Japan’s public broadcaster faced accusations it may have violated the Broadcast Law by earmarking around 900 million yen ($6.4 million) in its fiscal 2023 budget for online streaming of its satellite TV programs despite being prohibited from such activity.

Nobuo Inaba, who only took over as president of Japan Broadcasting Corp. (NHK) in January, ordered an in-house investigation. Those interviewed included NHK’s managing directors at the time the decision was made, as well as the former president, Terunobu Maeda.

The investigation concluded that NHK’s behavior was flawed in terms of governance and that the processes to earmark the spending may have been in violation of the Broadcast Law, according to multiple insiders.

The Broadcast Law states that NHK’s “essential business” is broadcasting and that online businesses constitute optional operations that complement its activities.

Under the Broadcast Law, documents known as “implementation standards,” which require approval from the minister of internal affairs and communications, determine the contents and extent of NHK’s online operations.

Currently, “NHK Plus,” the broadcaster’s online service, is allowed to stream only terrestrial TV programs in its live or on-demand streaming service, not satellite TV programs.

NHK cannot stream satellite TV programs online without a revision to the implementation standards.

Yet, it included around 900 million yen in related spending in its fiscal 2023 budget.

NHK did so to make necessary technical preparations to start streaming its satellite TV programs online from April 2024.

NHK’s Board of Governors, the broadcaster’s highest decision-making body, voted in favor of the draft budget, and the Diet approved it at the end of March with majority lawmaker support.

It was only after some insiders started griping about the spending appropriation that Inaba ordered an investigation.

During the investigation, views that cropped up were “The management decision was inappropriate,” or “It could be illegal.”

Based on the findings, the broadcaster suspended implementing the budget.

Nine individuals, including Maeda and some of NHK’s managing directors, circulated a document among themselves titled “Request for approval” to sanction budget spending, according to sources.

This approach meant that it was not the broadcaster’s Executive Board that approved the spending.

NHK decided to integrate its satellite TV channels “BS1” and “BS Premium” in December 2023 to reduce the number of satellite waves by one.

The planned reduction offered the prospect of fewer paying subscribers for NHK’s satellite TV service.

As a result, NHK formed a team within the organization last July to consider ways to stream satellite TV programs on NHK Plus. This was done when Maeda was president. He stepped down in January.

The broadcaster at the time was secretly preparing to start streaming its satellite TV programs on NHK Plus in April 2024, sources said.

The Asahi Shimbun contacted NHK for comment, but the broadcaster replied, “We cannot answer questions now.”

Joji Shishido, a professor at the Graduate School of the University of Tokyo who is an expert on the Constitution, laws on information and the Broadcast Law, said: “If NHK, in its budget, included spending for operations that the implementation standards don’t stipulate for the broadcaster, it acted without waiting for the minister’s approval or public discussion. That is tantamount to NHK violating the Broadcast Law.”

He added, “If NHK’s executives who approved the ‘Request for approval’ were not able to voice concerns, they clearly didn’t understand the Broadcast Law sufficiently.”

Shishido said the Audit Committee also bears serious responsibility for this issue, just like the nine NHK executives, including Maeda, and the Board of Governors.

He noted that members of the Board of Governors are appointed following Diet approval to represent the public.

“NHK needs to explain this issue in detail and rebuild its governance,” Shishido said. “This is an issue that raises questions about the entire organization, including the Board of Governors and the Audit Committee.”

However, communications minister Takeaki Matsumoto said May 30 at a news conference after a Cabinet meeting, “I do not believe NHK violated the Broadcast Law.”

He asserted that the business plan NHK submitted to the Diet and its budget did not include anything that violated the implementation standards.

Noting that the funds in question have not been spent, Matsumoto concluded that NHK did not violate the Broadcast Law.