On February 11, the Islamabad High Court ruled against the demand notices issued by the Pakistan Electronic Media Regulatory Authority (PEMRA) aimed at collecting five percent of annual advertising revenue from television channels. The court declared these notices, which amounted to a total demand of Rs32 billion from 23 TV channels, as illegal and unjustified.

Justice Saman Rafat Imtiaz delivered a written judgment that favoured the petitions filed by the Pakistan Broadcasters Association (PBA) and various TV channels. These notices were initially issued by PEMRA in March 2022, prompting the court to maintain a stay order on them until a final decision was reached.

The judgment, comprising 29 pages, specifically noted that the collection of revenue under the system established before the PEMRA Rules of 2009 was illegal and unauthorised. The court emphasised that regulatory fees must be legitimately related to the costs of PEMRA’s regulatory activities. However, PEMRA failed to demonstrate a reasonable correlation between the collected fees and the expenses incurred in its regulatory operations.

The court criticised the rationale behind the fees, pointing out that most of the collected revenue seemed intended to bolster general revenue rather than cover regulatory costs. It was noted that funds were being used for purposes not directly linked to the regulatory oversight of licensed broadcasting entities, thereby losing their legal justification.

Additionally, the judgment clarified that the amendments under the PEMRA (Amendment) Act 2023 would not apply to past collections. It also stated that issuing a demand notice does not inherently authorise the suspension or cancellation of licenses, and that a proper show-cause process must be adhered to before taking such actions.

The ruling has highlighted the need for transparency and legality in the imposition of regulatory fees, ensuring they are strictly used for the intended administrative purposes connected to PEMRA’s oversight duties.