BBC India Restructures Business After Centre Tweaks FDI Rules

The BBC has handed over its newsroom publishing licence in India to a private limited company, Collective Newsroom - a first for the public service broadcaster's global operations anywhere in the world. The move comes a year after searches at its offices by the Income Tax department.

Collective Newsroom, founded by four former BBC employees, will commence its operations from April 10. A wholly India-based company, it will produce content for the BBC's digital services in English, Hindi, Gujarati, Marathi, Punjabi, Tamil, and Telugu. 

As per the Ministry of Corporate Affairs (MCA), Collective Newsroom Private Limited was incorporated on October 27 last year.

"It's unprecedented for the BBC to grant their licence to publish to another entity...We will not compromise our journalism and the BBC is solidly behind us," Rupa Jha, Chief Executive Officer of the Collective Newsroom, told The Indian Express.

The restructuring was prompted by the new Foreign Direct Investment (FDI) rules, which were introduced in 2020, that imposed a 26% FDI limit in India's digital media sector.

Companies exceeding the 26% FDI limit were required to reduce their foreign investment to comply with this regulation by October 2021.

99.99% of BBC World Service India's shares are owned by its UK-based public broadcaster.

The BBC has sought a 26% stake in its recently established Collective Newsroom company, a source told NDTV. 

"There were a number of options before us. Considering that the BBC didn't want to lose its presence in India or cut jobs, and they didn't want it to become financially unviable, this forced us to think out of the box. Based on the legal advice the BBC was receiving, everyone was veering towards this as the viable option (of setting up the Collective)," Ms Jha was quoted saying by The Indian Express. 

Tax searches were carried out at the BBC's Delhi and Mumbai offices in February last year after it aired a controversial two-part series titled 'India: The Modi Question' that featured the 2002 Gujarat riots.