Changes in Media and Broadcasting: the Broadcasting Legislation Amendment (Broadcasting Reform) Act 2017 (Cth)

In October 2017, the Australian government passed legislation effecting a number of significant changes to Australia’s media laws that:

  1. will provide many opportunities for media clients to more freely expand their business in Australia, will significantly broaden the scope for investment in Australian media, and better reflect the contemporary digital media environment.
  2. also assist Australian media companies with the increasing competition for audiences and advertising revenue from other media companies including online and on-demand operators (e.g. Foxtel, Netflix and Stan) and foreign technology companies.

The key changes include:

  • abolishing the ‘75% audience reach rule’ and the ‘2 out of 3 cross-media rule’ from the Broadcasting Services Act 1992 (Cth) (BSA) which prevented control of commercial TV licences whose combined licence area populations exceed 75 per cent of the population of Australia, preventing mergers between Seven, Nine and Ten and regional broadcasters Prime, Win and Southern Cross
  • abolishing broadcast licensing fees and introducing a tax on transmitter licences associated with commercial broadcasting licences, focusing on setting prices for spectrum use rather than licensing fees, in order to more accurately reflect broadcasters’ use. This tax is applied to each individual transmitter
  • amending and introducing some additional local programming obligations under the BSA for regional commercial television broadcasting licensees, where, as a result of a change in control, their licences become part of a group of commercial television licences whose combined licence area populations exceed 75 per cent of the Australian population
  • requiring that the ACMA conduct a review after five years into the new taxation arrangements implemented by both bills 
  • permanently abolishing annual television and radio licence fees, and datacasting charges payable by commercial broadcasters
  • extending the anti-siphoning automatic delisting period and amending the anti-siphoning scheme which regulates media companies’ access to significant sporting events, the restriction on free-to-air broadcasters from exclusively televising sporting events on their digital channels has been removed as it is redundant (the rationale around the original restriction was that not all Australians had not switched to digital television yet). The amount of events allocating first rights free-to-air broadcasters have reduced to reflect those that are no longer broadcast on free-to-air, have small audiences or are events where the relationship is remote or non-existent (i.e FA Cup Final and the US Masters golf) golf has been removed from the list and there are reductions in first rights for:
    • Rugby League
    • Rugby
    • Cricket
    • Soccer
    • Tennis
    • Netball; and
  • establishing a transitional support payment scheme for 19 regional commercial broadcasters to ensure that they will not be worse-off during the first five years as a result of the transition from a revenue-based licence fee and charge arrangement to the new interim transmitter licence tax arrangements

Some key media rules remained unchanged, including:

  • the 5/4 media diversity rule, this will be retained to allow for the Australian market to retain a suitable amount of diverse voices
  • the continued requirements for minimum levels of content on matters of local significance in key regional commercial television markets.

China introduces new rules to ‘purify’ online video content

With effect from 1 July 2017, new rules have been introduced by the China Netcasting Services Association (CNSA) which increase the regulatory scrutiny applied to online video content. The rules, which are aimed at video hosting services which allow users to upload content, are drafted broadly, meaning that almost all video content will be affected.

Whilst video hosting services have always been required to vet content uploaded to its platforms, the level of scrutiny required was generally low, in contrast to internet TV services, which are subject to extensive vetting by the State Administration of Press, Publication, Radio, Film and Television. The rules can therefore be seen as an effort to exercise greater control over the content of material on video hosting platforms.

The new rules require that all programs must be examined carefully and strictly by video hosting platforms before broadcast to ensure that the programs do not contain, amongst others, content which:

  • Spoofs or damages the image or reputation of a Chinese revolutionary leader or heroic figure
  • Shows ‘abnormal’ sexual relationships
  • Infringes intellectual property rights
  • Uses non-standard Chinese characters

The rules also require that programs avoid the use of underage children, a move aimed at quashing an increasing trend for celebrities in China to use their children in content posted online.

The rules lay down specific criteria to be followed by video hosting platforms, including the training which examiners are required to undertake and that at least two or three examiners should examine the content of each video. The rules also make specific provision for ‘expert’ examination of videos which relate to Chinese revolutionary leaders, heroic figures, the Chinese army or judicial officials.

The CNSA is an industry association so the rules are only binding on CNSA members and do not have the force of law. However, as almost all major online audio and video platforms in China are members of the CNSA, the rules have the potential to significantly re-shape market practices.

Comments

The rules are more stringent than the current practice and will therefore impose an increased burden on video hosting platforms. The non-binding nature of the rules is seen by many as a move by the Chinese government to test the response from the public and industry before assessing its next move. The rules have been subject to criticism that they will restrict the content of online videos and impede Internet freedom in China.

However, the rules form part of a series of other measures aimed at ‘cleaning up’ the internet in China, including provisions on live broadcasting over the internet, the management of internet news services and trial measures in relation to online literature. The new Cybersecurity law in China and the recent crackdown on the use of VPNs in China also forms part of this trend of increasing government control over all aspects of the internet. Online content providers are therefore advised to watch this space carefully for future developments.