2019-2020-2021

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

 

SENATE

 

 

 

 

 

 

 

SUPPLEMENTARY EXPLANATORY MEMORANDUM

 

Amendments to be moved on behalf of the Government

 

 

 

(Circulated by authority of the

Treasurer, the Hon Josh Frydenberg MP)

 

 

Glossary............................................................................................................. 1

General outline and financial impact........................................................... 3

Chapter 1 ........... News Media and Digital Platforms Mandatory Bargaining Code - Parliamentary Amendments....................................................................... 5

Chapter 2 ........... Statement of Compatibility with Human Rights.......... 11

 

 

The following abbreviations and acronyms are used throughout this explanatory memorandum.

Abbreviation	Definition
Competition and Consumer Act	Competition and Consumer Act 2010
The ACMA	The Australian Communications and Media Authority
The Bill	Treasury Laws Amendment (News Media and Digital Platforms Mandatory Bargaining Code) Bill 2021
The Code	News Media and Digital Platforms Mandatory Bargaining Code

 

 

News Media and Digital Platforms Mandatory Bargaining Code - Parliamentary Amendments

The Parliamentary Amendments to the Bill:

•                amend the process to designate a digital platform service under the Code, so that when the Minister is deciding whether to designate a digital platform service, the Minister must:

-              provide notice to the responsible digital platform corporation that the Minister is intending to designate the digital platform service;

-              not designate the digital platform service until 30 days after the notice is given;

-              consider whether the digital platform has made a significant contribution to the sustainability of the Australian news industry through agreements for news content, including through remuneration; and

•                amend the non-differentiation provision to clarify that it does not prevent commercial agreements; and

•                add a new mediation process for registered news businesses and designated digital platforms reach commercial agreements.

Date of effect :  The day after the Bill receives the Royal Assent

Proposal announced :  These amendments have not previously been announced.

Financial impact :  Nil.

Human rights implications :  The amendments do not affect the analysis of the human rights issues provided for in the Explanatory Memorandum to the Bill. See Statement of Compatibility with Human Rights — Chapter 2

Compliance cost impact :  The amendments are not expected to substantially alter the cost impact outlined in the Explanatory Memorandum to the Bill.

 

 

Outline of chapter

1.1                   The Parliamentary Amendments to the Bill:

•                amend the process to designate a digital platform service under the Code, so that when the Minister is deciding whether to designate a digital platform service, the Minister must:

-              provide notice to the responsible digital platform corporation that the Minister is intending to designate the digital platform service;

-              not designate the digital platform service until 30 days after the notice is given;

-              consider whether the digital platform has made a significant contribution to the sustainability of the Australian news industry through agreements for news content, including through remuneration; and

•                amend the non-differentiation provision to clarify that it does not prevent commercial agreements; and

•                add a new mediation process for registered news businesses and designated digital platforms reach commercial agreements.

Comparison of key features of new law and current law

New law	Current law
When deciding whether to include a digital platform in the Code, the Minister must consider whether there is a significant bargaining power imbalance between Australian news businesses and the group comprised of the responsible digital platform corporation and all of its related bodies corporate. The Minister must also consider whether that group has made a significant contribution to the sustainability of the Australian news industry through agreements in relation to news content of Australian news businesses (including agreements to remunerate those businesses for their news content).	When deciding whether to include a digital platform in the Code, the Minister must consider whether there is a significant bargaining power imbalance between Australian news businesses and the group comprised of the responsible digital platform corporation and all of its related bodies corporate.
The Minister is required to provide a responsible digital platform corporation notice when designating a digital platform service.	The Minister is not required to give notice when designating a digital platform service under the Code.
The Minister must not designate a digital platform service under the Code, until 30 days after notice is given to the responsible digital platform corporation.	The Minister can designate a digital platform service under the Code immediately after Royal Assent.
A responsible digital platform corporation cannot differentiate between news media businesses by reason of their participation in the code. However a responsible digital platform corporation can differentiate between news media businesses on the basis of a commercial agreement and can remunerate different news media businesses differently under different commercial agreements.	A responsible digital platform corporation cannot differentiate between news media businesses by reason of their participation in the code.
The Bill requires a responsible digital platform corporation and news business corporation bargain in good faith for three months, enter into a mediation and then, if they cannot reach an agreement during mediation, enter into an arbitration.	The Bill requires a responsible digital platform corporation and news business corporation bargain in good faith for three months and then, if they cannot reach an agreement, enter into an arbitration.

Detailed explanation of new law

Changes to the designation process

The new designation criterion

1.2                   The Parliamentary Amendments to the Bill add an additional criterion for the Minister to consider, when deciding whether to designate a digital platform service under the Code.

1.3                   Previously, the Minister was required to consider whether there is a significant bargaining power imbalance between Australian news businesses and the responsible digital platform corporation group. The amendments require that the Minister must also consider whether the group comprised of the responsible digital platform corporation and all of its related bodies corporate has made a significant contribution to the sustainability of the Australian news industry through agreements in relation to news content of Australian news businesses (including agreements to remunerate those businesses for their news content). [Amendment 1, paragraph 52E(3)(b)]

The new notice requirements

1.4                   The Parliamentary Amendments to the Bill also introduce a notice requirement under the Code when designating a digital platform service. Previously the Minister was not required to provide notice when designating a digital platform service under the Code, however, the amendments provide that a responsible digital platform corporation notice when designating a digital platform service. [Amendment 2, paragraph 52E(5)]

1.5                   The Minister is required to provide a responsible digital platform corporation notice when designating a digital platform service. [Amendment 2, paragraph 52E(5)]

1.6                   The amendments also provide that the Minister must not designate a digital platform service under the Code, until 30 days after notice is given to the responsible digital platform corporation. [Amendment 2, paragraph 52E(6)]

Clarifications to the non-differentiation clause

1.7                   The amendments clarify that digital platforms can enter into commercial agreements with terms which are not identical without breaching the non-differentiation clause.

1.8                     Previously under the Bill a responsible digital platform corporation cannot differentiate between news media businesses by reason of their participation in the code. The amendments clarify that a responsible digital platform corporation can differentiation between news media businesses:

•        on the basis of a commercial agreement, which includes remuneration, where the differentiation arises solely from that amount of remuneration; and [Amendment 3, paragraph 52ZC(4)]

•        where:

-       the responsible digital platform corporation has entered into an agreement with a news media business, where the news media business is required to provide a certain type of content to the digital platform;

-       the responsible digital platform corporation will ensure that the content is ranked preferentially on the designated digital platform; and

-       the differentiation arises solely from that preferential ranking. 

[Amendment 3, paragraph 52ZC(5)]

1.9                   Amendments are also made to clarify the news content to which the non-differentiation clause applies. The non-differentiation provision will only apply to covered news content which is contained in news sources which regularly produce covered news content. [Amendment 3, paragraph 52ZC(6)]

The new mediation process

1.10               The Parliamentary Amendments add a new mediation process in between the bargaining and arbitration stages of the Code.

1.11               Previously, the Bill required a responsible digital platform corporation and news business corporation to bargain in good faith for three months and then, if an agreement is not reached, enter into an arbitration. The amendments require a responsible digital platform corporation and news business corporation bargain in good faith for three months, then, if an agreement is not reached enter into a mediation. [Amendment 4, section 52ZAI]

1.12               The mediator will be appointed by the ACMA and the mediation must be undertaken in good faith. [Amendment 4, section 52ZAI]

1.13               The mediation will end when either:

•        two months after the mediation commences;

•        if the parties agree to extend the mediation by two months - 4 months after the mediation commences;

•        when the parties agree to terminate the mediation; or

•        the mediator decides to terminate the mediation if, having regard to the conduct of the bargaining parties in the mediation, the mediator considers that there are no reasonable prospects of the bargaining parties reaching agreement over each core bargaining issue.

[Amendment 4, section 52ZIC]

1.14               The amendments provide that the bargaining parties can only commence arbitration after the end of the mediation. [Amendment 4, section 52ZL(2)]

1.15               An arbitration between the bargaining parties can only commence if:

•        a mediation between the parties has occurred and no agreement about the remuneration issue has been reached; or

•        the parties voluntarily submit themselves to arbitration, at least 10 days after the bargaining between the parties commenced.

[Amendment 5, section 52ZL(2)]

1.16               Regulations may set out rules about the conduct of mediation. These rules may be incorporated via a reference in the Regulations to extrinsic materials and must apply as in force at the time the regulations are made or at another fixed point in time. This is to ensure consistency across mediations and provide certainty for bargaining parties. A mediation must be conducted in accordance with any rules set out in the Regulations. The regulations may also set out rules relating to the payment of costs. [Amendment 4, section 52ZIB]

Corrections to the Explanatory Memorandum

1.17               At the end of paragraph 1.47 add:

•        This code only applies to the extent a platform is making covered news content available through those services intentionally.

1.18               At the end of paragraph 1.202 before the full stop add:

•        over the relevant period. 

Application and transitional provisions

1.19               The Bill as amended will commence on the day after it receives the Royal Assent.

 

 

Prepared in accordance with Part 3 of the Human Rights (Parliamentary Scrutiny) Act 2011

Treasury Laws Amendment (News Media and Digital Platforms Mandatory Bargaining Code) Bill 2021

2.1                   These Amendments are compatible with the human rights and freedoms recognised or declared in the international instruments listed in section 3 of the Human Rights (Parliamentary Scrutiny) Act 2011 .

Overview

2.2                   The Parliamentary Amendments to the Bill:

•                amend the process to designate a digital platform service under the Code, so that when the Minister is deciding whether to designate a digital platform service, the Minister must:

-              provide notice to the responsible digital platform corporation that the Minister is intending to designate the digital platform service;

-              not designate the digital platform service until 30 days after the notice is given;

-              consider whether the digital platform has made a significant contribution to the sustainability of the Australian news industry through agreements for news content, including through remuneration; and

•                amend the non-differentiation provision to clarify that it does not prevent commercial agreements; and

•                add a new mediation process for registered news businesses and designated digital platforms reach commercial agreements.

 Human rights implications

2.3                   The Parliamentary Amendments do not engage any of the applicable rights or freedoms.

Conclusion

2.4                   The Parliamentary Amendments are compatible with human rights as they do not raise any human rights issues.

2.5                   The Bill as amended is compatible with human rights as provided for in the Explanatory Memorandum to the Bill.