Australia's taxation system and legal framework, and the potential for
indirect assistance measures
This chapter discusses potential reforms to Australia's taxation and
legal systems that could encourage a healthy and prosperous public interest
It first discusses a number of potential amendments to Australia's tax
settings that were proposed in evidence received by the committee, which could encourage
an innovative not-for-profit news media sector. Proposal suggested that this
would be achieved by incentivising private philanthropy for not-for-profit
media, offsetting the employment of journalists for some companies, and broadening
eligibility for Australian consumers to claim tax rebates for new or ongoing
The chapter then outlines potential reforms to Australia's legal
framework raised in evidence, particularly in the areas of national security,
libel and freedom of speech, as well as through whistleblower protections and
shield laws for journalists.
Lastly, this chapter briefly discusses a number of other measures
proposed by submitters regarding Commonwealth protocol or administration.
General support for indirect measures
Whereas there were divergent views on whether the Commonwealth should
use direct subsidies to encourage public interest journalism, as discussed in
the last chapter, witnesses and submitters to this inquiry were overwhelmingly
in favour of the Commonwealth investigating the use of indirect measures,
particularly those potentially on offer through reform of our tax and legal
The Australian Treasury noted that the Commonwealth has already
instigated some tax measures 'that benefit a broad range of entities, including
those that may undertake public interest journalism', including:
Reducing the corporate tax rate;
Lifting the annual turnover limit from $2M to $10M [i.e. the
threshold for entities to claim lower corporate tax rates] and expanding access
to concessions for small businesses;
Increasing the unincorporated tax discount for small business;
Extending the $20,000 instant asset write-off to 30 June 2018.
However, it was repeatedly put to the committee that these measures
could be supplemented by new policy, particularly indirect measures encouraging
market-based solutions to a disrupted media sector. This, it was argued, would minimise
the risk of impinging on the freedom and independence of the press or
distorting the market unnecessarily, noting that direct subsidies had the
potential to compromise–or raise serious questions about–editorial independence.
Additionally, some witnesses and submitters suggested that indirect measures would
be able to be implemented at a low cost to the Commonwealth Budget, and
perceived more favourably by the general Australian public than direct
Ms Megan Brownlow, a partner with PwC with long experience consulting on
the media sector, noted that the Commonwealth had used indirect measures
successfully to support other industries, which shifted decision making to the
market, rather than using direct measures that could interfere with editorial
So in the film and television production sector, for example...we
have shifted Screen Australia from a very direct approach of subsidising film
and television to a much more indirect market-driven approach that you would
have to say, on all assessment, is really successful. That is where there are
production offsets and tax rebates for supporting Australian productions that
are great employers of Australians. They are the sorts of solutions, I think,
that would probably meet with favour by Australians.
Regarding proposals to encourage a healthy public interest journalism
sector through indirect measures, Professor Lawrie Zion, the Lead Chief
Investigator of the New Beats Project, noted:
I certainly think that those kinds of models or suggestions
should be really seriously considered, because it is really clear that not
doing anything at all is going to continue to have really adverse consequences.
I also appreciate that the range of options offer a mixed bag of different
approaches. And you need to get something, as I think I heard the committee say
earlier, with a revenue neutral kind of outcome as well. But it certainly makes
sense to me to investigate what pulling particular levers will do for the
sustainability of journalists' employment.
Some evidence suggested that tax reform alone would not address the
challenges the media sector faces. For instance, even though Mr Greg Hywood,
the Chief Executive Officer and Managing Director of Fairfax Media, voiced
general support or the Commonwealth considering tax support for the sector, he
argued that, absent reform to Australia's media laws, this would do little to 'level
the playing field':
As a commercial organisation our priority is to compete
effectively with all comers. That is what the Australian media needs now. It
needs a level playing field. We have media legislation at the moment which was
put in place effectively prior to the advent of the internet. It has diversity
at its centre. Diversity is no longer an issue; people can get content from
wherever they want globally. The issue is scale and whether media organisations
in this country can work together—who knows what the mix would be—to get the right
range of assets across multiple platforms to compete at scale with the major
international over-the-tops: Google and Facebook. That is the essential bottom
line. Unless we can compete effectively, tax breaks here and bits and pieces
there are not going to address the fundamental problem.
Adjusting Australia's tax system
There was a general consensus in the evidence considered by the
committee that the Commonwealth could adjust the tax system in a number of ways
to create the conditions for a more vibrant and innovative news media sector,
Extending Deductible Gift Recipient (DGR) status for
organisations producing public interest journalism, particularly the
Offering accelerated tax write-offs or concessions for media companies
employing journalists, which could be modelled on the research and development tax
incentive (R&DTI) available for business sector; and
Broadening eligibility for tax rebates for subscriptions to news
publications online for all Australians, as well as for DGR donations to
eligible media outlets.
Deductible Gift Recipient (DGR)
The committee heard compelling evidence that the health of public
interest journalism could be reinvigorated through the provision of tax
concessions for philanthropic donations to not-for-profit producers of quality
journalism. The easiest way to do this would be by making it easier for some
types of media organisations to claim DGR status, particularly not-for-profit
organisations, to encourage diversity and sustainable business models in the public
interest journalism sector.
It was argued that this reform would make it more attractive for private
and corporate donors to make philanthropic donations to eligible media
providers, and in turn revitalise Australia's journalism sector, as similar
policies have done in the US.
For example, the Journalism Education and Research Association of
Australia (JERAA) noted that there would be benefits in making donations to 'non-profit
or low-profit journalism organisations tax-deductible or exempt'. It
highlighted that the US example had revitalised journalism there, and that this
had not only been recognised by the media sector, but also by the US
The fact that donations to non-profit media are
tax-deductible serves as an incentive for citizens to lend financial support to
organizations whose missions they value.
A number of other small media organisations noted that DGR status would
benefit them significantly and more broadly encourage diversity of local media
voices and a more informed general public.
For example, Mr Jack Latimore, representing Indigenous X, observed that
his organisation's lack of DGR status had dissuaded potential donors who had
inquired about making contributions.
Dr Bill Birnbauer noted that only a few Australian media organisations
had been granted DGR status by the Australian Tax Office (ATO), as the current
eligibility criteria 'do not fit well with the purpose and functions of news
The Conversation is one of the few media organisations to have DGR
status. It submitted that this status was also a way of reinforcing its
accountability mechanisms, as it required a reputation for quality and
reliability among its readers and donors:
The deductible gift recipient status granted to The
Conversation by the ATO has been useful in enabling The Conversation to raise
much-needed funds from our audience. This is a particularly effective way of
supporting public interest media because there is an accountability mechanism
built in: success in raising donations depends, at least in part, on the media
outlet's ability to generate trust among readers.
Submitters addressing DGR status were generally supportive of limits to eligibility
for DGR status, to ensure that the measure was focussed and effective. For
example, Dr Birnbauer submitted that the Commonwealth should make
eligibility for DGR status contingent on a number of governance and ethical conditions,
to ensure journalistic products were consistent with industry standards and
free from editorial interference:
In order to qualify for such status, non-profit media
organisations should be properly constituted with boards and should be staffed
by journalists who adhere to the MEAA's code of ethics. Conditions for tax
deductibility would include that the centres adopt normal journalistic practice
and make editorial decisions independent of funders.
Professor Birnbauer set out a number of conditions that he judged
should be satisfied by any applicant for DGR status:
- The history and background of the applicant as a
journalist, particularly adherence to professional and ethical standards.
- The applicant’s ability to produce investigative and public
- Whether the organisation has editorial processes that create
stories that are in the public interest and educate audiences rather than
covering news of popular interest.
- Introducing a commitment that funding sources, including
publication of the identities of donations of more than $1000, be published on
the non-profit’s website.
- A commitment to publish on their websites information about
spending and revenue, as provided each year to the ATO and/or the Australian
Charities and Not-for-Profits Commission.
- Individuals and organisations that advocate particular
causes should not be granted DGR status under any media category. The
guidelines used by the IRS are useful in this regard.
- Anonymous grants or funding from political and other
entities where the source of the funding is not transparent should be banned.
Professor Peter Fray and Professor Derek Wilding proposed that DGR
status could be contingent on media organisations providing 'proof of overt
innovation and 'public service' if not 'public interaction' as a pre-requisite'.
Dr Christopher Berg, a Senior Fellow at the Institute of Public Affairs,
advised that, even though DGR status had 'much to recommend it'–even for
overtly political not-for-profit organisations–the Commonwealth should be
careful about the benchmarks used for eligibility and the nature and
operational guidelines of the designated approving body:
DGR status would be available to media outlets professing any
political slant. DGR status would encourage media firms to self-fund, to be
accountable to their supporters and readers, and it would not constitute a
direct call on public revenue. One concern with this model, however, is that it
would require an authority to decide which media outlets are legitimate public
interest journalism outlets and which are illegitimate ones. Poorly designed,
this could easily transform into a de facto licensing body through which the
government may be able to exert some influence over the press.
A number of submissions highlighted the successful US model of
encouraging philanthropic funding of media not-for-profits by offering tax
breaks. Dr Birnbauer provided a comprehensive outline of the ways that this
system is overseen by the US tax department, the Inland Revenue Service (IRS),
...four-part test to determine if activities by news organisations
are educational. First, that the content of the publication was educational;
second, the preparation of the material followed methods generally accepted as
educational in character; third, the distribution of the materials was
necessary or valuable in achieving the organisation’s educational and
scientific purposes; and fourth, the manner in which the distribution was
accomplished was distinguishable from ordinary commercial publishing practices.
In this, Dr Birnbauer noted that the IRS also has stringent criteria to
distinguish 'education' from 'advocacy':
- Whether a significant portion of the communication
consisted of 'viewpoints unsupported by a
relevant factual basis';
- Whether the facts relied on are 'distorted';
- Whether the organisation 'makes substantial use of inflammatory
and disparaging terms, expressing
conclusions based more on strong emotional feelings than objective factual
- Whether the 'approach to a subject matter is aimed at
developing an understanding
on the part of the addressees, by reflecting consideration of the extent to which
they have prior background or training'.
Dr Birnbauer also commented that the government could consider allowing
DGR organisations to carry advertisements, as long as the amount was considered
'insubstantial' and any profits declared and accounted for as unrelated
business tax. He also noted that not-for-profit media organisations were not
able to participate in political campaigns, promulgate 'propaganda', or attempt
to influence legislation–although this was 'not absolute'.
The Treasury provided the following
information to the committee on notice, regarding the ability of some media
companies to seek DGR status:
Organisations providing public interest journalism have the ability
to seek DGR status under the existing legislative framework.
DGRs can either be endorsed under a general category or
specifically listed in the tax law.
While there is no specific general category of DGR
endorsement for media organisations, media organisations can seek DGR status if
they meet the requirements of one of the established general categories or
through specific listing in the income tax law.
For example, some media organisations may be endorsed as a
DGR through listing on the Register of Cultural Organisations (ROCO).
The Minister for Revenue and Financial Services and the
Minister for the Arts approve new additions to the ROCO, and the Department of
Communications and the Arts administers the ROCO.
Alternatively, organisations can seek to be specifically
listed as a DGR by name where an organisation is unable to be endorsed under
one of the general categories.
For example, the Conversation (registered as the Conversation
Trust), a media outlet that publishes news and views sourced from the academic
community, has DGR status through specific listing.
For an organisation to become a DGR listed by name,
Parliament must amend the tax law to include the name of the organisation in
As noted above, public interest journalism organisations have
the ability to seek DGR status under the existing legislative framework.
The Australian Taxation Office (ATO) is responsible for
endorsing organisations as DGRs under the general categories. Generally, the Australian
Charities and Not-for-profits Commission (ACNC) does not have a direct role in
R&DTI-style accelerated tax
write offs for organisations employing journalists
There was a great deal of support in evidence for the Commonwealth to consider
offering tax concessions to media companies employing journalists, as a
cost-effective, targeted means of encouraging a reinvigorated public interest
Some advocates suggested this could be modelled on the R&DTI tax
concessions already offered by the Commonwealth.
This incentive tax is jointly administered by the Australian Tax Office (ATO)
and the Department of Industry, Innovation and Science.
It is designed to encourage companies to boost competitiveness and improve
productivity across the Australian economy by:
encouraging industry to conduct R&D that may not otherwise
have been conducted;
improving the incentive for smaller firms to undertake R&D;
providing business with more predictable, less complex support.
The Treasury noted that some media organisations may already be eligible
for the R&DTI:
...if they were developing new software, technologies or
platforms. The Australian Taxation Office and AusIndustry have released
extensive guidance in respect of what activities may qualify.
Interest Journalism Foundation also advised that the tax offsets for Film
Industry support outlined in the Income Tax Assessment Act 1997 provide
a model for a tax mechanism to strengthen support journalism.
In particular, the committee explored the following model, which it put to a number of
witnesses: offering a 40 per cent write-off for up to
$2.5 million spent on employing journalists, which would give up to
$1 million of deductions on the R&DTI model, with a threshold of at
least $300,000 turnover at the lower end for eligibility, and a maximum $25m turnover
ceiling for larger organisations.
Mr Paul Murphy, the Chief Executive of the Media, Entertainment &
Arts Alliance (MEAA), suggested that tax incentives for employing journalists
would be a way of assisting the media sector to become more flexible in
addressing the pressures of technological and structural change:
On the surface, I think that sounds like a very attractive idea
and a very appropriate one, particularly in an industry that is experiencing
such rapid technological change and development. The way that you distribute
your content is changing all the time. In that context, that idea sounds like
one that is very worthwhile investigating.
Mr Misha Ketchell, the Editor of The Conversation, thought offering tax
incentives to employ journalists would be a practicable and positive step
towards addressing the challenges to the media industry from digital
I think that's an excellent idea. I think it's excellent for
two reasons, one of which is that it's a practical mechanism I could see
working. The other is that it goes to the heart of the changes that have got us
to the situation where we feel that there is an issue around public interest
journalism. That is that the digital disruption has displaced the role of
professional journalists as information handlers, as honest brokers, as people
who will sort out what is reliable, what you can trust and what you can't...Something
that goes to the heart of targeting that journalistic function is employing
individuals whose role is to sort information, to check it, to make sure it's
accurate and to disseminate it, I think, sounds like a very innovative and
potentially desirable way forward.
Ms Rebecca Costello, the Chief
Executive Officer of Schwartz Media, outlined the substantial benefits that would
accrue to her organisation from R&DTI-style tax breaks:
For us, something like a 40 per cent tax offset for the first
$2.5 million spent on our journalism would allow for rich newsrooms. It
would allow us to bring on more people and to invest in training the next
generation of journalists. It would allow us to break more stories. It would
also allow us to commit to stories that are important but expensive. This is
where the country's press is strained and where it needs to be repaired. As it
stands, on the margins we operate, we might look at a story that will cost
$20,000 or $30,000 to cover and decide that we cannot commit to it. An
important issue will go unreported as a result or will be not reported as
deeply as it could be. This is where we, as small publishers, need assistance.
This is where we will spend money and produce better journalism.
Ms Costello indicated that this measure would allow her organisation
more space in their operational budget to expand the size of its publications
with more stories, and perhaps consider publishing more often. Additionally,
she highlighted that it could assist in developing a cadet program to develop
Representatives of Crikey told the committee that this kind of
initiative would 'help us enormously' as most of its resources were spent on
Mr Ben Taylor, the President of the Country Press Australia (CPA),
suggested that these kinds of tax breaks would be welcomed across the CPA's membership,
and were worthy of further consideration by the Commonwealth. However, he did
express some concerns that the threshold for eligibility should be set with consideration
for smaller papers with a circulation of under 2,000 per week (which he
noted would translate to an annual turnover of under $350,000).
Some evidence questioned whether R&DTI-style tax incentives would
genuinely encourage a healthy, innovative and vibrant news media sector. Dr
Berg, opposed the idea of offering R&DTI-style concessions for employing
journalists, advising that other measures would be more effective with less
risk of compromising the freedom of the Fourth Estate.
Mr Gerard Ryle, the Director of the International Consortium of
Journalists, suggested R&DTI rebates would simply support existing
organisations rather than encouraging new enterprises or innovation:
...I would be worried that what you are doing there [with tax
concessions for employing journalists] is really propping up existing players.
If you are here to help journalism, then you have to make it easier for
journalists to be journalists.
Tax deductible expenditure for
Many Australians are already eligible to claim rebates on work-related
expenditure on news media subscriptions and periodicals as part of their annual
There was some support for the eligibility for these rebates to be broadened,
to encourage more people to invest in subscriptions or memberships for news
providers, and thereby contribute to the financial stability of many
organisations delivering public interest journalism.
For example, the MEAA stated that:
We do think we should look at
the issue of tax deductibility for new subscriptions for individual members of
the public who take out subscriptions to established news services....
Ms Brownlow thought that tax breaks for consumers would be popular with
many Australians, and could be a good incentive for consumers to pay for access
to news once again:
My initial reaction is that individual Australians do love a
tax break. It is about consumer psychology. There is no sensible reason why we
are perfectly willing to step across the road and pay $3.50 for a coffee, yet many
people are not prepared to buy a newspaper anymore....If we can give people a way
of reframing how they are spending their money, even when it is relatively
small amounts, that does instinctively feel like quite an interesting idea.
However, Ms Costello suggested this measure would only have a limited
effect, as many subscribers could already claim media subscriptions as tax
I suppose it's absolutely a factor, but, with the industries
that our audience work in, the majority of those readers would have that
benefit based purely on the industry that they're in. From the research we've
conducted through the 20,000 readers we've surveyed over the last two years, we
know that the industries that they're in–the media, politics and education–are
all areas where they would probably be able to do that. But that's certainly an
In answers to questions on notice, Treasury commented that tax
deductions could be claimed already 'for expenses incurred while producing
income', although noted that the Commonwealth does not maintain figures on the
cost of these deductions to the Budget.
Australian laws that potentially restrict public interest journalism
Some submitters suggested that some elements of Australia's legal
framework had a 'chilling' effect on journalists reporting freely in the public
interest. These included: recent reforms to national security legislation;
defamation and libel provisions, as well as inconsistency across jurisdictions;
shield protection and whistleblower provisions covering journalists and their
sources; as well as copyright provisions.
The broad range of laws that potentially impinged on journalists was
outlined by Professor Mark Pearson, a Professor of Journalism and Social Media
at Griffith University:
The key areas of the law that I see as problematic are
clearly the suite of national security laws, which, interestingly enough, do
have an independent national security monitor as an interface between the
public and the parliament on the application of those laws. Other Commonwealth
laws include consumer law, privacy law and intellectual property law. Then you
start going into state laws like defamation, for which there are uniform
defamation laws–not totally uniform. The Commonwealth have played a key role in
making them relatively uniform through the former COAG system. Then you get the
various areas of the common law that apply to the media as well. I neglected to
say two important Commonwealth laws there: the evidence law to do with source
protection for journalists, which some of you senators would have been involved
with in its more recent iteration; and, of course, freedom-of-information laws,
which impact upon journalism...and whistleblower protection laws, which interface
to some extent with the journalism source protection laws.
Professor Pearson provided some examples of how these laws prevented
journalists from investigating and writing significant stories:
The legal impediments are so important and occupy so much
time. You have someone like the former Four Corners journalist Chris
Masters who spoke to students and said that he was spending–I forget the
percentage he said–a large percentage of his time dealing with lawyers trying
to navigate all these different laws for important parts of journalism. He would
have created much more public interest journalism if he hadn't had to deal as
often with lawyers and spend as much time there, let alone the times he was
having to appear in court to defend his work.
Impact of new national security
laws on journalists
Ms Anna Talbot, a Legal and Policy Adviser for the Australian Lawyers
Alliance (ALA), outlined to the committee the importance of freedom of
expression to public interest journalism:
Public interest journalism shines a light on government and
ensures that it operates within the confines of the law and in the public
interest. True accountability...requires vigilant protection of the rights to
both freedom of speech and privacy for both journalists and the general
population. Journalists should not be punished for any public interest
reporting that might cause embarrassment or reveal human rights violations,
misappropriation, gross inefficiency or other wrongdoing. They should be able
to speak freely with sources who provide such information, and the sources
themselves should not risk criminal sanctions for revealing the crimes or
wrongdoing of government actors. That is one of the reasons why we think it is
important to consider the broader legislative context in which journalists
The ALA submitted that the recent passage of national security laws
undermined public interest journalism by compromising freedom of expression and
restricting how journalists can report on particular issues:
The Commonwealth government has passed a swathe of laws in
recent years that restricts the ability of journalists and others to report on
matters that are in the public interest. These laws fall into two broad
categories: those that restrict the ability of journalists to report on certain
facts, and those that undermine the ability of journalists to communicate
confidentially with their sources.
These laws, the ALA submitted, have come about partly through amendments
to the Australian Security Intelligence Organisation Act 1979 (ASIO Act)
and the Australian Border Force Act 2015 (Border Force Act).
The ALA argued that Section 35P of the ASIO Act, under which persons who
reveal information about special intelligence operations are liable for a
maximum five-year prison sentence, does not include a public interest
exception, and does not require that national security be compromised by the
disclosure. It noted the Public Interest Disclosure Act 2013 provides only
limited protections for whistleblowers disclosing information related to the
above acts. The ALA proposed that all reporting on these issues should be
considered legal unless there is a demonstrable threat to national security.
Despite recent reforms Dr Andrew Morrison, a Spokesperson for the ALA,
was concerned that the current iterations of the ASIO and Border Force Acts
would continue to:
...inhibit whistleblowers, public comment and the disclosure of
information which would generally be in the public interest and yet would not,
in practice, have any significant effect upon national security or, indeed,
border force operations in the true sense.
The ALA also expressed its concern that, under the Telecommunications
(Interception and Access Act) 1979, ASIO and enforcement agencies may
access metadata stored by telecommunications providers without a warrant. The
metadata could include information such as who a person has contacted and, if
they are using a mobile device, the location of the individual.
Although a provision of the Act limits access to metadata regarding
journalists, the ALA suggested that the definition of journalist was unclear
and would likely not 'provide sufficient protection to everyone who engages in
public interest journalism'.
The ALA noted a case in 2017 in which an AFP officer requested and obtained the
call records of a journalist without a warrant, without facing any disciplinary
The ALA advised the committee that freedom of speech laws should be
consistent across different areas of application:
There does seem to be a bit of a disconnect in focusing on
the importance of freedom of speech in particular areas and yet having
limitations on other areas. Clearly the most important thing is for law to be
applied evenly across the different subject matters, whether it's unionism,
national security or border protection. Clearly, there are some sensitivities
around that, but, to have the fundamental premise of freedom of speech being
the presumption and then any limitation on that being clearly demonstrably
necessary in proportion to the risks that are faced is essential for the
integrity of the legal system more broadly, and for the integrity of the
journalists' ability to report fairly and freely on government activities.
Defamation and freedom of speech
A significant number of witnesses and submitters stated that Australia's
defamation and libel laws played a significant part in curtailing journalists'
efforts to pursue public interest stories.
This was not necessarily due to the damages awarded for publication of material
found to be libellous, but the legal costs of defending defamation cases.
Professor Michael West, an investigative journalist with two decades of
experience working for large Australian mastheads, submitted that Australia's
defamation framework was far more restrictive for journalists than the US
In Australia journalists can be sued whether a story is true
or not. The costs of paying lawyers and defending lawsuits are prohibitive. Law
firms are shutting down bloggers. Even the threat of litigation is often enough
to deter journalists from writing the truth. It leads to self-censorship.
In the US, it is far harder to sue journalists. The bar is
higher and requires evidence of malice on the part of the journalist rather
than claims of reputation damage.
Dr Berg also suggested that some features of Australia's legal system
made it difficult for private media organisations to compete on a level playing
field, in particular its 'onerous defamation law', as well as section 18C of
the Racial Discrimination Act.
The Freeline Group and Independent Australia both made submissions that drew
out the significance of this for journalists who were not backed by a major
publication and independent publishers. Independent Australia wrote:
Lastly, a reform of defamation law would also encourage
public interest journalism. Since journalists can
be sued regardless of whether a story is accurate, they are often reticent to
investigate sensitive issues or powerful people. Legislation should protect the
ability of the fourth and fifth estates to expose truth, especially with regard
to powerful institutions or individuals, without threat of costly litigation.
Legislation to restrict the ability of powerful and well-funded parties to
limit public interest journalism through expensive litigation would be of great
benefit to publications.
The Freeline Group submitted that Australia's libel laws were the 'major
single barrier to independent publishers', highlighting that this was noted by
Max Suich in 1990, who wrote:
The surprise [barriers from libel laws] lay in their cost,
both financially and intellectually. The financial cost arises not necessarily
from losing any case. There is a significant cost in obtaining advice prior to
publication. There is an even greater cost in taking advice if a writ should
drop and an exponentially greater cost if an experienced Q.C. is engaged for,
first, advice, and then the preliminaries to court action.
If the case should go to court it is often subsidised by the
plaintiffs, corporation, union, or organisation, which means the plaintiff does
not bear the cost out of his or her own pocket.
A mischievous try-on by a wealthy plaintiff which is
withdrawn or left to languish just before an actual court appearance, could
easily cost $35,000 : a significant burden to a small newspaper. Of
course if it goes to court but is then settled on the basis of each paying
their own costs, the bill might be $100,000 .
Regarding the effects of defamation laws on journalists, Professor
Pearson told the committee:
There are enormous problems with what is called the 'qualified
privilege defence'. It has a reasonableness component which courts can have
read down. Nevertheless, it is an attempt to allow for situations where
overwhelming matters of public interest might be excusable in defamation terms
because there is such public concern that the matter should be reported upon.
Professor Pearson proposed to the committee that:
of the lack of constitutional protections for public interest journalism in
Australia, the Commonwealth should build into every identified restriction on
media freedom a 'public interest journalism' defence, which would excuse a
'legitimate and demonstrated public interest in freedom to communicate on this
occasion', where the court would take evidence on the importance of the matter
of public concern, the publisher’s genuine track record of adherence to professional ethical
standards, its resolve to remedy past breaches (if any), and its commitment to
train their staff in legal and ethical issues. It should encourage other
Australian jurisdictions to take a uniform approach.
The MEAA noted that Australia's 'uniform national defamation law regime'
commenced operation in January 2006 by Council of Australian Governments (COAG)
agreement. Its submission highlighted that any changes to the law must be
universally agreed by jurisdictions. The MEAA suggested that this framework
should be reviewed, noting that an ongoing review by New South Wales, which was
to serve as a template for broader discussions for reform with states, appears
to have not progressed since 2015.
Some other measures were advocated for in evidence. For instance, Schwartz Media
submitted that any reform of defamation provisions should include a strict cap
on damages and the introduction of a tribunal system to avoid using and paying
lawyers for cases that could be resolved outside the courts.
Mr Tim Burrowes, the Founder of Mumbrella, suggested that a
professional membership of some bodies could potentially include support or
additional protections for members involved in libel cases. He added that some
of these initiatives were currently in the early stages of implementation
overseas, or had been discussed among APC members.
In respect of libel laws, the Attorney-General's Department informed the
Defamation is the responsibility of the states and territories. Uniform legislation was agreed between the
states and territories in the then Standing Committee of Attorneys-General to
regulate this issue.
Protection for whistleblowers and
Carrying on from the discussion above, the committee received some
evidence suggesting that current whistleblower protections are similarly
fragmented across sectors and jurisdictions, insufficiently robust in
particular sectors, and had been weakened by Commonwealth national security
laws introduced in 2014–2015.
Ms Talbot argued that it was not only journalists who should be
protected by law, but also their sources:
It's not only the journalists themselves that need
protection; there's also a need to make sure that people who are making
disclosures that are in the public interest don't suffer penalties from that.
In the legislation, we've highlighted perhaps some of the starkest examples of
when people who are disclosing injustice, or even criminal activity in terms of
special intelligence operations, themselves become subject to criminal laws.
The integrity of the entire processes all around becomes undermined, because if
there's illegal activity happening, and there's no threat to national security
if that illegal activity is revealed, there's a clear public interest in
understanding that illegal activity has happened.
Ms Talbot highlighted in particular that current provisions were too
fragmented across sectors and jurisdictions:
The public sector, the private sector and corporations—yes.
One can never be certain that, once they go through those steps, they'll have
done it in an adequate manner and will enjoy the limited protections that do
exist. So there is definitely a need to clarify and unify whistleblower
protection—and across the jurisdictions as well.
In his submission, Professor Joseph M. Fernandez cited the findings of
the MEAA regarding whistleblowers and recent national security legislation:
We've seen the greatest assault on press freedom in
Australia in peacetime. The Government's pursuit of whistleblowers through
legislation has been unprecedented. As MEAA has argued, when you go after
whistleblowers you go after journalism. In recent times a variety of federal
laws designed to hunt down whistleblowers and prosecute them were passed with
bipartisan support. This has undermined journalists' ethical responsibility to
protect their confidential sources. In essence, what we're seeing is the
criminalisation of journalism, and the criminalisation of truth telling.
Professor Fernandez also highlighted the recent 'grim' findings of the
whistleblowers have been sacked or forced to leave their job; some have
received death threats, been diagnosed with post-traumatic stress disorder and
have had their names and reputations tarnished within the industry, effectively
preventing them from finding employment in the same field.
Australian shield laws at a Commonwealth level offer discretion for the
courts to excuse a journalist from disclosing the identity of sources, in
consideration of 'the public interest in the communication of facts and opinion
to the public by the news media'.
Professor Pearson submitted that it was difficult for journalists to know what
protections shield laws could offer them, as they differed so much between
The other big area, of course, is the shield laws at the
Commonwealth level, where you invite a court to essentially weigh the
importance of the confidentiality of sources–that relationship between journalists
and their sources as an example of important public confidence–and weigh that
against other interests that might be at play in a particular case. That's what
most shield laws try to do in one way or another. There is another great
example of where state and Commonwealth laws differ in their wording and in
their application, and it is so difficult for a public interest journalist or
any journalist operating in the modern environment where their work transcends
borders, but all of these different kinds of laws, restrictions and permissions
or exemptions apply at different levels to their work as their work is
published in these different jurisdictions.
Moreover, his submission suggested that these protections could be
broadened to categories of people other than journalists, given that academics,
non-government organisations, journalism students and 'serious bloggers' were
also undertaking good public interest journalism in the modern digital era.
Dr Fernandez submitted that shield law provisions have been 'whittled
down over the years', including through recent national security laws
introduced between 2014 and 2015, referred to above. He commented that ongoing
cases may prove instrumental in determining whether shield laws were
While it is said that applications for disclosure of sources
have largely failed since the introduction of shield laws in most states and
territories, some pursuits for journalists' confidential sources are in
A number of submitters and witnesses drew the committee's attention to
the matter of copyright.
These submissions focused on two related issues: the reproduction of material
by news aggregators, leading to a loss of revenue by the producer of the original
material; and the use and reproduction of stories by journalists–whether by
modification or direct plagiarism–without acknowledgement of sources.
Some evidence considered there may be number of gaps and/or loopholes in
current legislation allowing aggregators to re-use written work without paying
for it. One submitter argued that, although news photographs, videos and
artwork are protected by copyright law, written work is not.
Another noted inconsistent requirements between online and offline
There is a gap in current legislation that allows online
content aggregators to operate without the same accountabilities and respect
for copyright that offline organisations are bound to. This has shifted the
profitability from content creators to content aggregators, even though they do
not produce the same level of value to the public.
Another submitter explained that the common practice of internet
aggregators to present 'collections of headlines of stories' in e–newsletters
and websites, with links to the original stories:
...would appear to be blatant breach of copyright but it is
legal because common law has established that a single line of text – a
headline – is too short to be copyrighted. Australian aggregators also are
excluded from recent amendments to the Copyright Act which provide for courts
to order internet service providers to disable sites located outside Australia
and which provide access to copyright material. Aggregation therefore is a
legal practice which is able to operate on a low cost, high margin basis
largely by using genuine journalists’ and publishers’ material while profiting
from advertising sales.
In 2017, a number of journalists whose work had been copied by others
without acknowledgement, payment or authorial consent, took to Twitter to share
their experiences with the hashtag #journotheft. In its submission, Freeline
Group gave an example of this happening to one of their members:
Recently a freelance journalist in this group publicised the
fact that she had a major investigative story almost immediately copied by
other Australian outlets. It was a sensitive story that required several months
of painstaking investigation and building up the trust of informants. The
original quotes and most of the information from the story was republished by a
number of media outlets, rewritten slightly but not substantially different to
her original story. The copies either carried no byline or were published under
a staff byline of the copying site. This was done without the consent of the
freelance journalist or any attribution or payment to her.
We are concerned that there seems no effective mechanism to
regulate publishers or journalists that repeatedly engage in such breaches.
This report has noted efforts to reform EU, as well as Spanish and
German copyright law (Chapter 5). A submission to this inquiry by two academics
argued that the development of a similar licensing scheme in Australia
requiring aggregators to pay a fee for use 'would need to grapple with the
existing debate over the merits of the current fair dealing regime', which
provides exceptions for use of copyrighted material. They further noted that '[S]ome
current practices may well not amount to fair use, but this appears not to be
an option local publishers wish to explore'.
Other Commonwealth policies
Some evidence advocated for the Commonwealth to more freely and
publically share data collected through the Australian Bureau of Statistics
This, they suggested, would encourage innovation in journalism and also allow
fact-checking of media stories. Ms Jacqui Park, the Chief Executive Officer of
the Walkley Foundation, told the committee:
One of the programs we've supported through our innovation
program is a tool to unlock the ABS data and provide it in infographics so that
any news organisations can pick that up. For example, we could be thinking
about something like an arm's length news service that has access to data out
of the health department. You can imagine the kind of very useful journalism
that could come out of that.
The Freeline Group noted a number of fees that could be reduced by the
Commonwealth, to assist independent journalists pursue stories, including
Freedom of Information requests, ASIC company searches, and digital court
In general, the committee heard compelling evidence that the
Commonwealth should consider making some adjustments to taxation and
legislative systems, in order to encourage a healthy and diverse public
interest journalism sector in Australia.
These kind of policy changes would assist the sector in indirect,
market-based ways, which would not only come at a comparatively low-cost to the
government and taxpayers, but would also go some way to ensuring that the Commonwealth's
general policy approach to support for media would not directly compromise the
principles of freedom and independence of the press.
It was clear to the committee that there was real potential for the
Commonwealth to encourage a healthy news media sector by making moderate
adjustments to certain tax settings. This approach was generally supported by
evidence, as a low-cost, market-based approach to assisting journalism that
would maintain the principle of government non-intervention in the media sector
It is clear to the committee that the Commonwealth should consider
broadening the eligibility criteria for DGR status, to encourage more private
support for not-for-profit media organisations. Although Australia does not
historically have the high levels of philanthropy that the US does, this is
clearly a policy option that the Commonwealth has to potentially unlock
philanthropic funding to revitalise the media sector.
Of course, this should be done judiciously, so as to make eligible only
providers of quality journalism, and ensure that private companies cannot
exploit the measure as a tax loophole.
Similarly, the committee considers that offering a tax rebate for all
Australians subscriptions to quality news providers should be at least considered
by the Commonwealth. This should include a cost-benefit analysis that models
its effects for the news sector and cost to the Commonwealth Budget.
The committee recommends that the Commonwealth develop and implement a
framework for extending deductible gift recipient (DGR) status to
not-for-profit news media organisations in Australia that adhere to appropriate
standards of practice for public interest journalism.
The committee recommends that the Treasury undertake cost-benefit modelling
on extending the tax deductible status of news media subscriptions to all
Australians, not just those who can already claim the cost of subscriptions through
existing income tax arrangements, for subscriptions to news media organisations
in Australia that adhere to appropriate standards of practice for public
Laws restricting freedom of
This committee received evidence expressing concern that journalists
wishing to investigate some public interest issues may be unduly inhibited by
In particular, submitters emphasised that despite recent reforms to attempt
to moderate some of the more severe prohibitions on reporting in the ASIO Act and
the Border Force Act, the law remains sufficiently oppressive that journalists are
reluctant to report relevant stories–even when reportage would not negatively
impact national security or border protection.
In considering this evidence, the committee affirms the paramount importance
of laws related to national security and border protection, and reiterates that
some sensitive material is not suitable for public release on account of
However, the committee also notes that freedom of political expression
and freedom of the press are fundamental democratic rights that Australia holds
dear, so that any limitations on these rights must be both demonstrably
necessary and proportionate. The committee is of the view that a lack of
clarity in these laws and the perception that anyone reporting on national
security matters may be penalised, regardless of whether reporting of a story
actually poses any security threat, may inhibit some journalists from reporting
issues of significant public importance.
Given the potential harm this chilling effect of national security laws
may have, the committee considers there is a need for an audit of the current
laws that impact on journalists reporting on matters that touch on or focus on
national security and border protection, to identify unjustifiably harsh or
draconian laws, inconsistencies in the law or and any lack of clarity in the
law, and to consider whether there is a need for further reform of the way
relevant laws apply to journalists. The committee considers that the Australian
Law Reform Commission is the most appropriate body to undertake such a task.
The committee recommends that the Australian Law Reform Commission conduct
an audit of current laws that impact on journalists reporting on matters that
touch on or focus on national security and border protection, to identify and
analyse unjustifiably harsh or draconian laws, inconsistencies in the law and
any lack of clarity in the law regulating the work of journalists in this
context, and to consider whether further reform is needed to achieve an
appropriate balance between the need to preserve national security and the need
for journalists to be able to carry out their work in the public interest.
The committee notes that the Commonwealth worked closely with the states
and territories to develop a uniform set of defamation laws in 2005.
The committee notes indications that there appears to be an appetite for
COAG to review the framework of existing defamation laws, especially
considering this framework has been implemented for more than a decade without
assessing potential areas that could be improved.
Given the National Uniform Defamation Law 2005 was agreed in the COAG
context and given that it covers the majority of defamation law in Australia,
it would be appropriate for the Commonwealth to investigate how it can work
through this forum to assist the states and territories to review and reform
our defamation laws, or to reinvigorate efforts already underway to do so, to
ensure those laws are consistent with a viable, independent public interest
journalism sector, work appropriately with whistleblower protection regimes,
and generally operate effectively in the digital age.
The committee recommends that the Commonwealth work with state and
territory jurisdictions through the Council of Australian Governments to complete
a review of Australian defamation laws, and subsequently develop and implement
any recommendations for harmonisation and reform, with a view to promoting
appropriate balance between public interest journalism and protection of
individuals from reputational harm.
Protections for whistleblowers and
The committee received evidence that the fragmented nature of current
legal provisions concerning whistleblowers and journalistic sources, both
across sectors and jurisdictions, can lead to a great deal of uncertainty for
some journalists pursuing stories. The committee considers that the
Commonwealth should look to harmonising these laws, in part to make it easier
for journalists to pursue legitimate stories in the public interest.
The committee is aware that the Parliamentary Joint Committee on
Corporations and Financial Services (JCCFS) completed an inquiry into whistleblower
protections in September 2017.
Although the JCCFS report did not consider the effects of current provisions on
journalists in great depth, this committee notes and endorses that committee's recommendation
that Australia's whistleblower framework should be harmonised across sectors
The committee also notes that in its 2009 report on a comprehensive
scheme for whistleblower protection in the Commonwealth public sector, the House
of Representatives Standing Committee on Legal and Constitutional Affairs also
suggested that extending whistleblower protections to the private sector was a
matter that should be considered in the future. At paragraph 9.30 of its
report, that committee stated:
legislation on protection for disclosures concerning misconduct within the
private sector appears piecemeal. In view of the concerns raised on the issue
during the course of this inquiry, the Committee considers that protections for
the disclosure of wrongdoing within the private sector could usefully be
reviewed in the future.
The committee notes that the Treasury Laws Amendment (Enhancing
Whistleblower Protections) Bill 2017 was introduced to the Senate on
7 December 2017, to be considered fully in 2018. This legislation
would extend the limited corporate whistleblower protections in the
Corporations Act 2001, and broaden existing protections for the kind of
individuals making disclosures, and the types of disclosures that can be made.
However, members of this committee will also look to the Commonwealth's response
to the JCCFS report, to see if the in-depth recommendations made by its report
have been appropriately considered.
The committee recommends that the Commonwealth look at ways to expand
whistleblower and shield law protections, and to harmonise those laws between
the Commonwealth and state and territory jurisdictions, noting the work in this
area already underway.
The committee received some evidence on enhancing Australia's copyright
regime. This focussed heavily on the difficulty for publishers and journalists
in monetising content published through aggregators, and in dealing with the
reproduction of stories or, indeed, with cases of direct plagiarism.
The committee is aware of the recent report by the Productivity Commission
into intellectual property, which may lead to some administrative and
legislative reform in the area.
Additionally, the committee understands that copyright legislation is
currently being considered by the European Union which is intended to address
the use of news content by aggregators through asserting publishers' rights. This
overseas experience may provide policy options that can be applied locally in
the future, and should be monitored.
The committee would also like to note that, as discussed earlier in this
report, there seems to be a growing willingness on the part of aggregators to
cooperate with elements of the media sector and journalists to assist in building
more sustainable models of monetising original content. This is a positive
development, and should be encouraged going forward.
There may very well be a role for the Commonwealth to play in this space
in the future. However, beyond the matters discussed, the evidence received by
this committee about this complex policy matter did not go to a level of
specificity or depth that would enable the committee to reach firm conclusions
about whether reform to copyright law is desirable or practical at this stage.
Senator Catryna Bilyk
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