In its Phonographic Performance Company of Australia Limited v Commercial Radio Australia Limited [2013] FCAFC 11 (13 February 2013) decision (available here), the Full Federal Court overturned the Trial Court’s finding that Commercial Radio Australia Limited’s (CRA) existing licence (granted by Phonographic Performance Company of Australia Limited (PPCA)) included the right to simultaneously broadcast radio programs over the Internet and over the air.

The trial judge held that ‘the simulcast transmission of the same radio program via the FM waves and the Internet is also a “broadcast” within [the definition] of the Copyright Act and, for that reason, is within the scope of the licence which PPCA agreed to grant to the members of CRA’.

At Issue

On appeal, the Full Federal Court focused on the construction of the definition of broadcasting service as delineated and applied in the Broadcasting Services Act 1992 (Cth) (the Broadcasting Act) within the context of the licence agreement between PPCA and CRA. The definition is affected by a 12 September 2000 Ministerial Determination made in accordance with the provisions of the Broadcasting Act.

According to the Broadcasting Act, broadcasting service means a service that delivers radio programs to persons having equipment appropriate for receiving that service, but relevantly does not include a service that the Minister determines not to fall within the definition. The effect of the Ministerial Determination is that broadcasting service means a service delivering radio programs to persons having appropriate equipment, where the delivery uses the radiofrequency spectrum, cable, optical fibre, satellite or any other means or combination thereof, but does not include a service that makes available radio programs using the Internet other than a service that delivers radio programs using the broadcasting service bands. Thus, the Ministerial Determination excludes some services from the definition, and then excepts some services from that exclusion.

Under the licence agreement, PPCA grants to CRA members a Broadcasting Right, defined as the right, from time to time, to broadcast (as defined in the Copyright Act 1968 (Cth) – a communication to the public delivered by a broadcasting service within the meaning of the Broadcasting Act) certain sound recordings.

With the pertinent terms nested within and cross-referenced in various acts and documents, the central question was whether the making available of radio programs using the Internet is within the licence granted by the PPCA.

The Court’s Rationale

The Full Federal Court discussed extrinsic materials which were contended to be relevant to the construction of the definition. The Court considered in detail several documents, including the Ministerial Determination, the Australian Broadcasting Authority Report of 30 June 1996 and the Productivity Commission Report of 3 March 2000. In the end, however, the Court concluded that whilst the extrinsic material assisted in giving some clarity and context, it was of little assistance in resolving any ambiguity that arises as to the application of the definition of broadcasting service to simulcast radio programs. Thus, the question must be resolved by analysing the definition, as affected by the Ministerial Determination, having regard to the provisions, purpose and object of the Broadcasting Act.

After engaging in such an analysis, the Full Federal Court determined that a service might:

  • be delivered by the use of any means, including the broadcasting services bands;
  • be delivered or made available using the Internet; or
  • be delivered or made available using the Internet and the broadcasting services bands.

The Court held that only the first and third categories are broadcasting services and therefore upheld the appeal in favour of PPCA.

Impact

The Full Federal Court has provided clarity as to the meaning of broadcasting service in the context of the Broadcasting Act.

However, the outcome of this case is likely to be controversial due to its lack of ‘technology neutrality’ – the definition of a ‘broadcast’ here depends not upon content, nor upon the simultaneity of transmissions, but upon the underlying communications channels by which the content is delivered.

The result is important to the PPCA, and the copyright holders it represents, because royalties payable in respect of radio ‘broadcasts’ are capped under the legislation, meaning that CRA members (reportedly 99% of all Australian commercial radio broadcasters) have effectively been able to simulcast via internet streaming at no additional cost. They will now need to negotiate separate licences for internet transmissions, which will not be subject to any cap.

It is possible that Australian radio broadcasters will simply cease internet simulcasting. However, given the amounts potentially at stake, an application for leave to appeal to the High Court also seems likely.

In the meantime, careful drafting of copyright licensing agreements, in particular when using terms as defined in specific (or several) acts, is always good practice.