions 2.2 and 12 of the FTA Licence is impermissible. This is so as if section 3(1) of the BO has expressly provided that the CA has power to issue a Code of Practice in relation to a requirement imposed under the BO itself, it must be read objectively to mean that it excludes any reference to other ordinances to enable the CA to issue a code. The CA cannot get around it by way of the back door through a condition in the licence.

136. I do not agree. Section 3 does not provide that the CA can issue a Code of Practice only under a requirement imposed under the BO. Further, it has instead expressly provided that the CA can issue a Code of Practice in respect of requirements under licence conditions. It cannot be read to be objectively intended to exclude any references to other ordinances which have been set out under any licence conditions.

137. Further, Mr Parker has drawn the court’s attention to the Gazette Notice[31] which published the approval of the revisions of Chapter 11 of the TV Programme Code and Chapters 2 and 9 of the TV Advertising Code by the CA’s predecessor. Counsel has pointed out that it only made a specific reference that the Notice was issued pursuant to section 3(2) of the BO, and a reference to section 23(2)(e) of the BO[32], without any reference to the BMPO[33]. This shows that the Codes (or at the least the Chapters which the Relevant Paragraphs are found) have nothing to do with the BMPO.

138. With respect, there is nothing in this submission. Section 3(2) of the BO relates to an issue of a Code of Practice under section 3(1) which, as explained above, gives power to the CA to issue and approve a Code of Practice in respect of licence conditions.

139. I therefore find no merit in this contention.

140. Mr Parker then secondly contends that the Relevant Paragraphs are ultra vires as the CA is not authorised under section 3(1) of the BO to issue a Code of Practice that restricts fundamental rights. Mr Parker’s submissions can be summarized as follows.

141. The principle of legality requires that legislation will not be interpreted as restricting fundamental rights at all unless it has provided for that in express words, or by necessary implication. In this respect, Mr Parker has drawn the court’s attention to section 23(1) of the BO which bans the broadcasting of subliminal messages, and sections 11 and 12 of its Schedule 4 which place restrictions on FTA TV advertising. Hence, the legislature does use express words in the BO to give power to the CA to restrict certain rights if it so intends.

142. There are however no express provisions under the BO, including section 3(1), or licensing conditions which provide for the CA to issue Code of Practice that would restrict fundamental rights. The CA therefore cannot issue Code of Practice which seek to restrict such rights in the absence of clear and express words in the enabling statute allowing it to do so.

143. I am similarly not convinced.

144. Sections 4(1), (2) and (4)(d) of the CAO provide relevantly as follows:

“4. Functions of Authority

(1) The Authority has all the functions conferred on it by or under the Broadcasting (Miscellaneous Provisions) Ordinance (Cap. 391).

(1A) …

(2) All functions conferred on the Telecommunications Authority by or under the Telecommunications Ordinance (Cap. 106), the Broadcasting Ordinance (Cap. 562), the Unsolicited Electronic Messages Ordinance (Cap. 593) or any other Ordinance as they were in force immediately before the commencement date and not inconsistent with this Ordinance are conferred on the Authority.

…

(4) Without limiting any other matters to which the Authority may have regard, in performing its functions, the Authority must have regard to such of the following as appear to it to be relevant in the circumstances—

…

(d) acting in a manner consistent with the provisions of the Hong Kong Bill of Rights Ordinance (Cap. 383).”

145. These provisions therefore provide and empower the CA to perform all the functions conferred to it under the BO and the BMPO, so long as it acts consistently with the provisions of the BOR. In this respect, BOR16 provides for the circumstances when the right to freedom of expression can be restricted.

146. In the premises, the CA has the statutory authority to issue the Relevant Paragraphs so long as it acts consistently with BOR16. I have for the above reasons already concluded that the Relevant Paragraphs are BOR16 compliant.

147. For all these reasons, I also reject the ultra vires arguments.

148. In the premises, the Relevant Paragraphs are BOR16, BL27 and BL39 compliant and not ultra vires. Ground 2 therefore fails.

C2. Ground 3

149. Under this ground, TVB submits that the CA erred in law in finding that the KFC Segment and Subject Scoop Segments constituted indirect advertising within the meaning of paragraph 1 of Chapter 11 of the TV Programme Code. TVB contends that paragraph 1 of Chapter 11 was not triggered and not breached, and instead it was Paragraph 10(a) which was engaged, and any breach must be found under it.

150. This is so, says TVB, as paragraph 1 of Chapter 11 of the TV Programme Code effectively outlaw all forms of product placement and programme sponsorship. On the other hand, paragraph 3 of the same Chapter provides that instances of product or programme sponsorship will be governed by paragraph 10 of Chapter 9 of the TV Advertising Code. Hence, the subject matter of the complaints relating to the KFC Case and the Scoop Case should only come to be determined within paragraph 10 of Chapter 9 of the TV Advertising Code but not paragraph 1 of Chapter 11 of the TV Programme Code.

151. The underlying plank of these contentions is effectively TVB’s submission that paragraph 1 of Chapter 11 of the TV Programme Code and Paragraph 10(a) on a proper construction are mutually exclusive and thus it could not be found to be in breach of both by the CA.

152. In its written reply, TVB has sought to further underline the conceptual inconsistency between these two provisions by saying it is impossible to reconcile the dichotomy between (a) on the one hand allowing product placement, where the whole point is to draw the sponsored product to the attention of the viewers, and (b) on the other hand seeking to so called protect viewing pleasure by permitting “flash exposures” of the product.

153. This is the same argument which I have considered above at [89] - [90], and for the same reasons, I would also reject it. In this respect, the two provisions are there precisely to strike a balance between the recognised need to allow a licensee to air advertisement to generate revenues and at the same time protect as practically as possible viewing pleasure. There is no irreconcilable dichotomy as submitted by TVB.

154. Ground 3 therefore also fails.

C3. Scoop Ground 4

155. This ground can be dealt with quickly.

156. Under this ground, TVB submits that the Scoop Final Decision is tainted with an error of law, as the references to myTV SUPER in the Subject Scoop Episodes do not amount to “advertisement” or “advertising materials” under the Codes as it is excluded under paragraph 2 of Chapter 2 of the TV Advertising Code.

157. Paragraph 2 of Chapter 2 of the TV Advertising Code provides relevantly as follows:

“2. For the purpose of this Code the term advertisement or advertising material does not include:

(a) station/channel/programme service identifications;

…

(c) material for the promotion of the licensee’s station and/or programme services”

158. TVB submits that, notwithstanding that myTV SUPER is owned by TVB.com Ltd:

(1) The promotion of myTV SUPER was a promotion for the same station of TVB; or

(2) The programme service promoted constituted the “licensee’s programme services”.

159. In support, TVB emphasizes that (a) myTV SUPER has five channels which are also shown on TVB’s FTA TV service, (b) TVB.com Ltd is wholly owned and controlled by TVB, and (c) the two share the same brand and logo.

160. In the circumstances, TVB further says in coming to the Scoop Final Decision, the CA:

(1) Failed to recognise that the restraint on free speech and expression under the Codes should be interpreted narrowly and strictly, and the exceptions to the restriction given a large, liberal and generous construction;

(2) Imported a requirement which is not stated in the provision itself, namely that the exception applies only to the licensee’s FTA service;

(3) Thought, further, (and again without basis), that the promoted service had to be “integral” to the FTA service; and

(4) Erred in placing any (alternatively undue) weight on the fact that TVB had incorporated myTV SUPER under a wholly‑owned subsidiary.

161. The contention is without merit.

162. First, the following facts show that myTV SUPER and TVB are clearly different entities for the purpose of FTA TV service regulations[34]:

(1) myTV SUPER is a service provided by TVB.com, which is not TVB. Although TVB.com is a wholly owned subsidiary of TVB, it is a third party and separate legal entity.

(2) TVB.com is not a licensee under, and not regulated by the CA pursuant to, the BO.

(3) myTV SUPER is an OTT service which is available to viewers upon payment of a subscription fee. In other words, unlike TVB, myTV SUPER does not offer a FTA TV service like TVB. Instead, myTV SUPER delivers contents through a media box connected to monitors or through smart phone or tablet applications.

(4) There are 52 different channels offered by the myTV SUPER OTT service. While five of those channels show content broadcast on TVB’s FTA TV service, the remaining 47 channels are not available on TVB’s FTA TV service.

163. In the premises, in light of these facts, TVB’s reliance on paragraph 2(a) of Chapter 2 of the TV Advertising Code is clearly misplaced. That sub-paragraph, which is clearly excepted from the definition of advertising material, concerns the “identification” of a station, channel or programme service. This will include, for example, occasional segments in a TV broadcast telling viewers which station or channel they are watching, segments telling viewers which programme will be broadcast next, the station or channel logo that constantly appears at the top right-hand corner of the TV screen, and the programme name that sometimes appears at the top left-hand corner of the TV screen. Their function is to inform viewers which station, channel or programme they are (or will be) watching. The meaning of paragraph 2(a) is made even clearer by the Chinese version of the TV Advertising Code, which uses the words “識別訊號片” (informally translated as “identification signal footage”). Clearly, the Subject Scoop Segment promoting myTV SUPER’s products and services are not for such an identification purpose.

164. Second, in relation to TVB’s reliance on paragraph 2(c) of Chapter 2 of the TV Advertising Code, it principal contention is that myTV SUPER’s OTT service should be equated with or included as part of “the licensee’s [ie, TVB’s] station”.

165. However, as mentioned above, myTV SUPER is provided by a separate third party company, not a FTA broadcaster and not a licensee of any kind under the BO, and that it provides a lot of channels and programmes which are not available on TVB’s FTA service.

166. Moreover, the CA has made it clear in the Scoop Final Decision that the materials which are said to have breached Paragraph 10(a) relate to the promotion of myTV SUPER’s user interface and functions as a provider of OTT media, but not the promotion of TVB’s channels and programmes[35].

167. With these fundamental differences between myTV SUPER and TVB, it is clearly right for the CA to conclude that myTV SUPER’s OTT service is not provided by TVB (but by a third party non‑licensee called TVB.com) and does not form part of its FTA TV service. The promotion of myTV SUPER by TVB is thus not promotion of the licensee’s station, but of a service provided by another organisation.

168. I therefore also dismiss Scoop Ground 4.

C4. KFC Ground 4 and Scoop Ground 5

169. These two grounds are advanced together by Mr McCoy.

170. Under these grounds, TVB first says the decisions reached in relation to the KFC Case and the Scoop Case are irrational. It further says the decisions are in any event not supported by adequate reasons.

171. I will deal with these arguments in turn.

C4.1 The Decisions are irrational or Wednesbury unreasonable

172. TVB has advanced two arguments under this complaint.

173. First, TVB says in the KFC Final Decision and the Scoop Final Decision, the CA found that TVB was in breach of both paragraph 1 of Chapter 11 of the TV Programme Code and Paragraph 10(a) (ie, the Relevant Paragraphs”). The conclusions are however internally inconsistent. This argument is again premised on TVB’s earlier contentions as summarized at [151] - [152] above that these two provisions are internally inconsistent and pulling towards different directions.

174. For the same reasons given at [153] above, I will reject this argument. The decisions that TVB was in breach of both paragraphs only mean that TVB fell foul of paragraph 1 of Chapter 11 of the TV Programme Code and (and also as) it did not come within the exception provided under Paragraph 10(a). There is no inconsistency in these conclusions.

175. Second, TVB says the Decisions also sit obviously inconsistently with the CA’s earlier other decisions in finding no breach[36].

176. To illustrate the inconsistent findings, TVB relies heavily and principally on the CA’s decision made in relation to what is conveniently called the “Pizza Hut Case”. In gist, in the Pizza Hut Case, the CA received complaints about TVB placing advertisement or advertising material relating to Pizza Hut within its programme of the 48^th Anniversary Gala broadcast on 19 November 2015. The material facts of the Pizza Hut Case now relied on by TVB are as follows.

177. On 6 April 2016, the CA wrote to inform TVB that it had received one complaint in relation to its 48^th Anniversary Gala, which had been broadcast six months earlier, on 19 November 2015 (Jade Channel, 20:00 ‑ 22:30) (“the TVB 48^th Anniversary Gala”).

178. During a segment of the TVB 48^th Anniversary Gala, a courtroom skit had been performed involving the delivery of pizza in a box marked with the “Pizza Hut” logo to a “judge”. The “judge” held up the open box of pizza, smelt the pizza and explained “咁大咁靚嘅pizza，好香喎，我好冧喎” (which translates approximately as: “the pizza is so big and nice, it smells so good, I love it very much”). The pizza was shared around with other artistes, playing as jurors, who in turn cheered and applauded. Medium shots again showed the branded Pizza Hut boxes, the exposure of which lasted approximately 30 seconds.

179. The CA further stated in its letter of 6 April 2016 that it was considering whether the show had contravened Paragraph 10(a) and / or paragraph 1 of Chapter 11 of the TV Programme Code, ie, the very same provisions found to be breached in the KFC Final Decision.

180. TVB responded to the complaint on 14 April 2016.

181. On 24 May 2016, the CA informed TVB that it had concluded that the complaint was unjustified and that no further action was to be taken against the TVB (“the Pizza Hut Decision”). In coming to that decision, the CA considered, inter alia, that the TVB 48^th Anniversary Gala was a live show and in view of the comical nature of the skit, the portrayal of court officers bringing out the pizza and the jurors eating pizza in court was not unacceptable; and that the judge making complimentary remarks of the pizza was brief and general, and was not unacceptable in the context of slapstick comedy.

182. It is TVB’s contention that the facts and materials relating to the KFC Case are clearly similar to that of the Pizza Hut Case, and yet the CA had reached an exact opposite conclusion. In particular, TVB emphasized that in the Pizza Hut Case, the actual length and duration of showing the “products” in the programme is longer than that in the KFC Case. This further shows that the CA is acting arbitrarily and subjectively in reaching the KFC Final Decision.

183. I am not persuaded by these submissions.

184. First, it is obvious that each case turns on its own facts and circumstances. Given the meaning of the Criteria under Paragraph 10(a) as explained above, as rightly submitted by Mr Chan, it is open to the CA to consider the facts of each case to see if the Criteria are satisfied by reference to the non-exhaustive factors such as (a) the nature and context of the individual programmes under complaint, (b) the forms, extent and prominence of the exposure and use of the products or services within each programme, and (c) the length of time of the exposure, to determine whether such exposure or use was clearly justified editorially, not obtrusive to viewing pleasure, and not gratuitous.

185. As such, I agree that it is unhelpful for TVB to forensically compare a selection of 20 previous decisions (out of 874 separate cases relating to indirect advertising) handled by the CA[37]. In the premises, TVB’s general reference to the fact that the CA has had made different conclusions relating to various complaints about indirect advertising over the years for different programmes per se does not even start to support a case of irrationality vis-a-vis the KFC Final Decision and the Scoop Final Decision.

186. Second, even in relation to the Pizza Hut Case, as explained by the CA, it has the following basis to distinguish it from the KFC Case[38]:

(1) The context of the “TVB 48^th Anniversary Gala” (that the Pizza Hut Decision is concerned with) was a live anniversary gala comprising singing, dancing, games and skits.

(2) The exposure of the sponsored products from Pizza Hut were made in the course of a slapstick drama of comical nature.

(3) The use of the sponsor’s products fitted in with the comical nature of the slapstick drama, in which the judge and juror characters passed the pizzas around and ate them in a court room.

(4) The exposure of the sponsor’s products was brief and incidental. The Pizza Hut brand was only briefly discernible in some incidental medium and distant shots.

187. By contrast, in “TV Awards Presentation 2015” (that the KFC Final Decision is concerned with), there was a sharp contrast between the dressed-up artistes (in formal dress) and their consumption of fried chicken by hand (without a table or even utensils) in the context of the award presentation ceremony. There were also complimentary remarks made by the host on the food, and continuous and gratuitous medium to close-up shots focusing on the brand logo of the sponsor on the food boxes.

188. In my view, given the various factors I mentioned at [184] above, in determining whether the Criteria under Paragraph 10(a) are satisfied in the Pizza Hut Case and the KFC Case, it is entirely open and reasonable for the CA to look at and take into account these differences between the two cases, in particular the incidental and brief nature of the exposure of the Pizza Hut logo in the former but the focused and extended close-up exposure of the KFC logo in the latter, in arriving at the respective conclusions. In other words, after taking these matters into account, it is not Wednesbury unreasonable or irrational for the CA to reach different conclusions in the Pizza Hut Decision (in finding no breach of Paragraph 10(a)) and the KFC Final Decision (in finding a breach)[39].

189. In relation to the Scoop Final Decision, TVB submits that it is also irrational as the CA had on the one hand concluded that some of the episodes complained of were found not be in breach of the Codes for indirect advertising, while the other two (ie, the Subject Scoop Episodes) were found to be so, when there were references to myTV SUPER services in all of these episodes.

190. Again, I agree with Mr Chan’s following submissions that TVB’s complaint that the Scoop Final Decision consists of rationally irreconcilable inculpatory and exculpatory aspects is without merits:

(1) As regards the exculpatory finding in Section (B) paragraph (b) of the Scoop Provisional Decision, it is clear that the shots of myTV SUPER products were brief. The logo of myTV SUPER was only shown on the upper corner of the TV screen or the upper side of the mobile phone demonstrating the myTV SUPER mobile app. There were no verbal references to myTV SUPER. Considering the infotainment nature of “Scoop”, the CA concluded that the segment did not breach the Codes.

(2) As regards the exculpatory finding in Section (B) paragraph (d) of the Scoop Provisional Decision, the CA considered that the main point of the segment was to cover instances of a variety show, which was often found in showbiz news items in entertainment programmes. Further, the references to myTV SUPER were only brief and occasionally shown on the backdrop. No verbal references were made to myTV SUPER.

(3) As regards the exculpatory finding in Section (B) paragraph (e) of the Scoop Provisional Decision: once again, shots of the logos of the sponsors (3HK and/or 3Home Broadband) and myTV SUPER in the backdrop or in the sponsor’s shops were only brief. There were no mentions of the names of myTV SUPER or of the sponsors. Further, the brief coverage of the distribution of free data SIM cards to the public with the sponsor identified, was contextually justified in light of the infotainment nature of “Scoop”.

(4) As regards the exculpatory finding in Section (B) paragraph (g) of the Scoop Provisional Decision, the CA found that this is similar to the publicity event at Section (B) paragraph (e) above. The references to myTV SUPER were brief and only in the backdrop. Further, no verbal references were made to myTV SUPER.

(5) Finally, as regards the exculpatory finding in Section (B) paragraph (h) of the Scoop Provisional Decision, the television programme “Extra” is an entertainment programme featuring showbiz gossip. Notwithstanding that there was one verbal reference to the name of myTV SUPER and remarks made by two artistes on the expected services of myTV SUPER during their interview, the nature of the segment on showbiz as a whole was justified in the context of “Extra”.

191. I therefore reject the irrationality complaints made under these grounds.

C4.2 Lack of adequate reasons arguments

192. The general principles concerning a reasons challenge are not controversial. Relevantly, what will amount to adequate reasons will depend upon the context and circumstances: Oriental Daily Publisher Ltd v Commissioner for Television and Entertainment Licensing Authority (1997-1998) 1 HKCFAR 279 at paragraph 39. The reasons given should show that the tribunal has address the substantial issues before it and show why it has come to its decision: ibid at paragraph 42.

193. Further, the expected standards of reasons are also set out at paragraph 30 of Smart Gain Investment v Town Planning Board (HCAL 12/2006 and 12/2007, 6 November 2007, A Cheung J (as he then was)). In particular, it is said that decision letters can afford to be more straightforward as they are addressed to parties well aware of the issue involved and the arguments advanced:

“The reasons for a decision must be intelligible and they must be adequate. They must enable the reader to understand why the matter was decided as it was and what conclusions were reached on the ‘principal important controversial issues’, disclosing how any issue of law or fact was resolved. Reasons can be briefly stated, the degree of particularity required depending entirely on the nature of the issues falling for decision. The reasoning must not give rise to a substantial doubt as to whether the decision-maker erred in law, for example by misunderstanding some relevant policy or some other important matter or by failing to reach a rational decision on relevant grounds. But such adverse inference will not readily be drawn. The reasons need refer only to the main issues in the dispute, not to every material consideration. They should enable disappointed developers to assess their prospects of obtaining some alternative development permission, or, as the case may be, their unsuccessful opponents to understand how the policy or approach underlying the grant of permission may impact upon future such applications. Decision letters must be read in a straightforward manner, recognizing that they are addressed to parties well aware of the issues involved and the arguments advanced.” (emphasis added)

194. Bearing these principles in mind, the complaints about lack of adequate reasons in the present challenges can be said to be startling. This is so as the CA has indeed sought to provide lengthy reasons for the Decisions in the respective letters sent to TVB.

195. In the KFC provision decision dated 30 March 2016 (“the KFC Provisional Decision”), the CA has provided the following reasons in it:

“(a) The concerned programme was a livecast of TVB’s annual award presentation ceremony. The insertion of the segment showing dressed up artistes consuming fried chicken in the award presentation ceremony was gratuitous, not justified editorially and obtrusive to viewing pleasure;

(b) The female host made the complimentary remark ‘食好嘢’ twice when she referred to the food to be served to the artistes. There were continuous and gratuitous medium to close-up shots focusing on the brand logo of the sponsor on the food boxes during the course of delivering the food to the artistes. The brand logo of the sponsor was prominently and conspicuously displayed in the middle of the screen for around 10 seconds to draw viewers’ attention to the sponsor and its products. Such prominent exposure of the sponsor’s brand logo and products with the complimentary remark made by the host could not be considered incidental, brief and subtle as submitted by TVB, but constituted blatant advertising material for the sponsor;

(c) the concerned programme segment was intentionally designed and inserted into the concerned TV award presentation ceremony to cater for the exposure of the sponsor’s brand logo and products. The prominent exposure mentioned above and the complimentary remark made by the host amounted to indirect advertising for the sponsor’s products. The deliberate inclusion of such a segment in the concerned programme without any editorial need but to draw viewers’ attention to the sponsor’s brand logo and products constituted a serious breach of the provisions in the [TV Programme Code] and the [TV Advertising Code] that govern indirect advertising and product/service sponsorship;

…

(e) the CA had expressed serious concern over TVB’s repeated breaches of the provisions governing indirect advertising and product/service sponsorship, as mentioned in [previous letters] ... The CA had also repeatedly reminded TVB that indirect advertising was strictly prohibited under the [TV Programme Code] and broadcasters should comply fully with the relevant provisions in the [TV Advertising Code] in respect of product/service sponsorship, and that the CA would consider imposing heavier sanctions for any further breach of the relevant provisions having regard to, among others, the nature and severity of the breach, and the licensee’s past record of noncompliance.”

196. Further, under the heading of “Proposed Sanction”, the CA stated in the KFC Provisional Decision that:

“In view of the above and taking into account TVB’s repeated breaches of the provisions that govern indirect advertising and product/service sponsorship, the CA made the provisional decision that the complaints were justified, and a financial penalty of $150,000 should be imposed on TVB for breaching paragraph 1 of Chapter 11 of the [TV Programme Code] and paragraph 10(a) of Chapter 9 of the [TV Advertising Code].”

197. On 24 May 2016, the CA issued the KFC Final Decision. At paragraph 2 of the KFC Final Decision, the CA stated that it decided to “uphold the provisional findings as set out in its letter dated 30 March 2016”.

198. Similarly, in the Scoop Provisional Decision, the CA set out the following:

“(a) … [the CA] considered that myTV SUPER and the TVB’s free TV service were different services operated by different companies. While TVB’s free TV service is a television programme service licensed under the Broadcasting Ordinance (‘BO’) which is intended or available for reception by domestic premises free of charge in Hong Kong, myTV SUPER is an OTT service intended or available for reception on payment of a subscription and is not licensed under the BO. Although myTV SUPER’s OTT service comprises five free TV channels of TVB... and other TVB productions, it is a pay OTT service comprising a vast collection of video programmes which are not broadcast by TVB’s free TV service. The CA considered that myTV SUPER could not be considered as an integral part of TVB’s free TV service licensed under the BO...

…

(c) in the edition of ‘Scoop’ broadcast on 18 May, a female artiste in the studio mentioned the name of myTV SUPER and talked about how she downloaded the myTV SUPER mobile app on her phone, followed by shots on a mobile phone showing the icon and user interface of the myTV SUPER mobile app, and trailers of a drama. The male host also invited viewers to download the myTV SUPER mobile app in the voice-over. The CA considered that the solicitation to download the myTV SUPER mobile app in this programme segment was gratuitous and not clearly justified editorially, which was in breach of paragraph 10(a) of Chapter 9 of the [TV Advertising Code], and amounted to the mingling of programme and advertising material, which breached paragraph 1 of Chapter 11 of the [TV Programme Code];

…

(f) for the presentation of a prize to the 800, 000^th subscriber of HKBN in the edition of ‘Scoop’ broadcast on 19 April, the programme hostess made favourable remarks about myTV SUPER, viz. ‘myTV SUPER氣勢強勁，我哋同合作夥伴嘅第八十萬個用戶誕生啦’and ‘以後落嚟就可以隨時隨地煲劇，又煲節目囉喎，係咪好開心先... yeah繼續睇電視，睇節目，好多好節目’. A HKBN staff member was seen holding a placard bearing the logo of HKBN with congratulatory remarks. When the two female artistes and the concerned customer of HKBN chatted about the TV programmes they were watching, the female artiste briefly talked about the upcoming programmes that she anticipated the most. The whole segment was commercial promotional activity without inherent content in the context of an infotainment programme on showbiz news and social issues. The CA considered that the exposure of the product/service sponsors, including the hostess’ remarks mentioned above, was not clearly editorially justified, was obtrusive to viewing pleasure and gratuitous in breach of paragraph 10(a) of Chapter 9 of the [TV Advertising Code]. Members also considered that there was mingling of programme and advertising material and/or the embedding of advertising material within programme content in breach of paragraph 1 of Chapter 11 of the [TV Programme Code] ...”

199. Subsequently, the Scoop Final Decision states that it “decided to uphold the provisional findings, as set out in its letter dated 28 September 2016... that the complaints regarding the two editions of “Scoop” broadcast on 19 April 2016 and 18 May 2016 were justified and that TVB had breached paragraph 1 of Chapter 11 of the [TV Programme Code] and paragraph 10(a) of Chapter 9 of the [TV Advertising Code]”.

200. Accordingly, the Scoop Final Decision adopts the reasoning in the Scoop Provisional Decision.

201. It is thus quite apparent that the CA has sought to provide detailed reasons for the Decisions.

202. Notwithstanding these, TVB says they do not constitute adequate reasons as it says the CA has failed to explain whether (and if so how) it considered that (a) the advertising material was not recognisably separate from the programme content, (b) viewers would be confused as to whether they were watching a programme or a paid advertisement (which is said to be the underlying rationale for the rule), and (c) the advertising material was not clearly identified.

203. This is particularly so, says TVB, in light of the following representations made by TVB in response to the complaints.

204. In relation to the KFC Case, it is essentially TVB’s representations that the references and use of fried chicken in the TV Awards Presentation was a conscious editorial decision to make it funny and hilarious. This was intended to be a parody.

205. For the Scoop Case, TVB’s position is essentially that myTV SUPER is an integral part of TVB’s domestic FTA TV programme service and the references to it was a legitimate act to inform viewers of the changing television scene brought about by technological advancements. Hence, the exposure of myTV SUPER logo and verbal references to its services were not services pertaining to another licensee. In the premises, they were not editorially unjustified for an infotainment programme[40].

206. In light of these representations, TVB submits that the CA’s above-mentioned reasons are merely repeating its own assertions that there was a breach. They failed to address TVB’s representations and explain why, despite the expressly stated editorial intention to create a parody, it was still considered by the CA that the placement of the fried chicken in the TV Awards Presentation was not editorially justified, not gratuitous and not obtrusive to viewing pleasure. In other words, TVB was at a loss as to why its representations about the editorial justification behind the “plot” was not accepted.

207. In this respect, Mr McCoy has also drawn my attention to the CA’s evidence in which it says TVB did not put forward any substantial editorial justification for the KFC Segment and for the exposure of myTV SUPER in the Subject Scoop Segment, or to explain why they complied with Paragraph 10(a)[41]. Counsel says in light of TVB’s above-mentioned representations, the CA’s said position must be incorrect. This does not only show that the CA in reaching the KFC Final Decision and the Scoop Final Decision had clearly made a mistake of fact in regarding TVB having failed to put in editorial justifications or explanations, but also supports TVB’s contention that the CA had failed to properly address TVB’s representations.

208. With respect to Mr McCoy, as submitted by Mr Chan, TVB’s contentions are misplaced and missing the point.

209. Given the meaning of the Criteria as explained above, it is objectively and reasonably clear to TVB that what was required for complying with Paragraph 10(a) was editorial justification for the extended and prominent display of the KFC logo and complimentary remarks about the food in the TV Award Presentation, and the extended references to myTV SUPER’s OTT services and platform in an infotainment programme. The fact that the TV Awards Presentation was said to be intended to be funny and a parody has nothing to do with these. Put it the other way round, it has not been objectively explained or justified why it was necessary to have a prominent and extended exposure of the logo of KFC in the TV Awards Presentation for it to be funny and hilarious.

210. Similarly, in relation to the Scoop Case, once the CA had rejected TVB’s primary underlying position that myTV SUPER should be treated as the integral part of TVB’s domestic FTA TV service, the explanation for editorial justification also fell away.

211. Once understood in this way and context, the reasons given by the CA in the KFC Final Decision and the Scoop Final Decision are in my view clearly adequate to enable TVB to understand (even though it may well disagree) why it was held that it was in breach of Paragraph 10(a) for indirect advertising.

212. TVB therefore also fails on these grounds.

C5. KFC Ground 5

213. This ground relates solely to the imposition of a financial penalty of $150,000 in the KFC Final Decision.

214. Under section 28(5) of the BO, any penalty awarded must be proportionate and reasonable in relation to the failure or series of failure concerning giving rise to that penalty[42]. TVB says this penalty is disproportionate, in that it is manifestly excessive, and that the CA failed to give adequate reasons for imposing this level of penalty.

215. In substance, TVB complains that the CA has not given proper explanation for this level of penalty. Although the CA appears to have taken into account other past breaches by TVB, it has not listed or identified the cases it had taken into consideration. There was also no reference made to other precedents, whether involving TVB or not. In the premises, the penalty is not proportionate.

216. There is no merit in these complaints.

217. It is well established as a matter of law that questions of penalty are a matter for the decision-maker, and that the Court will intervene only on the ground of Wednesbury unreasonableness: see Au Yeung Kwok Hing v Attorney General CACV 205/1994 (unreported, 7 February 1995) at paragraphs 16 and 31, Lie Han Ji v Registrar of the Hong Kong Institute of Certified Public Accountants CACV 265/2009 (unreported, 9 March 2012) at paragraph 56.

218. To put the debate in proper context, it is pertinent to note that section 28(3) of the BO provides that the financial penalties imposed shall not exceed $200,000 for the first occasion on which a penalty is imposed, $400,000 for the second occasion, and $1,000,000 for any subsequent occasion on which a penalty imposed.

219. Further, it is important to note that prior to the KFC Final Decision, the CA made it clear in a press release dated 3 December 2013 that “the CA will closely monitor further cases of contravention and will consider heavier sanctions for any further breach of the relevant provisions having regard to, among others, the nature and severity of the breach, and the relevant licensee’s past record of non-compliance”[43] (emphasis added).

220. In this respect, as pointed out in the CA’s evidence, from 2010 until May 2016, TVB had indeed been previously found to have breached the relevant provisions of the Codes on 32 occasions. During this period, the CA had imposed financial penalties on six occasions in respect of breaches of provisions on indirect and product sponsorship[44].

221. At the same time, in imposing the penalty of $150,000 in the KFC Final Decision, the CA have expressly set out its reasons:

(1) Under the heading of “Proposed Sanction”, the CA stated in the KFC Provisional Decision that:

“In view of the above and taking into account TVB’s repeated breaches of the provisions that govern indirect advertising and product/service sponsorship, the CA made the provisional decision that the complaints were justified, and a financial penalty of $150,000 should be imposed on TVB for breaching paragraph 1 of Chapter 11 of the [TV Programme Code] and paragraph 10(a) of Chapter 9 of the [TV Advertising Code].”

(2) At paragraphs 12 and 13 of the KFC Final Decision as follows:

“Proposed Penalty Being Unreasonable and Disproportionate

12. TVB submitted that the proposed penalty for the present case was unreasonable and disproportionate in comparison with those for the cases of “Triumph in the Skies II” (衝上雲霄II) and “The Taste of Taipan Snowy Mooncakes Mini 2013” (大班冰皮月餅特約：大班群星添戲Fun), where the exposure of the sponsor’s brands and products was far greater and more significant. Such a comparison is not valid, as the CA considers complaints on a case by case basis according to their facts and context. The CA considers that the segment in question in the present case was intentionally designed and inserted into the concerned TV award presentation ceremony to prominently expose the sponsor’s brand logo and products to a large audience. The deliberate inclusion of such a segment in the concerned programme, without any editorial need, to draw viewers’ attention to the sponsor’s brand logo and products constituted a serious breach of the Codes. This is reflected in the level of sanction.

13. The CA has expressed serious concern over TVB’s repeated breaches of the Codes in relation to issues of indirect advertising and product placement, in particular in its letters of 3 December 2013 and 18 February 2014 to TVB concerning the cases of ‘Triumph in the Skies II’ and ‘The Taste of Taipan Snowy Mooncakes Mini 2013’. The CA has repeatedly reminded TVB that it would consider imposing heavier sanctions for any further breach of the relevant provisions of the Codes, taking into account the nature and severity of the breach, and the licensee’s past record of non-compliance. In light of the public sentiment and community attitude towards indirect advertising and product/service sponsorship in television programmes as reflected by the public complaints received by the CA, the CA also issued a press release on 3 December 2013 to express its serious concern over the increasing trend of contraventions by television broadcasters of the relevant provisions that govern the subject matters.”

222. When these reasons are understood against the background and the press release stated in [219] - [220] above, TVB clearly should have no difficulty in understanding that this level of financial penalty was imposed by reference to (a) the severity of the breach, and (b) the fact that TVB had repeatedly breached the relevant provisions of the Codes.[45] The contention that the CA failed to give adequate reasons for imposing this level of financial penalty must thus be rejected.

223. Further, the $150,000 penalty imposed is even appreciably lower than the maximum financial penalty ($200,000) that can be imposed by the CA for the first time. Bearing in mind the approach set out at [217] above, and given that TVB had in fact been previously fined for six times for its breach of the Codes for indirect advertising, in any view, this penalty cannot be regarded as beyond a reasonable range that an objective reasonable person in the position of the CA would have imposed. The complaint that it is grossly excessive to be irrational in public law sense must be rejected. I therefore also reject KFC Ground 5.

C6. Ground 1

C6.1 The contentions in summary

224. Under this ground, TVB contends that the statutory scheme under the BO which provides for the CA to make the Decisions and for an appeal from those Decisions to the CEIC does not comply with BOR10, and is thus unconstitutional.

225. BOR10 provides relevantly:

“All persons shall be equal before the courts and tribunals. In the determination of any criminal charge against him, or of his rights and obligations in a suit at law, everyone shall be entitled to a fair and public hearing by a competent, independent and impartial tribunal established by law. …”

226. TVB says the Decisions involve the determination of “rights and obligations” in a suit at law, but neither the CA nor the CEIC is an independent and impartial tribunal (and judicial review is not curative). In the premises, the scheme underlying the making of the Decision and the Appeal Proceedings are not BOR10 compliant and thus unconstitutional.

227. In support of the contentions, TVB relies heavily on the judgment of G Lam J in Television Broadcast Ltd v Communications Authority and CEIC [2016] 2 HKLRD 41 (“the TVB Competition Case”).

228. On the other hand, Mr Chan and Mr Yu both submit that, on a proper analysis, the Decisions do not involve the determination of rights and obligations in a suit of law and thus BOR10 is not even engaged. In any event, even if BOR10 is engaged, the CA as well as the CEIC are independent and impartial for the purpose of making the Decisions, and alternatively, the availability of the judicial review in the present cases offer a sufficient curative measure to make the system BOR10 complaint.

229. In light of these principal contentions between the parties, it is natural for me to first examine the primary question of whether the Decisions involve the determination of rights and obligations in a suit at law for the purpose of BOR10.

C6.2 Do the Decisions involve determination of “rights and obligations in a suit at law” under BOR10

230. In determining whether the Decisions involve determination of “rights and obligations” for the purpose of BOR10, the following applicable principles can be distilled from the wealth of authorities.

231. The words “determination of … rights and obligations in a suit at law” called for a general and generous interpretation. See Lam Siu Po v Commissioner of Police (2009) 12 HKCFAR 273 at [24] and [62] ‑ [65] per Ribeiro PJ; TVB Competition Case at [93] and the authorities cited therein.

232. The phrase “rights and obligations in a suit at law” bears the same meaning as “civil rights and obligations” under Article 6 of the ECHR (“ECHR6”). The general inquiry is whether the subject process under challenge involves determination of a serious or genuine dispute of civil right or obligation available within the domestic law of the jurisdiction. See Lam Siu Po, at [62] - [72]; TVB Competition Case at [93].

233. Whether there is a determination of civil rights, which is an autonomous concept not dependant on domestic classification, is to be determined by the nature of the rights on a case-by-case basis. In other words, BOR10 may be engaged only in relation to some, but not all, the matters dealt with by a particular administrative authority or tribunal. Lam Siu Po, [91]; General Comments No 32, Human Rights Committee, paragraph 16.

234. In determining whether “civil rights and obligations” are involved, the court applies the prominent test to see if the rights and obligations in question are essentially or predominantly private rights in nature. Schouten and Meldrum v The Netherlands (1995) 19 EHRR 432 at [49] ‑ [60]. In this exercise, the court is entitled to look at whether the outcome of the decision under challenge is directly decisive for private rights and obligations that the balance will be tilted in favour of “civil rights and obligations”. A tenuous connection or remote consequences do not suffice. See: Le Compton, Van Leuven and De Meyere v Belgium (1981) 4 EHHR 1 at [47].

235. Hence:

(1) It has been held that BOR10 (or ECHR6) is not engaged when the public dimension is predominant, notwithstanding the right in dispute has personal or pecuniary effect on the individual challenging the determination in question. See for examples: Ferranzini v Italy (2001) 34 EHRR 168 at [25] ‑ [29]; Maaouia v France (2001) 33 EHRR 42 at [38].

(2) Also, where there are features of public law and private law involved in the subject determination, the court should evaluate the relative cogency of those features and determine which is predominant. See: Feldbrugge v Netherlands (1986) 8 EHRR 425, at [26] ‑ [40]and Schouten and Meldrum, supra, at [51] - [60].

(3) Similarly, disciplinary proceedings do not ordinarily involve disputes over civil rights and obligations unless, as has been decided, the determination would directly result in rendering the right to practise at stake. See Clayton and Tomlinson¸ The Law of Human Rights, 2^nd ed, paragraph 11.344; Albert and Le Compte v Belgium (1983) 5 EHRR 533 at [25] - [26], [28]; R (Thompson) v Law Society [2004] 1 WLR 2522 at [78], [80], [84] - [86] per Clarke LJ; Mattu v University Hospitals of Coventry and Warwickshire NHS Trust [2012] EWCA Civ 641 at [52] - [53] per Stanley Burton LJ.

(4) Nor does enforcement action per se necessary give rise to a determination of civil rights and obligations. It all depends on whether the character of the right decided or affected is a civil right. See Ma Wan Farming Ltd v CEIC [1988] 1 HKLRDD 514, at 520B-521J.

236. Further, a dispute is “pecuniary” in nature is not necessary sufficient to engage BOR10. The court will still have to examine whether the “pecuniary” obligations involved are ones that existed vis-à-vis the state which are considered as belonging exclusively to the realm of public law and are accordingly not covered by the notion of “civil rights and obligations”. See Shouten and Meldrum, [50]; Pierre-Bloch v France (1988) 26 EHRR 202 [51]; Ferranzi v Italy, [25].

237. Bearing these principles and approaches in mind, I now turn to look at the parties’ submissions under this issue.

238. Mr McCoy first says that the Decisions clearly involve the determination of TVB’s civil obligations and rights, as they directly decide on the extent of TVB’s right to free expression, and that of the third party content producers and advertisers.

239. With the greatest respect, I am not convinced by this submission.

240. In relation to TVB’s and third party advertisers’ rights to freedom of expression, these rights are by their now nature public law rights, not private law rights.

241. Moreover, as pointed out by Mr Yu, the enforcement action in the regulatory framework[46] underlying the Decisions does not only concern the CA and TVB, but relates to the viewing public interest in controlling or deterring indirect advertising which affect adversely their choice as customers and their viewing pleasure. This public interest perspective would infuse the determination with a significant “public” character. See: Three Weekly Ltd v Obscene Articles Tribunal (HCAL 42/2003, 29 June 2006, J Lam J) at [94] - [101][47].

242. In this respect, a decision as to what the public interest requires is not a determination of civil rights and obligations contemplated under BOR10 (ECHR6). As observed by Lord Hoffmann in R (Alconbury Developments Ltd) v Secretary of State for the Environment, Transport and the Regions [2003] 2 AC 295 at [74]:

“74 My Lords, these basic principles are the background to the interpretation of article 6(1): ‘In the determination of his civil rights and obligations ... everyone is entitled to a fair and public hearing within a reasonable time by an independent and impartial tribunal established by law.’ Apart from authority, I would have said that a decision as to what the public interest requires is not a ‘determination’ of civil rights and obligations. It may affect civil rights and obligations but it is not, and ought not to be, a judicial act such as article 6 has in contemplation. The reason is not simply that it involves the exercise of a discretion, taking many factors into account, which does not give any person affected by the decision the right to any particular outcome. There are many such decisions made by courts (especially in family law) of which the same can be said. Such decisions may nevertheless be determinations of an individual’s civil rights (such as access to his child: compare W v United Kingdom (1987) 10 EHRR 29) and should be made by independent and impartial tribunals. But a decision as to the public interest (what I shall call for short a ‘policy decision’) is quite different from a determination of right. The administrator may have a duty, in accordance with the rule of law, to behave fairly (‘quasi-judicially’) in the decision-making procedure. But the decision itself is not a judicial or quasi-judicial act. It does not involve deciding between the rights or interests of particular persons. It is the exercise of a power delegated by the people as a whole to decide what the public interest requires.”

243. As submitted also by Mr Chan, in considering what is “clearly editorially justifiable, not obtrusive to viewing pleasure and not gratuitous”, the CA is to play the role of the guardian of public interest. The decisions involve a judgment on what the public interest requires. These are clearly decisions of a public character that is not suitable for judicial determination by an independent and impartial tribunal. These regulatory decisions are, consistent with the rule of law and constitutional propriety, best entrusted to administrators: Runa Begum v Tower Hamlets LBC [2003] 2 AC 430, at paragraphs 56 ‑ 59, per Lord Hoffmann.

244. I accept that the statutory framework of the BO as described above is clearly regulatory in nature and is intended to protect public values and interests. As highlighted by Mr Chan:

(1) The long title of the BO describes it as: “An Ordinance to license companies to provide broadcasting services, to regulate the provision of broadcasting services by licensees, and to provide for matters incidental thereto or connected therewith.” Public broadcasting is, by nature of its influences and pervasiveness, an area that is universally subject to regulation.

(2) Similarly, the Preambles to the Codes provide that: “Due to the difference in the characteristics, pervasiveness and degree of influence of the television programme services, each category of television programme service is subject to a level of control appropriate to that particular type of services... Since [Free TV services] are the most pervasive of all the four categories of television programme services, it is reasonable for the audience to expect more stringent standards for protection of minors and public morality.”

245. Further, the contents of the Codes support this conclusion. Of particular pertinence to the present case, the provisions governing indirect advertising and product and service sponsorship were crafted taking into account the public interest considerations of: (a) consumer protection to avoid a subliminal effect on the audience who may not be fully aware of the advertising element in a programme; (b) preservation of programme integrity so as to obviate the risk of the programmes being distorted to accommodate the advertising element; and (c) consumer enjoyment that viewing interest and pleasure would not be obstructed so that indirect advertising is only permitted if it is editorially justified, not obtrusive to viewing pleasure and not gratuitous[48].

246. In support of its contention, TVB has sought to rely on various materials produced by the Office of Communications (“Ofcom”), the communications regulator in the UK to support its contentions that decisions of a similar nature are to be regarded as subject to ECHR6. In particular the following materials:

(1) Ofcom, Procedures for the handling of broadcasting standards or other licence related cases: Ofcom procedures for the handling of broadcasting standards investigations, 16 December 2009 at paragraph 3.

(2) Ofcom, Sanctions in broadcast cases: A consultation on an outline procedure for sanctions in cases relating to broadcasting, at A4.7 - A4.8.

(3) The Decision of the Ofcom Content Board in The Number (UK) Ltd v David Bedford [2004] ISLR 18 at [4].

247. These materials however do not assist TVB. As pointed out by Mr Chan, these are consultative documents which have since been superseded. It is notable that the most up-to-date guidance document from Ofcom, “Procedures for investigating breaches of content standards for television and radio” dated 3 April 2017 makes no reference to the right to fair trial whatsoever. Indeed, a review by the Ofcom Content Board, which is a committee of the main Board, is considered to be sufficient to satisfy the requirement of ECHR6. In any event, a comparison with the codes of conduct in the UK without having regard to the industry structure and licensing and regulatory regime there is not helpful.

248. Once so considered against the above regulatory context, it is clear to me that the determination by way of the Decisions of TVB’s rights to freedom of expression are not a determination of “civil rights and obligations” for the purpose of BOR10.

249. Secondly, Mr McCoy submits that the Decisions can and will have the effect of affecting TVB’s contractual relationship in with its commercial advertisers, which therefore relate to its civil obligations with third parties. In particular, under section 24 of the BO, the CA can issue a direction to TVB requiring it to take such action the CA considers necessary in order for the licensee to comply with any requirements prescribed under, amongst others, the Codes. These clearly relate to TVB’s civil rights and obligations.

250. I am equally not convinced.

251. As emphasized by both Mr Yu and Mr Chan, TVB has simply provided neither particulars nor evidence to support the contentions that TVB’s contractual rights with others (whether present or future) have been affected by the Decisions. This is particularly so as, prima facie, TVB’s existing contracts with the concerned advertisers have already been performed and there is no evidence provided to support that somehow those contracts’ performance had been curtailed by reason of the Decision.

252. Further, TVB remains at full liberty to implement existing contracts or enter into future contracts to engage in indirect advertising in a manner consistent with the requirements set out in the Codes.

253. Mr McCoy’s reliance on section 24 of the BO does not assist him.

254. Leaving aside the fact that the CA did not make any such direction in the present cases and such a direction is in any event a remote and tenuous possibility, it is important to bear in mind that the CA’s decisions are made on a case by case basis and are fact specific. The CA has expressly stated that it is not bound by its previous decisions, such that there is no basis to suggest that the Decision would be applied in a general and same way in respect of all advertisements TVB may have with its product sponsors. In this respect, TVB also has not adduced any evidence to show how the Decisions may affect its future contractual relations with third parties. Cf: Mattu, supra, [52] - [53].

255. In the premises, the suggestion that the Decisions have impacted on TVB’s contractual obligations with third parties present or future is simply not supported or proved.

256. Third, TVB says the financial penalty imposed in the KFC Case is a civil debt which can be enforced and recovered by the CA by civil action. This clearly relates to a determination of TVB’s civil rights and obligations.

257. However, the fact that financial penalty under section 28 of the BO is or may be imposed and recoverable as a civil debt per se in the present cases is not sufficient to turn a “public law” issue into a private law right. As mentioned at [236] above, there can be “pecuniary” obligations vis-à-vis the state (such as taxation) which are to be considered as belonging exclusively to the realm of public law, which does not engage BOR10. Hence J Lam J (as he then was) observed in Lee Yee Shing Jacky v Board of Review [2011] 6 HKC 307 at [51]-[55] as follows:

“Article 10 of the Hong Kong Bill of Rights

51. Though Mr Dykes referred to Article 10 of the Hong Kong Bill of Rights in his written submissions, counsel candidly admitted in his oral submissions that according to European authorities tax assessment is not within the scope of Article 6 of the European Convention for the Protection of Human Rights and Fundamental Freedoms, see Ferrazzini v Italy (2002) 34 EHRR 45; Emesa Sugar NV v Netherlands (13/1/2005 ECtHR); Viktor Ketko v Ukraine (3/4/2006 ECtHR) and Impar v Lithuania (5/4/2010 ECtHR). At para. 21 of the last decision, the principle was summarized,

‘The Court has consistently held that, generally, tax disputes fall outside the scope of “civil rights and obligations” under Article 6 of the convention, despite the pecuniary effects which they necessarily produce for the taxpayer.’

52. The rationale for that was discussed at length in Ferrazzini v Italy (2002) 34 EHRR 45 paras. 20 to 31. The European Court regarded tax matters as part of the hard core of public-authority prerogatives with the public nature of the relationship between the taxpayer and the tax authority remaining predominant. Thus it falls outside the scope of civil rights and obligations.

53. Mr Dykes submitted that such rationale stemmed from the distinction in the European countries between civil law and public law. Counsel also referred to the difference in wordings between our Article 10 and their Article 6.

54. However, it has been held by Judge Cheung (as Cheung JA then was) in Commissioner of Inland Revenue v Lee Lai-ping (1993) 3 HKPLR 141 that the expression ‘rights and obligations in a suit at law’ in our Article 10 has the same meaning as the expression ‘civil rights and obligations’ in Article 6 of the European Convention. At p. 152, after considering the European jurisprudence and the submission that different interpretation should be given to our Article 10, the Court held that assessment of profit tax does not involve any determination of private right. Rather it is a matter arising out of an administrative act.

55. I respectfully agree with Judge Cheung and hold that tax matters fall outside the scope of Article 10 of our Bill of Rights. But it does not mean that the process of assessment of tax needs not be fair. As explained, the process is subject to the supervision of the court by means of judicial review and the court can intervene if the process is unfair. There is simply no need to resort to any constitutional underpinning for what I would call a traditional judicial review challenge based on unfairness in an administrative process[49]. However, if there is no unfairness in the process, Article 10 cannot provide a basis for any constitutional challenge in relation to the process of tax assessment.”

258. In my view, the financial penalty imposed in the KFC Final Decision is clearly of a regulatory nature. The purpose of the financial sanction is to ensure the compliance of the Relevant Provisions and is part and parcel of the regulatory regime. In any event, even if (which I do not agree) the financial sanction has any effect on the civil rights and obligations of TVB, such effect is at best incidental and would not turn what is predominantly and essentially a decision of a public character into a private nature one.

259. I therefore also reject TVB’s said submission.

260. Finally, Mr McCoy says the decisions of a similar nature could lead to the suspension or even revocation of TVB’s licence under sections 31 and 32 of the BO. This would clearly affect TVB’s core business rights and thus its civil rights and obligations.

261. In this respect, counsel submits that the court in determining whether the system under challenge does engage BOR10 right may consider the consequences that are “potentially” at stake in the proceedings. See: A v Finland, App No 44998/98, 8 January 2004, p 9; Maruisic v Croatia, Application No 79821/12, 15 June 2017, at [72] - [73].

262. I can dispose of this submission quickly.

263. As submitted by Mr Chan and Mr Yu, all these authorities (which are in the context of disciplinary proceedings) show that the outcome of the proceedings under challenge must be directly decisive of the potential consequence of having the right to practise to be at stake for the BOR10 right to be engaged.

264. For example, in Maruisic, the ECHR said at [74] - [76] as follows:

“74. In the case at hand the Court notes that the possible sanctions which could be imposed by the Integrity Court according to section 9 of its Rules were reprimand, public reprimand, proposal for the institution of proceedings for the adoption of a disciplinary sanction for serious breaches of work duties, and an ancillary sanction of suggesting the institution of proceedings for removal of a teacher from the position which he or she occupied in the Faculty (see paragraph 47 above). The serious breaches of work duties referred to in section 9 implied the possibility of a proposal for the institution of proceedings for dismissal, as provided under the Disciplinary Regulations (see paragraphs 51 and 55 above). Accordingly, dismissal as one of the possible sanctions for the applicant was only remotely put into the prospect, further proceedings being necessary in order for dismissal to be even potentially applied.

75. The Court considers that this prospect of dismissal cannot be equated to the situation where the possibility of suspension of the right to continue with a professional activity is a sanction which may be applied directly in the context of disciplinary proceedings (see paragraphs 71-73 above). Accordingly, in this connection Article 6 cannot come into play (compare Yildiz v. Turkey (dec.), no. 65182/10, § 39, 24 January 2017). In this connection it is recalled that the result of the proceedings must be directly decisive for the right in question, mere tenuous connections or remote consequences not being sufficient to bring Article 6 § 1 into play (see, for instance, Lupeni Greek Catholic Parish and Others v. Romania [GC], no. 76943/11, § 71, ECHR 2016 (extracts)).

76. With regard to the applicant’s argument that the proceedings in question affected her professional reputation, the Court notes that in order for Article 6 to come into play, the outcome of the proceedings must be decisive for a ‘civil right’. This will be the case where the outcome of the proceedings depends on an assessment of an unjustified attack and harm to good reputation (see, for instance, Helmers v. Sweden, 29 October 1991, § 29, Series A no. 212-A).” (emphasis added)

265. Similarly, in R(Thompson), supra, Clarke LJ said at [78] as follows:

“78 The applicants were found guilty of professional misconduct and suspended from practising medicine by a disciplinary tribunal in Belgium. One of the questions before the European court in the earlier case was whether their rights under article 6(1) had been infringed. The conclusions reached by the court may be summarised as follows. (i) Disciplinary proceedings do not normally lead to a contestation (or dispute) over ‘civil rights and obligations’ or, in terms of the English text, a determination of civil rights and obligations, but may do so in certain circumstances: see para 42. (ii) In order for there to be such a determination the result of the proceedings must be ‘directly decisive of such a right’: see para 47. (iii) A decision to suspend a doctor from practising medicine is a decision which is directly decisive of his right to practice, whereas a warning, censure or reprimand is not: see paras 47 and 49. The court said 4 EHRR 1, 18, para 49:

‘Unlike certain other disciplinary sanctions that might have been imposed on the applicants (warning, censure and reprimand), the suspension of which they complained undoubtedly constituted a direct and material interference with the right to continue to exercise the medical profession. The fact that the suspension was temporary did not prevent its impairing that right; in the “contestations” (disputes) contemplated by article 6(1) the actual existence of a “civil” right may, of course, be at stake but so may the scope of such a right or the manner in which the beneficiary may avail himself thereof.’” (emphasis added)

266. Under the BO, when the CA considers (a) there may be cause to suspend a licensee’s licence under section 31(1), or (b) there may be cause for the CEIC to revoke the licence under section 32(1), it must cause a public enquiry to be held for that purpose. It is thus clear that the Decisions cannot be directly decisive of any “potential” consequence of having TVB’s licence suspended or revoked.

267. On this basis alone, I will also reject TVB’s submissions.

268. This leaves me to consider the TVB Competition Case.

269. In that case, the CA issued a decision against TVB in finding that it had infringed sections 13(1) and 14(1) of the BO (which are in effect provisions prohibiting anti-competition conducts) by imposing various restrictions on its artistes and signers which had the purpose of preventing, distorting or substantially restricting competition. The CA further directed TVB to end the infringement and to undertake a number of remedial action (including abandoning the restrictions in question), and imposed a financial penalty of $900,000. TVB applied to judicially review the decision on various grounds.

270. Amongst others, the learned judge effectively held at [93] - [173] that the challenged decision involved the determination of rights and obligations in a suit at law, and that the CA was not an independent and impartial tribunal for that purpose. Further, neither the appeal to the CEIC nor the availability of judicial review to challenge the decisions of the CA and the CEIC could not cure this defect. The system underlying the challenged decision was therefore not BOR10 compliant and thus unconstitutional.

271. Mr McCoy therefore submits that the TVB Competition Case is directly on point to support of his contentions that the system underlying the Decision and the Appeal Proceedings engages, and is in breach of, the BOR10 rights.

272. I agree with Mr Chan and Mr Yu that the TVB Competition Case does not assist Mr McCoy as it is clearly distinguishable from the present case for the following reasons.

273. As mentioned at [233] above, whether there is a determination of civil rights, which is an autonomous concept not dependant on domestic classification, is to be determined by the nature of the rights on a case-by-case basis. In other words, BOR10 may be engaged only in relation to some, but not all, the matters dealt with by a particular administrative authority or tribunal.

274. In the TVB Competition Case, G Lam J held that the enforcement action concerning anti-competition provisions in sections 13 - 14 of BO (which have been repealed) involves the determination of civil rights and obligations of three matters. They are, TVB was ordered to abandon certain clauses and polices, its relevant private law rights under existing contracts with artistes and singers were brought to an end by the order made under section 16 of the BO (which has also been repealed) and possibly avoided automatically by virtue of section 13(3), and TVB’s freedom to enter into future contracts was also restricted by the decision and order of the CA.

275. However, none of these is present in the present cases concerning the Codes:

(1) It was held in the TVB Competition Case that there was a final determination on whether there was a breach of statutory prohibition against anti-competitive conduct under the new repealed sections 13 and 14. However, there is no issue of beach of statutory prohibition in the present cases. The CA in the Decisions are concerned with the compliance of the Codes, which relate to the appropriate standard and their maintenance in the public interest.

(2) As explained above in [250] - [254], in the present cases, unlike the TVB Competition Case, TVB’s right to engage in products and services advertising is not terminated or curtailed.

(3) The decision under challenged in the TVB Competition Case had direct and decisive impact on the licensee’s private law rights because follow-on actions by third parties relying on the CA’s findings there is expressly prescribed by section 15(2) of the BO[50]. In the present cases, there is no question of TVB incurring any liability in private law to third parties by reason of the Decisions. This is particularly so in light of the post-broadcast complaint-based regime adopted by the CA for enforcing the Codes.

(4) G Lam J considered that the sanction for infringement included a financial penalty on TVB recoverable as a civil debt, but expressed no view on whether a financial penalty of regulatory or disciplinary nature would constitute a determination of civil rights and obligations. See [96] - [97] of the TVB Competition Case.

(5) Finally, the learned judge held that the competition law decision was analogous to classic civil law cases concerning the enforcement of restraint of trade clauses. As submitted by Mr Chan, one would be hard-pressed to find, in domestic private law, rights concerning or akin to the Codes on indirect advertising.

276. For all these reasons, I conclude that the Decisions and the system do not involve the determinations of TVB’s civil rights and obligations for the purpose of BOR10. BOR10 rights are therefore not engaged in the present cases.

C6.3 Independent and impartial tribunal and curative procedure

277. Once I have concluded that the BOR10 rights are not engaged in the present cases, it is not necessary for me to determine the consequential questions of (a) whether the CA and the CEIC can be regarded as independent and impartial tribunal for that purpose, and (b) if not, whether the availability of judicial review is curative of any possible defects of procedural fairness.

278. Indeed, given my above conclusion, I believe it is not only unnecessary but also inappropriate for me to continue to consider these consequential questions. This is so since, as rightly submitted by Mr Chan, these questions should be considered and in light of the role of the CA, the nature of the decision to be made and the decision‑making process as a whole. In my view, my conclusion above in particular on the public law nature of the Decisions may well affect my consideration of these questions. It would therefore be unrealistic and inappropriate for me to venture into making any determination on these issues on the alternative basis that the Decisions do involve the determination of civil rights and obligations for the purpose of BOR10.

D. CONCLUSION

279. TVB therefore fails in all its grounds of challenge in both applications. I will dismiss the judicial reviews.

280. There are no reasons why costs should not follow the event. I will therefore make an order nisi that TVB should pay the costs of the CA and CEIC, with certificate for two counsel. In this respect, I consider it appropriate for CA and CEIC to be respectively entitled to costs since the challenges made against them are separate and distinct and call for certain different submissions to be made.

281. Finally, it remains for me to thank counsel for their invaluable assistance in these matters.

	(Thomas Au)
	Justice of Appeal
	sitting as an additional judge of
	the Court of First Instance

Mr Gerard McCoy SC and Mr Timothy Parker, instructed by Mayer Brown, for the applicant in both actions

Mr Johannes Chan SC and Mr John Hui, instructed by Eversheds Sutherland, for the 1^st respondent in HCAL 151/2016 and the respondent in HCAL 47/2017

Mr Benjamin Yu SC and Ms Eva Sit, instructed by Department of Justice, for the 2^nd respondent in HCAL 151/2016 and the interested party in HCAL 47/2017

[1] Leading Mr Tim Parker.

[2] Leading Mr John Hui.

[3] The CEIC is joined as the 2^nd respondent in the KFC Judicial Review and as an interested party in the Scoop Judicial Review.

[4] Leading Ms Eva Sit.

[5] This is largely taken from the Affirmation of Tai Ka Pui (“Affirmation of Tai”) and the CEIC’s skeleton submissions.

[6] Affirmation of Tai at paragraph 11.

[7] See Affirmation of Tai at paragraph 32.

[8] See Affirmation of Tai at paragraph 30.

[9] The competition provisions have since been repealed with the taking effect of the Competition Ordinance (Cap 619).

[10] See Affirmation of Tai at paragraph 37(a); sections 10(1) - (2) of the BMPO.

[11] See: Affirmation of Tai at paragraphs 23 ‑ 25.

[12] I will deal with this in greater detail under Ground 2, where TVB now seeks to challenge that they are not.

[13] See Affirmation of Tai, paragraph 108.

[14] See Affirmation of Tai, paragraph 128.

[15] BL27 provides that “Hong Kong residents shall have freedom of speech, of the press and of publication…”. In these applications, TVB’s arguments are premised principally BOR16. It is not seeking to argue that BL27 provides any further rights which are different from BOR16. It is therefore unnecessary for the parties and the court to consider separately the rights protected under BL27 under this ground. BL39 effectively constitutionalizes the status of the BOR, which domesticated the provisions of the International Convention of Civil and Political Rights (“ICCPR”).

[16] See Chee Fei Ming v Director of Food and Environmental Hygiene [2019] HKCA 1425, at [7] ‑ [8] per Lam VP.

[17] See Affirmation of Tai, paragraph 36.

[18] See also: Hong Kong Television Network Ltd v CEIC [2016] 2 HKLRD 1005 (CA) at [84], [88], [90], [98] and [99] per Cheung CJHC (as he then was).

[19] Such as product, service, trademark, brand name or logo of a commercial nature.

[20] See Affirmation of Tai, paragraphs 139 - 143.

[21] See paragraph 3 of Chapter 1 of TV Programme Code.

[22] See: Hysan Development Co Ltd v Town Planning Board (2016) 16 HKCFAR 372 at [57] - [80].

[23] See Affirmation of Yip Ka Sing at paragraph 15(a).

[24] See Affirmation of Yip Ka Sing at paragraph 15(c).

[25] See Affirmation of Tai, paragraphs 85 ‑ 87.

[26] See Affirmation of Tai, paragraph 89 ‑ 91.

[27] See: R v Director of Public Prosecutions ex Kebilene [2000] 2 AC 326, 381B-D; Brown v Stott (Procurator Fiscal Dunfermline) [2003] 1 AC 681, 7031 and Krone Verlag GmBH & Co KG (No 3) v Austria (App No 39069/1997), 11 December 2003, at [31].

[28] Manfred Nowak, UN Covenant on Civil and Political Rights: CCPR Commentary (NP Engel, 2^nd rev ed, 2005) 458 [42]; see also 459 [44].

[29] Marc J Bossuyt, Guide to the Travaux Preparatoires’ of the International Covenant on Civil and Political Rights (Martinus Nijhoff, 1987) 386.

[30] In this respect, TVB’s reliance on the authority of R (Northern Cyprus Tourism Centre) v Transport for London [2005] EWHC 1698 to support its submissions that the Relevant Paragraphs amount to a disproportionate infringement of the right to freedom of expression is misplaced. The authority is clearly distinguishable as in that case, the court found the restriction disproportionate there was a complete ban of placing the relevant advertisement on all property controlled by the defendant from any source at any time. See [96]. This is very different from the present cases.

[31] GN4322.

[32] Section 23(2)(e) of the BO provides that a licensee shall “without prejudice to the operation of any Code of Practice which relates to this section, to any regulations under section 42(1)(e) or the [CA’s] functions under section 9 of [the BMPO], secure proper standards for its licensed service with regard to television programme content and technical performance.”

[33] The Gazette Notice relevantly states: “Pursuant to section 3(2) of [the BO], the Broadcasting Authority gives notice that it has approved the [relevant revisions in the respective Chapters] in respect of the requirement for a licensee to secure proper standards for its licensed service with regard to television programme content under section 23(2)(e) of the [BO]”

[34] See the undisputed evidence deposed to at paragraph 150 of Affirmation of Tai.

[35] See section (B), paragraphs (c) and (f) of the CA’s Scoop Provisional Decision dated 18 September 2016. See also [57] and [58] above on the descriptions of the contents of the Subject Scoop Segment.

[36] These other decisions have been listed in the Affidavit of Ting Chi Yan Jane and Annex I thereto.

[37] Or formerly, the Broadcasting Authority. See: Affirmation of Tai at paragraph 155.

[38] See Affirmation of Tai at paragraph 157 and the Pizza Hut Decision stated in the CA’s letter dated 24 May 2016.

[39] In particular, and as an example, the court was shown the subject programme segments respectively of the KFC Case and the Pizza Hut Case at the hearing. The court’s then immediate response was to ask Mr McCoy whether the Pizza Hut logo was shown at all in the programme. This highlights one of the reasonable and legitimate bases for the CA to distinguish the KFC Case from the Pizza Hut Case for the purpose of Paragraph 10(a).

[40] See in particular TVB’s representations dated 1 July 2016 (ie, the Scoop Initial Representations).

[41] See Affirmation of Tai at paragraphs 108 and 128.

[42] Section 28(5) of the BO provides: “The [CA] shall not impose a financial penalty under this section unless, in all the circumstances of the case, the financial penalty is proportionate and reasonable in relation to the failure or series of failures concerned giving rise to that penalty”.

[43] See Affirmation of Tai, paragraph 162.

[44] See Affirmation of Tai, paragraphs 161 to 163.

[45] See paragraphs 12 and 13 of the KFC Final Decision.

[46] As set out under the Background Section of this Judgment.

[47] The Court of Appeal expressed no opinion on this finding on appeal: [2007] 3 HKLRD 673 at [43].

[48] See Affirmation of Yip at paragraph 15.

[49] “In this connection, see Stock Exchange of Hong Kong v New World Development [2006] 2 HKLRD 518 at para. 91 where Ribeiro PJ said the principle of fairness provide the appropriate framework to deal with the question of legal representation even though the Disciplinary Committee is not a court.”

[50] Which is also repeated upon the taking effect of the Competition Ordinance.

TELEVISION BROADCAST LTD v. COMMUNICATIONS AUTHORITY AND ANOTHER

Court

Procedural posture

Issues

Holdings

Legal principles

Disposition

Key citations