MUMBAI: Zee Telefilms, which had been set a deadline of 26 March by the information & broadcasting ministry to comply with the revised guidelines for news and current affairs issued last year, has filed the necessary application.

The application to restructure its news uplinking operations was submitted to the I&B ministry on 10 March.

The revised guidelines for news channels, announced on 26 March 2003, say that any news channel wishing to uplink from India can attract a total of 26 per cent foreign investment. The operative word is 'TOTAL'.

This means that the law has done away with ambiguities and is saying that including FDI, NRI/OCB/FII investment, the sectoral cap cannot exceed 26 per cent.

While details of how it is going about the restructure process were not provided in the statement issued by the company today, an option before Zee Telefilms (the total foreign holding is 64.06 per cent at the moment) is to form another company and spin of all operations of Zee News there. A structure similar to Star News, which is looked after and managed by Media Content & Communications Services India Pvt. Ltd. (MMCS) that itself is a joint venture between a dominant Indian partner (ABP group holding 74 per cent) and Hong Kong-based Star group, holding the remaining equity.

How could this work? Hypothetically, a joint venture company with dominant (up to 74 per cent equity stake) Indian partner can be formed in which Zee Telefilms can hold up to 26 per cent equity stake, if a foreign partner(s) is not found.

The exact details of the restructure should be known soon enough so stay tuned for that.