Note: Where available, the PDF/Word icon below is provided to view the complete and fully formatted document
Broadcasting Legislation Amendment (Foreign Media Ownership, Community Radio and Other Measures) Bill 2017

Bill home page  


Download WordDownload Word


Download PDFDownload PDF

2016-2017-2018

 

 

THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA

 

 

HOUSE OF REPRESENTATIVES 

 

 

 

BROADCASTING LEGISLATION AMENDMENT (FOREIGN MEDIA OWNERSHIP AND COMMUNITY RADIO) BILL 2017

 

 

 

 

 

 

SUPPLEMENTARY EXPLANATORY MEMORANDUM

Amendments to be moved on behalf of the Government

 

 

 

(Circulated by authority of the Minister for Communications,

Senator the Honourable Mitch Fifield)

 

 

 

 

 

OUTLINE

 

The Broadcasting Legislation Amendment (Foreign Media Ownership and Community Radio) Bill 2017 (Bill) will amend the Broadcasting Services Act 1992 (BSA) and the Australian Communications and Media Authority Act 2005 to improve transparency in the levels and sources of foreign investment in Australian media companies, and strengthen localism in community radio broadcasting.

 

The proposed amendments to the Bill would address an anomaly arising from the application of the regional local programming requirements under Division 5D of Part 5 of the BSA to a non-aggregated licensee in regional Western Australia. Under current arrangements, the affected licensee would be subject to disproportionately high local programming requirements relative to its competitors (which broadcast to an equivalent geographic area) following a trigger event for the relevant licence area (Amendment Sheet EK129).

 

 

 

 

 







FINANCIAL IMPACT STATEMENT

These Government amendments have no financial impact.  



AMENDMENT SHEET EK129

The proposed amendments will insert a new Schedule 3 into the Bill to amend Division 5D (Local programming requirements for regional commercial television broadcasting licensees) of Part 5 of the BSA. The new Schedule to the Bill would address an anomaly arising from the application of the regional local programming requirements to a non-aggregated licensee in regional Western Australia. The amendments would also amend the title of the Bill.

Background

Overview

For historical reasons, the licensing arrangements for the two commercial television broadcasting licensees in regional and remote Western Australia, Golden West Network Pty Ltd (ACN 008 681 196) (GWN7) and WIN Television WA Pty Ltd (ACN 001 969 491) (WIN), differ significantly from ordinary practice. Ordinarily, the licensing arrangements for competing commercial television broadcasting licensees in the same market are equivalent.

However, despite GWN7 and WIN broadcasting to a geographic area of an equivalent size in regional and remote Western Australia, GWN7 presently controls four licences in regional and remote Western Australia while WIN only holds one. GWN7’s four licences include one remote licence (which is not subject to the local content requirements) and three regional licences that commenced in the 1960s and 1970s.

By comparison, WIN only holds one licence in regional Western Australia which covers an equivalent geographic area to the four GWN7 licences and which commenced in 1999.

More specifically, in regional Western Australia, GWN7 controls commercial television broadcasting licences which relate to the following licence areas: Geraldton TV1; South West and Great Southern TV1; and Kalgoorlie TV1. WIN holds one licence in regional Western Australia which relates to the Remote and Regional WA TV1 licence area. 

The Broadcasting Services Local Programming Determination 2018 (the Determination) was made by the Australian Communications and Media Authority (ACMA). The Determination prescribes the ‘local area’ that regional commercial television broadcasting licensees, such as GWN7 and WIN, must serve with material of local significance (local content) following a relevant change in control (trigger event).

The Determination provides that, for certain licensees (including GWN7), the local area is the area identical to the licence area for the licence, essentially prescribing one local area per relevant licence. Additionally, by operation of the Determination, the local area for WIN’s regional WA licence covers the same geographic area as the combined area of the licence areas for GWN7’s three regional licences and one remote licence.

The effect of this is that, although GWN7 and WIN broadcast to a geographic area of an equivalent size, if a relevant trigger event were to occur, GWN7 would have three local areas to serve in Western Australia while WIN would have just one. As a result, GWN7 would be subject to three times the local content obligations that WIN would face if its sole commercial television broadcasting licence in regional Western Australia was affected by a trigger event.

The pertinent licences held by GWN7 and WIN are ‘regional non-aggregated commercial television broadcasting licences’ for the purposes of Division 5D. This means that six months after the occurrence of a trigger event for any one of GWN7’s or WIN’s licences in regional Western Australia, local programming requirements will be introduced for the relevant licensee.

Division 5D - Local programming requirements for regional commercial television broadcasting licensees

The Broadcasting Legislation Amendment (Broadcasting Reform) Act 2017 inserted Division 5D into Part 5 of the BSA. Division 5D increased, or introduced for the first time, local content obligations which apply where, as a result of a relevant change in control, a regional commercial television broadcasting licence becomes part of a group of commercial television licences with a combined licence area population which exceeds 75 per cent of the Australian population (i.e. a ‘trigger event’ as defined in section 61CV of the BSA).

Section 61CX sets out the local programming requirements that apply to regional non-aggregated commercial television broadcasting licensees affected by a trigger event. The minimum amount of local content that must be broadcast is defined using a points system, where licensees earn a specified number of points for each minute of local content that is broadcast.

Section 61CX provides that, when a trigger event occurs (that is the first or only trigger event for the licence), a relevant licensee is required to broadcast local content to each local area to accumulate at least:

a.        600 points in each timing period that begins 6 months after the trigger event; and

b.       100 points in each week that is included in a relevant timing period.

Section 61CY sets out the points system that applies in relation to the local programming obligations under section 61CX. A higher number of points per minute are scored for particular types of content, such as local news.

The Local Programming Determination

As noted above, the Determination was made by the ACMA under subsection 61CZ(1) of the BSA and stipulates what the ‘local area’ is for each regional commercial television broadcasting licence that will be subject to local content obligations under the BSA.  

Addressing the anomaly

As previously identified, although GWN7 and WIN broadcast to a geographic area of an equivalent size, currently, if a relevant trigger event were to occur, the licensee that controls the three GWN7 licences would be subject to three times the local content obligations that the licensee that controls the WIN licence would face if its sole commercial television broadcasting licence in regional Western Australia was affected by a trigger event.

The new Schedule to the Bill intends to address this anomaly by inserting provisions in Division 5D of Part 5 of the BSA which alter the manner in which points may be accumulated by a commercial television broadcasting licensee for the Geraldton TV1, Kalgoorlie TV1 and South West and Great Southern TV1 licence areas, where those licences are under common control.

In particular, under certain circumstances, the proposed new provisions would apply to mean that when calculating whether it had accumulated the required number of points, where a person controls each of the three relevant commercial television broadcasting licences in regional Western Australia, a licensee would be able to count local content that relates to any of the local areas of any of the three relevant licences.



 

NOTES ON AMENDMENTS

Amendment (1)

This Amendment would alter the title of the proposed Act so that it includes “and Other Measures” to reflect the inclusion of the proposed new Schedule to the Bill which relates to a measure other than foreign ownership of media assets and community radio broadcasting licences.

Amendment (2)

This Amendment would insert a new Schedule 3 into the Bill, titled “Local programming requirements for regional commercial television broadcasting licensees”.

All of the items that follow, comprising Schedule 3 to the Bill, are proposed amendments to the Broadcasting Services Act 1992 (BSA).

Item 1 - Section 61CU

Item 1 would insert three new definitions into section 61CU, which sets out definitions that are relevant to Division 5D of Part 5 of the BSA.

The term, combined designated Western Australian commercial television broadcasting licence area is defined to mean the area that consists of the licence areas of the designated Western Australian commercial television broadcasting licences. This term is used in proposed new subsection 61CYA(2) (item 8 below), which would modify the way in which content may accumulate points for the purposes of satisfying the local programming requirements under section 61CX. The term is also used in proposed subsections 61CYA (3) and (5) (item 8).

The term, combined designated Western Australian commercial television broadcasting local area is defined to mean the area that consists of the local areas of the designated Western Australian commercial television broadcasting licences. The term is used in proposed subsections 61CYA(2), (3), (4) and (6) (item 8).

The term, designated Western Australian commercial television broadcasting licence is defined to mean a commercial television broadcasting licence for any of the following licence areas:

·          Geraldton TV1;

·          Kalgoorlie TV1;

·          South West and Great Southern TV1.

The term is used in proposed subsection 61CYA(1), with the effect that the modifications made by that section will only apply where there is a trigger event for one of these licences. The three commercial television broadcasting licences for these licence areas are currently under the common control of GWN7.

Item 2 - Section 61CU (at the end of the definition of local area )

Item 2 would add a note at the end of the existing definition of ‘local area’, referring the reader to proposed section 61CYA which deals with modifications that are to apply to designated Western Australian commercial television broadcasting licences (refer Item 8 below).

Item 3 - Section 61CU (at the end of the definition of material of local significance )

Item 3 would add a note at the end of the existing definition of ‘material of local significance’, referring the reader to proposed section 61CYA.

Item 4 - At the end of subsection 61CX(1)

Subsection 61CX sets out the local programming requirements for regional commercial television broadcasting licences in non-aggregated markets that are affected by a trigger event. It requires a licensee to broadcast, to each local area, material of local significance in order to accumulate certain minimum points in each timing period and each week within the timing period. Item 4 would add a note at the end of existing subsection 61CX(1), referring the reader to proposed section 61CYA which would modify the requirements in certain circumstances.

Item 5 - At the end of subsection 61CY(3)

Section 61CY sets out the points system that applies for the local programming obligations under section 61CX (as noted above). Subsection 61CY(3) relates to the number of points that are to be assigned for different types of material of local significance. Item 5 would add a note at the end of subsection 61CY(3), referring the reader to proposed section 61CYA, which would affect the application of the points system in certain circumstances (see proposed subsection 61CYA(3)).

Item 6 - At the end of subsection 61CY(5)

Item 6 would add a note at the end of existing subsection 61CY(5). This particular subsection provides limits on the number of points that are to be accumulated for types of material of local significance.

The note would refer the reader to section 61CYA, which would modify the application of subsection 61CY(5) in certain circumstances (see proposed subsection 61CYA(5)).

Item 7 - At the end of subsection 61CY(7)

Item 7 would add a note at the end of existing subsection 61CY(7). This particular subsection relates to limits on the points that may be accumulated in a local area for broadcasts of community service announcements.

The note would refer the reader to section 61CYA, which would modify the application of subsection 61CY(7) in certain circumstances (see proposed subsection 61CYA(6)).

Item 8 - After section 61CY

Item 8 would insert new section 61CYA which would modify aspects of the local programming requirements as they apply to designated Western Australian commercial television broadcasting licences subject to a trigger event. It would also insert new section 61CYB, which would set out when designated Western Australian commercial television broadcasting licences are considered to be under common control for the purposes of paragraphs 61CYA(1) (c) and (d).

These modifications would alter the manner in which points may be accumulated by a commercial television broadcasting licensee for the Geraldton TV1, Kalgoorlie TV1, and South West and Great Southern TV1 licence areas, provided the licences for those licence areas are under common control immediately before (and continue to be under common control after) the relevant trigger event occurs.

Scope

Subsection 61CYA(1) would set out the scope of the section, stipulating when the modifications are to apply.

Subsection 61CYA(1) provides that section 61CYA is to apply where:

·          a trigger event for a designated Western Australian commercial television broadcasting licence occurs on a particular day; and

·          that event is the first or only trigger event for the licence; and

·          immediately before that event, the designated Western Australian commercial television broadcasting licences were under common control; and

·          a period satisfies the following conditions:

o    the period began at the time of that event;

o    at all times during the period the designated Western Australian commercial television broadcasting licences are under common control.

It is only when these conditions are satisfied that a person would enjoy the operation of section 61CYA.

The modifications set out under section 61CYA are only to apply in certain circumstances and will cease to apply where these circumstances no longer exist.

Currently, each of the three designated Western Australian commercial television broadcasting licences are under the common control of GWN7. The modifications set out under proposed section 61CYA are intended to reduce the burden on a licensee that controls each of the three designated Western Australian commercial television broadcasting licences so that, were a relevant trigger event to occur, such a licensee would not, in practice, need to source a disproportionately larger amount of material of local significance than the other regional Western Australian commercial television broadcasting licensee (whose licence relates to the Remote and Regional WA TV1 licence area ) who broadcasts to a geographic area of an equivalent size.

Provided that a person continues to control all three licences at once, proposed section 61CYA will continue to apply regardless of whether that person is continuously the same person or not. This allows for the bloc of three licences to be on-sold or to come under control of another person. However, if control of the bloc of three licences is broken apart at any point after the trigger event, the material of local significance requirements will revert to their ordinary application under Division 5D of Part 5 of the BSA, and proposed section 61CYA will not apply. This means that each licensee would be required to satisfy the material of local significance obligations without the ability to rely on content that is of significance to the other two licence areas or their associated local areas.

If, following a split in the bloc of the three licences, the three licences then subsequently come under common control again, proposed section 61CYA would not apply. Proposed section 61CYA operates in this manner to ensure that (once a split in the bloc of three licences occurs) audiences in the three relevant licence areas are not provided with a greater quantity of material of local significance more directly relevant to their locality and then (if the bloc re-forms) later denied this more directly relevant material. It also ensures that the proposed amendments to Division 5D in Part 5 of the BSA are targeted at specifically addressing the one anomalous circumstance (relating to the commonly controlled licences for the Geraldton TV1, Kalgoorlie TV1, and South West and Great Southern TV1 licence areas) which currently exists.

Material of local significance

Proposed subsection 61CYA(2) would modify the test for determining whether material is material of local significance in relation to the local area of a relevant licence for the purposes of satisfying the local programming requirements under section 61CX.

This provision would stipulate that material that relates directly to the combined designated Western Australian commercial television broadcasting local area is taken to be material that relates directly to the local area of the relevant licence; and similarly that material that relates directly to the combined designated Western Australian commercial television broadcasting licence area is taken to be material that relates directly to the licence area of the relevant licence. This ensures that material which would be considered material of local significance relating to one of the three relevant licences, may be counted in all three of the relevant licence areas as though it was local material for the purposes of each licence.

The requirement under section 61CX for the licensee to broadcast material of local significance for each licence area would remain, with the licensee required to accumulate points individually for each licence area. However, the operation of the deeming rules in proposed section 61CYA would mean the licensee could rely on material relating to any of the three licence areas or corresponding local areas that is broadcast in the relevant licence area when calculating the accumulation of points for that relevant licence area to satisfy the licence conditions.

This is to help ensure that, were relevant trigger events to occur, the two commercial television broadcasters in regional Western Australia (who broadcast to a geographic area of an equivalent size) would need to source a similar quantity of material to satisfy their local content obligations.

Points system

Proposed subsection 61CYA(3) would modify the effect of the points table at subsection 61CY(3) as it applies to the relevant three licences for the purposes of accumulating points for material of local significance. Where section 61CYA applies, references in the table at subsection 61CY(3):

·          to local area are to be read as though they refer to the combined local area of the three relevant licences; and

·          to licence area are to be read as though they refer to the combined licence area of the three relevant licences.

This provision would give effect to the intended accumulation of points in each local area by reason of having broadcast material that relates to the combined local area relating to the three licences.

Proposed subsection 61CYA(4) would broaden the application of any additional rules that are set out in a local programming determination made by the ACMA for the purposes of paragraph (d) of item 1 of the table at subsection 61CY(3) so that these additional requirements would extend to the combined local area of the three relevant licences. These are requirements that apply in addition to those set out in paragraphs (a), (b) and (c) of item 1 of the table at subsection 61CY(3) in order to accumulate the maximum 3 points for each minute of material of local significance.

It is necessary to broaden the application of any such additional rules in this manner so that material broadcast by a designated Western Australian commercial television broadcasting licensee that relates to any of the local areas that make up the combined designated Western Australian commercial television broadcasting local area (or that meets any other ‘local area’ related requirements for any of the relevant local areas) will, provided it meets other relevant requirements, be regarded as material of local significance that accumulates points in the local area in which it is broadcast. This is to help ensure that if a relevant trigger event occurs, the two commercial television broadcasters in regional Western Australia would need to source a similar quantity of material to satisfy their local content obligations.

Proposed subsection 61CYA(5) would provide that subsection 61CY(5) (which limits the points of material of local significance that may relate directly to a licensee’s licence area) has effect as though a reference in that subsection to the licensee’s licence area were a reference to the combined designated Western Australian commercial television broadcasting licence area. This means that a maximum of 50% of the points accumulated in the applicable local areas can be attributed to material relating to the combined licence area of the three relevant licences. This allows the limitation to apply to the three relevant licences in an equivalent way to other commercial television broadcasting licences.

Proposed subsection 61CYA(6) would provide that subsection 61CY(7) (which limits the points that may be accumulated in a local area for the broadcast of community service announcements) has effect as though a reference in those paragraphs to the area were a reference to the combined designated Western Australian commercial television broadcasting local area. This means that the limit on the broadcast of community service announcements applies to the combined local area of the three relevant licences, as opposed to the local area of each licence individually. This means that the limitation applies equally across the combined local area of the three relevant licences.

Again, proposed subsections 61CYA(5) and (6) are necessary to help ensure that if a relevant trigger event occurs, the two commercial television broadcasters in regional Western Australia would need to source a similar quantity of material to satisfy their local content obligations.

‘Under common control’

Item 8 would also insert new section 61CYB, which sets out when the three designated Western Australian commercial television broadcasting licences are considered to be ‘under common control’ for the purposes of paragraphs 61CYA(1)(c) and (d).

Proposed subsection 61CYB(1) provides that the designated Western Australian commercial television broadcasting licences will be considered to be under common control if, at a particular time, a person controls each designated Western Australian commercial television broadcasting licence.

Proposed subsection 61CYB(2) provides that for the purposes of subsection 61CYB(1) a person controls a designated Western Australian commercial television broadcasting licence if the person holds the licence or is in a position to exercise control of the licence. Schedule 1 to the BSA sets out mechanisms that are to be used in deciding whether a person is in a position to exercise control of a licence.

Worked example

What follows is a scenario used to illustrate the application of section 61CYA and how points for local content are accumulated under the current arrangements, and how they would accumulate under the amended arrangements. The scenario illustrates the accumulation of points through the examples of local news and community service announcements.

Example: Local news

In this part of the scenario, a range of points that can be accrued is given. This is to reflect the different point values placed on local content in the table in subsection 61CY(3). The minimum value in the range applies if all of the local news relates directly to the local area, which accrues 2 points per minute (as per Item 2 of the table). The maximum value in the range would apply if all of the local news depicts people, places or things in the local area, which accrues 3 points per minute (as per Item 1 of the table).

Company A is in a position to control four Western Australian commercial television broadcasting licences:

·          Geraldton TV1

·          Kalgoorlie TV1

·          South West and Great Southern TV1

·          Western Zone TV1

Following a trigger event, all four of Company A’s commercial television broadcasting licences are controlled by Company B, a metropolitan broadcaster. Local content obligations are placed on each of the three regional Western Australian commercial television broadcasting licences (Geraldton TV1, Kalgoorlie TV1, and South West and Great Southern TV1). As a result, Company B must ensure that 100 points of local content is accumulated in the local area for each relevant licence, during each week in a timing period.

Company B organises half hour 6 pm news bulletins on each weekday, which include news that meets the definition of local content. One such broadcast provides material that relates directly to the four Western Australian commercial television broadcasting licence areas in accordance with the table below.

 

Geraldton TV1

Kalgoorlie TV1

South West and Great Southern TV1

Western Zone TV1

Example Bulletin

(Minutes of local content)

2:00

1:30

9:00

1:00

(Note: It is also assumed that this bulletin may include national news that would not be considered local content)

Existing arrangements

Under the existing arrangements, Company B would accumulate points in the following ranges for each local area:

·          Geraldton TV1 - 4-6 points

·          Kalgoorlie TV1 - 3-4.5 points

·          Southern West and Great Southern TV1 - 18-27 points

In each relevant local area, only the parts of the news bulletin that contain local content related to that local area accumulate points. Furthermore the minute of content relating to Western Zone TV1 does not accumulate points as it is not relate to the licence area of any of the relevant licences, and remote areas are excluded from the local content obligations.

Proposed arrangements

Under the proposed arrangements, provided subsection 61CYA(1) applies, Company B would be able to accumulate points for each local area for the broadcast of content that is relevant to any of the three local areas that correspond to the three licences it controls. This is because the proposed subsection 61CYA(2) modifies the way in which content accumulates points for the purposes of satisfying a licensee’s local content obligations, effectively providing an expanded local area that Company B can accumulate points within.

Therefore, Company B would accumulate points in the following ranges for each local area:

·          Geraldton TV1 - 25-37.5 points

·          Kalgoorlie TV1 - 25-37.5 points

·          Southern West and Great Southern TV1 - 25-37.5 points

These point ranges are provided due to the amendment of the points system, proposed by subsection 61CYA(3). Under the proposed arrangements, local content relating to any one local area can be used to accumulate points in all three of the three relevant local areas. This is due to the expanded local area the measure provides. As a result, should Company B simulcast the example bulletin in all three regional Western Australian commercial television broadcasting licences it controls, it can claim points for all local content that relates to the three areas combined.

The minute of content relating to Western Zone TV1 does not accumulate points as it is not part of the designated local area for each licence, nor would it relate to the licence area of the relevant licence.

As the measure would still require each licensee to meet its local content obligations in each licence area per section 61CX, compliance reports would still need to be completed for each regional Western Australian commercial television broadcasting licence under section 61CZB of the BSA.

Example: Community service announcements

During the example bulletin detailed above, Company B agrees to broadcast a community service announcement for an upcoming event related to the Geraldton TV1 local area. The community service announcement is broadcast twice during two separate advertising breaks in the example bulletin and lasts for a combined time of 1 minute. Company B simulcasts the example bulletin to the local area of each licence area it controls (as well as Western Zone TV1). The community service announcement accumulates one point under item 3 of the table at subsection 61CY(3), when relevant.

Existing arrangements

Under the existing arrangements, Company B may accumulate points in a local area for community service announcements under subsection 61CY(7). This is capped at five broadcasts of the same community service announcement. Further, the number of points Company B can accumulate from community service announcements during a single timing period is capped at 10% of the total points accumulated (effectively 60 minutes of community service announcements per timing period).

Company B would accumulate one point in the local area relevant to the Geraldton TV1 licence as a result of the broadcast of the community service announcement during the example bulletin, and no points in the other two local areas. This is because the community service announcements would only be considered as local content to the Geraldton TV1 local area.

Proposed arrangements

Under the proposed arrangements, Company B may accumulate points for the broadcast of the community service announcements in the expanded local area provided under proposed subsection 61CYA(2). The effect of proposed subsection 61CYA(6) would be to allow these points to be accumulated across the three local areas by community service announcements. Consistent with the existing arrangements, this is capped at 5 broadcasts of the same community service announcement due to proposed subsection 61CYA(6). The 10% limit on points accumulated from community service announcements during a single timing period by subsection 61CY(8) also applies.

Company B would accumulate one point in each local area as a result of the broadcast of the community service announcements during the example bulletin due to the amendments relating to the accumulation of points that would allow material that relates directly to one local area to accumulate one point in all three of the local areas under proposed subsection 61CYA(3).