5 ambiguities in the recent amendment to the National Broadcasting Rules

National Broadcasting Rules television broadcast
Photo: Pexels/ Donald Tong

For a very long, we have been hearing the government’s intention to regulate the over-the-top (OTT) and internet-based broadcasting in Nepal. Well, the wait is over as the government has already come up with an amendment to the National Broadcasting Rules, 1995.

The 11th amendment to the National Broadcasting Rules has included OTT, video on demand (VOD), and internet television with the definition of “other means of communications.” With the said inclusion, the rules now require OTT and internet television to obtain licences to avail of their services in Nepal.

The term OTT has been defined as the service of broadcasting the content as per the demand of the consumer through the internet which also includes the media streaming services through other platforms by the means of the internet. Further, internet television (internet TV) has been defined as a regular act of transmission of the self-produced audio-visual programme through the internet.

The amendment to the National Broadcasting Rules has further provisioned for the mandatory requirement of the cache server within Nepal if the OTT service provider intends to make any members or customers in Nepal or acquire any kind of fee from Nepal. It has also required the storage of user information within the server of Nepal.

Further, the OTT service providers should keep a record of the programmes transmitted by them, for at least 60 days and such shall also be made accessible to the Ministry of Communications and Information Technology and other governmental authorities in the process of investigations.

According to the amendment to the National Broadcasting Rules, the content to be displayed through OTT must be subject to categorisation as per age. The U category refers to the content which is appropriate to all the age groups whereas the A rating is provided to the content for the age group above 18 years. In the same way, the R rating is provided for the content appropriate to the age groups of 10-18 years.

The amendment to the National Broadcasting Rules has it that the ministry can take on control of such equipment or make necessary arrangements to disallow the operation of such equipment which has been used for transmission or communication of the programme in an unauthorised manner without obtaining the necessary licence or approvals as required by the rules.

However, the amendment has created some important ambiguities, which we will discuss below.

1. The OTT definition

OTT streaming platform new National Broadcasting Rules
Photo: Pexels/ cottonbro

It appears the definition of OTT included in the amendment to National Broadcasting Rules, 1995 includes any apps/platforms which publish content through the internet and streaming services on other platforms. This wider definition will include every platform streaming content through the internet irrespective of the duration of the video which implies that the video streaming apps like TikTok, Facebook, etc may also be within the ambit of the OTT.

Furthermore, there seems ambiguity about whether any platform can be regarded as OTT when it allows programming to be broadcast by others through its platforms.

2. Registration of foreign OTT service providers

registration new National Broadcasting Rules
Photo: Pixabay/ geralt

The amendment to the National Broadcasting Rules, 1995, mandatorily required approval (licence) from the ministry to distribute the content through the internet in Nepal. It is notable to observe whether such will be complied with by the foreign OTT service providers due to the limited market user in Nepal. Further, the rules are not unclear whether foreign OTT service providers will be required to have a local presence in Nepal.

The amendment to the National Broadcasting Rules is silent on the period to comply with such requirements and what will be consequences if in case the foreign OTT service providers fail to comply with the licensing requirement.

3. Server requirement

Photo: Pexels/ Brett Sayles

The amendment to the National Broadcasting Rules requires OTT service providers (a) to keep a cache server in Nepal, (b) to store user data within the servers of Nepal, and (c) to store transaction details in the customer management system server. The regulation is unclear what it means by “customer management system server” and whether such a server has to be within Nepal and managed by the OTT service providers.

Further, as the OTT service providers are required to store user data within the server of Nepal, it is unclear whether OTT service providers have to own and maintain a separate server, or such can be stored in the third-party server. Further, as the data has to be stored locally, it will be not able to see what procedure the ministry will come up with for the cross-border transfer of a copy of data.

Lastly, as the OTT service providers may operate various services from one platform and no other activities may qualify as OTT, it is unclear whether these requirements extend to other services provided by service providers to only to those services which qualify as OTT.

4. Broadcast and distribution fee

Representational file

The amendment to the National Broadcasting Rules requires the broadcasting institutions broadcasting/distributing the programmes to pay two per cent of annual total (gross) income or ten per cent of annual total (gross) profit, whichever is higher, to the Government of Nepal as the broadcasting fees. It is, however, unclear whether this requirement also extends to the OTT service providers or is only applicable to the traditional broadcasting institutions.

5. Age rating of the content

censored sign
Photo: Pixabay/ Clker-Free-Vector-Images

The amendment to the National Broadcasting Rules requires the programmes to be classified according to the age of the consumer. As the regulation does not provide for any procedure/authority for age rating, it seems the service providers are required to voluntarily classify the content based on the general practices.

As not having a specific procedure for age rating of the internet content (except for motion pictures), the voluntary classification may be an issue as the age requirement to access content may vary from place to place. Further, the amendment is also unclear what age group can view parental guideline (PG)-rated content.

There have been a lot of mixed views concerning the amendment to the National Broadcasting Rules whereas the ministry has informed that it will come up with a directive that will clarify the ongoing ambiguities and concerns. It would be convenient if the ministry could collect suggestions and recommendations or call for a discussion with the concerned stakeholders so as to introduce a better regulatory regime for OTTs.

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Suman Siwakoti is a corporate lawyer dealing with matters relating to e-commerce, information, and technology. He is an associate at Pioneer Law Associate.

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