Conflicts of interest reported at Communications Commission

The Georgian National Communications Commission (GNCC) is hindering the creation of a competitive media environment in the country, according to the results of a Levan Mikeladze Foundation and Georgian Young Lawyers Association report.

The report, Civil Monitoring for Improvement of TV Media Environment, is based on annual data published by the Commission.

The primary source of income in the television broadcasting sector is advertising. According to 2010 data, almost 78% of all income in the sector came from advertisements, and 60% of that income was distributed between Imedi TV and Rustavi 2.

According to Georgian legislation, the Commission has no right to regulate the activities of advertising agencies; however, it is obliged to manage the observance of established advertisement time limits for all television channels.

Irakli Chikovani, chair of the GNCC, owns 35% of Magi Style Media Ltd., a company that produces and places television advertisements. He is partnered in this venture with Giorgi Gegeshidze, who is the current General Director of Rustavi 2, and holds 49% of that company’s shares. Magi Style Media places advertisements, on behalf of other companies, on Rustavi 2, Stereo, Imedi TV, Mze, Sakartvelo, and the 1st Channel.

The report alleges that as Chair of the GNCC, Chikovani has the opportunity to ignore violations to suit his interest in Magi Style Media. As his revenue is directly linked to the amount of its advertisements placed on television channels, Chikovani’s economic interests stand in opposition to his role as head of the Commission.

GNCC failed to consider violations of time limits by Rustavi 2 and Imedi TV, until Studio Monitor ?led an administrative complaint, which resulted in fines of 2500 GEL for the networks.

Kakhi Kurashvili of the GNCC Legal Department called the report “biased” and claims it cites “disfigured statistical data”. Promising to protect consumers’ rights and update their website with frequently asked questions, Kurashvili also responded to accusations of an artificially suspended distribution of licenses. He said that the Commission has not stopped receiving applications and even recently approved several TV, radio, cable and satellite licenses.

Having encouraged the Commission to avoid discrimination and ensure effective monitoring advertising time limits, the authors of the report also addressed the parliamentary committees responsible for selecting Commission members. They hope to initiate consultations with relevant state agencies and civil society actors on amendments to those acts which regulate broadcasting and electronic communications.