06 Dec 2012

Federal Government responds to Convergence Review in part, with key issues left for another day

by Kate Jordan, Mary Still, Anna Haynes

The Federal Government's initial response to the Convergence Review Final Report deals with television broadcasting licence fees, Australian content requirements and the 75% audience reach rule.

The Federal Government's initial response to the Convergence Review Final Report was released last Friday, dealing with issues such as television broadcasting licence fees, Australian content requirements and the removal of the 75% audience reach rule. 

However, the package is only a partial response to the broad ranging recommendations made by the Convergence Review Committee, with the Federal Government's consideration of the final report stated to be continuing. 

Media ownership is one area of reform which has largely been left for another day, with the exception of the removal of  the 75% audience reach rule.  We are yet to see the Federal Government's response on widely debated recommendations such as the public interest test with respect to a change of control of a content service enterprise of national significance.

Television broadcasting licence fees to be reduced

The current rebate on television broadcasting licence fees (which expired on 30 June 2012) will be extended for a period of 12 months, with immediate effect.  The extended rebates will apply for the financial year 2012-13 and will be followed by a permanent reduction in television broadcasting licence fees by 50 percent, to a maximum of 4.5% of revenue. 

Media ownership reforms

The 75% reach rule will be removed. This rule currently prohibits a person from being in a position to exercise control of commercial television broadcasting licences whose combined licence area populations exceed 75% of the population of Australia.  There are corresponding rules in respect of directorships.

The removal is stated to be subject to the approval of Parliament and to adherence by the commercial television broadcasters to existing local content obligations in regional areas and written undertakings in respect of those obligations.

Australian content requirements to apply from 1 January 2013

  • Retention of the current requirement that all commercial television broadcasting licensees broadcast an annual minimum transmission quota of 55% of Australian programming between 6 am and midnight in respect of broadcasters' primary channels.
  • Introduction of greater flexibility into current sub-quota arrangements, which currently set specific minimum annual sub-quotas for Australian (adult) drama, documentary and children’s programs.
  • Introduction of a new multichannel Australian content requirement for each commercial television broadcaster, under which commercial television broadcasters will be required to broadcast 730 hours of Australian content in 2013, increasing to 1095 hours in 2014 and to 1460 hours in 2015.  The content requirement will comprise an incentive for first-release drama by allowing an hour of first release drama premiered on a digital multichannel to count for two hours under the transmission hours requirement for multichannels.

Other issues

There has also been an announcement that there will be public consultations in early 2013 on how captioning levels will be increased on multichannels following digital switchover.

No spectrum or broadcast licences will be made available to a fourth free-to-air television network. The longer term potential uses for the spectrum will be further considered.

Next steps

The legislation required to implement these reforms is scheduled to be developed by March 2013 and will comprise transitional arrangements in respect of the Australian content requirements.

A firm timeframe for response on the remaining issues addressed in the Convergence Review Final Report has not been set, but the Federal Government has indicated further announcements will be made in 2013.


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Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this communication. Persons listed may not be admitted in all States and Territories.