Application under s 152 of the Copyright Act 1968 by W.E.A Records

[1983] FCA 89

J

COMMONWE?+LTH O F AUSTKqLIA

COPYRIGHT ACT 1968

I N THE COPYRIGHT TRIBUNAL O. 1 A OF 1980

APPLICATION UNDER S . 152 OF

THE COPYRIGHT F.CT 1968 BY

WEA RECORDS PTY. LIMITED I

ASTOR RECORDS PTY. LTD. ,

R . C . A . L I M I T E D , POLYGRAM RECORDS PTY. LTD. ,

C. B . S .	RECORDS AUSTRqLIA
L I X I T E D ,
FESTIVAL	RECORDS PTY. LIMITED

T I E TRIBUPTAL: - ~ U S T R A L I A ) LIMITED,

LOC?HART J. D e p u t y President

R . V . J . P U X V I S E s q . , Q . C . A p p l l c a n t s

D.K. !1ALCOL:i E s q . , 0.C.

STEREO F.M. PTY. L IMITED -

R e s p o n d e n t

1 7 I U Y	1 9 8 3	REASONS	D CISION	FOR
*

WEA R e c o r d s P t y . L i m i t e d , EM1 ( A u s t r a l i a ) L i m i t e d ,

F e s t i v a l R e c o r d s p t y . L i m i t e d , C E S R e c o r d s A m s t r a l l a L i m i t e d ,

Polygram F e c o r d s P t y . L i m i t e r l , RCA L i m i t e d and A s t o r R e c o r d s P t y .

L m i t e d ( " t h e record c o m p a c i e s " ) and Phonographic P e r f o r m a n c e C o .

of A u s t r a l l a L i m i t e d ( " P P C A " ) have appl led t o t h i s Tribunal u n d e r

S. 152 of the C o p y r i g h t A c t 1968 ( " t h e A c t " ) for orders

d e t e r m l n l n q the amourits payable t o each of them as the o w n e r s of

c o p y r i g h t s i n p u b l l s h e d sound r e c o r d i n g s by t h e h o l d e r s of

l l cences for commercial FE.; broadcast lng s t a t ions I n A i l s t r a l l a

("the broadcast-ers") . The b roadcas t e r s a r e S t e r e o FM P t y .

-2-

L m l c e d ( "2MMM"), Sydney FM Limlted ( "2DAY"), a r o a d c a s t FM P t y .

Limlted ( "3FGX") , A d e l a l d e S t e r e o FE1 P t y . L m i t e d ( " 5 S S A " ) , N e w

B r o a d c a s t i n g P t y . L l m i t e d ( "6NOW"), Melbourne F2 R a d l o P t y .

L i m i t e d ("3EGM") and Stereo FM Br lsbane L l m l t e d ("4MMM"). Each of

t h e b r o a d c a s t e r s 1 s t h e h o l d e r of a commerc la l r ad io b roadcas t ing

l i c e n c e u n d e r t h e B r o a d c a s t i n g a n d T e l e v l s i o n A c t 1 9 4 2 w h i c h

e n t i t l e s t h e h o l d e r t o b roadcas t by means of FM r a t h e r t h a n t h e

c o n v e n t i o n a l A Y . FM b roadcas t ing by commerc ia l r ad io commenced

l n 1 9 8 0 Aus t r a l i an Broadcas t lng Tr ibuna l . w i t h c h e g r a n t l n g o f l l c e n s e s o n 22 August 1 9 8 0 by t he

PPCA w a s i n c o r p o r a t e d l n New South Wales In March 1969.

Each o f t h e r e c o r d c o m p a n i e s i s a member o f P P C A . P P C A a l s o

r ep resen t s t en o he r r co rd manufac tu r lng compan les whose

b u s l n e s s a c t l v i t i e s a r e smaller i n s c a l e t h a n t h o s e o f a n y o f t h e

record- companles. We sha l l r e f e r l a t e r I n more d e t a l l t o PPCA and.

Its a c t i v l t l e s , b u t t ha t t h e prlmary ob3ec t for whlch PPCA w a s formed was it 1s s r l f f l c l e n t for p r e s e n t p u r p o s e s t o s a y

co p r o v l d e

a c e n t r a l t o b r o a d c a s t o r p e r f o r m i n p u b l l c s o u n d r e c o r d l n g s a c i m m l n i s t r a t l v e o r g a n l s a t i o n f o r t h e l s s u e o f l l c e n c e s

m whlch sound

r e c o r a l n g c o p y r l g h t 1s owned b y t h e respective members. PDCA

a l s c a r r a n g e s f o r t h e p a y m e n t t o lt on j e h a l f o f I t s members o f

f e e s o r r o y a l t i e s f o r t h e llse o f copyr lgh t rna re r l a l and f o r t h e

m a i n t e n a n c e a n d 2 r o c e s s l n g o f log r e p o r t s . * h i c h r e c o r d t h e

b ~ o a d c a s t l n g of r eco rds wn lch In ~ 0 1 x 6 r e c o r d i n q copyright

s u b s l s c s . The same counse l 2nd s c l l c l t o r s r e p r e s e n t the r eco rd

companles and PPCX.

~ c t o r s and Annoance r s Equ ty ' Assoc la t ion o f Australia

and t h e W 1 s l c l a n s ' Unlon a r e p a r t l e s t o t h e a p p l l c a t l o n s b u t h a v e

p layed no r o l e i n t h e h e a r l n g o f t h e m . At t h e l r e q u e s t h e y

were g iven leave t o wl thdraw f rom the hear lnq when I t commenced.

The p e r i o d s p e c i f l e d i n e a c h a p p l l c a t l o n a s t h e p e r l o d

t o whlch the orders sought should apply 1s from 1 October 1960 to

t h e 30 June next succeeding any order made b y t h e T r i b u n a l .

The p a r t i e s r e q u e s t e d t h e T r l b l l n a l t o de t e rmlne a

g r e l l m m a r y q u e s t l o n of law before embarklnq on the subs tan t lve

h e a r l n g of the app l i ca t lons t hemse lves . Counse l l n fo rmed t he

T r l b u n a l t h a t d e t e r m l n a t i o n t h e o f t h l s G u e s t i o n wou ld

c o n s i d e r a b l y f a c i l i t a t e t h e p r e p a r a t i o n b y t h e p a r t l e s of t h e i r

r e s p e c t l v e c a s e s f o r h e a r l n g , p r o b a b l y e n a b l e a g r e e m e n t t o be

r e a c h e d a s t o f a c t s and documents and thus subscant la l ly shor ten

t h e l e n q c h of t h e .!iLtrmate h e a r l n g . The Tr lbunal acceded CO t h l s

r e q u e s t and heard by consent arglmenc on a quest ion formulaced by

t h e p a r t l e s I n t h e s e c- D r m s : -

"Whether I n f l x l n g a n y amollnt pursl-lant t o t h e

powers conferred by S. 1 5 2 , Fartic7:larly

sub-s , 7 , t h e T r l b u n a l , 12 caklng Lnto acco' lnt

t h e e x t e n t of use of r e c o r d s a s prescribed. ln

t ha t sub - sec t lon , sho l l ld have r eca rd o ~ i y t o

t h e 'lse b y a b r o a d c a s t e r o f r e c o r d s w ~ t h

r e s p e c t t o whlch :he a p p l l c a n t ' s s c lnd

recordlnq ccpyrlghc -1zc1udes the excLI:siVe

S r o a d c a s t l n g r l q h t r e f e r r e d t c ~n S . 25 ( = ) of

che Ace. Z r sho2;ld t n e Tribunal have reqzrd

eo che 11se by a S r o a d c a s r s r of a l l r e c o r d s l n

wnlch t h e l r subsLsts IZ favour che of

copyrlght owner any of c h e s p e c l e s c f souzd

-4-

r e c o r d i n g c o p y r i g h t d e f l n e d I n S . 8 5 , o t h e r

t h a n c o p y r i g h t a r l s 1 c 5 s o l e l y b y v l r t u e o f

f l r s t p u b l l c a t l o n o f a s o u n d r e c o r d l n g 13

A u s t r a l i a " .

On 20 November 1981 t he T r ibuna gave l I ts d e c i s l o n (E

WEA R e c o r d s P t y . L l m l t e d & Ors. ( 1 9 8 1 ) 4 0 A . L . ? . . 111) and

expressed I t s conclusion ( a t p. 1 2 4 ) a s fol lows:-

" I n t h e r e s u l t , o u r conclusion t h e o n

p r e l m i n a r y	p o l n t s	w h i c h	h a v e	b e e n	a r g u e d	1s
t h a t : -

T h e amounc payab le under S . 152 ( 2 ) i s l n

r e s p e c t O f t h e b r o a d c a s t i n g b Y

b r o a d c a s t e r s o f publ lshed sound

r e c o r d l n g s r e s p e c t i n of wh ich t he

c o p y r l g h t i n c l u d e s the e x c l u s l v e r l g h t t o

b roadcas t unde r S . 85 ( c ) whlch would be

i n f r i n g e d b y the b r o a d c a s t e r , u n l e s s a n

o r d e r 1s made Imder S . 152 or an

unde r t ak lng	i ven	In	acco rdance	w i th	S .
109 (1).

T h e amount so payab le 1s t o be determlned

b y t h e r e l e v a n t T r i b u n a l t a k i n g I n t o a c c o u n t a l l

m a t t e r s l n a c c o r d a n c e w i t h S .

152 ( 7 1; b u t t h a t s u b - s e c t i o n , w h i l s t

e x c l l l d l n g t h e r e f r o m t h e x t e n t o w h l c h

the - b r o a d c a s t e r u s e s r e c o r d l n q s l n

r e l a t l o n t o wh lch S . 1 0 5 a p p l i e s a n d i n c l u d i n g t h e r e l n t h e e x t e n t t o w h l c h t h e

b r o a d c a s r e r uses sound record lngs rn

w h l c h c o p y r i g h t s u b s l s t s , does n o t lmlt

t h e c l a s s o f r e l e v a n t m a t t e r s t o t h e 11se

made o f r e c o r d i n g s l n r e s p e c t o f w h l c h

the copyr lgh t ' I nc ludes t he exc lus ive

r i g h t o Sroaecast under S . 8 5 ( c ) and

tyhlch a t t r a c t s t h e amounc payable 'under

S . 152 ( 2 ) .

A t t h e d e t e r m i n a t l o n r e q u e s t of t h e p a r t l e s w e make n o

o r o r e e r a t t h l s s t a c e ; h ~ c

w i l l ad]ourn cne fur ther hear lnq c f =he mat te r

t o a d a r e t o b e f i x e d , sc t h a c ? h e partlss may

conslder what we h a v e s a l d a n d t h e r b r ~ n 5 12

shor r minu te s of che approFrzace deterrninar:cn

or o r d e r . 'I

- 5 -

Afte r w e g a v e t h l s d e c i s i o n t h e p a r t i e s r e q u e s t e d t h a t

w e make n o c o n s e q u e n t l a l o r d e r s o t h e r t h a n d l r e c t l o n s f o r t h e

h e a r l n g o f	t h e a p p l i c a t l o n .
F o l l o w l n g o u r d e c i s i o n o n t h e p r e l l m i n a r y q u e s t l o n of

l a w t h e p a r t l e s r e q u e s t e d t h e T r i b u n a l t o h e a r o n l y t h e f i r s t

a p p l i c a t i o n ( U of 1980) i n which the respondent is 2MMM and t o

s t a n d t h e o t h e r a p p l i c a t l o n s o v e r so t h a t t h e y may be r e s t o r e d t o

t h e l i s t and hearc? i n t h e l l g h t of o u r f i n d l n g s I n 1A. we took

t h l s c o u r s e . been heard by	Hence	i t	1s	o n l y	a p p l l c a t l o n	1A	which	as	so	f a r
11s.

o u r d e c i s l o n I n t h e p r e l i m l n a r y o n q u e s t l o n w e

c o n s i d e r e d v a r l o l l s m a t t e r s including q u e s t i o n s o f law whlch a re

r e l e v a n t t o t h e i s s u e s now b e f o r e u s . We do n o t p r o p o s e t o

repeat what w e sa ld t h e r e e x c e p t w h e r e r e p e t l t i o n is n e c e s s a r y t o

d e a l w l t h r e p e t i t l o n t h e l s s u e s c u r r e n t l y b e f o r e u s . To t h a t e x t e n t

1 s i n e v i t a b l e . A p rope r unde r s t and ing o f ou r dec i s lon

h e r e , h o w e v e r , does r e q u l r e r e a d i n g o u r e a r l l e r r e a s o n s f o r

d e c l s l o n .

Application may be made r-o c h e T r l b ' J n a l p l l r s u e n c t o

sub-s . 152 (1) of che %ct f a r a n o r d e r d e t e r r n l n l n g t h e arnollnt

payable by a b roadcasce r t o the owners of copyr lgh t s In p l lb l l shed

sound r eco rd ings r e c o r d l n g s r e pec t In o f =he broadcast-ng cf t h o s e

b y t h a r b r o a d c a s t e r . The Yr lbune cannc t l meke an

o r d e r r e q u l r l n g a ccmmerc la l j roadczs t e r t c cey ar. amcunc

-6-

exceedlng 15 of t h e amount de te rmlned by the Tr lbunal to be t h e

g r o s s e a r n l n g s o f t h e b r o a d c a s t e r d u r l n g t h e r e l e v a n t p e r l o d i n

w h i c h t h e o r d e r applies ( s u b - S . 1 5 2 ( 8 ) 1 . T h e A n s t r a l l a n

E r o a d c a s t l n g C o n u n l s s l o n c a n n o t be r e q l l l r e d t o pay an amoun t

exceeding an amount assessed on a p o p u l a t i o n basls ( s u b - s . 1 5 2

(11) 1 .

Sound r e c o r d m g s a r e t h e m s e l v e s t h e s u b ~ e c t m a t t e r o f

c o p y r i g h c m 2 e r t h e A c t a n d t h l s s p e c i e s of c o p y r l g h t e x l s t s

l ndependen t ly of a n y c o p y r i g h t s u b s l s t l n g t h e i n literary,

d r a m a t i c , m u s i c a l o r a r t i s t i c w o r k s e m b o d l e d I n t h e r e c o r d s .

I n f r l n g e m e n t of t h e c o p y r l g h t l n a s o u n d r e c o r d l n g may a l s o

c o n s i t i t u t e i n f r i n g e m e n t o f , f o r e x a m p l e , t h e c o p y r l g h t I n m u s l c

embodied l n a r e c o r d b u t t h i s w i l l n o t necessarily be t h e c a s e .

Each c o F y r l g h t each case depend 1 s i ndependen t and ques t lons o f l n f r lngemen t l n

cpon the p rovls lons o f r;he A c t r e l a t l n g t o e a c h

s e p a r a t e sllbject matter of c o p y r i g h t .

-

-.

For t h e p u r p o s e s o f t h e A c t , c o F y r i g h t i n r e l a t l o n t o a

sound record lng i s the e x c l u s i v e r l g h t t o d o a l l o r a n y of t h e

following:-

( a ) t o make a r e c o r e embodying che recor2 lnS;

( b ) t o c a u s e t h e r e c o r d l n g t o be hea rd 12 p u b l l c ;

( C ) to broadcasc rhe record ing : 1 S. 2 5 ) .

-7-

There a r e i m p o r t a n t l i m l t a t i o n s o n t h e e x c l l l s i v e r i g h t s

of t h e o w n e r o f c o p y r l g h t I n a s o u n d r e c o r d l n g , t h e m o s c

impor t an t of which a r e t h e c o m p u l s o r y l i c e n s i n g p r o v l s l o n s f o r

t he pub l l c pe r fo rmance and b roadcas t ing of r e c o r d s . T h e s e s t r l k e

a b a l a n c e b e t w e e n t h e c l a i m s o f t h e record p r o d u c e r s f o r a n

a d e q u a t e r e t u r n f o r t h e i r s k l l l a n d e f f o r t I n m a k l n g r e c o r d s a n d

t h e c l a i m s o f t h e b r o a d c a s t e r s a n d t h o s e l n t e r e s t e d i n t h e

p e r f o r m l n g r i g h t s . C o m p l s o r y l l c e n c e s for t h e b r o a d c a s t l n g o f

s o u n d r e c o r d i n g s a r e d e a l t w i th by S. 1 0 9 . The es sence of t h e

scheme i s t h a t ~ . t 1 s n o c a n i n f r l n g e m e n t o f c o p y r l g h t i n a

published sound record lng t o b r o a d c a s t it w i t h o u t t h e c o n s e n t of

t h e owner of t h e c o p y r l g h t l n t h e r e c o r d l n g If t h e r e c o r d l n g h a s

b e e n r e l e a s e d s l n c e f i r s t r e l e a s e o v e r s e a s i n A u s t r a l i a o r t h e p r e s c r l b e d p e r l o d h a s e l a p s e d

and r o y a l t i e s a r e p a l d l n a c c o r d a n c e

w i t h t h e r e q u l r e m e n t s of t h e A c t .

Sub-sect ions 109 (l), i 2 ) and ( 3 ) prov:de a s follows:-

--

" ( l ) S u b l e c t t o t h l s s e c t l o n , t h e c c p y r l g h t

i n a i n f r lnged by the mak lng publ l sned sound record icg is nor

3f a b r o e d c a s t of t h a t

recort i lng lf -

(a) where there 1 s no o r d e r of t h e T r i b u n a l

i n f o r c e u n d e r s e c t l o n 1 5 2 aFpiy1r.g to

the maker of t h a t b r o a d c a s t lr. r e l a c l o n

t o t h e t u n e when chac b roadcas t has xaae

- t h e maker 05 t h a t b r o a d c a s t h a s q i v ~ ~

a n u n d e r t a k l n g I n w r l t l n g t o t h e > e r s o n

who 1 s t h e owner of t h e c o p y r l g h t l n r k a c

r e c o r d l n g t o ?ay t o hlm such emo1:nts (:f

a n y ) a s may spec:flsa be ~ n , c r

eetermlned ;n accs rdecce : $ l th , 2s o r d e r

o f t he T r lb ' i na l maEe l l n a e r t h a r s e c t l o n

i n r e s p e c c o f = h e b r o a d c z s t l n q S y t h e

-a-

maker , 6ur lng a p e r i o d w l t h i n w h l c h t h a t

b r o a d c a s t was made, of Fubllshed sound

r e c o r d l n g s i n w h i c h t h e c o p y r i c h t s a r e

owned by t h a t p e r s o n and whlch include

t h a t r e c o r d l n g ; o r

( b ) where there 1 s a n o r d e r o f t h e T r i b u n a l

i n f o r c e u n d e r t h a t s e c t l o n a p p l y l n g t o

t h e m a k e r t o t h e t i m e o f t h a t b r o a d c a s t I n r e l a t i o n

when t h a t b r o a d c a s t was made-

( 1)	t h e
c o p y r i g h r owned by a person who i n t h a t r e c o r d i n g i s

1 s s p e c l f l e d

l n t h e o r d e r a s o n e of t h e p e r s o n s

among whom t h e a m o u n t s p e c i f l e d

I n , or d e t e r m l n e d i n a c c o r d a n c e

w l t h , t h e o r d e r IS t o be d iv ided

a n d t h e m a k e r o f t h e b r o a d c a s t

t o t h e p e r s o n l n

makes payments

accordance wi th t h e o r d e r : o r

( ii) t h e c o p y r l g h t i n t h a t r e c o r d i n g i s

owned by s p e c i f l e d i n t h e o r d e r . a pers 'on who i s n o t s o

( 2 ) The l a s t p reced ing sub - sec t lon does no t

a p p l y i n r e l a t i o n t o a b r o a d c a s t o f a sound

r e c o r d i n ? t h e b r o a d c a s t i f m de was I n

accordance with an agreement between the maker

t he b roadcas t o f ?he nd owner t h e o f

c o p y r l g h t I n t h e r e c o r d i n g .

( 3 ) Sub-sect lon (l) d o e s a p p l y n o t i n

r e l a t l o n -to a b roadcas t o f e sound recording

t h a t h a s n o t b e e n p u b l i s h e d I n A l l s t r a l i a I f

t h e b r o a d c a s t was made b e f o r e t h e e x p l r a t l o n

of t h e p r e s c r r b e d p e r l o d a f t e r t h e d a r e o f t h e

f i r s t p u b l l c a t l o n O f r e c o r d i n g . t h e I'

The p r e s c r i b e d p e r i o d 1 s seven weeks (see Reg. 1 9 o f t h e

Copyr ight Regula t lons 1 9 6 9 ) .

The g e n e r a l e f f e c t o f t h l s 2rov1s ion 1 s t h a t a f r e r a

r e c o r d h a s S e e n r e l e a s e d I n A a s t r a l l a , s l ~ b ~ s c t tc, zomplymg kvlch

r h e r e q u l r e m e n t s o f t h e A c t i t m a y b e b r o a e c a s t s1:b;ect :o

paymenc o f appropr l a t e royalties and c the r -d l se comp1y:nc wl th che

-9-

A c c . I f t h e r e c o r d l n g h a s n o t been pub l l shed In Australia, a

p r e s c r i b e d p e r l o d o f s e v e n deeks m u s t e l a p s e a f t e r t h e d a t e o f

f i r s r p u b l l c a t l o n b e f o r e t h e i l c e n c e p r o v l s i o n s c a n 'se lnvoked.

S e c t l o n 1 5 2 , whlch i s t h e k e y s e c t i o n i n r e l a t l o n t o t h e

ques t ions whlch we h a v e t o c o n s l d e r , provides:-

"152 . (1) I n t h l s s e c t i o n , u l e s s t h e

c o n t r a r y l n t e n t i o n a p p e a r s -

" A u s t r a l i a " d o e s n o t i n c l u d e t h e x t e r n a l

T e r r l t o r i e s :

"broadcas te r" means -

( a ) t h e A u s t r a l i a n B r o a d c a s t l n g C o m m l s s l o n ;

( a a ) t h e S p e c i a l B r o a d c a s t l n g S e r v i c e ;

( b ) h o l d e r t h e of a l i c e n c e f o r a

b r o a d c a s t l n g s t a t i o n ;

( c ) t h e h o l d e r o f a l l c e n c e f o r a t e l e v l s l o n

s t a t i o n ; o r

( d ) a p e r s o n s l ~ b - 3 a r a g r a p h 9 1 p r e s c r l b e d for t h e p u r o o s e s c f

( a ) (111) o r 9 i ( 5 )

( iii) -.

( 2 ) S u b l e c t t o chls s e c t l o n , a n a p p l l c a t l o n

may be made t o rhe T r l 3 u n a l f c r a n o r d e r

de t e rmln lng , o r maklng provls lor . fo r

d e t e r m l n l n g , t h e amounc payable by a

b r o a d c a s t e r to t h e o w n e r s o f c c p y r l 5 h t s ir.

pub l l shed sounc! r eco rd lngs 13 r e s p e c t of t h e

b r o a d c a s t l n g , d u r l n g a p e r l o d s p e c l f l e c l n t h e

a p p l l c a t i o n ,	of	t h o s e	r e c o r d l c g s	Sy	z n a t
b r o a d c a s t e r .

( 3 ) An sub-sec t ion may be mace app l l ca t i cn I l nae r t h e l ~ s c 5recedrr.g

by t h e b r o a c c a s t o r c)r

b y t h e sound reccrd ing . o w n e r 3f a c o F y r l g h t l n 3 published

( 4 ) The p a r z ~ a s :o a n s p p l l c a ~ l o n l ~ n d e r

sub-secclon 12 ) a r e -

-10-

(a)	the person rnaklng the appllcatlon: and
(b)	such organlzations or persons as apply to the Tribunal to be made parties to the appllcatlon and, in accordance wich the next succeeding sub-sectlon, are made parties to the appllcation.

4

( 5 )	Where an organization (whether claiming to be representatlve of broadcasters or of the owners of copyrights in publlshed sound recordings or not) or a person
(whether a broadcaster or the owner of a copyright In a published sound recording or not) applles to the Trlbunal to be made a party to an application Imder thls section, and the Trlbunal 1 s satlsfied that the organlzation or person has a substantial interest ln the matter that
1 s the subject of the appllcatlon, the
Tribunal may, lf it thinks fit, make that organizatlon or person a party to the appllcation.

( 6 ) The Tribunal shall consider an

application under sub-section ( 2 ) and,

after giving the parties to the appllcation an opportunlty of presenting their cases, shall make an order -

(a) determining, or making provlslon 'for

determining, the amount payable by the broadcaster to the owners of copyrights

ln publlshed sound recordlngs In respect

of the broadcasting, durmg the period to

order broadcaster of those recordlngs; applies, by the

which t e

(b)

specifyinq as the persons among whom that amount is to be dlvlded. such cf the persons who were, or were represented by, parties to the appllcatlon as the

Trlbunal is satlsfied are the owners of

copyrlghts in publlshed sound recordings:

and

(c) speclfylng as that amo'mt of -the perscns among whom that amount 1 s to be dlvlced and as the times 35 whlc:? those shares 3rs to be pale such shzres and. tlmes as chose the respecclve shares ;n

persons agree ,3r, ln iefaulz of

agreement,	the	as	Tribunal	thlnjcs
equltable.

-11-

( 7 ) I n so maklng an order i n r e l a t i o n t o a

b r o a d c a s t e r , t h e T r l b l m a l s h a l l t a k e l n t o

accolint a l l r e l e v a n t m a t t e r s , L n c l l i d l n g t h e

e x t e n t t o wh lch t he b roadcas t e r u s e s , f o r t h e

purposes o f broadcas t lng , records embodylng

s o u n d r e c o r d l n g s ( o t h e r t h a n r e c o r d i n g s i n

r e l a t l o n to w h i c h s e c t l o n 1 0 5 a p p l l e s ) I n

w h l c h o p y r l g h t s s u b s l s t , b e i n g c o p y r i g h t s

owned by persons who a r e , or a r e r e p r e s e n t e d

by, p a r t i e s t o t h e a p p l i c a t i o n .

( 8 ) T h e T r i b u n a l s h a l l n o t make a n o r d e r t h a t

would r e q u i r e a b r o a d c a s t e r b e i n g t h e h o l d e r

o f a l i c e n c e f o r a b r o a d c a s t i n g s t a t i o n t o

p a y , r e s p e c t

l n pub l i shed of t h e b r o a d c a s t i n g o f

sound r eco rd lngs du r ing t he period

i n r e l a t i o n amount exceeding 1% of t o w h l c h t h e o r d e r t h e amounc de termlned a p p l i e s , a n

b y t h e t h e b r o a d c a s t e r d u r l n g t h e p e r i o d e q u a l Tr ibunal t o be t h e g r o s s e a r n l n g s o f

t o t h e

p e r i o d i n r e l a t i o n t o which the o r d e r a p p l l e s

t ha t ended of commencement of on 30 Jlme the p e r l o d l a s t p r e c e d i n g t h e d a t e

i n r e l a t i o n to

w h i c h t h e o r d e r a p p l l e s .

.. .

(10) Sub-sect lon ( 8 ) does n o t a p p l y to an

o r d e r i n r e l a t i o n t o a b r o a e c a s t e r ‘ m l e s s -

b r o a d c a s t e r t h e ( a ) e s t a b l l s h e s s a t i s f a c t z o n t o the

of t h e T r l b u n a l the amount

o f t h e dllrl.ng g r o s s e a r n m g s o f t h e b r o a d c a s t e r

t h e p e r i o d I n r e s p e c t o f whlch

t h o s e - e a r n i n g s a r e t o be determlned: and

( b ) b r o a d c a s t e r t rznsrn lss ion of programmes by slay cf t h e t h e c a r r l e d o n

sound broadcas t ing th ro lqhout che whole

of t h a t p e r i o d .

(11) Where a n a p p l l c a t i o n 1 s made t o The

Trlbunal lnder sub-sect lon ( 2 ) m r e l e t l o n co

t h e Australian Broadcastlng Conunlssion, the

T r l b u n a l -

(a) s h a l l make s e p a r a t e o r d e r s lr- r e sFecc of

s o u n d b r o a d c a s t s b y t h e Commlsslcr! of

published sound recorci inqs and ln r a s p e c t

-

01 t e l e v l s l c r . b r o a d c a s t s by t h e

Commlsslon o f s l lch raccrd lngs : 2nd

..

-12-

( b ) s h a l l n o t make a n o r d e r t h a t w o u l d

r e q u l r e t h e Commlsslon t o p a y , I n r e s p e c t

of sound broadcasts of published sound

r e c c r d l n g s d u r i n g t h e p e r l o a i n r e l a c l o n

i

t o w h i c h

t h e exceeding t h e sum of - o r d e r a p p l i e s , a n a m o u n t

( i ) I n r e s p e c t o f each comple te year

i n c l u d e d t h a t I n p e r l o d - t h e

amount a s c e r t a i n e d b y m u l t l p l y i n g

one-half of One c e n t b y t h e number

e q u a l t o t h e n u m b e r o f p e r s o n s

comprised in e s t h e m a t e d

p o p u l a t i o n o f A u s t r a l i a a s l a s t

s e t out i n s t a t i s t i c s p u b l i s h e d b y

t h e Commonwealth S t a t l s t l c l a n

b e f o r e	t h e	m a k l n g	o f	t h e	o r d e r :
and

(ii) I n r e s p e c t o f e a c h p a r t o f a yea r

l n c l u d e d t h a t I n p e r i o d - t h e

a m o u n t t h a t b e a r s t o t h e amount

a s c e r t a m e d i n a c c o r d a n c e w l t h t h e

l a s t p r e c e d l n g r e l a t i o n s u b - p a r a g r a p h l n

t o a c o m p l e t e y e a r t h e

same p r o p o r t l o n a s t h a t p a r t o f a

y e a r b e a r s t o a comple te year .

( 1 2 ) A p e r s o n who 1 s n o t s p e c l f l e d i n an

o r d e r i n the pe r sons among whom f o r c e u n d e r s u b - s e c t l o n ( 6 ) a s o n e o f

t h e m o u n t s p e c i f i e d

i n , o r d e t e r m i n e d I n a c c o r d a n c e w i t h , t h e

o r d e r 1s d l v l d e d b e t o may, b e f o r e t h e

e x p i r a t i o n o f t h e p e r l o d t o w h l c h t h e o r d e r

a p p l l e s , - a p p l y t h e T r l b u n a l t o f o r a n

amendment-of t h e o r d e r so a s t o specxfy h l m a s

one	of	those	p e r s o n s .
..

(14) The T r i b u n a l c o n s l d e r s h a l a n

a p p l i c a t l o n u d e r s u b - s e c t l o n ( 1 2 ) fo r an

amendment of an o r d e r i n force l lnder

sub - sec t ion ( 6 ) ( m t h l s s u b - s e c t l o n r e f e r r e d

t o a s " t h e p r m c l p a l o r d e r " ) a n d , a f t e r q l v l n g

t h e p a r t l e s s a t i s f l e a t o t h e a p p l l c a t l o n a n o p g o r t u n l t y

o f p r e s e n t l n q t h e l r c a s e s , s h a l l , l f I t 1 s

t h a t t h e applicant i s t h e owner o f

t h e copyright o r c o p y r i g h t s I n one o r m o r e

published sound record lngs , make ar. s r d e r

amending the principal o r d e r so a s t o -

-13-

( a ) s p e c i f y t h e pe r sons a p p l l c a n t a s among o n e of t h e

whom t h e amount s p e c l f i e d

i n , o r d e t e r m l n e d I n a c c o r d a n c e w l t h , t h e

p r l n c l p a l o r d e r 1s t o be d lv lded ; and

( b ) s p e c l f y a s t h e s h a r e of t h e a p p l l c a n t 1p.

t h a t amounc and a s t h e t i m e s a t x h l c h

t h a t s h a r e i s eo be pa id such sha re and

t lmes a s t he a p p l i c a n t a n d t h e o t h e r

pe r sons among whom t h a t amount i s t o be

d i v i d e d a g r e e a g r e e m e n t , o r , d e f a u l t I n of

T r i b u n a l ' t h e a s h i n k s

e q u i t a b l e a n 8 rnake any consaqnen t i a l

a l t e r a t i o n s i n r e s p e c t o f t h e s h a r e s of

t h o s e o r h e r p e r s o n s .

( 1 5 ) An o r d e r o f t h e T r l b u n a l made cnder

s u b s e c t i o n ( 6 ) I n r e l a t l o n t o a b r o a d c a s t e r

a p p l l e s i n r e l a t i o n t o t h e p e r l o d commecclng

o n t h e d a t e s p e c i f l e d l n t h e o r d e r a n d e n d l n g

on 30 J u n e n e x t s u c c e e d i n g t h e d a t e of making

of	t h e order.
. . .

(18) W h e r e a n o r d e r o f t h e T r i b c n a l is I n

f o r c e u n d e r t h l s e c t i o n , t h e b r o a d c a s t e r I n

r e l a c i o n t o whom t h e o r d e r a p p l l e s 1s l l i l b l e

t o pay t o each of the p e r s o n s s p e c l f l e d I n t h e

o r d e r a s t h e p e r s o n s among whom t h e a m o u n t

s p e c l f i e d i n , de t e rmined o r accordance In

w l t h , ti-ie_'qrder i s eo be d l v l d e d t h e s h a r e so

s p e c l f i e d a n r e l a t i o n t o t h a t p e r s o n a n d 1 s so

l i a o l e t o p a y ' c h a t s h a r e a c t h e c l m e s s o

s p e c i f l e d a n d t h a t p e r s o n may r e c o v e r a n y

amount t h a t i s n o t pa ld In acco rdance wl th the

o r d e r i n a c o u r t c f c o m p e t e n t ~ l ~ r ~ s d l c t i c n

f r o m t h e b r o a d c a s t e r a s a d e b t d u e t o = h e

person .

(19) For the purposes of t h i s s ec t lon , t h e

g r o s s e a r n i n g s cf a b r o a d c a s t e r I n r e s p e c t of

a p e r l o d b r o a d c a s t e r a r e t h e 5 r o s s e a r n l n g s of t h e

d u r l n q c h a t p e r i o d lr. r e s p e c t of

t h e b r o a d c a s t m g by : u m of a d v e r t l s e m e n t s o r

o t h e r n a t t e r , : n c l u C 1 ~ 5 Ehe g r o s s e a r ~ 1 n q . s of

the Droadcascer d1:rlng t h a c 2 e r l o d In r e s p e c r

p r o v l s l o R r e s p e c t o f , x a t t e r k r c a d c i l s r b y h m c f , cr ot?.er;vlse 12

o f t h e

by 5x1.

-14-

(20) Where, i n connex lon w i th a t r a n s a c t l o n ,

a n y c o n s i d e r a t i o n 1 s p a l d o r g i v e n o t h e r w l s e

t h a n c a s h ,

i n c o n s l d e r a t l o n t h e money v a l u e of t h a t

s h a l l , f o r t h e p u r p o s e s of t h e

l a s t p r e c e d i n g s u b - s e c t i o n , be deemed t o h a v e

been paid or g lven . I'

Although S. 152 may be invoked w i thou t any ande r t ak lng

hav lng been g iven unde r sub-s. 109 (l), o n c e a n o r d e r i s made

under S. 152 it fol lows t h a t sub-s. 109 (1) 1 s b r o u g h t i n t o p l a y .

The r e m u n e r a t l o n t o be f lxed under S. 152 1s an amount payable by

t h e b r o a d c a s t e r r e c o r d i n g 50 t h e o w n e r o f t h e c o p y r l g h t i n a sound

who h a s t h e e x c l l l s l v e r l g h t t o b r o a d c a s t t h a t r e c o r d i n g .

b y v l r t u e of S . a5 ( c ) .

The d e t e r m i n a t i o n of t h l s a p p l i c a t l o n n e c e s s a r l l y

l n v o l v e s d e c i d i n g c e r t a l n q u e s t l o n s r e l a t l n g t o t h e c o n s t r u c t i o n

and opera t lon of 9 .152 . I t i s t o t h e s e t h a c w e now t u r n .

CCPYRIGHT OWNERS AND REPRESENTATIVES I N C L U D I N G PPCA

-

I t was conceded by 2MMM t h a t e a c h t c f r e c o r d

companies w a s t h e owner o f t he copyr igh t ~n a t l e a s t c n e sound

r e c o r d i n g . I t f o l l o w s t h a c e a c h o f t h e m h a d t h e s t a n d l n g

requl red by sub-s . 1 5 2 ( 3 ) of t h e ;?ct t o make t h e a p p l l c a t l o n .

The s u b ~ e c t m a t t e r o f t h e a p p l l c a t l o n c o n t e m p l a t e d b y s u b - S . 1 5 2

( 2 ) and t h e n a t l l r e o f t h e o r d e r r e q u l r e d t o be made S y sub-s . 1 5 2

-

(6) 1 s an o r d e r : -

- 1 5 -

" ( a ) d e c e r m l n l n g , de t enn ln lng , m a k l n g o r p r o v i s l o n f o r

t he amoun t payab le by t he

b r o a d c a s t e r t o t h e o w n e r s o f c o p y r i g h t s :

l n p u b l l s h e d s o u n d r e c o r d l n g s I n resuect

o f che b roadcas t ing , du r lng the pe r lod . t o

w h l c h	o r d
a p p l l e s , b r o a d c a s t e r t h e t h e r b y

of t h o s e r e c o r d l n g s ;

( b ) s p e c l f y i n g a s the pe r son among whom t h a t

amount 1 s t o b e d l v l d e d s u c h o f t h e

pe r sons who were , o r were r ep resen ted by,

p a r t i e s t o a p p l l c a t l o n t h e t h e a s

Tr lbuna l i s s a t i s f l e d a r e t h e o w n e r s o f

c o p y r l g h t s	m	pub l l shed sound	r eco rd lngs ;
and

( c ) s p e c i f y l n g a s t h e r e s p e c t l v e s h a r e s I n

t h a t a m o u n t t h a t amount 1s o f t h e p e r s o n s among whom

t o be d lv lded and a s t3e

t m e s a t w h l c h t h o s e s h a r e s a r e t o be

pa ld such p e r s o n s s d e f a u l t a re s and tlmes as t h o s e

a g r e e I n o r , f

agreement , T r l b u n a l t h e a s t h l n k s

e q u i t a b l e . 'I

I t 1s common g round t ha t on t he p rope r construction o f

sub-s . 152 ( 6 ) t h e T r l b u n a l w a s r equ i r ed : -

d e t e r m i n e t o ( a ) o r make i x o v l s l o n t h e f o r

-

_ .

de re rmlna t lon o f a g l c b a l amount payable by the

b r o a d c a s t e r t o t h e copyright owners (chls amount

w a s r e f e r r e d . t o i n t h e p r c c e e d l n g s a s " t h e c a k e " ) ;

(b) to s p e c l f y t h e p e r s o n s amcng w n c m the cake is EO

be d iv ided ; and

0 '

-16-

( c ) t o s p e c i f y t h e r e s p e c t i v e s h a r e s c f s u c h p e r s o n s

1

i n t h a t a m o u n t a n d t h e t u n e o f p a y m e n t . The

T r i b u n a l must . be s a t l s f i e d t h a t s u c h p e r s o n s w e r e

"owners of copyr lgh t s pub l i shed In ound

r e c o r d m g s " a n d w e r e p a r t i e s o r r e p r e s e n t e d b y

p a r t i e s to t h e a p p l l c a t i o n .

On l t s f a c e s u b - s . 1 5 2 ( 6 ) p o s t u l a t e s t h a t a l l

i n t e r e s t e d c o p y r i g h t o w n e r s w l l l b e f o r e b e t h e T r i b u n a l .

Sub-sec t ion (12), h o w e v e r , r e c o g n l s e s t h a t h l s may n o t De t h e

case and makes p rov i s ion fo r an app l l ca t ion t o be made t o t h e

Tr ibunal by a person n o t s p e c i f i e d i n a n o r d e r u n d e r s u b - s . ( 6 )

f o r a n a m e n d m e n t o f t h e o r d e r so a s t o s p e c l f y h i m a s o n e o f

t h o s e p e r s o n s . S u b - s e c t i o n ( 1 4 ) p r o v l d e s t h a t h e T r i b u n a l

s h a l l , i f i t 1s s a t i s f i e d t h a t t h e a p p l i c a n t 1 s t h e o w n e r o f

copyr igh t c o r py r lgh t s one In o r more publ lshed sound

r e c o r d m g s , make a-n- order amending l t s o r i g i n a l o r d e r so a s t o

e n a b l e t h e a p p l l c a n t t o p a r t l c i p a t e i n t h e d l v l s l o n o f t h e amount

prev lous ly de te rmlned , and "make a n y c o n s e q l l e n t i a l a l t e r a t l o n s ~n

r e s p e c t o f c h e s h a r e s " of t h e o t h e r p e r s o n s e n t i t l e d . I t i s

a p p a r e n t t h a t a q u e s t l o n c f r e f u n d l n a c o u l d a r l s e o n s u c h a n

a p p l i c a t i o n if sub-s. (14) 1 s read l n l s o l a t l c n f r o m t h e

remainder of s.152. These d l f f l c a l t l e s w e r e c l e a r l y r e c o q r . l s e d

by the e n s u r e d raf t sman of S . 152 and scsps were taken CO mee t t hen t o

t h a t a n y amendment had o n l y a p r o s p e c t l v e a p e r s c l o n . By

sub-s . 1 5 2 ( 2 ) a p e r l c a f c r t h e o p e r a t l o n o f t h e o r d e r may Se

-17-

s p e c l f i e d i n t h e o r l g l n a l a p p l l c a t i o n . 3y sub-s . ( 1 5 ) a n o r d e r

under sub-s. ( 5 ) a p p l l e s l n r e l a t i o n t o t h e p e r i o d ccmmenclng on

a d a t e succeeding s p e c l f l e d l n the da t e o f mak lng t h e o r d e r a n d the o rde r wh lch . e n a l n g c n t h e 3 0 t h J u n e n e x t

It i s a n t l c l p a t e d ,

w l l l be 30 June 1983. I t w a s n o t d l s p u t e d b y 2°K c h a t I t w a s

a p p r o p r l a t e f o r t h e p e r i o d t o commence or: 1 October 1 9 8 0 , a s

s p e c i f i e d i n t h e a p p l l c a t i o n . T h e T r i b l m a l a c c e p t s t h a t a n y

o r d e r It makes hould apply t o a d a t e commencmg on 1 October

1 9 8 0 , b e a r i n g i n mind. t h a t t h e l n l t i a l a p p l l c a t i o n was made on 1 5

September 1980, following the commencement o f b roadcas t ing on 2 2

Augusc 1980 by 2 ” M . I n t h e e v e n t of a n a p p l l c a t l o n b e l n g made

under sub-s. ( 1 2 ) a f t e r t h e Trlblmal has made l t s o r d e r , sub-S .

( 1 7 ) p r o v l d e s t h a t a n y s u b s e q u e n t o r d e r made under sub-s . ( 1 4 )

amend lng the p r inc ipa l o rde r w i l l a p p l y I n r e l a t i o n t o t h e p e r l o d

“ c o m m e n c i n g o n t h e d a t e o f m a k l n g o f t h e a m e n d i n g o r d e r and

end ing on t he da t e of e x p l r a c i o n o f t h e p e r l o d I n r e l a t l o n t o

which t h e o r d e r t h a t is be ing amended a p p l l e s “ . Th~s , a t l e a s t

so f a r as t h e A c t - i s concerned, no q u e s t l o n o f r e f u n d l n g w l l l

a r i s e .

So f a r a s 2°K 1 s c o n c e r n e d . t h e r e s u l t s o f t h e l o g

a n a l y s e s a n d t h e ? l a y llst a n a l y s e s c a r r l e d O ~ J C on behal f of t h e

r eco rd compan les r e c o r d l n q s b r o a d c a s t b y shok t ha t he vas t 5 u l k of a ; l p r o t e c t e c s o u n d

2MM.1E.l ? . u r l n g c h e r e l e v a n t 3 e r l o d w e r e

r e c o r d i n g s I n r e s p e c t of w h l c h t A l s c r a l l a n e b r o a d c a s r l n g

c o p y r l g h t i s owned cr c o n t r o l l e d 3 y o n e o r o c h e ? o f t h e r e c o r d

comcanles. The r e c c r c cornpanl2s have 13 : l x n g r + n r e c e s c l l s l v e

-18-

a l u t h o r i t y to P P C A t o a c t a s c o l l e c t i n g a g e n t a n d t o g r a n t

l l c e n c e s t h l r d t o p a r t l e s r e s p e c t I n t h e o f b r o a d c a s t i n g

c o p y r i g h t s owned o r c o n t r o l l e d b y t h e m .

On 9 October 1980 PPCA a p p l i e d t o t h e T r l b u n a l t o be

made a p a r t y t o t h e r e c o r d c o m p a n l e s ' a p p l l c a t i o n p u r s u a n t t o

sub-s. 1 5 2 ( 5 ) of t h e A c t which provides:-

"Where a n o r g a n i z a t i o n ( w h e t h e r c l a m i n g t o be

a r e p r e s e n t a t l v e o f b r o a d c a s t e r s o r of t h e

owners c r e c o r d l n g s o r	o f	py r lgh t s	pub l i shed	i n	sound
n o t ) o r a p e r s o n ( w h e t h e r a

b r o a d c a s t e r o r the owner of a c o p y r i g h t i n a

publ i shed sound record lng or n o t ) a p p l i e s t o

t h e T r i b u n a l t o be made a p a r t y t o a n

a p p l l c a t i o n u n d e r t h l s s e c t i o n , a t h e d

Tr lbuna l 1 s sa t l s f ied t h a t the o r g a n l z a t i o n or

person h a s a s u b s t a n t i a l l n t e r e s t l n t h e

m a t t e r t h a t i s t h e s u b ~ e c t of t h e a p p l l c a t l o n ,

t h e T r i b u n a l o r g a n i z a t l o n may, l f it t h i n k s f l t , make t h a t

or pe r son a p a r t y t o t h e

a p p l l c a t l o n . "

On 14 Octobe r 1980 t he t hen ? r e s iden t of t h e T r i b u n a l

f o l l o w t h a t P P C A 1 s e n t l t l e d t o b e s p e c l f l e d a s a p e r s o n t o

r e c e l v e a s h a r e of the cake on beha l f cf I-he copyr ight owners i t

r e p r e s e n t s . PPCA could. only be so spec l f i ed unde r sub-S. 1 5 2 ( 6 )

i f t h e T r i b u n a l w e r e s a t l s f l e d t h a r lt was the awner of c o p y r l g h r

i n a t l m p l l c l t l e a s t o n e published. sol:c< r e c o r d ~ n g . I t 1s. h o w e v e r ,

f r o m p a r a . 1 5 2 ( 6 ) : ~ ) t n a t ? ? C A , a s a T a r t y t o t n e

a p p l i c a r i o n , may represent owners of ccpyr lqht ln publ l shec i sound

r e c o r d l n g s who were n o t t h e m s e i - J s s c a r t l e s ;S I-he a p p l l c a t l c n .

-19-

PPCP. w a s l n c o r p o r a t e d I n N e w South 'riales on 2 7 March

1969 fo r t he pu rpose , among o t h e r s , o f e x e r c l s l n g c h e c o p y r l g h t

I n sou -~d r e c o r d l n g s u n d e r p a r a . 8 5 (b) and ( c ) o f t h e Ac; o n

b e h a l f o f t h e o w n e r s o f t h o s e r l g h t s . PPCA ROW r e p r e s e n t s t h e

o w n e r s o f c o p y r l g h t s i n a l a r g e n u m b e r o f p u b l l s h e d s o u n d

r e c o r d i n g s . The s p e c i f l c ob jec ts f o r whlch PPCA w a s e s t a b l l s h e d

i n c l u d e t h e following:-

"(l) To be or become b y g r a n t t r a n s f e r

ass ignment agreement l l cence o r o t h e r w l s e

t h e	o w n e r s	o f	o r	o t h e r w l s e	n t l t l e d	t o
t h e	b

n e f l t copyr lgh t s of o r i n t e r e s t t h e l n

sound ( h e r e i n a f t e r any r eco rd ing In

c a l l e d ' r e c o r d i n g s ' ) and t o

exe rc i se pe r fo rm and e n f o r c e a l l r l g h t s

and rernedies A c t 1968 of by v l r t u e of the Copyright

t h e Commonwealth of A u s t r a l i a

o r a n y

s t a t u t o r y r e -enac tmen t m o d l f i c a t i o n amendment

o r conso l ida t ion t he reo f o r

any enac tmen t t l m e b e i n g r ep lac ing t he same f o r t h e

I n f o r c e ( a l l o f w h l c h a r e

h e r e i n a f t e r i n c l l l d e d i n t h e e x p r e s s i o n

' t h e C o p y r l g h t b r o a d c a s t m g A c t ' ) I n respect o f t h e

of r e c o r d l n g s o r o f c a k i n g

t h e r e c o r d i n g s ( h e r e i n a f t e r t o be h e a r d I n p u b l l c

j o i n t l y t h e c l l d

'Per formance ' ) and t o r e s t r a m o r p r e v e n t

by lega l anauthorised performance. p r o c e s s o t h e r w i s e o r a n y

( 2 ) To exerclse ?er form and enforce an behal f

o f t h e e n t l t l e d o w n e r s o f o r p e r s o n s o t h e r k k l s e

t o t h e b e n e f i t o r I n r e r e s t l n

t h e c o p y r i g h t s owners I n r e c o r d l n g s (all such

ar.d pe r sons be ing h e r e i n a f t e r

c a l l e d t h e ' p r o p r l e t o r s ' ) all r l g h t s an6

r e m e d i e s o f t h e p r o p r l e t o r s DY v l r t u e of

the Copyr ight Act l n r e s p e c t o f t h e

performance and to r e s t r e l n o r p r e v e n t b y

o t h e r - d l s e nnauthorised perfcrmance. p r o c e s s l e g a l o r a n y

-20-

( 3 ) e n f o r c e m e n t e x e r c i s e

t h e r e m e d l e s I n s e r f o r m a n c e c r

a n y s w h o f r i g h t s a n d

a s a f o r e s a l d t o g r a n t l l c e n c e s

and t o e n t e r i n t o a n y l i c e n s l n g s c h e m e s

a g r e e m e n t s o r o t h e r a r r a n g e m e n t s o r t o

o b t a l n o r s e e k t o o b t a l n a n y O r d e r f r o m

the Copyr ight Tr ibunal w l t h r e s p e c t t o

t he pe r fo rmance o r t o t he amoun t ag reed

o r de t e rmined to be payab le I n r e s p e c t o f

the performance and from tune t o t i m e t o

r e s c i n d a l t e r o r v a r y a n y s u c h l l c e n c e s

l icens ing schemes a r r a n g e m e n t s agreements o r

o r t o o b t a l n o r s e e k t o

ob ta in any va r i a t ion o f any Orde r of t h e

C o p y r l g h t T r i b u n a l a n d t o c o l l e c t a n d

r e c e i v e a n d g i v e e f f e c t u a l d i s c h a r g e s f o r

a l l r o y a l t l e s , f e e s and o ther monles

payab le unde r any such l i cences l l cens ing

schemes o t h e r w i s e agreements arrangements o r Orde r s

o r e s p e c t performance I n any of

by a l l n e c e s s a r y a c c l o n s o r

o t h e r p r o c e e d i n g s a n d t o r e c o v e r s u c h

r o y a l t i e s f e e s and o the r mon ies and t o

r e s t r a i n and recover damages for the

in f rmgemen t by means of any performance

of t h e c o p y r i g h t s i n r e c o r d l n g s o r o f a n y

o t h e r r l g h t s o f t h e Company o r o f t h e

p r o p r l e t o r s o r o f t h e Company on t h e i r

beha l f i n r e spec t o f such r eco rd ings and

r e l e a s e t o compromlse r e f e r o r t o

a r b l t r a t i o n such any a c t i o n s o r

proceedings o r a n y o t h e r d l s p u t e s o r

d i f f e r e n c e s i n r e l a t l o n t o t h e p r e m i s e s .

( 4 ) TO i a q u l r e f r o m a n y p e r s o n o w n i n g o r

h a v i n g t h e r i g h t o r power t o o r a n t h e

same r l g h t s l n r e spec t o f t he pe r fo rmance

o f no t r eco rd lngs whe the r o r

a n y c o p y r i g h t s s h a l i subslst i n r e l a t i o n

t h e r e t o and t o e x e r c i s e and perform chose

r i g h t s and by way of l i c e n c e agreement or

o t h e r means permi t per formance the

t h e r e o f a n d t o e n f o r c e DY a l l a w f u i

means any such llcenco or agreerent. I'

I n f u r t h e r a n c e o f I t s o b l e c t s ? P C 4 h a s s n t e r e d I n t o a

number of agreemencs i escr lbed as "InpJt ; .greemerts" ~ r ~ h =he

record companles Agreements and c r ta l r . o ther companies. The inp ' l t

are xempllf led by an agreement 6zted 3 1 August 1 9 7 0

- 2 1 -

between PPCA and Warner Bros . Records P ty . Lmi ted (now ca l led

W E A Records P ty . i lml t ed and t o wh ich w e s h a l l r e f e r as " ' N E " ' ) .

Inpu t Agreemen t h e f o l l o w l n g	t	s	In	t he	same	terms	hzve been	e n t e r e d	I n t o	w i t h
:

APOLLO SOUND

ASTOR ECORDS AVAX-GUARD MUSIC PTY. LIMITED PTY. LTD.

C A R I N I A COMPANY PTY.LTD.

CBS RECORDS AUSTRALIA LTD.

cas RECORD h CASSETTE CLUB PTY. LTD.

EM1 (AUSTRALIA) LTD.

FESTIVAL RECORDS PTY. LTD.

MOVE RECORDS

POLYGRPM RECORDS PTY. LTD.

RCA LIMITED

SUMMIT RECORDS AUSTPALIA

UNIVERSAL RECORD CLUB PTY. LTD.

WORLD RECORD CLUB PTY. LTD.

WEB 1 s r e f e r r e d t o I n t h e I n p u t A g r e e m e n t as " t h e

Company". The agreement r e c l t e s t h a t : -

''. . . The Company c l a m s a n d r e p r e s e n t s t h a t :t

1s t h e owner of a n d / o r c o n t r o l s o r 1s

otherwise	e n t l t l e d	t o	a n	i n t e r e s t	i n	o r	t h e
b e n e f i t	p e r f o r m l n g

t h h e r e i n a f t e c d e f m e d ) I n . o f r i g h t ( a s

sound r eco rd inqs . . . I'

The p e r f o r m l n g r l g h t i n c l u d e s t h e b r o a d c a s t c o p y r l g h t l n

r e s p e c t of a p r o t e c t e d r e c o r d i n g l n r e s p e c t o f which remunerar lon

i s p a y a b l e f o r t h e ' b r o a d c a s t o f t h e r e c o r d i n g ~.n Australia,

l n c l u d l n g a n y a m o u n t ? a y a b l e b y t h e T r l b u n a l l n d e r S . 1 5 2 .

Clause I1 p a r a . 1 of the input Agreement _crcv iaes : -

"The p u r p o s e s o f t h l s Agre-anenr a r e t o enaDle

P P C A , f o r t h e per:oe o f 551s .J.graemenr, t o

e x e r c l s e c h e e x c 1 1 J s l v e r l g h t a n d a u t n o r l t y t o

d o :n Company a l l a r Zny of A1Jstral:a f a r and o n t h e fc l l=wlng acts cr s e n a l f =f The

t h l n g s l n r e l a t l o n 50 t h e r e c o r d l n s s of t h e

Company, t h a r 1 s =o s a y . . . "

-22-

V a r i o m t h i n g s a r e t h e n s e t out including t h e l l c e n s l n g

o f b r o a d c a s t i n g b y t h i r d p a r t i e s ; t h e m a k i n g o f a p p l i c a t l o n s t o

t h e T r i b u n a l r e s p e c t I n t h e o f b r o a d c a s t i n g p r o t e c t e d o f

r e c o r d i n g s o f WEA and o t h e r s ; t h e c o l l e c t l o n a n d r e c o v e r y o f

amoun t s payab le by any t h i rd pa r ty o r pa r t i e s pu r suan t ' t o any

o r d e r o f t h e T r i b u n a l ; a n d t h e i n s t i t u t i o n a n d c o n d u c t o f

enforcement p roceedings . The e x p r e s s i o n " t h e r e c o r d i n g s o f t h e

Company" i s def ined by Clause I p a r a . 3 i n t e r m s w h l c h i n c l u d e

a l l r e c o r e i n g s t h e p e r f o r m i n g r l g h t s o f w h i c h a r e f r o m t i m e t o

t ime owned cr c o n t r o l l e d b y WEA o r t o t h e b e n e f l t o f w h i c h i t is

e n t i t l e d .

Clause I p a r a . 2 ( a ) p r o v i d e s t h a t a p e r s o n s h a l l b e

deemed t o c o n t r o l t h e r e l e v a n t r i g h t w h e r e t h a t p e r s o n i s a n

" e x c l u s i v e l l c e n s e e " f o r t h e p u r p o s e s of t h e A c t .

C lause I -pa ra . 2 (b) p r o v l d e s t h a t a p e r s o n s h a l l b e

deemed t o b e e n t l t l e d t o t h e b e n e f i t o f t h e r e l e v a n t r i g h t w h e r e

t h a t p e r s o n ( n o t b e i n g t h e owner of o r t h e p e r s o n c o n t r o l l l n g t h e

c o p y r l g h t i n t h e r e c o r d m g ) 1 s e n t l t l e d , p u r s u a n t t o the t e rms of

. an agreement wi th o r ins t r7nnent o f the owner o r o f the person

c o n t z o l l i n g t h e c o p y r i g h t I n t h a t r e c o r d m g , t o confe r on PPCA

power and authority t o d o I n r e l a t l o n t o t h e r e c o r d l n g s o f t h a t

p e r s o n t h e t h l n g s s e t oUt ln C lause II p e r a . 1 of the Agreement.

- 2 3 -

By Clause I1 p a r a . 2 p r o v l s i o n i s made f o r PPCA t o be

c o n s t i t u r e d t h e a t t o r n e y o f W E A f o r t h e p u r p o s e s p e c i f i e d 15

Clause I1 p a r a . 1. By p a r a . 4 of t h e same c l a u s e WEA a g r e e s , a t

t h e r e q l l e s t c o p y r i g h t o f P P C X , t o a s s i g n t h e p e r f o r m a n c e a n d b r o a d c a s t

i n a n y o f t h e r e c o r d i n g s o f WEA where WEA 1 s the owner

and to procure such an asslgnment f rom the owner where WEA merely

c o n t r o l s t h a t c o p y r l g h t . There was n o e v l d e n c e b f o r e t h e

T r i b u n a l t h a t e l t h e r CVEA o r any o f t he o the r r eco rd compan les had

a s s l g n e d o r p r o c u r e d t h e a s s l g n m e n t o f t h e p e r f o r m a n c e a n d

b r o a d c a s t c o p y r l g h t t o PPCA.

Clause I11 p a r a . 3 makes p r o v l s l o n f o r WEA t o p r o v i d e

PPCA w i t h l i s t s and o the r l n fo rma t ion conce rn ing the t l t l e s o f

a l l r e c o r e l n g s o f W E A a n d d e t a i l s of ownersh ip and cont ro l of the

c o p y r i g n t i n t h e m , t o g e t h e r w l t h o t h e r i n f o r m a t l o n w h i c h w l l l

e n a b l e PPCA to determine whether a r eco rd lng 1 s p r o t e c t e d .

Clause I V p a r a . 1 c o n t a n s a covenant by PPCX t h a t It

w l l l not:-

“ ( i )	en te r
l n to p a r t y r e l a t m g t o t h e any ag reemen t w:th a n y t h l r d

use b y t h a z t h l r d

p a r t y of r e c c r d l n g s l n c l l ~ c 2 l ng

r e c o r d l n g s t h e o f Campany f o r t h e

purpose of performance; c r

( i i) granc ar.y Llcence tc a n y c h l r d p a r t y f o r

performance the o f any r eco rd ln5s

i n c l u d i n g r e c c r d i n a s of che Company

(wherher pl l rscant t o zny l icence scneme

o r o t h e r w l s e !

-24-

u n l e s s t h a t a g r e e m e n t o r l l c e n c e s h a l l b e

t e rminab le by PPCA a t any t lme wi th ln a F e r l o d

n o t m o r e t h a n t w e l v e ( 1 2 ) m o n t h s a f t e r t h e

d a t e upon whlch from tune t o t i m e t h i s

Agreement may be t e rmmated in acco rdance wi th

paragraph 1. of Clause V I . h e r e o f . "

Paragraph 3 of Clause I V p r o v l d e s t h a t PPCA may m l x t h e

f u n d s r e p r e s e n t i n g c o l l e c t i o n s i t s c o l l e c t l o n s o n b e h a l f o f WEA w l t h

on beha l f o f any o the r company or person and l i s ts

Khe expendi tures whlch may be made from such payments. Paragraph

4 of Clause I V p r o v i d e s for the p repa ra t lon o f an accoun t showlng

t h e n e t r e c e i p t s a v a i l a b l e f o r d i v i s i o n among t h e p e r s o n s who

have en tered in to Input Agreements wl th PPCA. Paragraph 6 o f

Clause I V p r o v l d e s t h a t t h e n e t r e c e l p t s s h a l l b e d l v i d e d among

t h e p a r t l e s e n t i t l e d : -

l ' . . . w h e r e v e r p o s s i b l e , o n t h e b a s l s o f t h e

' e x t e n t o f t h e u s e made of p r o t e c t e d r e c o r d l n g s

o f t h e p e r f o r m a n c e r e s p e c t i v e g r a n t o r s f o r t h e p u r p o s e of

o r , w h e r e t h e e x t e n t of such 11se

c a n n o t b e r e a s o n a b l y a s c e r t a l n e d , on t h e b a s i s

of a formula whlch sha l l be de te rmlned from

t i m e t o t i m e by a r e s o l u t l o n of t h e D l r e c t o r s

of PPCA.. .I'

The d l s t r l b u t l o n i s f a c t i n made a on S a s l s of

s t a t i s t l c a l m a t e r i a l r e l a t i n g t o e x t e n t o f u s e p r o v l d e d t o PPCA

a on c o n f i d e n t l a l b a s i s A u s t r a l e s i a n b y P e r f o r m l n g R l g h t

Assoc ia t lon L t d . ( " A P m " ) .

- 2 5 -

B y a p o w e r o f a t t o r n e y d a t e d 31sc A u g u s r 1 9 7 0 WZA

appolnred PPCA i t s a t t o r n e y t o a c t o n i t s behalf e l t h e r l n t h e

name of W E A o r I n t h e name of PPCA i n r e l a t l o n t o the performance

a n d b r o a d c a s t l n g c o p y r l g h c i n r e s p e c t o f r e c o r d i n g s o f WEA a s

de f lned . These powers l nc lude t he l l cens lng of a n y t h l r d p a r t y ,

w h e t h e r p u r s u a n t t o a l l c e n c e scheme o r o t h e r w i s e ; t h e m a k i n g o f

a n a p p l i c a t i o n t o the Tribunal : and the prohibition or caking

such s t e p s as may b e a v a l l a b l e t o p r e v e n t t h e u n a u t h o r l s e d

pe r fo rmance b roadcac ing o r r eco rd lngs . o f PPCA 1 s a lso

a u t h o r i s e d t o c o l l e c t and recover any moneys due i n r e s p e c t o f

t h e b r o a d c a s t l n g i n c i d e n t a l or per formance of record lngs o f WEA and o the r

m a t t e r s . The p o w e r o f a t t o r n e y s p e c l f l c a l l y e x t e n d s

t h e d e l e g a t l o n t o t h e p e r s o n f o r t h e t l m e be lng appo ln ted by t he

d i r e c t o r s o f PPCA t o be I t s g e n e r a l m a n a g e r t h e 2ower t o

"exerclse and perform Ln t h e name of and on beha l f o f PPCA any

'Fower or authority he reby confe r r ed upon PPCA" .

The e f f e c t o f t h e s e d o c m e n t s 1 s t h a r PPCA 1 s t h e a g e n t

a n d a t t o r n e y o f WEA f o r t h e p u r p o s e s o f , m c e r a l l a , t h e e x e r c l s e

o f t h e r i g h t s I n c l d e n t a l t o the S r o a d c a s t c o p y r 1 5 h t I n r e l a t l o n

t o c e r t a i n ownersh lp s o u n d r e c o r d l p g s . ?PC>. 1 s n c t l t s e i f v e s t e d with any

r lgh t s w l th r ega rd to such copyr lgk r r .

-26-

2MMM'S UNDERTAKING

A t a v e r y e a r l y s t a g e i n t h e h e a r i n g o f t h e a p p l l c a t l o n ,

counsel f o r 2MMM ou t l ined t he co r re spondence be tween 2MKM and

PPCA between 16 May 1980 and 1 October 1980 c o n c e r n i n g t h e g r a n t

o f a l i c e n c e b y PPCA o f a l l c e n c e t o S r o a d c a s t s o u n d r e c o r d l n g s .

By l e t t e r d a t e d 1 5 August 1980 PPCA informed 2°K c h a t It was

p r e p a r e d t o l l c e n s e it to b roadcas t sound r eco rd ings on paymen t

of an annual fee represent ing 1% o f t h e s t a t i o n ' s g r o s s e a r n l n g s .

I n i t s r e p l y d a t e d 25 September 1980 2MMM s a i d t h a t it cons lde red

i t s e l f e n t i t l e d copyr lgh t on the t o an r r angemen t r e spec t i n b roadcas t o f

same terms as the agreements which had been made

w i t h t h e AM s t a r i o n s . 2 M M M d i d , h o w e v e r , g l v e t o PPCA t h e

following under tak ing: -

"P*Jrsuant t o s e c c l o n 109 (1) ( a ) t h e o f

Copyright.-Act, t h i s Ccmpany g l v e s t o PPCA, on

b e h a l f o f - t h e o w n e r s o f t h e c o p y r l g h c i n

c e r t a i n r e c o r d i n g s , a n a n d e r t a k i n g ( l m i t e d as

h e r e i n s t a t e d ) t o p a y t o PPCX ( o r t o s c c h

owners) such amounts ( i f a n y ) a s may be

s p e c l f l e d I n , d e t e r m i n e d o r 111 accordance

w i t h , a n o r d e r of the Copyrzght Trlbunal made

unde r s e c t l o n 1 5 2 of t he Co_cyr lg f . t A c t i n

r e s p e c t o f t h e b r o a d c a s t l n g b y t h l s Company,

( d u r i n g a pe r iod wi th in wh lch any k roadcas t 1 s

made by i t ) of pub l i shed r eco rd ings l n which

t h e c o p y r i g h t s a r e owned 5y those owners anC

whlch i n c L ude s t h o s e f l r s t - m e n t l o n e d

r e c o r d l n g s .

.-

-27 -

CSPYRIGHT CWNERS

Drawing on the terms of tine Input Agreements an2 the qualificatlons contained In the undertaking, counsel for 2MEIM submitted that the lmdertaking was given to PPCA only In Its

capacity as agent for copyrlght owners. Further, It was

submltted that only those recordlngs In respect of which the

copyright owners were parties or represented by partles were rn the way of such owners belng regarded as "partles" or

relevant f o r the purposes of S. 1 5 2 . If and to the extent chat

"represented by" a party for the purposes of para. 1 5 2 ( 6 ) (b) .

It was contended, however, that a dlstlnctlon had to be made between the owners of the broadcasting copyright, on the one

hand, and entitled to the beneflc persons who merely controlled that rlght or were

of It, on the other. The dlstlnction was

-

made in the terms of the input Agreements.

A smilar contenclon was made wlth respect to the record

companles. 2XMM' S' contentlon was that the record cornpanales kere the owners of copyrlght l n some sound recor2incs but were rnerely the licensees of the coFyright of others <lnder the terms of

llcences which were bot:? exclusive ane non-excll2s;ve. It das

only In the former caFzclcy that they C O u i S oe recarded 5s =he

owners of copyrlghts fo r the pl-rFoses of S. l 5 2 .

-26 -

4 d i s t l n c t i o n 1s made I n s.119 b e t w e e n a n e x c l u s i v e

l l c e n s e e and t h e owner of the c o p y r i g h t . S e c t i o n 119 provides : -

" S u b ~ e c t CO the succeeding s e c t i o n s o f t h l s

D i v l s i o n -

e x c e p t a g a i n s t c o p y r i g h t , o w n e r t h e o f the

the e x c l u s i v e l i c e n s e e has t h e

same r i g h t s o f a c t i o n as he would have,

and 1 s e n t i t l e d t o t h e same remedles a s

h e w o u l d s e c t i o n b e e n t i t l e d t o , b y v i r t u e o f

115 i f t h e l i c e n c e h a d b e e n a n

a s s ignmen t , and t hose r i gh t s and r e rned le s

are c o n c u r r e n t w i t h the r l g h t s a n d

r emed ies o f t he owner of the c o p y r l g h t

under t h a t s e c t i o n :

except a g a i n s t t h e o w n e r t h e o f

c o p y r i g h t , t h e e x c l u s i v e l i c e n s e e h a s t h e

same r i g h t s of a c t l o n as he would have,

and 1s e n t l t l e d t o t h e same remedies as

he would be e n t i t l e d t o , b y v i r t u e o f

s e c t l o n 116 i f the l lcence had been an

asslgnment; and

the owner of t h e c o p y r i g h t does n o t h a v e

a n y r i g h t s o f a c t l o n t h a t h e would n o t

have, and 1 s n o t e n t i t l e d t o any remedies

t h a t h e w o u l d n o t be e n t i t l e d t o , by

v i r t u e of s e c t i o n 116 lf t h e l i c s n c e h a d

been -an asslgnment. I'

B y S . 117 the e x p r e s s i o n "lf t h e l l c e n c e h a d b e e n a n

assignment" means : -

" . . . l f , i n s t e a d o f t h e l l c e n c e , t h e r e h a d beer.

g r a n t e d ( s u b j e c t t o cond l t ions co r re spond lng

a s n e a r l y as p r a c t l c a b l e w i t h t h o s e s u b l e c t t c

whlch t h e l l c e n c e was qranted) an ass lgnrnent

o f t h e c o p y r l g h t I n r e s p e c t o f I ts a p p l l c a t l o n

t o t h e d c l n g , t h e p l a c e s a t a n d tunes

a u t h o r i s e d b y t h e l i c e n c e , c f t h e a c t s s o

- a u t h o r l s e d : "

..

-29-

I t i s made c l e a r 5 y s u b - S . 196 (1) t h a t c o p y r l g h t 1 s

per sona l p rope r ty and 'LS, mter a l l a , t r a n s m l s s l b l e 5 y a n

ass lgnment . By p a r a . 196 ( 2 ) i a ) an a s s lgnmen t o f copyr igh t may

be l i m l t e d t h e c l a s s e s o f a c t s w h i c h , b y v i r t u e o f t h e I n a n y way 1ncll;dlng a l m l t a t l o n t o o n e o r more of

A c t , t h e owner of the

c o p y r i g h t h a s t h e e x c l u s l v e r l g h t t o do . Thus , a b r o a d c a s t

copyr igh t r ecogn i sed by pa ra . 85 ( c ) 1 s capable ,o f ass lgnment

e i t h e r w l t h o r w l t h o u t h e p e r f o r m a n c e c o p y r i g h c r e c o g n l s e d b y

p a r a .	85	(b)	.
I n	o u r o p l n i o n , upon t h e p r o p e r c o n s t r u c t l o n of t h e s e

v a r i o u s p r o v i s l o n s , a n a s s l g n e e of t h e b r o a d c a s t c o p y r l g h t would

f a l l w i t h i n t h e d e s c r l p t l o n of "owner" of t h a t c o p y r i g h r f o r t h e

p u r p o s e s o f t h e A c t . The e f f e c t of S. 119 1 s t h a t a n e x c l u s l v e

l i c e n s e e o f t h e b r o a d c a s t c o p y r l g h t I n a s o u n d r e c o r d l n g 1s

e n t i t l e d t o t h e same r l g h t s o f a c t l o n a n d r e m e d l e s a s If h e was

a n a s s l g n e e e x c l u s l v e	o
f l l c e n s e e t h a t -. copyr igh t . Thus , t he Ac t con fe r s lupon t h e

t h e same r ights and remedles he would have If

he were owner. the owner of the copyrlght , except as a g a z n s c t h e a c t u a l

S e c t l o n s 115, 117 end 119 aepear l n Par: V o f t h e A c t

whlch 1 s concerned wlth remedles for 1nfr :ncevents of c c p y r l g h t .

By sub-s . p r o c e e d z n g 11.: (1) t h e word " a c t l o n " a s u s e c ln P ? r t V means " a

-

cf a c l v l l n a t U r e S e t - d e e n C e r t l e s , and 1nc l I Jdss a

coun te rc l a lm" . I t i s necessa ry CO d e c e r m x e , T h e r e f c r e , whet:?er

- 3 0 -

a p r o c e e d i n g p r o c e e d i n g b y way o f a n a p p l l c a t l o n u n d e r S. 152 i s " a

o f a c l v i l n a t u r e b e t w e e n p a r t l e s " . If l t IS, l t

would appear t o have the e f f e c c t h a t a n e x c l u s i v e l i c e n s e e o f a

copyr ight would be regarded as the owner bo th fo r t he pu rposes of

S . 109 a n d f o r t h e p u r p o s e s o f S . 1 5 2 . If i t i s n o t , a n

e x c l u s i v e l i c e n s e e c o u l d n o t be t r e a t e d as a c o p y r i g h t owner f o r

those purposes . Sec t ion 109 p r o v i d e s a de fence t o a n a c t i o n f o r

a n i n f r i n g e m e n t u n d e r c e r t a i n c l r c m s t a n c e s , including t h e g i v l n g

of a n u n d e r t a k i n g t o the owner o f t h e r e l e v a n t c o p y r l g h t t o p a y

a n a m o u n t d e t e r m i n e d b y t h e T r i b u n a l . I t would be a n odc?

circumstance i f t h i s d e f e n c e w e r e a v a l l a b l e a c a i n s t t h e o w n e r

p r o p e r l y so ca l led b u t n o t a g a i n s t a n e x c l u s i v e l l c e n s e e .

S e c t i o n 1 2 1 s p e c i f i c a l l y p r o v i d e s t h a t a n y d e f e n c e a v a i l a b l e

a g a i n s t a n o w n e r i s l i k e w i s e a v a l l a b l e a g a i n s t a n e x c l u s i v e

l i c e n s e e . I n t he l l g h t of t h a t p r o v i s i o n a n d t h e i n t e n t l o n o f

S .109, w e a r e o f t h e o p i n i o n t h a t i n t h e a p p l l c a t l o n o f s s . 109

members o f t h e g e n e r a l p u b l l c 1 3 y e a r s of age and over, who had taped

e l t h e r sound o r v i d e o f o r p r i v a t e a s d i s t i n c t f r o m commercial ?Ise, on

a n u m b e r o f q u e s t i o n s r e l a t l n g C O C a p l n g . T h e s u r v e y s o l l g h t t o

measu re t he mc idence o f home t a p l n g , b o t h a u a l o a n d v l d e o . 2 , 1 7 2

i n t e r v i e w s w e r e c o n d u c t e d l n 1 5 T e t r o p o l l t a n a n d c o u n t r y c e n t r e s

t h r o u g h o u r A u s t r a l l a . The survey was deslcned and supervised by X r .

Adr i an Fe the r s , a P r o ~ e c t D l r e c t o r of %ear:< Research P t y . Lirnlred, the

e v e n t u a l a n a l y s l s b e l n g c h e c k e d o y i Mr. A . W h l t f l e l a o f l e s s r s .

--_ .

De lo l t t e Xask lns & S e l l s , C h a r t e r e d A c c o u n t a n t s . The L a t t e r f i r a

c a r r l e d o u t a n a u d l t o f t h e s u r v e y .

-89-

The f l r s t o b l e c t l v e o f t h e s u r v e y was to e s t i m a t e t h e t o t a l

number of L . P . e q l i v a l e n t s b e l n g t a p e d f r o m records, pre- recorded

t a p e s , r a d i o and t e l e v l s l o n , and t o e s t i m a t e t h e marke t va lue of t h o s e

e q u l v a l e n t s . S u b s e q u e n t l y , t h e u s e a n d s a l e s o f b l a n k t a p e s b y

p e o p l e t a p l n g , r e a s o n s f o r t a p l n g , a n d t a p i n g t r e n d s , w e r e a s s e s s e d .

A s d e t a i l e d i n t h e r e p o r t on t h e s u r v e y , t h e p r o c e d u r e

adop ted to p roduce the t ap lng estimates was t o -

1. k s c e r t a l n c h e proportion of dwellings ~n t h e sample

a r e a c o n t a l n l n g a person or pe r sons who had taped sound

a n d j o r v l d e o m a t e r l a l w i c h i n t h e t h r e e m o n t h s p r e c e d i n g

the d a t e of t h e m t e r v l e w :

2 . A s c e r t a l n t h e number o f s o u n d a n d j o r v l d e o t a p e r s i n

e a c h t a p e r dwelling;

3 . Gross 11p t h e nlnnber of s o c n d o n l y t a p e r s Ln the Sample

t o r e p r e s e n t t h e number cf t a p e r s I n t h e p o F u l a t l o n of

the sampled a rea ;

4 . A s c e r t a i n the s c \ m E t a p e s made GY rJne randcmly selected.

t a p e r I n e a c h t a p r d w e l l i n g ;

-90-

5 . Gross "p t h e number o f L . P . e q u l v a l e n t s t a p e d f r o m a l l

s o u r c e s , r e c o r d s , p r e - r e c o r d e d t a p e s a n d r a d l o a n d

t e l e v i s l o n , t o r e p r e s e n t h e taping o f a l l t a p e r s I n

a l l d w e l l i n g s w i t h t a p e r s w i t h i n t h e d e f l n e d a r e a ;

6 . E s t l m a t e h r e t a l l m a r k e t v a l u e by m u l t l p l y l n g t h e

t o t a l e q u l v a l e n t s o f L . P . s t a p e d b y t h e a v e r a g e r e t a i l

p r i c e of an L . P . , t h a t 1 s S8.00; and

7 . E s t i m a t e d i r t h e c t l o s s r e c o r d I n s a l e s b y

a s c e r t a i n i n g t h e l i k e l l h o o d o f p u r c h a s e of taped music

i f t h e t a p e r h a d b e e n ' I n a b l e t o t a p e , a n d r n u l t l p l y l n g

t h e number of L . P . e q u l v a l e n t s b y t h e a v e r a g e r e t a i l

p r i c e of an L . P .

The results o f t he su rvey showed , Ln te r a l l a , cha t : -

( a ) Duf-Gg a per iod of twelve months , 74% of A U S t r a l l a ' S

p o p q l a t l o n was t a p i n g t h e q u i v a l e n t of 5 5 . 1 n u l l l o n

L . P . ~ , e i c h e r f r o m r e c o r d s , p r e - r e c o r d e d c a p e s . o r t h e

r a d i o and t e l e v i s l o n ;

(b) A l i s t r a l i a n s t a p e d t h e equivalent o f 6 . 3 rn l l l l on L . ? . s

f r o m r e c o r d s	i n	t h e	t h r 2 2 m n c h s ' F e r i o d	t h e	s u b ~ e c t	of
t h e s u r v e y :

-91-

( c ) The re the su rvey pe r ioc ! f rom o the r p re - r eco rded t apes ; were some 637,000 pre- recorded tapes t aped dur lng

( d )	By
d i v i d i n g t a p e d f r o m r a d i o a n d t h e t o t a l n a n b e r o f h o u r s t h a t a p e r s h a d

t e l e v i s i o n b y a f a c t o r o f 1 .5 t o 1

or t h e e q u i v a l e n t o f 1 1 / 2 L . P . S t o e v e r y hour t a p e d ,

on t h e basls t h a t most L . P . s r e q u i r e a b o u t 40 minutes

t o p l a y , t h e r e was found t o be a t o t a l o f 4 . 5 m l l l l o n

h o u r s t a p e d f r o m r a d i o a n d t e l e v i s i o n d u r l n g the t h r e e

m o n t h s S - l r v e y p e r l o d . T h l s 1 s t h e equivalent o f

6 ,876,000 L . P . s :

( e ) T h e r e i s t h e same a m o u n t o f t a p l n g f r o m r a d l o a n d

t e l e v i s i o n as t h e r e IS f rom records and pre-recorded

tapes combmed;

( f ) Blank tape p u r c h a s e s f o r p r l v a t e p u r p o s e s , a c c o r d m g t o

t h e s u r v e y , w e r e s u f f i c l e n t d u r l n g t h e t h r e e m o n t h s '

p e r l o d t o rnu l t lp l e cap ing a p e 5 4 . 6 m i l l i o n i.P.s w l t h o u t t a k l n g

n t o account :

( g ) S a l e s m t h e t h r e e m o n t h s s u r v e y p e r l o c w e r s s u f f l c l e n t

t o t a p e 1 9 . 2 . n l l l l o n L. P . eq l l l va l an t s :

(h) T5e m u l t l p l o llse o f I= ian< tapes 1 s wldespread, m d . h a s

t h e e f f e c t of l n c r e a s l n c t h e p o ' i e n t l a l for ' l se of any

one t ape . m c l t l p l e Scme es t l rne te 1 s Peeded ~ ' 3 a c c o l m t f o r t h i s

'lse:

-92-

(1) M u l t i p l e %se of b l a n k t a p e would l n c r e a s e t a p l n g

p c t e n t i a l b e t w e e n 1 5 % and 2 0 3 l n t h e t h r e e m o n t h s

I

s u r v e y p e r l o d , b u t c o u l d i n c r e a s e t a p l n g p o t e n t i a l b y

up t o 5 0 % I n a f u l l y e a r . B l a n k t a p e p u r c h a s e s b y

t a p e r s w e r e s u f f i c i e n t t o t a p e 6 4 . 8 r n l l l l o n L.?.s 1n a

f u l l y e a r w i t h o u t t a k l n g m - 1 l t i p l e 1lse l n t o a c c o u n t .

The e s t i m a t e o f L . P . s t a p e d b y p r l v a t e l n d l v i d u a l s i n a

f u l l y e a r purchased; was 5 5 . 1 r n i l l l c n , o r 8 5 % o f t h e b l a n k t a p e

( J ) Khllst n o e s t l m a t e was made i n t h e s u r v e y o f t h e

likelihood of purchase o f mus ic t aped f rom the rad lo

a n d / o r t e l e v i s i o n , c a l c u l a t l o n s w e r e made a n I n

endeavour t c e s t i m a t e how many records and pre- recorded

t a p e s home	taped	might	have	been	bought	15	it	h a d	n c t
been	poss lb l e

t ape d e m o n s t r a t e d hem. t o The c a l c u l a t i o n s

t h a t h e loss would be some 6 . 5 m i l l i o n

rec 'eds and 4 9 2 , 0 0 0 pre- recorded tapes I n a f q l l y e a r ;

(k) On m o s t t a p i n g o c c a s i o n s t h e t a p e r t a p e s a complete

L. P . p e o p l e o t h e r r a t h e r t h a n e x c e r p t s . Of = h e t a s e s owned by

t h a n t h e t a p e r , 50% would have been bought

I f t h e c a p e r had been lmabl-e to t ape cheq ;

-93-

(l) The survey found a t o t a l o f 4 . 6 m l l l i o n h o u r s t a p e d

f r o m r a d l o a n d t e l e v l s l o n l n t h e s u r v e y p e r l o d . This

was t h e e q l l l v a l e n t o f 2 7 . 5 r n l l l l o n L . P . s i n a f ~ ~ l 1

y e a r , a n d e q u a L l e d t h e a m o ' l n t t a p e d f r o m L . 2 . s a n d

pre- recorded tapes ;

( m ) 42% of h o t x s t a p e d came from W. commerc la l s t a t lons

compared with 24% from F M commerc ia l s ta t lons ; and

( n ) R a d l o , a t

l e a s t influence among t a p e r s , was t h e most lmpor t an t

on r eco rd and p re - r eco rded t ape s a l e s . Apar t

from r a d r o , t h e m o r e i m p o r t a n t f a c t o r s i n f l u e n c i n g

p u r c h a s e S e h a v l o u r i n c l u d e d t e l e v i s i o n a d v e r t i s l n g ,

music programs, and recommendations.

I n summary M r . hiyhltfleld c o n c l u d e d t h a t t h e m a r k e t v a l u e of

eqr l iva len t L . P . s taped per annlm f rom records, pre-recorded tapes ,

r a d l o a n d t e l e v l s l o n o n t h e basls of t h e 1 9 7 6 Australian p o p u l a t l o n

census was $ 5 9 5 . 7 m i l l l o n . The t o t a l L .2 . eql l lva len ts t aped per annlm

whlch ad been taped from radlo ivas 24. 3 ~ n l l l l o n . The e s t l m a c e o f

l o s t s a l e s p e r annum d1le zo t a p l n g s f r o m records and pre-recorded

t a p e s o n l y was o n t h e d u s t r a l l a n p o p u l a r i o n b z s l s S 7 5 , 8 G G , G O C o r 9 . 5

m l l l l o n L . P . e q u l v a l e n t s .

-94-

I n f o m a t l o n was obta lned by Mr. WhltSield from various

nembers of A R I A o f s a l e s of r eco rds and p re - r eco rded t apes for t h e

1 9 7 9 , 1980 and 1961 ca l enda r yea r s . The i n f o r m a t i o n l n d l c a t e d t h a t ,

w h i l s t s a l e s b y v a l l l e i n c r e a s e d 1 6 . 8 % b e t w e e n 1 9 7 9 - 1 9 8 0 , a n d 5 %

b e t w e e n 1 9 8 0 - 1 9 8 1 , t h e n u m b e r o f ' J n l t s s o l a only i n c r e a s e d b y 1%

b e t w e e n 1 9 7 9 - 1 9 8 0 a n d e c r e a s e d b y 4 . 5 5 be tween 1980-1981 . Mr.

W h l t f l e l d compared t h e m a r k e t v a l u e o f t h e e q u l v a l e n t L . P . s t a p e d p e r

annum from r e c o r d s , p r e - r e c o r d e d t a p e s , r a d l o a n d t e l e v l s i o n , t o

r e t a i l v a l u e o f s a l e s b y A R I A merbers , and the es t lmate o f l o s t s a l e s

p e r a n n m dlle t o t a p l n g f r o m r e c o r d s a n d p r e - r e c o r d e d t a p e s o n l y

compared t o r e t a i l v a l u e s o f s a l e s b y ARIA members ( n o t m c l u d l n g

t a p i n g f r o m r a d i o a n d t e l e v i s l o n ) . X e c o n c l u d e d t h a t t h e l n c l d e n c e o f

home t a p l n q i n r e s p e c t of radio sound is s i g n l f l c a n t I n r e l a t l o n t o

s a l e s	of	records and pre- recorded tapes by record manufac turers .
The Reark Research Report of January 1982 provrded

information from which W . W h l t f i e l d c o n c l u d e d t h a t t h e r e t a i l v a L - l e

- -

eqluvalent of hours ' taped f rom FM commercial radlo In Xew South Males

f o r a twelve month period was $17 .6 ml l l lon of whlch S 1 1 . 9 m i l l i o n was

a t t r i b u t a b l e t o 2 M M M .

It was conceded by m . F e t h e r s t h a t h e J a n l l a r y l 9 6 2 s7xvey

h a d n o t b e e n d e s l g n e d t o a s s e s s t h e e f f e c t o f t a p l n g f r o m r a d l o of

so1md r e c o r d l n q s on t h e s a l e s o f r e c o r d s . .Addl=lonal q u e s t i o n s would

need t o be put , sane of which wolild be h y p o t h e r l c a l .

-95-

In September 1 9 8 2 , a f u r t h e r t a p e s u r v e y was conducted by

R e a r c k i i e s e a r c h d i r e c t e d t o o b t a i n l n g .=E e s t i m a t e o f r e c o r d a n d

pre- recorded tape sales t h a t w e r e l o s t b y r e a s o n of home tap ing f rom

t h e r a d l o . examlne The r e p o r t o n t h e S e p t e m b e r 1 9 8 2 s u r v e y s o u g h t a l s o t o

the re levance o f the ques t lons then asked i?. r e l a t l o n t o the

e a r l i e r J a n u a r y 1 9 6 2 s u r v e y .

The September 1982 survey was l l m i t e d t o S y d n e y , h e

Kelbourne, Brisbane, Adelalde and P e r t h n e t r o p o l l t a n a r e a s , a n d d l d

n o t e x t e n d , r ep resen ted m l l k e t h e Z a n u a r y 1 9 8 2 s u r v e y , t o c o u n t r y a r e a s . I t

59% o f t he t o t a l Australian popula t lon aqed 1 3 y e a r s a n 8

over , whereas the January 1962 survey had represented 7 4 % of t h a t

p o p u l a t l o n .

I n o r d e r t os t i m a t e t h e loss o f s a l e s of L . P . s and

p r e - r e c o r d e d t a p e s m o r e d i r e c t l y a t t r i b u t e d t o home t a p l n g f r o m t h e

r a d l o , t h e s u r v e y a s k e d r a d i o t a p e r s : -

- t o t h i n k a b o u t t h e l a s t ( 1 . e . mosc r e c e n t ) o c c a s l o n o n ulhich

they had t aped ma te r l a l f rom the r ad lo :

.-. -.

- how I l k e l y t h e y would have been t3 511y zny of t h a t m u s l c ,

e l t h e r a s a n L . ? . o r as a pre- recorded LaFe , ln che vent

t ha t chey were n o t a b l e t o t a p e I t ; and

-96-

The conclusions r e a c h e d a s a c o n s e q u e n c e o f t h i s s u r v e y

inc l l l ded the fo l lowing : -

o f t h e approxlmate ly p o p l e i d e n t i f l e d r a d l o 42% o f a s t a p e r s , t h e o r l g l n a l s a m p l e , b e i n g

1 6 % c e r t a i n l y

would have bought , 40% probably would have bought, 26%

probably would not have bought , and 1 4 % c e r t a l n l y would

n o t h a v e b o u g h t , a t l e a s t some o f t h e m u s l c r h e y l a s t

t aped :

P e o p l e l n t h e c a p l t a l c i t i e s who tape mus lc f rom the

radio would have bought 5 . 8 m l l l i o n L . P . s or

pre- recorded tapes over a twelve month per iod had they

b e e n u n a b l e t o t a p e t h a t m u s i c f o r some reason; and

A s s u m i n g o n l y o n e t a p l n g ?er t a p e r d w l n g t h e s i x

m o n t h s ' p e r i o d , t h l s a d m i t t e d l y b e i n g c o n s e r v a t l v e , t h e

s m v e y i n d i c a t e d t h a t among people aaed 1 3 years and

o v e r , l i v i n g l n t h e m a i n l a n d c a p l t a l c l r i e s , a t o t a l o f

1 . 7 m i l l m n L . P . 5 a n d / c r p r e - r e c o r d e d c a p e s d e f l n l t e l y

m u l d have been bought, and a f u r t h e r 4 . 1 m l l l l o n L . P . s

a n d / o r p r e - r e c o r d e d r a p e s p r o b a b l y w o u l d h a v e b e e n

bought .

-97-

An a m e n d m e n c w a s s u g g e s t e d t o t h e S e p t e m b e r l982 R e a r k 1

R e s e a r c h r e s u l t s b y M r . W h i t f i e l d I n t h a t t h e S e p t e m b e r 1 9 8 2 a n a l y s l s

l l s e d t h e t o c e l p o p u l a t i o n a g e d 1 3 y e a r s a n d o v e r , l l v l n g I n t h e

s u r v e y e d c l t i e s , as t h e basis f o r g r o s s l n g !JP, w h e r e a s " a f a i r e r or

more reasonable approach" would be to gross "p r e s u l c s t o t h e t o t a l

number o f househo lds In the su rveyed . c l t i e s .

Consequen t ly t he va r lous e s txna te s f l owing f rom the s t l rvey

c a l c u l a t i o n s w e r e r e v l e w e d a n d a n e s t m a t e made o f a t o t a l s a l e s loss

i n twe lve mon ths o f 2 . 4 r n l l l i o n L . P . s and/or pre- recorded tapes va l l led

a	t	$ 1 9 . 5	m i l l i o n o n t h e h o u s e h o l d a p p r o a c h .
Mr. W h i t f i e l d c o n c e d e d a p o s s l b l e m a r g i n o f e r r o r I n t h e

r e s u l t s o f a D o u t p l u s or mlnus 10%. M r . F e t h e r s was the f i r s t t o

a g r e e t h a t o n e s h o u l d n o t a p p l y t h e r e s u l t s of s u r v e y s s l l c h a s t h o s e

abovementioned as I f t h e y r e s u l t e d l n m a t h e m a t i c a l c e r t a l n t i e s . The

e r n p l r i c a l r e s u l t s w e r e , o f ccurse, n o t a b l e t o be t e s c e d l n t h e a c t u a l

market p l a c e .

'whllst t h e l n c l d e n c e o f home zaplng 1 s a t l e a s t l l l ? x z t r a t e d

i n t h e a b o v e s u r v e y s , w e a r e mlndf-21 of t h e f a c t c h z t b l a n k c a p e s w e r e

u n t i l r e c e n t l y m e n n f a c t n r e d D Y some of t h e r e c o r d m a n l J f a c t 1 l r e r s

themselves . Indeed a t c h e t l T e o f t h e h e s r l n g r e c o r d c o r n c a n l e s o l d

- c a F e s , oEe s lde be lng p re - r eco reed - <he ocher S l a c k , acd knokn as

"one pills o n e " . n e ?rice wes t h e same f o r ::he "one =L,ls oEe" a s for

a t a p e f u l l y r e c o r d e d .

-98-

A l t h o u g h t h e n u m b e r s o f r e c o r d l n g s n a d e a n d t h e v a l u e o f

s a l e s f o r e g o n e may b e d i f f i c u l t t o a s s e s s , we g e n e r a l l y a c c e p t h e

r e s u l t s o f t h e two s u r v e y s . The problem of home tap lng f rom rad io and

o t h e r s o u r c e s i s obvious ly one of s l g n l f i c a n t d i m e n s l o n s .

I t 1 s a s e a s y n o t t o r e l e v a n c e t h e e s s t h e s e o f

c o n s l d e r a t i o n s t o o u r t a s k . I t IS t r u e t h a t t h e b r o a d c a s t e r s o b t a i n

bene f i t f rom home t ap ing f rom the r ad io because home c a p e r s , w n l l s t

t a p l n g , a r e l i s t e n l n g t o o r t u n e d l n t o t h e r a d l o a n d t h e r e i s a

d e f l c i t e r e l a t i o n s h i p b e t w e e n popularity o f a r a d i o s t a t i o n , l t s

r a t i n g s and i t s revenue f rom adver t l s lng lncome. I t i s a l s o t r r l e t h a t

home t a p i n g h a s a s e r i o u s e f f e c t on t h e s a l e s of sound recordlngs and

t h e r e f o r e on t h e income of record mansfacturers . Al though w e s e e some

f o r c e i n t h e a r g u m e n t t h a t t h e q u e s t i o n o f home t a p l n g 1s l r r e l e v a n t

t o o u r t a s k , w e t h i n k o n b a l a n c e t h a t i t 1 s of some r e l e v a n c e a n d t h a t

i t should c o m p a n i e s be t aken t o a c c o u n t t o some e x t e n t I n f a v o u r o f t h e r e c o r d

i n a s s e s s i n g t h e amount payable by 2MMM. The q l l a n t i f i c a t l o n

o f t h e ~ u d g m e n t . s i g n l f l c a n c e o f home t a p l n g i s o f n e c e s s l t y a m a t t e r o f

I t 1 s u n p o s s l b l e t o d e f i p e i t a r l t h m e t l c a l l y or p r e c l s e l y .

We do no t cons lder lt should be taken inco accolmt t o a n y s l g n i f i c a n t

e x t e n t b e c a u s e o f t h e c o n ] e c t s r a l n o t i o n s t h a t n e c e s s a r l l y r e

invo lved i n any a s ses smen t ? f t he e f f ec t of home c a p l n g r e l e v a n c t o

t h e s e applications. There ls, however, =n Lndica t lon IF. t h e v i d e n c e

t h a t 2MMM has a substantial Impact i n t h e c o n t e x t of kome t e p i n g In

New South Wales.

.

-99-

GROSS EARNINGS O F A 3ROADCASTER L V D SUB-S. i 5 2 ( 8 )

The p r o h i b l t l o n I m p o s e d b y s l ~ b - s . 1 5 2 (11) a g a l n s t t h e

T r l b u n a l r e q u i r l n g a commercial b r o a d c a s t e r t o pay an amount exceedlng

1% o f t h e g r o s s e a r n i n g s of t h e b r o a d c a s t e r d u r i n g t h e r e l e v a n t p e r i o d

t o whlch t h e order a p p l l e s f i x e s a c e i l l n g w h i c h t h e T r l b u n a l c a n n o t

exceed. The sub-sec t lon does n o t r e q u l r e tine T r i b u n a l t o a p p r o a c h t h e

t a sk o f d e t e r m i n l n g t h e r e l e v a n t amomt payab le by r e fe rence t o a

formula expressed as a pe rcen tage of t h e b r o a d c a s t e r ' s oross e a r n i n g s

not exceedlng l % , bllt there a r e o b v l o u s o u n d p r a c t i c a l r e a s o n s why

t h e a s s e s s m e n t of the r e l evan t amoun t i s best expressed a s a

pe rcen tage of g r o s s e a r n i n g s .

What are t h e g r o s s e a r m n g s o f a b roadcas t e r? Sub- sec t lons

1 5 2 (19) and ( 2 0 ) o f the A c t p r o v l d e t h a t h e g r o s s e a r n l n g s of a

b r o a d c a s t e r i n respecr o f a p e r l o d a r e h l s g r o s s e a r n l n g s d u r l n g t h a t

p e r l o d o f t h e b r o a d c a s t i n g b y him of adve r t l s emen t s c r o t h e r matter,

l n c l l l d i n g h i s g r o s s e a r n n c s d u r l n g t h a t p e r l o d i n r e s p e c t o f the

p r o v l s i o n b y h i m o f o r o t h e r w l s e i n r e s p e c t o f , a a c t e r b r o a d c a s t b y

hlm. Where i n o r g i v e n o t h e r w i s e t h a n I n c a s h , t h e c o n n e c t i o n w l t h a t r a n s a c t i o n a n y c o n s i a e r z c l o n 1s p a l d

money v a l u e of t h a t c o n s l d e r a t l o n

15, f o r t h e p u r F o s e s o f sub-s. l 5 2 i l S I ) , t o be deemed co have been

pald. o r g i v e n . it 1 s che money valt le of = n e g r o s s e a r n l r g s l n r e s p e c t

of t h e n a t t e r b r o a d c a s t 5 y 2FMM c;?.=-, IS r e l s v a n r to ~ 1 1 1 ' i e c e r n l n a t l o n .

-100-

The g r o s s l n c m e o f 2MMM a s dlsclosed I n I ts s t a t e m e n t s of

p r o f l t and loss for t h e r e l e v a n t y e a r s c o m p r l s e d items d e s c r i b e d as

"adve r t i s ing r evenue" , " con t r a i ncome" and "other income" o r

"mlsce l l aneous r evenue" .

T h e item "other lncome" or "mlsce l laneous reven1le" Inc luded

l n t e r e s t a n d e a r n i n g s of a l l k e n a t u r e n o t r e c e i v e d I n r e s p e c t o f

b r o a d c a s t i n g . We l e a v e them ollt of account.

The i tem "contra income" was t h e s u b j e c t of some d e b a t e . The

item r e l a t e d t o s u c h matters as v o r n l n g t r a f f l c r e p o r t s , s u r f r e p o r t s ,

r a d i o g i v e - a w a y s , t i c k e t s t o c o n c e r t s , a f o u r - w h e e l d r i v e v e h l c l e used

on Sydney beaches, 2MMM a d v e r t i s l n g s l g n s o n b i k e s , a s t a f f p a r t y a n d

a give-away hol lday.

T h e asslgnznent of val l les t o t r a n s a c t l o n s l n v o l v l n g t h e

exchange of goods or s e r v i c e s 1 s o b v i o u s l y d l f f i c n l t a n d o f t e n b e c m n e s

s u b j e c t i v e a n d a r h l t r a r y . 2MMM p l a c e d v a l > l e s c p o n t h e s e Items and i t s

f i n a n c i a l c o n t r o l l e r s t a t e d t h a t h e h a d u s e d h i s bes t ~ u d g m e n t I n

a r r i v l n g a t t h e f l g u r e s i n t h e a c c o u n t s . The accolmts ulere a u d l t e d by

2MMM's a u d i t o r s , Messrs. ?xthur Anderson 6, C o . I n o u r o p l n l o n t h e

va lues p l aced on the "con t r a lncome" l t ems by 2MMM shoald oe accepted .

The o t h e r item o f c o n t e n t l o n , l l n d e r t h e h e a d l n g " c o n t r a

I n c o m e " , r e l a t e d t o a m o u n t s r + c e l - / e d by 2MMM f rom advertisers o n

b e h a l f o f t e l e v i s l o n s t a t i o n s lr. r e s p e c t of s u n u l c e s t s . The amounts

r e c e l v e d i n t o t a l w e r e l e s s c h a n = h e p r o d a c t l o n c o s t s . In n u r view,

-101-

t h e moneys rece ived and subsequent ly Paid t o t h e t e l e v l s l o n s t a t i o n s

a r e m o r e c o n s l d e r t h a t t h e y a r e “ g r o s s e a r n i n g s ” I n i n t h e n a t u r e o f r e c o v e r y o f a n e x p e n s e a n d w e d o n o t

respect of t h e b r o a d c a s t i n g

of adver t l sements wi th ln the meanlng of sub-S. 1 5 2 (19).

2MMM’ S “ g r o s s e a r n i n g s “ f o r t h e p u r p o s e s of sub-s . 1 5 2 ( 1 9 )

ove r t he r e l evan t pe r iod compr l s lng adve r t l s lng r even‘ l e , “ con t r a“ and

o c h e r l n c m e were made available t o 11s i n a c o n f l d e n t l a l e x h l b l t .

Hence w e do noc t h l n k It a p p r o p r i a t e t o m e n t l o n t h e f l g - l r e s ~n o u r

r e a s o n s .

DETERMINATION OF AMOUNT ?AYABLE

in our oFin ion the amount payable by 2 ° F m t h e o w n e r s o f

c o p y r i g h t I n s o u n d r e c o r d l n g s i n r e s p e c t o f t h e p e r l o d commeflclng 1

O c t o b e r	1 9 8 0	a n d	e n d i n g	o n	30 Zune	1983	L S b e s t	e x p r e s s e d	a s	a
-

pe rcen tage	of	g r o s s	e a r n l n g s	a t t r i b l l t a b l e	t o	t h e	]:se	of	p r o t e c t e d
r e c o r d l n g s .

We have consldered all r e l e u a n c T a t t e r s f o r t h e p m p o s e of

sub-s. 1 5 2 ( 7 ) and have come t o t h e concl1:slon = h a t t h e amount payab le

should be 0 .45% of the g ross ea rn l f iq s of 2YX>!.

-102-

We do n o t p r o p o s e t o make o r d e r s a t t h i s s t a g e , b u t w i l l

s t a n d t h e a p p l l c a t l o n o v e r t o a d a t e t o be f i x e d . T h e p a r t l e s may

c o n s l d e r o u r r e a s o n s f o r d e c i s i o n In t h e m e a n t m e a n d b r i n g I n s h o r t

minutes of o r d e r t o q l v e e f f e c t t o t h e s e r e a s o n s .