Chapter 1 Three broadcasting reform proposals
Context of the inquiry
The operations of Australian media have been the subject of recent
government-established reviews and policy deliberations, as well as debates in
the wider community. Two major reviews and the introduction of a package of
legislation form the context for current parliamentary attention. A brief
overview of these inquiries, and the government’s response (in the form of the
introduction of legislation and the establishment of this committee), is
Convergence review (2012)
On 14 December 2010, the Government announced the Convergence review,
chaired by Glen Boreham, ‘to examine the policy and regulatory
frameworks that apply to the converged media and communications landscape in
Australia.’ During the review period, a range of
discussion papers were released, and an interim report was released in December
Among its findings in its March 2012 final report, the Convergence
review committee recommended making any new policy framework
technology-neutral; removing barriers to entry for the supply of content or
communications services, except in relation to a finite resource such as
spectrum; and establishing a new communications regulator that can certify
whether industry self-regulation meets best practice.
Finkelstein review (2012)
The Independent Inquiry into Media and Media Regulation was established
in September 2011. The review, led by former Justice of the Federal Court, Mr
Ray Finkelstein QC, was asked to examine current media codes of practice and
how they related to technological convergence and the production of quality
news. It also examined how to strengthen the independence and effectiveness of
the Australian Press Council.
Recommendations in the February 2012 report of the Finkelstein review included:
establishing a statutory News Media Council to set journalism standards and
handle complaints in relation to breaches; the Productivity Commission inquiring
into the health of the news industry; and the Government inquiring into the
health of the regional and local news industry.
Government response and parliamentary consideration
In November 2012, the Minister for Broadband, Communications and the
Digital Economy, Senator the Hon Stephen Conroy, announced the Government’s
initial response to the Convergence review. The measures included:
n introducing a
multichannel Australian content requirement for each commercial broadcaster;
n retaining the 55 per
cent transmission quota of Australian programming for the commercial television
broadcasters’ primary channels;
n not making spectrum
or broadcast licences available for a fourth free-to-air television network;
n investigating the
removal of the 75 per cent reach rule.
On 12 March 2013, Minister Conroy announced the formal response to both
the Finkelstein and Convergence reviews, referring to a series of proposed
reforms, and a parliamentary committee which would be established to consider
three further areas of potential reform. A package of six bills
was introduced on 14 March 2013, and the Joint Select Committee on Broadcasting
Legislation was appointed by resolution of the House and Senate on 13 and 14
March respectively, with terms of reference to investigate three additional
areas of reform:
n the abolition of the
75 per cent rule, particularly in relation to regional and local news;
n whether the
Australian Communications and Media Authority (ACMA) should be required to
examine program supply agreements for news and current affairs when determining
whether a person is in control of a commercial television broadcasting service;
n on-air reporting of
ACMA findings regarding broadcasting regulation breaches.
Following their introduction, the bills were referred to committees in
the House and Senate. The Senate Environment and Communications (Legislation)
Committee held public hearings on 18 and 19 March, and reported on 20 March.
The Chair of the House Committee on Infrastructure and Communications, in a
statement to the House on 18 March, noted that other inquiries into the
issues were underway, and referred to the comprehensive inquiry program which
had been proposed by the Senate Committee.
Role of this Committee
Following its appointment, this Committee held its first meeting on 15 March
to determine the scope of its inquiry and how it could best conduct its
investigations, noting that these would occur in an environment where reviews
and debates into the legislation were already in progress, and an extensive
level of public debate was underway. In light of this, and the Minister’s remarks
if the Committee were to ‘come up with a quick resolution on the 75 per cent
rule, the Government would include this amendment in the general package’,
submissions were invited on this area of proposed reform. Following a public hearing
on 18 March 2013 and subsequent deliberations, the Committee announced the
following day that it had not reached an agreed position on the 75 per cent
reach rule, and that it would therefore continue to take evidence on this and
the other two terms of reference. Further submissions were invited.
Status of legislation and impact on this report
During this period, the package of legislation provoked heated debate in
the Parliament and the wider community. Following negotiations, two of the six
bills in the package passed the House on 19 March 2013 and the Senate on 20
n the Broadcasting
Legislation Amendment (Convergence Review and Other Measures) Bill 2013, which
covered the announced Australian content and spectrum changes, updated the ABC and
SBS charters for digital content, and ensured that the SBS board has an
Indigenous member in recognition of the SBS providing a National Indigenous
Television service; and
n the Television
Licence Fees Amendment Bill 2013, which permanently reduced the annual
commercial television broadcast licence fee.
The remaining four bills were discharged from the Notice Paper on 21 March
n the Broadcasting
Legislation Amendment (News Media Diversity) Bill 2013, which sought to
introduce a public interest test on the merger of news organisations to ensure
sufficient diversity in news and current affairs;
n the News Media
(Self-regulation) Bill 2013, to allow the new Public Interest Media Advocate to
approve an industry self-regulatory body and recognise a news media
n the News Media
(Self-regulation) (Consequential Amendments) Bill 2013, to amend the Privacy
Act 1998 consequential to the above Bill; and
n the Public Interest
Media Advocate Bill 2013, which sought to establish the Advocate as a statutory
officer to implement the self-regulation and diversity schemes.
The Committee, having agreed to investigate in more detail the two other
areas it had been invited to consider, continued to follow up matters raised in
evidence received and discussed at the public hearing held on 18 March. Although
intensive debate on the proposed reforms had initially occurred in Parliament,
the Committee received few additional submissions. Therefore, the Committee decided
to present its observations on the three areas outlined in its resolution of
appointment, in order to provide a report reflecting the status of views in
industry and the community at this point in time. These areas are discussed
Submissions received and witnesses who provided evidence at the 18 March
public hearing are listed at Appendices A and B respectively. A transcript
of the hearing is available on the Committee’s website.
The 75 per cent audience reach rule
Section 53 (1) of the Broadcasting Services Act 1992 specifies
that, ‘A person must not be in a position to exercise control of commercial
television broadcasting licences whose combined licence area populations exceed
75% of the population of Australia.’ The Act makes the Australian
Communications and Media Authority (ACMA) responsible for determining licence
area populations, and s.53(3) of the Act requires ACMA to have regard to the
most recently published census in making this determination.
History of the rule and regional markets
Until 1987, the limit on television broadcast licences had been that no
person could control more than two stations Australia-wide. In recognition of
the potential economies of scale from larger operations, and to complement new
rules on cross-media ownership, this limit was changed to a 60 per cent audience
reach rule (that is, the combined licence area populations could not exceed 60
per cent of Australia’s total population). The reach rule was expanded to 75
per cent in 1992.
In its 2000 report, the Productivity Commission stated that the rule prevented
metropolitan networks from expanding into regional Australia and allowed the
establishment of smaller regional networks. The Commission also stated that the
reach rule appears to have been intended to make room for regional operators
and underpin local program production.
Regional services were also affected by regional-specific regulation.
Until 1989, most regional areas had just one commercial station that could
select programming from the main metropolitan stations. Their monopoly position
made them very profitable. From 1989, the Commonwealth Government introduced
regional television aggregation, where two additional stations were introduced
into each regional market. Profitability was reduced, but viewers had a wider
range of programs.
Aggregation led to regional television stations affiliating with one of
the three metropolitan networks. Affiliation agreements gave the regional
stations access to the larger network’s programming for a fee which is
typically based on the regional station’s gross revenue.
The current audience reach rule
The current audience reach percentages are in the table below. The table
demonstrates that the television market in Australia has split into two
segments, with three larger networks focussing on major centres and three
smaller networks focussing on regional centres.
Table 1.1 Commercial
television broadcasting licensees – current holdings of ‘regulated media
TV audience reach (%)
Seven West Media
Nine Entertainment Co.
Prime Media Group
Submission 7, p. .
Local content rules
Approximately 10 years after aggregation, some regional networks closed
down news offices. Prime Television closed offices in Canberra, Newcastle and
Wollongong in June 2001 and Southern Cross closed offices in Canberra, Cairns,
Townsville, Darwin and Alice Springs in November that year. The networks stated
they did so due to high costs and low ratings.
In response, the then Australian Broadcasting Authority (ABA)
commenced an investigation into the adequacy of local news on commercial
television in four markets: Regional Queensland, Northern NSW, Southern NSW and
Regional Victoria. It found that aggregation had increased the quantity of
local news broadcast, but that there had been less competition in sourcing news
since the mid-1990s. It also found that since aggregation there had been a
‘significant decline’ in local programs other than news. The ABA concluded that
the objects of the Broadcasting Services Act 1992 in relation to the
following were not being achieved:
responsiveness to audience needs in relation to material of local significance.
The ABA implemented a new licence condition to support local content in
these four aggregated markets, which commenced in February 2004. This condition
was extended to the Tasmanian market in January 2008.
In 2004, the ABA released a report on the remaining regional and rural
licence areas. It concluded that these areas were fundamentally different
because of their smaller populations and larger areas. It declined to apply an
additional licence condition for these markets, but noted that at least one
commercial service was providing local news and information in each area.
In evidence, the Department suggested that a population of 500,000
tended to be the minimum for local content rules due to the costs of developing
But they are really around areas where the population is
above 500,000. That is not a hard-and-fast rule, but that is certainly the way
the licence condition has been applied mainly because there was a recognition
by the ABA at the time it introduced the licence area … that some of these
licence areas are very small and it may be an unreasonable impost to put upon
these licence areas the provision of local news or materials of local
significance given that is much more expensive to produce than programming that
is purchased and just provided.
The current local content rules refer to two types of area: the full
licence area, and within each of these, between four and seven local areas. The
exception is Tasmania, which is one local area only. Material of local
significance must relate directly to either the local area or the licence area.
Broadcasters receive points for material of local significance in line with the
Table 1.2 Points for each minute of material of local
Material not broadcast during an eligible period
(overrides entries below)
Material (other than a community service announcement)
that has been previously broadcast to a local area (overrides entries below)
News that relates directly to the local area
Other material that relates directly to the local area
News that relates directly to the licence area
Other material that relates directly to the licence area
2.3 of the Broadcasting Services (Additional Television Licence Condition)
Notice, 8 November 2007
Eligible periods are between 6.30 am and 12 midnight during the week and
from 8 am to 12 midnight on weekends. Licensees are required to accumulate
90 points a week and at least 720 points in a timing period (usually six
weeks). There are limits on the number of times a community service
announcement can generate points and no more than 50 per cent of points can be
from other material that relates directly to the licence area.
In summary, the system encourages news and local content. However,
nothing in the rules stipulate the quality of the material, such as whether it
includes relevant footage or interviews.
Other ownership rules
There are other ownership rules that apply to the commercial media that
are designed to support diversity. They are summarised in the table below:
Table 1.3 Commercial media ownership rules
4/5 rule (minimum num-ber of voices)
Television, radio and newspaper
No fewer than five independent and separately controlled
media operators or groups in a metropolitan commercial radio licence area,
and at least four in a regional area
2 out of 3 rule
Television, radio and newspaper
A person cannot control more than two out of three media
platforms in a commercial radio licence area
One to a market rule
A person may not exercise control of more than one television
licence in a licence area, except for satellite licences issued under section
38C of the Act
Two to a market rule
A person may not exercise control of more than two radio
licences in a licence area (with an exception for supp-lementary licences
issued under section 40 of the Act)
Review Final Report, Department of Broadband, Communications and the Digital
Economy, March 2012, p. 19.
In addition to these rules, media companies are subject to the Competition
and Consumer Act 2010, in particular its restrictions against
mergers that would substantially lessen competition.
Previous reviews on the audience reach and local content rules
As part of media reforms conducted in 2006, the review’s discussion
paper supported the continuation of the reach rule, although it was not
specifically examined.  The discussion paper
also supported local content rules in the four aggregated markets in which they
were operating. The Government proposed two reforms: extending the local
content rules to Tasmania; and legislating to require the imposition of licence
conditions involving material of local significance in these markets. Both of
these were implemented.
The discussion paper also considered other regional markets and stated
that the Government would continue to monitor local content levels in them. It
left open the option of extending local content licence conditions to these
markets if ‘local content levels decline materially.’ However, the
Government also noted that local content adds to the costs of regional
broadcasters and that any moves to extend local content rules would need to be
subject to a cost-benefit analysis.
The 2012 Convergence review specifically discussed media ownership laws.
In two submissions from Free TV Australia, representing all the commercial
television broadcasters, the removal of the 75 per cent rule was supported. The
second submission noted that the reach rule ‘is increasingly anomalous in a
borderless media environment.’
Free TV Australia also commented on the regulation of media ownership.
In its first submission, it supported the existing media diversity rules. But
in its response to the interim report, Free TV Australia argued that the
current media ownership rules worked to the disadvantage of regional media and
Existing regulation of media ownership imposes particular
burdens on the regional media sector, stifling growth and denying regional
media consumers access to the benefits of investment in the regional media
It is arguable the ‘voices’ regime, ostensibly enacted to
protect diversity and preserve localism, could in fact have the opposite
The Convergence review found that technological change is breaking down
the differences between various media types. Australians are still sourcing
news, information and entertainment from the same organisations, but the internet
has reduced the relevance of the 75 per cent reach rule:
Geographic markets are still relevant for maintaining an
adequate level of access to local news and commentary. However, the internet
has also made national media outlets accessible across the whole country. Media
and communications are increasingly viewed nationally, with catch-up television
services and online news websites allowing programming beyond 75 per cent of
the population and bypassing geographic borders. The increase in nationally
networked content has also diminished the effectiveness of the 75 per cent
The Convergence review recommended that all the media ownership rules be
removed, including the audience reach rule, apart from a rule stipulating the
minimum number of owners (the 4/5 rule). In their place would be a public
interest test for transfers of ownership of media companies.
The Convergence review also discussed local content rules and
recommended that the compliance regime should be more flexible. It did not make
substantive comment about the requirements themselves, apart from noting that
commercial radio and television licensees should continue to meet minimum
requirements for local content, which would be reviewed and amended from time
to time by future regulators.
Industry views during the inquiry
At the hearing, the Committee heard from all six major television
networks. The Committee was aware of media reports of a possible merger between
Nine and Southern Cross. The latter has an affiliate agreement with Network
Ten. Abolishing the reach rule would allow such a merger to proceed, without
any divestiture of television assets. Most, but not all, of the networks
represented at the hearing were in favour of abolishing the reach rule. Their
individual positions were:
n WIN opposed removing
the rule because it would lead to a reduction of regional news and regional
n Prime supported
removal because it, ‘quarantines regional broadcasting to the past’;
n Southern Cross
supported removal because it, ‘belongs to a different era’;
n Ten opposed removal
in the context of the legislation before the Parliament at the time, noting
that the other ownership rule changes recommended in the Convergence review
were not included in the legislative package;
n Nine supported
removal because the rule was, ‘an out of date and irrelevant barrier that
prevents our industry from investing in and delivering more local content’;
n Seven expected that
the reach rule would be eventually abolished, but did not support removal now
because there had not been sufficient consideration of the mergers that would
most likely occur.
The Committee sought at the hearing an explanation for the apparent
breakdown in consensus between the Free TV Australia submissions and the views
expressed by individual networks during the inquiry. Network Ten stated that
the reach rule was not considered a priority issue in developing the Free TV
submission and that the views it expressed were in part driven by a desire to
Network Ten, as Network Ten, has never said a single word in
favour of lifting the reach rule. In any meetings that we have had with the
government, with cabinet, with ministers, with any politician or the
bureaucracy or the Convergence Review, Channel 10 has never sought to lift
the reach rule. There were 24 words in a Free TV submission to the Convergence
Review out of 8,600 words which mentioned the reach rule and said that perhaps
it was time to look at getting rid of it. Free TV is a consensus based organisation
and in the cut and thrust of getting consensus, you often let things go
Seven West Media confirmed this general approach at the hearing.
Benefits of removing the rule
The Committee received evidence at the hearing about two clear benefits
from removing the rule. The first is that the regional networks would most
likely merge with metropolitan networks, increasing efficiency and economies of
scale. Nine advised the
Committee that the regional networks’ corporate and operational headquarters
are based in major centres, in particular Sydney, Melbourne and Wollongong. These
are the likely sites of duplication and are where the most efficiencies would
be found. Regional staff are mainly involved in sales and news gathering, which
would not be duplicated with a metropolitan network.
The second benefit is that regulation would be more consistent with
converging technology and media. For example, some of the most popular online
news sites in Australia in June 2012 were run by television broadcasters:
ninemsn Nine News was ranked first and Yahoo!7 News was ranked third.
Online media is the growth sector for advertising expenditure, increasing its
market share from 15 per cent in June 2009 to 24 per cent in June 2012.
In June 2012, 1.6 million people streamed a television program and 1.2 million
people downloaded a television program.
The market for local news in regional areas
The Committee was particularly concerned with any effect the removal of the
audience reach rule may have on local news in regional areas. Mr Ian Audsley,
from Prime Media Group, described Nine’s purchase of NBN Television, which had
a high rating local news service in Newcastle. The service was retained and continues
to rate well. Mr Audsley explained that:
In a former life I was at the Nine network. In that time we
acquired NBN Television, which is the Nine affiliate in northern New South
Wales. The task fell upon me to integrate NBN into the Nine network. That was
in about 2006 or 2007. Today, in 2013, NBN news is still in place. It is still
delivering audiences—somewhere around 50 per cent of the audience—between six
and seven o’clock … I just emphasise that it is not demonstrated anywhere that
networks will collapse local news infrastructure and centralise it to Sydney or
If the experience with NBN Television is a useful guide, then abolishing
the 75 per cent reach rule is unlikely to put at risk local news programs which
attract large audiences.
The great majority of the evidence to the Committee suggested that there
is a substantial demand for local news in many regional markets, which means
that some networks are offering much more local news than they are required
under the local content rules. Prime stated that they make a large investment
in local news and that it generates substantial commercial returns, both
directly and indirectly:
… we produce six local half-hour news bulletins for the areas
we broadcast to, which is far in excess of what the requirement is under
legislation, and we do about 140 local news and local weather updates per day.
We do not believe that local news will disappear with changing the 75 per cent
reach rule. The reality is that local news services deliver audiences well in
excess of 40 per cent and 50 per cent of the total audience, and any
broadcaster that took the blade to local news services would suffer from an
audience point of view. Whether the revenue comes directly into local news
programs or other parts of the schedule is really irrelevant because it is a
bit like the AFL: you get a halo effect in revenue and audience from having
WIN stated the opposite. Despite its large investment in news, on a
similar scale to Prime, WIN stated that there is no profit from its local news:
… WIN spends probably three to four times the amount of
revenue it actually generates to produce those news services. There is no
commercial gain for WIN in producing so many news services.
The Committee notes that WIN’s viewpoint is different to that of other
networks. Nine stated that there is a demand for local news and that an evening
bulletin will give a network ‘the platform to launch your primetime schedule.’
Southern Cross said that it collects footage and news in some regional markets
where it can generate sufficient ratings, such as the Spencer Gulf.
While the Committee is aware that broadcasters often generate a
commercial return from an investment in local news, it is not guaranteed.
Southern Cross stated that it has tried to improve its market share in some
markets, but that it is difficult to break into a market. Southern Cross
attributed this to the size of regional markets:
I think part of it is to do with the size of the markets
themselves. If you have the first mover advantage … and you are first in the
market then you certainly have a big advantage, and it is very difficult for an
operator confined with the style of programming we have as well. But
principally I do think it is a market size issue more than anything else.
Seven West Media agreed, noting that in most regional markets there is
not room for three networks specialising in local news. They commented, ‘There
will only be room for first mover advantage and maybe another one.’
If a market is sufficiently small, then it may not be able to
commercially support any substantial investment in local news. The then Government
made this point in its discussion paper for its 2006 reforms, where it declined
to extend local content requirements, other than to Tasmania. The Committee
heard in evidence that WIN shut down its news service in the Riverland and
Mount Gambier in South Australia partly due to the small size of the market.
This region has 120,000 people, compared with the benchmark for local content
requiremens of 500,000 suggested by the Department in evidence.
Based on these views, it may be expected that an established local news
service in a large regional market will maintain market share and revenues, at
least for the time being. The Committee notes the view of Professor Fraser,
from the Communications Law Centre, who advised that commercial broadcasters
would only continue to provide local news if it remained profitable.
Given the current growth in online content and its potential to disrupt the
broadcasting industry, the Committee is aware that profitability of local news may
not be able to be guaranteed in the medium to long term.
Regulation would be a way of managing this uncertainty. Nine stated at
the hearing that it would be willing to provide an enforceable undertaking to
achieve a required level of local content and tabled draft provisions.
Later in the day, Seven West Media queried whether enforceable undertakings
would be effective if a broadcaster was not profitable.
After the hearing, Nine made a supplementary submission where it proposed that
additional local news requirements be included in the Broadcasting Services
Act 1992. The new provisions would be targeted at broadcasters who reach
more than 75 per cent of the audience:
… Nine proposes that a requirement applicable only to
broadcasters who control licences that exceed more than 75% of the population
be developed. Under this proposal those broadcasters would be required to
produce 30 minute regional news bulletins each week day in all local licence
areas owned by that broadcaster. This requirement will mean every local area
that currently gets its own news service will continue to do so. It is a
legislative safeguard that will mean the types of news services currently
provided in regional markets today will continue. The requirement would form
part of a broadcaster’s licence conditions and would be enforced by the ACMA.
The Committee notes that there is a range of regulatory options
available and expects that it would be possible to safeguard local news,
especially if industry were consulted during the development of any new
The Committee considers that, in the larger regional markets, there is
sufficient demand to ensure news services of a certain quality from one or two
broadcasters. The local content standards do not seem to be of practical relevance
to the leading news broadcasters in each regional market, and it is unlikely
that the provision of news services is being driven by the reach rule alone. This
has been demonstrated where metropolitan networks own regional licences but
still invest in local news programs.
The Committee notes concerns that more thought should be given to the
effects of mergers that are likely to eventuate if the reach rule is abolished.
This includes possible adverse effects on regional areas because of losses of
local staff, content of local significance such as local news, and advertising.
The Committee received little specific evidence as to the overall consequences
for regional communities caused by likely mergers, but is aware of views of
some regional advocates that the impacts could be serious. Therefore, the
Committee supports the removal of the reach rule, provided there are safeguards
in place to deliver appropriate local content to the regions either by
legislation or by legally enforceable undertakings by the relevant broadcaster,
and subject to the issues raised in Recommendation 1.
The Australian Government introduce legislation to abolish
the 75 per cent audience reach rule, provided there is legislation or legally
enforceable undertakings to safeguard local content in regional Australia.
Prior to the introduction of the
legislation, a clear definition of local content needs to be established
which ensures regional viewers have access to appropriate levels of high
quality, locally devised, and locally presented programming.
Program supply agreements
Control of broadcasters is defined in Schedule 1 of the Broadcasting
Services Act 1992. Broadly, for a person to have control of a licence or
company, the legislation requires a much greater relationship than the
provision of a program or a small number of programs. Sub-paragraph 2(1)(b)(ii)
of the Schedule states that a person is in a position to exercise control of a
licence or a company if:
… the person, either alone or together with an associate of
the person, is in a position to exercise (whether directly or indirectly)
control of the selection or provision of a significant proportion of the
programs broadcast by the licensee;
Subclause 2(2) of the Schedule specifically excludes program supply
agreements from the question of control if they only relate to the programs or
On 25 February 2013, during Senate Question Time, the Leader of the
Greens, Senator Christine Milne, asked the Minister for Broadband,
Communications and the Digital Economy about the relationship between News
Limited and Channel Ten, through the former producing the latter’s current
affairs program, Meet the Press. In its submission to
this inquiry, Ten responded that it retains editorial control and general
oversight of the program’s production in line with its licence obligations.
In considering this issue, the Committee notes that industry unanimously
opposed widening the definition of control to include the provision of
particular programs; no other views were received.
Industry gave two main reasons for its position, the first of which was that
journalists have long crossed-over between different media outlets. The
Australian Subscription Television and Radio Association (ASTRA), the peak body
representing the subscription television industry, stated:
Involvement by journalists and commentators from one media
entity with the news or current affairs programs or content produced or
provided by another media entity is not new or novel – it has been common
practice for decades. For example, journalists and commentators from Fairfax,
News Ltd and other media entities regularly appear across a range of Sky News
programs, just as they might appear on the ABC’s Insiders.
The second reason given was that regulators have in the past used the
Act to prevent certain relationships between broadcasters. As an example, Seven
West Media described an occasion where program supply agreements went beyond
For example, in the 1999 ABA investigation into the possible
breach of any provision of Part 5 of the Broadcasting Services Act 1992 by
Prime Television Limited (Prime Investigation) the ACMA took the preliminary
view that Prime was in a position to exercise control of Canberra FM and Radio
Newcastle, as a result of arrangements between Prime and Austereo that Prime
would provide news services to Canberra FM and Radio Newcastle in return for
the radio stations promoting Prime on the radio, and acknowledging Prime as the
source of the news. Footnote - It was not necessary for the ACMA to
reach a final decision on this matter as the parties amended the relevant
Seven West Media also noted that the ACMA has published a list of
factors that it takes into account when determining who is in a position to
exercise control of a ‘significant proportion’ of programs. These include:
n scheduling decisions;
n decisions to either
commence or cease broadcasting a program; and
n decisions on which
programs to purchase and from whom.
The Committee does not believe that it is worth specifically including
program supply agreements in the control provisions of the Act at this point in
time. Most importantly, the Committee received no submissions in favour of the
proposal. Further, the broadcasting regulators have enforced the control provisions
in the past. While control provisions may require amendment at some point, at
this stage the Committee makes no specific recommendations on this issue.
On-air reporting of ACMA findings
ACMA currently has a broad suite of enforcement powers. Up until 2006, a
number of reviews found that ACMA, and its predecessor the ABA, had limited
mid-range enforcement powers, especially in relation to breaches of codes of
practice. In the words of the Productivity Commission, ‘a licensee is unlikely
to face a sanction for breaching a code of practice.’
The impetus for reform appears to have been Professor Ian Ramsey’s report
in 2005, which he prepared at the request of the ABA. The report recommended such
enforcement powers as enforceable undertakings, injunctive relief and civil
monetary penalties. In September 2006, the
then Government introduced legislation that gave ACMA many of these powers.
ACMA’s enforcement powers now include the following:
action – infringement notices, enforceable undertakings, giving a remedial
direction, and suspending or cancelling licences;
n civil litigation
– injunctions, an order to cease, civil penalty orders, and enforcement of
compliance with an enforceable undertaking; and
proceedings – referral to the Director of Public Prosecutions in relation
to a criminal offence.
The broadcasting of regulatory findings was raised and recommended in
all of these reviews, and was also raised and recommended in the recent
Convergence and Finkelstein reviews. The difference between the two latter reports
was that the Convergence review recommended that a content regulator should
have the power to order the publication or broadcast of regulatory findings on
the relevant media platform, for news and commentary programs only.
In its submission, ACMA argued that it did not have a sufficient range
of mid-tier powers. For example, a broadcaster needs to offer an enforceable
undertaking; ACMA cannot impose one on a broadcaster. The alternative for ACMA
when a broadcaster does not wish to offer an enforceable undertaking is to
impose a licence condition. However, ACMA views this as a ‘serious outcome that
is best suited to high-end breaches or to damaging, repetitive conduct.’ The
Administrative Appeals Tribunal agrees that imposing a licence condition is a
Industry unanimously opposed the proposal.
The reasons given by Commercial Radio Australia, which were mirrored in some
other submissions, included that:
n ACMA already
publicises the findings of its investigations, which includes press releases,
its website and social media;
n broadcasters already
play advertisements publicising the codes of practice and their operation;
n broadcasters have
already paid for the use of spectrum and it would not be appropriate, ‘to be
forced to provide valuable airtime, free of charge,’ for this purpose;
n it could breach the
implied constitutional protection of political communication;
n it could erode the
laws of natural justice, in particular the right to a fair hearing where a
licensee has appealed ACMA’s decision.
The Committee notes concerns raised in other forums about how complaints
are resolved, and that expert reviews have consistently recommended changes.
The Committee also notes that industry arguments against the proposal may be
countered with views such as:
n increased publicity
may be appropriate in more serious breaches of codes of practice;
n the current television
advertisements on the codes of practice do not discuss enforcement action or
ACMA and could be modified to do so, even to the extent of briefly referring to
n the licence fee could
be reduced by a small amount in recognition of licensees allocating a small
amount of airtime to publicising enforcement action;
n the court case in
question referred to political communication during an election period, which
may well be different to compliance with an industry code of practice more
n when a legal matter
is under appeal, it is normal practice for this to be included in news reports,
which could also be done if a licensee broadcasts an ACMA finding.
The Committee accepts that ACMA has a broader range of enforcement
powers following the reforms in 2006. However, ACMA has demonstrated that there
are mid-level situations where it cannot impose an appropriate sanction. In
particular, enforceable undertakings must be offered by the broadcaster and the
Administrative Appeals Tribunal has declared that imposing a licence condition
is a serious matter. There is a gap in between these penalties.
On balance, the Committee agrees that ACMA should be given the power to
require the broadcasting of its regulatory findings. The Committee considers
that industry concerns, such as those expressed by Commercial Radio Australia,
are not sufficient to prevent the proposal from proceeding, but should be taken
into account in consultations to ensure that any power would be fairly exercised,
subject to the issues raised in Recommendation 2.
The Australian Government, following consultation with
industry, introduce legislation to give the Australian Communications and
Media Authority the power to require on-air corrections, clarifications and
directions based on its findings.
Senator Doug Cameron
19 June 2013