21 September, 2017
Significant changes will be made to media regulation in Australia, with passage through the Senate of broadcast reform Bills
What you need to know
After months of negotiation and amendment, the Broadcasting Legislation Amendment (Broadcasting Reform) Bill 2017 and Commercial Broadcasting (Tax) Bill 2017 passed the upper house on 14 September 2017.
The suite of reforms aim to improve the sustainability of Australia’s print, radio and television sector by removing rules that industry claims create an uneven playing field.
The Broadcasting Reform Bill includes measures to relax rules around media ownership and broadcast restrictions.
The Tax Bill aims to reduce licence fees and improve the fairness of taxation of broadcasters.
The Bill will not officially become law until it returns to the House of Representatives when parliament resumes on 16 October, but the government has a majority in the house so this should be a formality.
Passage of the Bills through the Senate was secured after the government reached a deal with Senator Nick Xenophon, who agreed to vote for the reforms in exchange for an innovation fund to support small media companies and their recruits, especially in regional areas.
The Government also reached a deal with One Nation, in exchange for its support for the Bills, to force the Australian Broadcasting Corporation and Special Broadcasting Corporation to publish the wages of employees earning more than $200,000, and legislative changes requiring that ABC to be "fair and balanced". These changes will require amendment to the ABC Act which has not yet been brought before the Parliament. Other parties including the Nick Xenophon team have indicated they will not support the changes. One Nation also negotiated a $12 million subsidy to community radio.
The Broadcasting Reform and Tax Bills were opposed by the Opposition and the Greens.
Media ownership
The '75 per cent audience reach rule' in the Broadcasting Services Act 1992 (BSA) will be repealed. This rule prevents any person controlling commercial television licences in areas whose combined population exceeds 75 percent of the population of Australia. Repealing it will, subject to competition and other laws, allow mergers between metropolitan and regional broadcasters, providing for greater scale in operations and it is argued, will enable broadcasters to compete more readily with online streaming services.
The 2 out of 3 cross-media control rule in the BSA will also be repealed. This rule prevents any individual controlling two out of three media interests (radio, television and print) in one licence area. The rule does not take into account online services, which are recognised as significant players in the media landscape.
Anti-siphoning
Anti-siphoning rules will be relaxed, giving subscription television and multi-channels more ability to broadcast listed events. The anti-siphoning scheme in the BSA allows the Minister for Communications to specify a list of events that should be available on free-to-air television, and prevents a subscription broadcaster acquiring a right to televise an event until a free-to-air broadcaster has obtained that right. Currently, an event is delisted 12 weeks before it happens, because free-to-air broadcasters would be taken not to be interested in acquiring a right if they have not done so by then. This period will be extended to 26 weeks. Another restriction, known as the 'multi-channelling rule', will be removed. This rule prevents a free-to-air broadcaster premiering a listed event on a multichannel (eg ONE, GEM, 7Mate). This rule aimed to prevent viewers with analog television being disenfranchised but, following the digital switchover in 2013, this rule is now considered to be redundant.
Licence fees and taxes
The Tax Bill will permanently abolish broadcasting licence fees, datacasting charges and apparatus licence fees. Free-to-air broadcasters have argued that these fees are no longer warranted or sustainable in circumstances where online and on-demand services face no such fees. Others have argued that such fees are appropriate while broadcasters continue to use valuable public spectrum.
In any event, the licence fees will be abolished and a new transmitter licence tax will be introduced. The amount of tax will be determined by the Communications Minister, but must not exceed the cap specified in the Bill. The government says the new tax will more accurately reflect the use of broadcast spectrum.
The Bill requires the Australian Communications and Media Authority (ACMA) to review broadcasting pricing arrangements by 2022.
For further information, please contact:
Robert Todd, Partner, Ashurst
robert.todd@ashurst.com
