REFERENCE BY AUSTRALASIAN PERFORMING RIGHT ASSOCIATION LIMITED RE AUSTRALIAN BROADCASTING CORPORATION
[1985] ACopyT 2
•6 December 1985
CATCHWORD
Copyright ‑ proposed licence scheme licensing the ABC to use music in APRA repertoire ‑ whether scheme should be confirmed, confirmed with variations or not confirmed ‑ nature of Tribunal's jurisdiction ‑ suggested methods of arriving at licence fee - cents per head of population ‑ annual lump sums ‑ percentage of revenue or expenditure ‑ relevance of past dealings between parties ‑ reference to earlier arbitration and Tribunal decisions in Australia and overseas ‑ significance of music in ABC programming ‑ selection of percentage of expenditure as indication of value of licence ‑ determination of base figures on which percentage to be charged.
Copyright Act 1968, s 154 and also ss 31, 136, 148 to 152 and 157.
Trades practices (restrictive) ‑ implementation of.1icence scheme: said to involve substantial lessening of competition and to restrict entry of other persons into market ‑ discussion of evidence.
Trade Practices Act 1974, ss 45 and 46
REFERENCE BY AUSTRALASIAN PERFORMING RIGHT ASSOCIATION LIMITED RE AUSTRALIAN BROADCASTING CORPORATION
COPYRIGHT TRIBUNAL
No. 2 of 1981
Coram: Sheppard J. President and Mr. Allan Horton, Member
Date: 6 December 1985
Place: Sydney
COMMONWEALTH OF AUSTRALIA
COPYRIGHT ACT 1968
IN THE COPYRIGHT TRIBUNAL No. 2 of 19 81
REFERENCE BY AUSTRALASIAN PERFORMING RIGHT ASSOCIATION LIMITED RE AUSTRALIAN BROADCASTING CORPORATION
Sheppard J. President and Mr. Allan Horton, Member
6 December 1985
REASONS FOR DECISION
ARRANGEMENT
Introduction........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ..... 2
The Course of the Proceedings........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ..... 2
The Legislation........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ 3
The Licence Scheme........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... 6The Parties and their Negotiations and Agreements down to the Formulation of
the 1981 Licence Scheme........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ...... 7
APRA........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ . 7
The Australian Broadcasting Corporation........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ . 9
The History of Negotiations and Agreements between APRA and the ABC........ ........ ........ ........ .... 13
The Case for APRA........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ...... 17
The Case for the ABC........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .. 20
Questions of Law........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .. 22
The Tribunal’s Jurisdiction........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .. 22
Relevance of Provisions of s 152 of the Copyright Act 1968........ ........ ........ ........ ........ ........ ........ ...... 25
The Lawfulness of a Licence Fee Assessed as a Percentage of Expenditure........ ........ ........ ........ .... 28The Analogy of Damages for Infringement of Copyright as a Guide to
Reasonable Remuneration........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ . 29
Submissions of Counsel for ABC based on Trade Practices Act 1974........ ........ ........ ........ ........ ...... 30Earlier Arbitration both in Australia and Overseas concerning the amount to be
Paid for Public Performance or Broadcast Rights........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .. 35
The Evidence........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ . 54
The Extent and Significance of Music in Radio and Television Programmes........ ........ ........ ........ .. 56
The Finances of the ABC........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .... 59
Payments by the ABC to APRA........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ 61
Reach and Ratings........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ....... 65
Some aspects of the evidence of Mr Freegard and Mr Sturman........ ........ ........ ........ ........ ........ ........ . 68
The Quest for a formula which will yield Reasonable Remuneration........ ........ ........ ........ ........ ........ 71
Conclusions........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ .... 80
Summary........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ ........ 86
Introduction
In question is a reference brought by Australasian Performing Right Association Limited ("APRA") pursuant to s 154 of the Copyright Act 1968 ("the Act"). The reference relates to a proposed licence scheme for the broadcasting by the Australian Broadcasting Corporation (formerly the Australian Broadcasting Commission) of copyright works owned by APRA. The licence scheme relates to a licence in respect of musical works and, insofar as such works are accompanied by words, to literary and dramatic works. APRA is said to be the owner or prospective owner of the performance rights in those works. In its reference APRA asks the Copyright Tribunal to make such order, confirming or varying the scheme, as the Tribunal considers reasonable in the circumstances. We shall refer to the licence scheme in more detail later on. Before doing so we propose to refer to the course of the proceedings and to the relevant legislation.
The Course of the Proceedings
The proceedings were commenced on 17 February 1981. That was before the Australian Broadcasting Corporation Act 1983. The Corporation's predecessor, the Australian Broadcasting Commission, was then broadcasting and televising programmes over stations now controlled by the Corporation. Its statutory charter was to be found in Part III of the Broadcasting and Television Act 1942. The Part was entitled, "The National Broadcasting Service and the National Television Service”.
The reference came before the Tribunal in 1982 and a question was raised as to whether the Australian Broadcasting Commission was the Crown for the purposes of the Act. Lockhart J., sitting as Deputy President of the Tribunal, determined that the Commission was not the Crown; see Ex parte Australasian Performing Right Association Limited; re Australian Broadcasting Commission (1982) 42 A.L.R. 58. Subsequently the Commission requested that a case be stated pursuant to s 161 of the Act so that the decision of the Federal Court of Australia might be sought on the question. The Court agreed with Lockhart J. that the Commission was not the Crown; see Re Australasian Performing Right Association Limited’s Reference; Re Australian Broadcasting Commission (1982) 45 A.L.R. 153.
The decision of the Court was given on 15 December 1982. Thereafter the matter, so far as the Tribunal was concerned, ceased to be active. Whether this was due to the need for preparation of the parties' cases or for other reasons we do not know; it is not of any consequence to speculate about the cause of the delay that ensued. Eventually the matter was said by the parties to be going ahead. There followed a succession of directions hearings which led to the reference being firmed for hearing on 20 May 1985. The hearing continued until it concluded on 21 June 1985 when the Tribunal reserved its decision.
The Legislation
Section 154 of the Act is found in Part VI thereof. It opens with s 136 which contains a number of definitions. These include a definition of "licence scheme", which, so far as relevant, is as follows:
“‘licence scheme’ means a scheme ... formulated by a licenser or licensers and setting out the classes of cases in which the licenser or each of the licensers is willing, or the persons on whose behalf the licensor or each of the licensers acts are willing, to grant licences and the charges (if any) subject to payment of which, and the conditions subject to which, licences would be granted in those classes of cases;”
"Licence” is defined as follows:
“‘licence’ means a licence granted by or on behalf of the owner or prospective owner of the copyright in a literary, dramatic or musical work, or of the copyright in a sound recording, being:
(a)in the case of a literary, dramatic, or musical work - a licence to perform the work or an adaptation of the work in public, to broadcast the work or an adaptation ref the work, to make a sound recording or cinematograph film of the work or of an adaptation of the work for the purpose of broadcasting the work or adaptation or to cause the work or an adaptation of the work to be transmitted to subscribers to a diffusion service; or
(b)in the case of a sound recording ‑ a licence to cause the recording to be heard in public or to take a copy of the ,sound recording for the purpose of broadcasting the recording;”
Section 154 needs to be read with those definitions in mind. So far as it is material it is as follows:
“154 (1) Where a licensor proposes to bring a licence scheme into operation, he may refer the scheme to the Tribunal.
(2)The parties to a reference under this section are:
(a) the licensor referring the scheme; and
(b) such organisations or persons of any) as apply to the Tribunal to be made parties to the reference and, in accordance with the next succeeding sub‑section. are made parties to the reference
…………………….
(4)The Tribunal shall consider a scheme referred under this section and, after giving to the parties to the reference an opportunity of presenting their cases, shall make such order, either confirming or varying the scheme, as the Tribunal considers reasonable in the circumstances.
(5)An order (other than an interim order) of the Tribunal under this section may, notwithstanding anything contained in the licence scheme to which it relates be made so as to be in force either indefinitely or for such period as the Tribunal thinks fit.
(6)Where a licence scheme has been referred to the Tribunal under this section, the licensor may do either or both of the following things:
(a)bring the scheme into operation before the Tribunal makes an order in pursuance of the reference;
(b)withdraw the reference at any time before the Tribunal makes an order in pursuance of the reference whether the scheme has been brought into operation or not.
(7)If the scheme is not brought into operation before an order is made in pursuance of the reference, the scheme as confirmed or varied by the order comes into operation, notwithstanding anything contained in the scheme, forthwith upon the making of the order.
(8)After the making of an order in pursuance of the reference, the scheme as confirmed or varied by the order remains in operation, notwithstanding anything in the scheme, so long as the order remains in force.”
It is to be observed that the Tribunal's power in relation to the reference is to be found in subsec 154(4). It is to make such order, either confirming or varying the scheme, as the Tribunal considers reasonable in the circumstances. It is also to be observed that, pursuant to para. 154(6)(a), the licensor may bring the scheme into operation before the Tribunal makes an order in pursuance of the reference. In para 6 of the reference it was said that the licensor proposed to bring the proposed scheme into operation. That was done by written notification to the Commission on 20 February 1981.
It will be necessary to refer to some other provisions of the Act as we proceed, but for the moment we add a reference only to s 31 which provides for the nature of copyright in original works. So far as material ss 31(1) provides that for the purposes of the Act, unless the contrary intention appears. copyright in relation to a work is the exclusive right, inter alia, in the case of a literary, dramatic or musical work, to reproduce the work in a material form, to perform the work in public and to broadcast the work. Sub section (10)(1) defines the expression "broadcast" to mean broadcast by wireless telegraphy. "Broadcasting" has a corresponding meaning.
As earlier mentioned the Corporation was established by the Australian Broadcasting Corporation Act 1983. The principal provision) of that Act commenced on 1 July 1983. Section 5 provides that the body corporate that was immediately before the commencing day in existence by virtue of s 30 of the Broadcasting and Television Act 1942 under the name Australian Broadcasting Commission continues in existence by force of the section as a body corporate under and subject to the provisions of the Act under the name Australian Broadcasting Corporation. Reference needs also to be made to the Australian Broadcasting Corporation (Transitional Provisions and Consequential Amendments)Act 1983 the principal provisions of which also commenced on 1 July 1983. Subsection 15(2) of the Act provides that the Corporation may apply moneys in payment, inter alia, of charges, obligations or liabilities that were incurred or undertaken before the commencing day by the Commission or in connection with the performance of its functions or the exercise of its powers and were not paid or discharged before that day. It was no doubt because of the provisions of s 5 of the Corporation's Act and s 15 of the Transitional Provisions Act that the Corporation made no submission that it was not affected by the licence scheme which was referred to the Tribunal in 1981 nor that it was not bound to pay any moneys falling due under the scheme in respect of periods prior to the Corporation coming into existence in 1983
Unless it is necessary to distinguish between the Commission and the Corporation, we shall hereafter refer to them indistinguishably as the ABC.
The Licence Scheme
The licence scheme is dated l6 February 1981. It was amended in April 1981 and again at the commencement of the hearing. It commences with the statement that APRA is willing to grant a licence to the ABC in the form of a licence thereinafter set forth, subject to the payment of the charges specified therein, and subject to the terms and conditions contained therein. There then follows the licence. It is important that its terms be understood comprehensively. Rather than set out extensive quotations from it, we have appended the licence as attachment A to this decision. The licence is there set out in its finally amended form.
The essence of what APRA seeks to achieve is to be found in Clause 1 of the Schedule. The claim is for 2 per cent of the ABC’s gross operational expenditure incurred in the provision of radio broadcasting services, including the domestic service and the overseas service, less total direct expenditure incurred by the Commission in the broadcasting of proceedings of Parliament and 1.5 per cent of the Commission’s gross operational expenditure incurred in the provision of television broadcasting services, less total direct expenditure of the Commission on the purchase, hiring or production of television programmes, provided that the total amount so deducted shall re no morn than 44 per cent of the ABC’s gross operational expenditure in the provision of television broadcasting services during the relevant year
The amount incurred by the ABC in the broadcasting of Parliamentary proceedings is not substantial. Thus the amount sought in respect of radio broadcasting is effectively 2 per cent of the gross operational expenditure incurred in the provision of such broadcasting. In the course of his opening counsel for APRA said that it was not intended to include as part of the cross operational expenditure the cost of maintaining the various symphony orchestras which there are in the capital cities of the States, nor the cost of promoting and conducting concerts put on by these orchestras. Later in the hearing counsel for APRA said that it would be prepared further to vary the scheme by replacing the provision, applicable to the gross operating expenditure in the provision of television broadcasting services, which reduced the amount of the expenditure by the amount of the cost of television programmes, with a provision which permitted the deduction of 40 per cent of the operational cost incurred in the provision of television services irrespective of the cost of television programmes. In consequence the licence fee sought in respect of television broadcasts is effectively 0.9 per cent rather than 1.5 per cent of gross operating expenditure incurred in providing television services.
The Parties and their Negotiations and Agreements down to the Formulation of the 1981 Licence Scheme
APRA
APRA is a performing right society. There are performing right societies in most countries in the world. Often there is only one such society in each country. That is the case in Australia and also in New Zealand where APRA also owns the public performance and broadcast rights in music. The members of APRA are, for the most part, copyright owners, usually of music, and are either composers or music publishers. The members make an assignment to APRA of the public performance, broadcasting and diffusion rights, which may be collectively described as the performing rights, in their musical compositions, both past and future, subject to a reservation of "grand rights" to the copyright owner. The assignment made by members is unlimited as to time or place
The expression "grand rights" (otherwise "grands droits") generally denotes the rights of publicly performing or broadcasting dramatico - musical works, for example, musical plays (including operas and operettas) in their entirety, excerpts from musical plays when accompanied by dramatic action, music written for ballet, when accompanied by a performance of the ballet, and oratorios or long choral works
Grand rights are to be distinguished from small rights ("petits droits"). It is over the small rights which APRA takes the assignments of the public performance rights. Because it is the only collecting society in Australia and because it has, for all practical purposes, complete control over the performance rights of all works performed and broadcast in Australia, using that expression in the sense earlier explained. It has a monopoly in Australia over the broadcasting and performing of musical works.
APRA enters into licence agreements with a vast number of bodies and organisations of different kinds. It has licence agreements with each of the television and radio stations in Australia. It has agreements with each of the motion picture companies and companies operating cinemas, with theatres of all kinds, and with most other organisations and operators in the entertainment industry. Arrangements are made in relation to the playing of music in places such as discos and on juke boxes which may be situated in places of amusement or in shops of various kinds. The list is endless. The moneys which it receives from these sources are pooled, but pooled separately in order to differentiate amongst the various sources from which the moneys come. For example, there is a separate pool for commercial radio, another pool for commercial television and another pool again for the ABC.
The distribution of the moneys which APRA receives involves a complex operation. Detailed evidence was given of what procedures we're followed and, at the request of counsel for APRA we made an inspection of its Sydney premises where we had explained to us in much detail what exactly transpired. The system is designed, so far as reasonably possible, consistent with the keeping down of collection costs, to ensure that fair payment is received by each copyright owner for the use of his music. The system operates, to a degree, on a statistical sampling process. APRA does not require users to keep a log of the use which is made of music for every week of the year. Weeks are selected and during those weeks each commercial television station, each commercial broadcasting station and a selection of ABC networks provide precise information as to the music used during the selected weeks. This information is passed to APRA and forms the starting point for its assessment of what proportion of a particular pool should be paid to particular copyright owners.
As might be expected, much of the music played on radio and television stations in Australia is overseas music, and the performance rights in it are owned by overseas interests. These are usually the collecting societies in other countries. In that event, the payment which is due for the performance of it in Australia goes to the overseas collecting society. Thus much of the money which is collected by APRA in Australia goes overseas, particularly to the United Kingdom and to the United States of America. APRA receives some return from overseas collecting societies, but the amount received is only a fraction of that which it pays to overseas societies.
The Australian Broadcasting Corporation
We have already referred to the establishment of the Corporation by the Australian Broadcasting Corporation Act 1983 which came into force on 1 July 1983. The Corporation replaced the Commission which had been established on 1 July 1932 (Australian Broadcasting Commission Act 1932). Anew Commission was established in 1942 (the Australian Broadcasting Act 1942 which later became the Broadcasting and Television Act 1942). Section 6 of the Corporation’s Act contains its charter. Because of the substantial reliance placed by counsel for the Corporation on the provisions of its charter it is necessary to set out the section in full. It is as follows:
"Charter of the Corporation
6(1) The functions of the Corporation are:
(a) to provide within Australia innovative and comprehensive broadcasting and television services of a high standard as part of the Australian broadcasting and television system consisting of national, commercial and public sectors and, without limiting the generality of the foregoing, to provide:(i) broadcasting programs and the television programs that contribute to a sense of national identity and inform and entertain and reflect the cultural diversity of, the Australian community; and
(ii) broadcasting programs and television programs of an educational nature;
(b) to transmit to countries outside Australia broadcasting programs and television programs of news, current affairs. entertainment and cultural enrichment that will:
(i)encourage awareness of Australia and an international understanding of Australian attitudes on world affairs; and
(ii) enable Australian citizens living or travelling outside Australia to obtain information about Australian affairs and Australian attitudes on world affairs; and
(c) to encourage and promote the musical, dramatic and other performing arts in Australia.
(2) In the provision by the Corporation of its broadcasting and television services within Australia.
(a)the Corporation shall take account of:
(i)the broadcasting and television services provided .by the commercial and public sectors of the Australian broadcasting and television system;
(ii)the standards from time to time approved by the Australian Broadcasting Tribunal in respect of broadcasting and television services;
(iii)the responsibility of the Corporation as the provider of an independent national broadcasting and television service to provide a balance between broadcasting programs and television programs of wide appeal and specialized broadcasting programs and television programs;
(iv)the multicultural character of the Australian community; and
(v)in connection with the provision of broadcasting programs and television programs of an educational nature - the responsibilities of the States in relation to education; and
(b)the Corporation shall take all such measures, being measures consistent with the obligations of the Corporation under paragraph (a), as, in the opinion of the Board, will be conducive to the full development by the Corporation of suitable broadcasting programs and television programs.
(3) The functions of the Corporation under ss (1) and the duties imposed on the Corporation under ss (2) constitute the Charter of the Corporation.
(4) Nothing in this section shall be taken to impose on the Corporation a duty that is enforceable by proceedings in a court.”
The Corporation is constituted as an independent statutory body. It has a board of directors, a chairman and a managing director. The usual provisions are to be found in its Act which one would expect in relation to the incorporation of such a body and the conferring of powers on the body and its board to discharge its various functions.
Specific reference should be made to finance which is provided for in Part VI of the Act. Section 67 provides that there are payable to the Corporation such moneys as are appropriated by Parliament for the purposes of the Corporation. The Minister for Finance may give directions as to the amounts in which, and the times at which, moneys referred to in the section are to be paid to the Corporation. By s 68 the moneys of the Corporation shall be applied only in payment or discharge of the expenses, charges, obligations or liabilities incurred or undertaken by the Corporation in or in connection with the performance of its functions or the exercise of its powers, in payment of any remuneration or allowances payable under the Act and in making any other payments that are required by the Act to be made out of the moneys of the Corporation. Section 69 requires the Hoard to prepare estimates, in such form as the Minister directs, of the receipts and expenditure of the Corporation for each financial year and, if the Minister so directs, for any other period specified by the Minister, and the Board shall submit estimates so prepared to the Minister not later than such dates as the Minister directs. Sub section 69(2) provides that the moneys of the Corporation shall not be expended otherwise than in accordance with the estimates of expenditure approved by the Minister.
By ss 70(1) the Corporation shall not, without the approval of the Minister, enter into a contract under which the Corporation is to pay or receive an amount exceeding $500.000 or, if a higher amount is prescribed by regulation, that higher amount. Finally, s 70 provides that the Corporation is not subject to taxation under the law of the Commonwealth or of a State or Territory.
In evidence is the report of the Corporation for the year ended 30 June 1984. It was the Corporation’s first annual report and was the only report available to the Tribunal at the time of the hearing. The report shows that the Corporation operates medium wave (AM) radio stations in all States and Territories of Australia. Many of the programmes are relayed from one station to others. Programmes originate in different studios in different States and Territories from time to time. Sometimes programmes originate in country stations but are usually only broadcast in the area served .by the station from which the broadcast comes. On the other hand, some country stations are relay stations only. Three networks are operated. They are known as Radio 1, Radio 2 and Radio 3. Radio 1 operates for the main part in capital cities and major centres of population providing a good deal of light music, some drama and features, and a large number of spoken word programmes, including much news and news associated programmes, the Parliamentary broadcasts, some religious programmes, a great deal of sporting descriptions and commentaries and some rural, news, information. and talks. Radio 2 also operates in each of the capital cities and most of the major centres of population. It plays a good deal of classical music, as distinct from light music. It has news services, religious services and a number of spoken word programmes of various kinds. It also has most of the drama and features broadcast over the ABC. Radio 3 is a composite of Radio 1 and Radio 2 and is broadcast in country areas.
What has been said about the nature of the programmes on these various stations has to be modified somewhat because of a continuing trend, apparent at the time` of the hearing, and presumably still continuing, from music to "talk". This follows a trend which began some time ago in some commercial radio stations. In the case of the ABC, the balance is redressed, to a degree, by the increasing number of frequency modulation (FM) radio services. These usually originate from Sydney or Adelaide and are now broadcast in all capital cities and a great many country centres: The number of FM radio stations available in Australia is increasing. The policy of the ABC appears to be to transfer to the FM stations much of the task of providing music to those who prefer it to talk or mixed talk and music.
In accordance with its charter, the Corporation endeavours, as did its predecessor, the Commission, to make available services to the more remote areas of Australia. Sometimes these services are the only radio services available, commercial stations not existing in the areas in question. Until recently the bulk of the cost of the provision and maintenance of such services was borne, not by the ABC, but by Telecom which provides and maintains transmitting and relay equipment throughout Australia for the ABC at Telecom’s cost. The only cost which the ABC was required to meet was an annual charge for the provision of land lines. The pre-existing position has now changed to a not insubstantial degree with the introduction of the AUSSAT Satellite which will enable new and improved radio and television services to be provided to the remote parts of Australia. For the year ending 30 June 1986 there will be a charge made to the ABC of approximately $22 million. A corresponding charge will apparently be made in succeeding years.
In addition to operating medium wave and FM stations, the ABC also operates some short wave radio stations for inland Australia. Additionally, it operates Radio Australia which is the overseas service of the Corporation. The programmes originate from studios in Melbourne and are transmitted from transmitters at Shepparton and Lyndhurst in Victoria and Carnarvon in Western Australia. The service is extensive and the expenditure incurred on it is substantial. In addition to news, features and talks of various kinds, a good deal of music is also broadcast.
The ABC provides television services in all States and Territories of Australia. As in the case of radio, there is substantial relaying of programmes. Services are provided, so far as possible, to remote areas of Australia. Relay and transmitting facilities and associated technical equipment are provided by Telecom.
Extensive evidence of programming was given. It was said that the ABC provided programmes which were intended to discharge the obligation imposed on it by its charter. In consequence its programmes were said to be often of a very different kind from those broadcast over commercial radio and television.
The History of Negotiations and Agreements between APRA and the ABC
We have found it necessary to give an extensive account of the history of the negotiations and agreements between APRA and the ABC because of the substantial reliance placed by counsel for the ABC upon the agreements earlier entered into by the two organizations. In his submission these were the best evidence of what was a fair and reasonable price for the use of APRA music by the ABC.
The first licensing agreement made between APRA and the ABC was entered into on 2 July 1934. It was formulated as the result of a Royal Commission which bad been held into broadcasting services generally the previous year. The Royal Commissioner was Owen J. of the Supreme Court of New South Wales. He described APRA in his report as a "super monopoly". The 1934 agreement, which was based in part on his recommendations, provided for the payment of 27,000 pounds per annum and a further sum equivalent to 6 per cent on so much of the gross annual income of the ABC from broadcast listeners’ licence fees as exceeded the sum of 250,000 pounds. Licence fees had been imposed prior to the establishment of the ABC; Wireless Telegraphy Act 1905 and regulations made thereunder. For many years after 1934 a proportion of each licence fee was paid to the ABC. The sum of these formed a not inconsiderable part of its income. Licence fees were abolished in 1974 (Broadcasting and Television Act 1974, s 4) but long before their abolition a proportion of each licence fee had ceased to form any part of the ABC’s income. From 1948 when the Australian Broadcasting Act 1948 effected certain amendments to the Broadcasting and Television Act, its revenue was composed almost entirely of .Parliamentary appropriations. This has continued to be the case ever since.
In 1938 APRA and the ABC submitted the question of what payment should be made by the ABC to APRA for the licence which it conferred to the arbitration of Mr Clive Teece K.C. of the New South Wales Bar. On 16 May 1938 he determined that, for the period from the date of the award, 16 May 1938. to 31 May 1938, there should be paid by the ABC one farthing for every broadcast listener’s licence in force in the Commonwealth on 15 May 1938. For the period from 1 June 1938 to 31 December 1938 he determined that the amount should be one halfpenny per month for every broadcast listener's licence in force in the Commonwealth on the fifteenth of each month in respect of which the payment was made (in effect sixpence per year). The .formula evolved by Mr Teece was applied for many years. Notwithstanding that licence fees had ceased to have any relevance to the manner in which the ABC was funded after 1948, the numbers of licences continued thereafter to provide the yardstick for the calculation of the fee paid to APRA. A slight modification to the agreement was made in 1954 when it was agreed that during the five years commencing 1 July 1955, the ABC would pay an additional sum of 2,250 pounds per annum comprising 1,250 pounds on account of the overseas service and 1,000 pounds on account of public concerts. The payments otherwise continued to be assessed upon the basis of pence per broadcast listeners’ licence.
In November 1956 the Commission began to broadcast television programmes from stations in Sydney and Melbourne. Discussions eventually led to there being made by the ABC a payment of 5,000 pounds for the period of 12 months commencing on 1 July 1958. At that time the ABC still had stations only in Sydney and Melbourne. For music played over radio stations the licence arrangements remained the same, that is, one halfpenny per month or sixpence per year for each licence other than a pensioner’s licence for which threepence per year was paid. For the year commencing 1 July 1959 the fee became 3,500 pounds for television from Sydney and Melbourne and 750 pounds for each of the new television stations to be established in Adelaide, Brisbane. Hobart and Perth.
The advent of television and the irrelevance of the numbers of broadcast licences apparently precipitated a search for a new formula. As an interim measure the parties agreed to payments of 74,000 pounds and 80,000 pounds respectively for the years commencing 1 July 1960 and 1961. The fee was for the right to use APRA controlled music in domestic and shortwave radio broadcasts, in television services and, for an additional sum of 1,000 pounds, for the use of APRA controlled music in public concerts.
The continuing formula decided upon was an amount per head of the Australian population. For the year 1963/1964 it was 1.99 pence per head. For the financial years 1964/1965 and 1965/I966 the amount was increased to 2.1 and 2.2 pence per head respectively. The amounts yielded were approximately 101,004 pounds and 110,000 pounds. It was agreed that from 1 July 1966 the amount to be paid in respect of each financial year would be 2.3 pence per head of population as reported by the Commonwealth Bureau of Census and Statistics on 31 December in each financial year. The amount was to be increased or reduced by reference to a formula which depended on the Consumer Price Index.
The new arrangement was formalised in an agreement dated 8 December 1964. This took the parties through to the end of the financial year, 30 June 1967. The formula agreed upon in the 1964 agreement was continued well beyond that date. For the year ending 30 June 1970 the rate per head of population was 2.38 pence (sic) and yielded a gross figure for that year of $245,843.69.
In 1971 the Board of APRA decided to endeavour to obtain an increase and contemplated the possibility of a chancre in the formula to a formula similar to that upon which the fee payable by the commercial stations was calculated. The commercial radio stations paid a fee based on 2 per cent of their net advertising revenue. In the case of the commercial television stations the percentage was 1.5 per cent.
On 15 ,December 1971 APRA gave the ABC notice that the 1964 agreement would terminate on 30 June 1972.
Negotiations for a new agreement began. Letters setting out the various considerations passed between the parties and a number of discussions were held. In the middle of 1972 the parties were diverted by a disagreement which developed about the way in which the formula for increase in the amount payable which depended upon adjustments to the Consumer Price Index, were to be calculated. This led to litigation between them, litigation in which the ABC was ultimately successful; see Australian Broadcasting Commission v. Australasian Performing Right Association (1973) 47 A.L.J.R. 526.
In 1975 anew agreement was entered into. It was expressed to operate from 1 July 1974. Notwithstanding the negotiations which had crone on, the old formula was retained. For the near commencing 1 July 1974 the amount of the fee was the amount obtained by multiplying 3.3158 cents by the number of persons comprising the estimated population of Australia as at 31 December 1974 as set out in the report published by the Commonwealth Statistician. In respect of the licence year commencing 1 July 1975 and in respect of each succeeding licence year, the amount was to be ascertained by multiplying the "relevant per capita sum in cents" by the number of persons comprised in the estimated population of Australia as at 31 December of the licence year under determination. The "relevant per capita sum in cents" was to be ascertained by a formula based upon the Consumer Price Index. The agreement is still in existence, subject of course to the licence scheme now propounded by APRA. For the year ended 30 June 1984 the figure by which the population was multiplied was 7.46 cents. It yielded a total sum of $1.252.021. By the agreement APRA authorized the ABC to broadcast all works in APRA’s repertoire from all national broadcasting stations, including those carrying Radio Australia programmes and all national television stations and also to perform in public works in APRA’s repertoire at paid concerts and free concerts organized or promoted by the ABC anywhere in Australia. As was the case in previous agreements between the parties, grand rights were excluded. The provisions of the licence conferred by the licence scheme now under consideration are similar, except that the licence no longer authorizes the ABC to perform works in public at any concerts. The omission of that provision is a matter of contention between the parties.
In 1979 APRA reopened the question of the formula upon which the ABC’s licence fee was calculated with the ABC. Negotiations continued in a sporadic fashion until the formulation of the licence scheme which is the subject of this reference. If the APRA scheme were implemented without alteration it would yield a figure in excess of $3,300.000 for the year ended 30 June 1984.
The Case for APRA
We propose now to refer shortly to the cases of the parties Our statement of their cases is not exhaustive and we shall refer to more of the detail of them when we come to discuss the various matters which need to be taken into account in reaching a decision. We mention, however, that each party filed a most detailed statement in support of its case. We have read the two statements and taken the material into account but have not found it necessary to set out substantial extracts from them.
The foundation for APRA’s case is that the present basis upon which it is remunerated provides no true guide as to what the value of the APRA licence is. In APRA’s submission the only true reflection of that value will be provided by a method of remuneration which is based upon the value the community itself places on the programmes which the ABC broadcasts. The measure of that value is said to be the appropriation which Parliament, as the community's representative, determines to make for the ABC’s operations. The base is not, however, the amount of the Parliamentary appropriation, but operating expenditure less certain deductions. But, as was explained in the APRA case, the reason for the selection of expenditure rather than revenue (that is the appropriation) was because it was easier to deduct from the total amount of it amounts incurred by the ABC in respect of certain items which APRA conceded should be left out of account. Thus the circumstance that the base was to be operating expenditure less certain costs, and not the amount of the appropriation, was not inconsistent with its case. That case was based on the amount of the appropriation, but expenditure, rather than revenue, was selected in order to enable the base figure on which the percentage was to be charged the more easily to be arrived at.
The reason APRA is prepared to deduct certain costs from the total amount of operating expenditure is that it seeks to equate the ABC with the commercial television stations. It has sought to exclude expenditure items which do not find any parallel in the commercial area. The commercial stations do not broadcast the proceedings of Parliament, maintain orchestra. or conduct concerts. Therefore, consistently with the case which it makes, APRA agrees that the cost of providing these items should be omitted. As will be seen the cost of acquiring or producing television programmes is omitted from the base figures upon which the percentage payable by the commercial stations is charged. For this reason APRA is prepared to make a similar allowance in the case of the cost of acquiring or producing television programmes incurred by the ABC. But when it comes to activities in which both commercial stations and the ABC engage, for example, the presentation of news or the description of sporting events, the fact that there is little, if any, music used provides no reason for leaving out such items of expenditure because commercial stations, as well as the ABC, provide programmes of this kind.
This circumstance serves to emphasize that the amount of the appropriation or expenditure (less, in either case, the relevant deductions) can only be a starting point because what has to be arrived at is the value of the music, really the value of the copyright owners broadcast rights which APRA licenses the ABC to utilize. Only a portion of ABC radio and television time is occupied in the transmission of music. As will be seen when we come to discuss the evidence, APRA has given elaborate evidence, based upon the information which it has for the purpose of distributing its income to the various copyright owners, of the proportion of broadcast time which is taken up by the playing of music.
A matter upon which APRA places great emphasis is the value of the licence which it confers. It is a licence which, in practical terms. authorizes the broadcasting of all music which is the subject of copyright, no matter where it was composed and however old the copyright in it may be. It authorizes the licensee to broadcast it at any time of the day as often as the licensee chooses throughout the period of the licence. In effect it means that the licensee may confidently use all music available in the world secure in the knowledge that in doing so it will not infringe copyright, either because the music is in the public domain or because the licensee is lawfully authorized to broadcast all music which is still the subject of copyright.
As we have mentioned, APRA has drawn heavily on the commercial situation. The amounts which are paid by these stations are, as earlier noted, based upon percentages of advertising revenue received by each station. The percentage paid by the radio stations is 2 per cent of such revenue and the percentage paid by the television stations 1.5 per cent less the cost of programmes, provided that the deduction does not amount to more than 40 per cent of the total operational costs. These percentages are agreed percentages between the commercial stations and APRA, although the 1.5 per cent, which, subject to the programme cost deduction, is paid by television stations, derived originally from an arbitration conducted in 1963 by Sir John Spicer, the then Chief Judge of the Commonwealth Industrial Court. To his reasons for decision we shall refer in some detail later on. There has not been any similar arbitration in relation to the amount to be paid by the commercial radio stations.
It is APRA’s case that the ABC should be placed upon a similar footing to the commercial stations. The Parliamentary appropriation (or the operating expenditure) is, in its submission, to be equated to the income of the commercial stations, that is, the income they receive from advertising revenue. The application to that appropriation (or expenditure) of the same percentages as have been agreed upon over the years between the commercial stations and APRA will, in APRA’s submission, give a true guide to the value of what it is that the ABC receives from APRA.
It should be emphasized, however, that APRA’s case is not based on the simplistic proposition that, because the commercial stations pay a percentage of their revenue, the ABC should do likewise. We can best explain the approach which APRA makes by quoting from its written submissions, para. 18 of which is as follows
"Just as advertising revenue represents the value which the advertisers place on the operations which include the use of APRA music, so the income or its Equivalent, the expenditure of the ABC, reflects the value which the community places on the like operations of the ABC. It reflects what Parliament has decided should be paid for the broadcasting by the ABC of programmes including music. Income, or its equivalent expenditure is, therefore, the most appropriate base with reference to which to calculate the value of a blanket licence to use APRA music. There is no base more appropriate.”
APRA’s contention is that the ABC pays fair market prices for all commodities and services which it uses. The salaries and wages it pays to its staff are, for the most part, either determined by an industrial award or by agreement and are thus themselves also fair market prices for the services which the staff renders. The music used by the ABC should be in no different category from all the other commodities and services which it needs to run its enterprise. The existing formula, based as it is on cents per head of population, will not yield a true market price for the music which is used. Not only is the amount now paid out of kilter with the amount’s paid by the commercial stations; a yardstick based on cents per head of population has no relationship to what the fair market value of the music is. The basis should therefore be changed to one which will reflect this value.
In APRA’s submission this value will be reflected if the same percentages to ABC radio and television expenditure are applied as apply to the income of commercial stations: In APRA’s submission, this should be done, “not because it is contended that the ABC is engaged in a commercial operation, but because it is considered reasonable to do so. It is a reasonable reflection of that part of the income or expenditure of the ABC which it is considered appropriate as a return to APRA copyright owners for the right to broadcast their music.” In other words, it is a going rate established by what the commercial stations pay. The payments which they make are, objectively speaking, reasonable prices for what they receive. The ABC should pay the same.
The Case for the ABC
The case for the ABC begins with the proposition that for very many years the parties have entered freely into agreements, some formal and others arising out of a course of dealing, based on cents per head of population. Thus the parties themselves by the course of that dealing, have established what a fair market value for the music is. There is no warrant for any change in that position. Subject to appropriate adjustments being made from time to time to the number of cents to be paid, the existing agreement provides fair return to APRA for the music which is used.
Furthermore, the method by which APRA is remunerated by the commercial broadcasting and television stations provides no satisfactory guide as to what the payment by the ABC should be. That is because of the very different functions and purposes which the ABC has, compared with the commercial stations. Pursuant to its charter, the ABC is obliged to provide broadcasting and television services in remote areas of Australia where a commercial operation would not be profitable, and thus viable. Much was made during counsel's submissions of the "tyranny of distance" which is one of the problems faced by an organization such as the ABC in having to provide services to the remote and least populous parts of the Continent. But that was only one factor. Another, and more important factor, was the type of programme which the ABC was bound to offer. Commercial stations follow the demands of the market. They put on programmes which have a substantial popular appeal. In this way they are able to attract advertisers and maintain their revenue at a consistently high level. The ABC is not necessarily engaged in pursuing popular tastes and demands. It is obliged to provide programmes, as best it can, for all sections of the community and also to endeavour to raise standards of public taste and to educate the community in areas which would not appeal, necessarily, to the vast bulk of the population.
For these reasons, a change to a percentage of revenue or expenditure basis of remuneration was not warranted. The cents per head of population basis might have its weaknesses and be open to some criticism, but it had not been established by APRA that there was any warrant for changing it. The commercial basis of remuneration had no application to the ABC.
In case that might not be the Tribunal's view, counsel for the ABC developed two fall back positions. The preferred one was that there should be fixed a lump sum payment for each of the years covered by the licence scheme. In counsel's submission the Tribunal ought not, in any event, adopt a percentage basis without taking into account the consequence of it in terms of actual money. The very size of the increase involved in the confirmation of the licence scheme without alteration should make us pause and think very hard before acceding to it. Towards the close of the proceedings the ABC made an open offer to APRA in settlement of the dispute between them. The amount offered for the financial year 1984-85 was $1,325,000. For succeeding year the amount was indexed progressively to increases or decreases in “the Average. Weekly Earnings”. This expression was defined in the offer. It is unnecessary to refer to the detail of the definition. The offer was rejected.
If nevertheless the Tribunal were to take the view that a more satisfactory basis of remuneration was to be found in a percentage of revenue or expenditure, APRA’s case should not be accepted in its entirety. That was because the numbers of persons listening to ADO radio or viewing ADO television could not be compared with the numbers listening to or viewing commercial stations or channels. The evidence established that advertising revenue was greater when the numbers of people listening or watching at any given time were greater. The greater the attraction of a programme the more likely it was that ratings would be higher and thus the revenue which the station was able to command itself higher. Since the ABC was, overall any given metropolitan area the least popular station or channel (omitting the Special Broadcasting Service and some ethnic and FM stations) any basis of remuneration which adopted the formula which applied in the case of commercial stations was inappropriate, at least unless .a proper allowance was made by way of a reduction of the percentage to take account of the smaller numbers of people listening to or watching ABC stations.
The ABC relied on a number of points of law. It is convenient to discuss now some legal matters including these and those are the matters to which we next go.
Questions of Law
The Tribunal’s Jurisdiction
The Tribunal's jurisdiction to make an order is provided for in ss 154(4) earlier quoted. It is to make such order, either confirming or varying the scheme, as the Tribunal considers reasonable in the circumstances. It is to be observed that the sub‑section does not expressly provide that the Tribunal may decline to make an order at all.
The question to be determined concerns the meaning of the word ‘vary’. Is it wide enough to empower the Tribunal, in the event that it considers the referred scheme totally unreasonable, to substitute for it a scheme which it does consider reasonable? It. was the submission of counsel for the ABC that it was empowered to do so; counsel for APRA submitted to the contrary. The word “vary” and its derivatives are not words of precise meaning. Synonyms are the words “change”, “alter” and “amend”. In order to determine what the word means in the present case, we must look at it in that particular context in which it is used.
Section 154 is in Division 3 of Part V1 of the Act. Part VI is entitled, “The Copyright Tribunal” and Division 3, “Inquiries by, and Applications and References to, the Tribunal”. The Division opens with s 148 which provides for inquiries into the amount of royalty payable in respect of records of musical works. The section applies where the Attorney‑General, being of the opinion that the amount of royalty is not equitable, requests the Tribunal, pursuant to s 58 of the Act, to hold an inquiry into the amount of the royalty, or the minimum royalty, payable in respect of records generally or in respect of records included in a particular class of records. Section 149 provides for applications to the Tribunal for determination of the remuneration payable far the making of a recording or a film of a work. The Tribunal’s task is to make an order determining the amount it considers to be equitable remuneration to the owner of the copyright. Similar language is used in s 149A which provides for the determination of an equitable remuneration to the owner of copyright for copies made under statutory licence. The words “the determination of an equitable remuneration” are also used in ss 150 and 151 which deal with the determination by the Tribunal of the remuneration payable to the owner of copyright in a recording for the making of a copy of the recording or for the public playing of the recording.
The language of s 152 is somewhat different. It deals with applications to the Tribunal for the determination of amounts payable for broadcasting published sound recordings. There the Tribunal’s task is to determine the amount payable by a broadcaster to the owners of the copyrights in question. The words “equitable remuneration” are not used. Nevertheless the Tribunal’s task is to determine the amount of the remuneration which is payable and in that sense its task is similar to that which is had under the earlier sections referred to: cf WEA Records Pty Limited v Stereo FM Pty Limited (1983) 48 ALR 91 at pp 110-3.
The provisions of s 154 are expressed very differently. As already noted, ss 154(4) empowers the Tribunal to make such order, either confirming or varying the licence scheme, as the Tribunal considers reasonable in the circumstances. To be read in conjunction with s 159 is s l57 which provides in ss (2) that .3 person who claims, in a case to which a licence scheme applies, that he requires a licence but that tine grant of .a licence in accordance with the scheme would be subject to the payment of charges that were not reasonable in the circumstances, may apply to the Tribunal under the section. Pursuant to ss 157(6) the Tribunal is to make an order specifying the charges which the Tribunal considers reasonable in the circumstances.
The contrast between the language used in ss 148 to 152 inclusive on the one hand and s 154 on the other hand, in our opinion leads to the conclusion that the word “variation” in s 154 is not to be construed so widely that it would empower the Tribunal to substitute for the scheme which is referred under the section a scheme of an entirely different kind in cases where the Tribunal concluded that the referred scheme was wholly unreasonable. In such a case the only course is to make no order on the application. Notwithstanding the absence of any express power to take this course, it seems clear to us that the Tribunal must, by implication, have that power if it is not satisfied that the scheme is reasonable.
It follows that the Tribunal’s power to vary a scheme will be limited to making variations in the sense of amendments or alterations, but not so to change it as to substitute an entirely different scheme for the one referred. In the present case it would be within our power to vary the percentage of expenditure upon which the proposed formula is based yr to exclude further items of expenditure additional to the direct cost of Parliamentary broadcasts, the cost of maintaining orchestras and the cost of television programmes. Probably the adoption of the amount of the Parliamentary appropriation, rather than the amount of operating expenditure, as the base (with or without deductions) would also amount to a variation. But to substitute for the referred scheme, a scheme which was baled on cents per head at population or which provided :Ear the payment annually of a lump sum, would not be to vary the referred scheme but to substitute an entirely different scheme for it. A party advocating such a course is not without remedy. He may, in addition to opposing the application made under s 154, proceed under s 157. The Tribunal would them have power to give effect to whatever it thought reasonable in the circumstances and be able to act in much the same way as it does under the earlier section, ss 143 to 152.
In passing, we should mention that our later reference to decisions of the Performing Right Tribunal in the United Kingdom will show that, in at least one case, a wider view was taken of the meaning of the word “varying” in the comparable provisions of s 25 of the Copyright Act 1956 (UK). However, the provisions of the two sections are not identical. In the United Kingdom it is the licensee who makes the application. Furthermore, there is no provision comparable with s 157 in the United Kingdom Act. We have taken into account the apparent practice in the United Kingdom, but are, nevertheless, of the opinion that the use of the word “varying” in s 154 of the Act here has the meaning we have indicated; cf. The Modern Law of Copyright, Laddie, Prescott and Vitoria p 475.
Counsel for the ABC foresaw that this view of the meaning of ss 154(4) might be preferred and asked us, if we thought that the referred scheme was unreasonable, to indicate our view of what we thought a reasonable licence fee should be. Counsel for APRA did not dissent from this course, and, if the need arises, we shall indicate our view accordingly We do so because of the substantial time, trouble and expense in which the parties have been involved in the preparation and presentation of their cases. The case is one where there ought desirably be a. commercial solution, and we should be prepared to do our best to assist in its achievement.
Notwithstanding his assent to the course proposed by counsel for the ABC, counsel for APRA pressed upon us a further submission consequential upon our having accepted the construction of ss 154(4) which he advocated. It was that, if we took the narrower view of ss 154(4), as we have done, then it was not for us to substitute our own view of what was reasonable in all the circumstances. If we thought that the licence scheme was, objectively speaking, reasonable, or would be reasonable if some variation of it were made, it was our duty to give effect to it notwithstanding that we ourselves might take the view that a somewhat different licence scheme would be more reasonable. We have reached the conclusion that we should give effect to that submission.
Relevance of Provisions of s 152 of the Copyright Act 1968
Sub‑section 152(2) of the Act provides that an application may be made to the Tribunal for an order determining, or making provision for determining, the amount payable by a broadcaster to the owners of copyrights in published sound recordings in respect of the broadcasting, during a period specified in the application, of those recordings by that broadcaster
Sub‑section 152(6) empowers the Tribunal to make certain orders. It is unnecessary to refer to the detail of the sub‑section except to say that it empowers the Tribunal to determine, or make provision for determining, the amount payable by the broadcaster to the owners of the copyrights in the sound recordings in question. For the purposes of this case the important provision is ss 152(11) which is in the following terms
“Where an application is made to the Tribunal under sub‑section (2) in relation to the Australian Broadcasting Commission, the Tribunal –
(a)shall make separate orders in respect of sound broadcasts by the Commission of published sound recordings and in respect of television broadcasts by the Commission of such recordings; and
(b)shall not make an order that would require the Commission to pay, in respect of sound broadcasts of published sound recordings during the period in relation to which the order applies, an amount exceeding the sum of-
(i)in respect of each complete year included in that period - the amount ascertained by multiplying one‑half of One cent by the number equal to the number of persons comprised in the estimated population of Australia as last set out in statistics published by the Commonwealth Statistician before the making of the order; and
(ii)in respect at each part of a year included in that period ‑ the amount that bears to the amount ascertained in accordance with the last preceding sub‑paragraph in relation to a complete year the same proportion as that part of a year bears to a complete year.”
As best we could understand the reliance placed by counsel for the ABC on this provision, it was that it provided an indication that Parliament had placed its imprimatur an the existing basis upon which APRA is remunerated by the ABC. At the least, so it was submitted, the provisions of ss 152(11) provided the :tribunal with guidance as to whether the licence scheme propounded by APRA was reasonable. Since it proposed an entirely different basis for the calculation of the remuneration to be payable, the section indicated that such a. basis was not .s reasonable one.
In addition to relying on the distinction which there is between ss 152 and 154 and the absence of any similar words in s 154, counsel for APRA referred us to the second reading speeches of the then Attorney-General, the Honourable Nigel Bowen, Q.C., MP (as Bowen CJ then was), when the Copyright Bill 1967 and the Copyright Bill 1968 were introduced into Parliament. The 1967 Bill was not proceeded with. A new Bill was introduced in 1968. In the course of his second reading speech in support of that Bill the Attorney-General said:
“In the case of .a commercial radio station, the Tribunal may not fix an amount payable in respect of the broadcasting of records by that station which exceeds one per cent of the gross annual revenue of that station. In the case of the broadcasting of records by the Australians Broadcasting Commission by means of its radio, broadcasts, the Tribunal may not fix an annual royalty which exceeds one‑half cent per head of population.
These limits have been set to allay fears expressed by both the commercial broadcasting stations and the Australian Broadcasting Commission that the payment of royalties for the broadcasting of records could impose a substantial financial burden on them. The limits have been fixed in the light of the special circumstances now existing in Australia in relation to the broadcasting of records and are not intended to imply that any particular royalty or rate of royalty is appropriate for the broadcasting of musical copyright works.”
(Hansard, Vol H of R 59, 15 May 1968 p 1535).
the emphasis is ours.
We would only take head of a second reading speech if we thought there were an ambiguity in the language used in the relevant provisions of the Act. We do not think that there is any ambiguity. It is our view that s 154 deals with an entirely different subject matter from that dealt with in s 152. We would not, therefore, have thought the presence in s 152 of ss (11) had any bearing upon the way in which our task under s 154 should be approached. If, however, there is any ambiguity, then what the Attorney General said when introducing the 1968 Bill is plainly indicative of an intention that provision of the Copyright Act other than s 152 were not to be at all controlled or affected by its provisions. It may be that the formula for which s 152 provides in ss (11) was derived from the basis upon which APRA was then remunerated by the ABC. That is only surmise; we gave no information on the point. But if we were satisfied that the formula provided for in s 152 had come from the then existing basis upon which APRA was remunerated for its broadcast right, that would not of itself provide a reason why that basis should not be changed, so far as concerns a licence scheme referred under s 154, if the dictates of reasonableness required that course.
Our conclusion is, therefore, that the provisions of s 152 do not circumscribe an applicant under s 154 in relation ta the licence scheme which he may propound, nor da they circumscribe the Tribunal in its determination of the question of whether such a scheme is reasonable. The submissions of counsel for the ABC based on s 152 are therefore rejected.
The Lawfulness of a Licence Fee Assessed as a Percentage of Expenditure
In the submission of the ABC a licence scheme levying a percentage of the ABC’s operational expenditure was incapable of being a scheme which was reasonable in the circumstances' within the meaning of ss 154(4) of the Act. The submission was founded on the proposition that the licence scheme proposed by APRA amounted to a scheme to tax a Parliamentary appropriation. It was not therefore one which the Tribunal ought to approve even if it thought that at was otherwise reasonable.
The starting point for the development of the submission was found in the provisions of ss 69(2) of the Australian Broadcasting Corporation Act earlier referred to. The section is one of those in Part VI entitled “Finance”. Sub‑section 69(1) provides that the Board of the Corporation shall prepare estimates, in such farm as the Minister directs, of the receipts and expenditure of the Corporation .far each financial year, and. if the Minister so directs, for .any other period specified by him. The Board is to submit estimates so prepared no 1ater than such date as the Minister directs. Sub‑section 69(2), the provision relied upon by counsel, provides that the moneys of the Corporation shall not be expended otherwise than in accordance with the estimates of expenditure approved by the Minister.
The submission involves the proposition that a licence scheme which proposes a fee to be arrived at as a percentage of expenditure is, if not illegal, then per se unreasonable. We are of opinion that the submission should be rejected. Any statutory corporation such as the ABC must carry on its affairs by making estimates of its expenditure and endeavouring to keep within those estimates. If it finds that the estimates are insufficient for its needs. It may need to make revised estimates and seek the approval of the appropriate Minister to them. That would be the course which the ABC would be bound to follow if its estimates proved inadequate. It is the course which it in fact follows. So much appears from the evidence of Mr Oliver who was, at the time he gave evidence, the ABC’s Budget Officer.
That being the case, we see nothing unlawful in the implementation of a scheme such as APRA propounds. What it would involve would be the estimation of the entirety of the ABC’s expenditure; the deduction from it of irrelevant costs, and then the addition to the remaining expenditure of sums arrived at by applying the relevant percentages. The .licence fee so calculated would itself become an item of expenditure and, form part of the estimates sent to the Minister for approval pursuant to ss 69(2).
The Analogy of Damages for Infringement of Copyright as a Guide to Reasonable Remuneration
In each of the cases which have so far come to the tribunal, the Tribunal has sought guidance as to the proper approach to its task from cases dealing with the measure of damages to be awarded in infringement cases. The Tribunal has found particular assistance in the decision of the House of Lords in General Tyre and Rubber Co v Firestone Tyre and Rubber Company [1976] RPC 197, particularly per Lord Wilberforce at pp 212-5. We refer to the decisions of the Tribunal in Report of the Inquiry by the Copyright Tribunal into Royalties payable in respect of Records Generally published 24 September 1979 at pp 97-101, WEA Records Pty Limited v Stereo FM Pty Limited (1983) 48 ALR 91 at pp 110-3 and Copyright Agency Limitedv Department of Education of New South Wales (1985) 59 ALR 172 at pp 181-183. In each of those cases the Tribunal was not concerned with the question of whether a licence scheme should be confirmed but with the question of what should be paid to the owner of the copyright by way of fair or equitable remuneration. The word “equitable” is found in s 1494 of the Act providing for applications to the Tribunal for the determination of remuneration payable to the owner of copyright for copies made under statutory licence. As mentioned, the word “equitable” is not used in s 152 which is the section which concerned the Tribunal in the W.E.A. case. Nevertheless the Tribunal in that case thought that substantial help was to be obtained by reference to the approach adopted by courts in assessing damages for the infringement of industrial or intellectual property rights.
Counsel for the ABC has submitted that this approach is of no help or relevance in the present case except insofar as the evidence might disclose that there is a going rate. 1f there be no going rate, however, the submission was that the more broad based approach :adopted by courts in infringement cases did not provide .assistance. That was particularly because the Tribunal’s task in the present case was different from its task in the earlier cases. Its task was not to determine equitable remuneration: rather it was concerned with the question whether it should approve, that is, confirm, a particular scheme with or without variations.
Because of the differences in the Tribunal’s task., we think that there is some force in the submission, but in the end we will need to consider what is reasonable in the circumstances in order to provide ourselves with a guideline as to what view we should take of the reasonableness or otherwise of the APRA scheme. We do not find it otherwise necessary to deal with the submission.
Submissions of Counsel for ABC based on Trade Practices Act 1974
In the course of his final address counsel for the ABC raised for the first time the question of some potential breaches by APRA of the Trade Practices Act 1974 in the event that the licence scheme were to be implemented. It was, to say the least, unfortunate that such allegations were not raised earlier. Evidence could have been led by the ABC to support its claims and APRA would have had the opportunity, if it were necessary to meet any such evidence. Counsel for APRA did not oppose the matters being raised. In any event, as questions of possible illegality were brought to the Tribunal’s attention, we felt obliged to consider the submissions and the matters put in support of them.
Notwithstanding written submissions on the matter, it remains far from clear what evidence, if any, is relied upon to support the claims of the ABC. Furthermore, it is not completely clear to us which particular provisions of the Trade Practices Act were the subject of supposed contravention in the event that the licence scheme were to come into force.
In his submissions counsel for the ABC relied upon potential breeches of ss 45 and 46 of the Act if the licence scheme were brought into operation. He abandoned an earlier attempt to rely on s 45A. Before we deal in detail with these claims, it is necessary to consider what relevance they have to the Tribunal’s task.. At the risk of repetition we note that ss 154(4) of the Copyright Act provides that the Tribunal shall consider a scheme referred to it and “shall make such order, either confirming or varying the scheme, as the Tribunal considers reasonable in the circumstances”.
It was submitted on behalf of APRA that even if the Tribunal did come to the conclusion that the scheme may in some respect infringe the Trade Practices Act, it would nevertheless not be a matter which the Tribunal should take into account in reaching its conclusion. That was because jurisdiction in trade practices matters was conferred on the Federal. Court exclusively of .all other courts except the High Court; s 86 of the Trade Practices Act.
We reject the submission. If the proposed scheme itself revealed that its implementation would transgress the law, or if evidence led in the proceedings pointed to that being the case, it would not be either lawful or reasonable for us to confirm the scheme unless it were varied to overcome the illegality. Our course in a case of this kind is clear. In North West Salt Co. Limited v Electrolvtic Alkali Company [19141 A.C. 461 Viscount Haldane L.C. said (p 469):-
“My Lards, it is no doubt true that where on the plaintiff’s case it appears to the Court that the claim is illegal, and that it would be contrary to public policy to entertain it, the Court may and ought to refuse to do so But this must only be when either the agreement sued on is on the face of it illegal or where, if facts relating to such an agreement are relied on, the plaintiff's case has been completely presented. If the point has not been raised on the pleadings so as to warn the plaintiff to produce evidence which he may be able to bring forward rebutting any presumption of illegality which might be based on some isolated fact, then the Court ought not to take a course which may easily lead to a miscarriage of justice. On the other hand, if the action really rests on a contract which on the face of it ought not to be enforced, then, as I have already said, the Court ought to dismiss the claim, irrespective of whether the pleadings of the defendant raise the question of illegality.”
We refer also to the speech of Lord Moulton at pp 476-7 and to the decision of Devlin J (as he was ) in Elder v Auerback [1950] 1 KB 359 at p 371.
We do not sit as a court of record but as an administrative tribunal. Nevertheless, the parties have filed detailed statements of their cases and also points in support of those cases, each has led extensive evidence. The Tribunal’s power to call evidence without the consent of both parties is at least doubtful; cf ss 167(2) of the Act. In any event, it would be quite impractical for it to do so. It is therefore appropriate, in our opinion, to apply by analogy what has been said in the authorities to which we have referred. No reference to any potential infringement of the Trade Practices Act was made by the ABC in its case or in its points in support of that case or, at least in icy direct way, in the evidence. As we haves said, no mention of the matter was made until counsel far the ABC embarked upon his final address. The find address of counsel far APRA was then complete, although, of course, he was afforded a reply.
The authorities referred to establish that, while it is necessary that the Tribunal. consider a potentially relevant illegality that appears clearly to arise on the face of the evidence, it is another thing altogether to suggest that the Tribunal will lightly infer illegality or make findings that serious allegations have been established unless the evidence is clear and cogent.
Section 164 of the Copyright Act provides that in proceedings before it, the tribunal is not bound by the rules of evidence. However, we adopt what was said by the Tribunal in the WEA Records case (48 ALR at p 119):
“Counsel for the record company accepted that not all the relevant evidence was available in relation to the trade practices issues which had been raised. It was suggested that s 164 could assist the Tribunal in such a situation. In our opinion the mere fact that tire Tribunal is not bound by the rules of evidence does not mean that it should not base its decisions on the material before it.”
Thus a party making serious allegations, such as are involved in the ABC submissions, must substantiate them and not rely on generalisations or assertions unsupported by the evidence or other material before the Tribunal.
We turn to the substance of the allegations made. After a good deal of discussions counsel said that he would put his submissions on the questions in writing. He agreed that these would represent the totality of what he wished to put in relation to the natter and would replace earlier oral and written submissions. Written submissions were lodged after we reserved our decision. These were answered in writing by counsel for APRA.
The submissions, in our opinion, fail. adequately to specify or particularize in what precise respects the provisions of the Trade Practices Act would be contravened if the scheme were implemented. Furthermore, the evidence, if there be any, upon which the allegations are based is, in our opinion, quite insufficient to found them. With due respect to counsel, we feel bound to say that the submission has substituted broad generalization and speculation for evidence or facts.
Although it is not entirely clear, counsel for the ABC appeared to rely on ss 45(2) of the Trade Practices Act. So far as relevant the sub‑section is as follows:
A corporation shall not –
(a) make a contract or arrangement, or arrive at an understanding, if:
…………………………………
(iii)a provision of the proposed contract, arrangement or understanding has the purpose, or would have or be likely to have the effect, of substantially lessening competition:….”
We shall assume that the relevant “corporation” is APRA, the relevant “proposed contract” is the licensing scheme referred to the Tribunal and that the relevant provision is that which obliges the ABC to pay a proportion of its expenditure. In paragraph 15 of the ABC’s submissions is found what appears to be the essence of the s 4 argument:
There can be no question about our jurisdiction to vary the licence scheme to give effect to our decision. What we propose is a t rue variation of the scheme. We bear in mind the submission made by counsel for APRA that in the end it was a question of our deciding, not what we ourselves would have awarded, but whether the APRA licence scheme was reasonable. We are prepared to confirm it, but we wou1d regard it as unreasonable unless it were varied in accordance with the decision which we have indicated we propose to make.
Two matters remain to be mentioned. The first of these concerns the fact that the licence scheme does not confer on the ABC a licence to perform works in the APRA repertoire at ABC concerts. The history of the negotiations and dealings which we have earlier recounted discloses that such a licence has always been conferred by APRA until the present proposal. In 1955 a specific sum was assigned to cover this matter. Counsel for the ABC has submitted that we should vary the licence scheme so as to provide that the formerly existing position should be retained. Having given the matter due consideration, we have decided that we should accede to this submission with the consequence that the licence scheme will be varied to include a provision that the ABC be licensed to perform works in the APRA repertoire at its concerts. No additional sum will be payable.
The remaining matter concerns a submission that the new licence fee, which will apply from 20 February 1981, should be phased in. In other words, in the submission of counsel for the ABC, we should not leave the situation as one in which the new formula will, apply to the calculation of the licence fee payable by the ABC to APRA for years prior to that ending 30 June 1986. What should be done, in his submission, is that we should fix amounts, in each case an amount less than that which would be derived by the application of the new formula, so that the impact of our decision upon the ABC is not as great as would otherwise be the case. We have decided not to accede to this application. The ABC has had notice of the proposed licence scheme since 1981.
The provisions of the Act are such that it applies in terms from 20 February 1981 subject to such variations as we consider should be made. Since 1981 there has been substantial inflation in the community. Furthermore, there is no provision which would enable there to be any award of interest on moneys which, in the view of the matter which we take, should have been paid in past years.
Notwithstanding these conclusions, we would be prepared to give consideration to varying the licence scheme by providing that moneys due to APRA by the ABC in respect of the licence fee payable for the years ending 30 June 1981 to 1985 inclusive not become wholly payable until 1 July 1986. We are prepared to consider this course because of evidence which suggests that current estimates may not enable the total payment to be made from funds available in the current financial year without there being some adverse effect on other aspects of the ABC’s operations. Although the licence scheme makes some provisions in relation to payment of increases in the licence fee for past years, there is a question in our minds as to our power to vary the scheme to postpone payment in the way that we think may be desirable. It is a matter on which we would need to hear counsel. We should add that we would be unlikely, in any event, to make any such variation unless there were evidence which demonstrated the need for it.
It is perhaps unnecessary to mention that the ascertainment of what is due for past years will involve not only the giving of credit for what has been paid, but also the removal from past operating expenditure for each year of the amount already paid to APRA before the appropriate percentage is applied.
Summary
In summary then we have decided that the licence scheme should be confirmed but subject to the following variations:
The percentage provided for in sub-paragraph 1(a) of the Schedule will be 1.25 per cent rather than 2 per cent.
The words from and including the word “less” down to the end of the sub-paragraph will be omitted.
The percentage provided for in sub-paragraph 1(b) of the Schedule will be 0.6 per cent rather than 1.5 per cent.
The words from and including the word “less” down to the end of the sub-paragraph will be omitted.
The licence scheme will be amended to make it clear that the operating costs of the ABC upon which the percentages are to be levied do not include the cost of providing and maintaining orchestras, conducting concerts or of running the ABC Shops.
The licence scheme will be amended so as to provide that for the fee which is payable the ABC is to have a licence to use in its concerts all works in the APRA repertoire.
We do not propose to make formal orders at this stage. We propose to stand the matter over for a short time to enable counsel and the parties to consider what we have said. When the matter is again in the list counsel for APRA are to bring in short minutes of order to give effect to our decision. We shall then also consider any application that either party may make in relation to costs.
I certify that this and the 86 preceding pages are a true copy of the reasons for decision herein of the Copyright Tribunal.
[Note: This is a copy and page numbering differs from original]
Associate to President
Dated 6 December 1985
ATTACHMENT A see page 6
AUSTRALASIAN PERFORMING RIGHT ASSOCIATION LIMITED
LICENCE SCHEME FOR AUSTRALIAN BROADCASTING COMMISSION
AUSTRALASIAN PERFORMING RIGHT ASSOCIATION LIMITED is willing to grant a licence to The AUSTRALIAN BROADCASTING COMMISSION in the form of the Licence hereinafter set forth, subject to the payment of the charges specified therein, and subject to the terms and conditions contained. therein.
DATED THE 16th day of February 1981
For and on behalf of
Australasian Performing Right
Association Limited
Signed JL Sturman
……………………………………
J.L Sturman
Managing Director
LICENCE
In this Licence
"the Association" means Australasian Performing Right Association Limited;
"the Commission" means Australian Broadcasting Commission;
"broadcast" means a wireless sound transmission, whether made in conjunction with a wireless image transmission or not;
"date upon which this licence comes into operation" means the date upon which the Licence Scheme. of which this Licence forms part comes into operation by virtue of Part VI of the Copyright Act, 1968;
"dramatico‑musical work" means an opera, operetta, musical play, revue or pantomime, insofar as it consists of words and music written expressly therefor, but does not include any such work where a broadcast is given by means of a cinematograph film which has been made primarily for exhibition in motion picture theatres;
"licence year" means the period of twelve months commencing first July of the year to which reference is made;
"licensed territory" means the Commonwealth of Australia;
"works in the Association’s repertoires" means all and any musical works (including such words or lyrics as are normally associated therewith) the right to broadcast in which is from time to time during the term of this licence vested in or controlled by the Association for the licensed territory.
As from the date upon which this Licence comes into operation and until the due termination or expiry of this Licence and subject to the conditions and limitations hereinafter contained the Association grants to the Commission A LICENCE to broadcast works in the Association’s repertoire from national broadcasting stations (including those carrying Radio Australia programmes), national television stations and such television repeater stations, national broadcasting translator stations and national television translator stations which distribute the Commission’s programmes when distributing any of the Commission’s programmes.
In consideration of the Licence herein granted the Commission shall make payments to the Association in accordance with the provisions set out in the Schedule hereto.
The Licence herein granted shall extend to and authorise any, public musical entertainment given by or under the authority of the Commission either in its studios or in other premises provided that the whole or any part of the entertainment is broadcast as part of the Commission’s programmes, and the audience (if any) is admitted to the entertainment without payment.
This Licence is strictly limited to the acts hereby expressly licensed and does not extend to or include any other incidental or implied rights or powers.
This Licence shall not extend to or authorize:
(a)The broadcasting in their entirety in any manner whatever of dramatico‑musical works.
(b)The broadcasting of excerpts from any dramatico-musical works if broadcast with dramatic action and/or stage costume and/or scenic accessories.
(c)The broadcasting of vocal performances with instrumental accompaniment only (ie without dramatic action, stage costume or scenic. accessories) of excerpts from any dramatico‑musical works as aforesaid, if the Association shall have notified the Commission in writing that such excerpts are prohibited from broadcasting by such means. Excerpts other than the one thus excluded may be so broadcast by the Commission subject to the general limitation that the Commission may not broadcast without written permission more than two excerpts from such work in any one programme. The Association shall not prohibit any such excerpts from broadcasting under this provision unless such excerpts have also been prohibited from broadcasting generally by commercial radio and television stations in Australia .
(d)The broadcasting by purely instrumental means (ie without dramatic action, stage costume or scenic accessories) of excerpts from any dramatico‑ musical work as aforesaid, if the Association shall have notified the Commission in writing that such excerpts are prohibited from broadcasting by such means. Until such notifications (if any), such excerpts may be so broadcast by the Commission without limitation. The Association shall not prohibit any such excerpts from broadcasting under this provision unless such excerpts have also been prohibited from broadcasting generally by commercial radio and television stations in Australia.
(e)The broadcasting of oratorios or major choral works (that is choral works exceeding twenty minutes’ duration) in their entirety or excerpts therefrom if the duration of any such excerpts exceeds twenty minutes.
(f)The broadcasting of the whole or any part of the music written for a ballet if accompanied by a visual representation of the ballet. For the purpose of this clause, "ballet" means a choreographic work to be accompanied by music, having a story, plot or abstract idea, devised or used for the purpose of interpretation by dancing and/or miming, but does not include country or folk dancing, nor tap dancing, nor precision dance sequences.
(g)The vocal performance of songs in broadcasts of a theatre or music hall programme in respect of which songs the Association has notified the Commission that the television rights have been reserved to a particular artist except where performed by such particular artist or by other persons with the approval of the person controlling the said rights.
(h)The broadcasting (unless authorized in writing by the Association or the copyright owner) of any music accompanied by any words other than those (if any) published or otherwise associated therewith by the publisher for Australia; or of any musical work in any adapted or rearranged form, or in such manner as to burlesque or parody the work.
The Association will give the Commission, on request, all such information as the Association reasonably can give respecting works claimed or represented as being works for the time being in the Association's repertoire.
Without prejudice to clause 6 hereof the Association reserves the right to withhold permission to broadcast or to restrict and exclude from the operation of this Licence the broadcasting of any work or works for the time being in the Association’s repertoire provided no commercial records thereof has been issued for retail sale to the public in Australia and provided further that the total number of such works which may be withheld at any one time shall not exceed three hundred. The Association agrees to give notice in writing to the Commission of any works permission to broadcast which is withheld or restricted as above provided and undertakes at all times to use its best endeavours to make the range of works that may be broadcast as wide as possible.
Where a restriction notice has been given by the Association pursuant to clause 8 hereof in respect of a work which has previously been broadcast by the Commission under this licence then the restriction notice shall not be effective for a period of thirty (30) days after the giving thereof provided the Commission upon receipt of the said notice first furnished evidence that the work has been specifically included in a programme arranged before receipt of the notice for broadcasting within that said period of thirty (30) days.
(1) The Commission shall send to the Association at its registered office a return in such form as may be reasonably required by the Association of all musical works performed in public or broadcast from time to time in whole or in part by it and such return shall show in respect of each musical item:
(a)The title thereof;
(b)The name or names of the composer, author, arranger and publisher thereof and if a commercial gramophone record or a film is used the name of the manufacturer and identification number of the record or the title of the film and the name of the producing company thereof;
(c)The number of minutes and seconds occupied in performing or broadcasting the time, and
(d)In the case of broadcast by means of a sound film, whether the performance is featured or background.
Provided that in respect of any programme recorded overseas or by a television station operator within Australia other than the Commission the foregoing obligations shall be deemed to have been complied with if the Commission sends to the Association at its registered office a return setting out:
(e)The title of the programme;
(f)The episode number of such programme (if any);
(g)The name of the producer where available;
(h)The music cue sheet relating to the programme;
(2)The Commission shall take all reasonable care to ensure the correctness of all the information required by sub‑clause 1 of this clause but having taken all such reasonable care the Commission shall not be responsible for or in any way liable in respect of errors or omissions.
(3)The said return. shall be sent to the Association with all reasonable despatch if practicable within one week, but in no case later than four weeks from the date of broadcasting .
(4)The Commission shall give to the Association such further information as to its programmes or any such musical works as aforesaid as the Association may from time to time reasonably require and may be available in the records for the time being normally kept by the Commission for its own purposes.
(5)The Commission shall in all published programmes and in the said returns adhere to the titles of such musical works as aforesaid and the names of composers, authors, arrangers and publishers thereof as appearing on the works themselves or records or films thereof and no substituted titles shall be used in the said programmes or returns.
Subject to the due observance by the Commission of conditions terms and restrictions contained in this Licence the Association agrees to indemnify the Commission its servants and agents from all actions and suits of whatsoever nature that may be brought against it or any of them in respect of broadcasts by the Commission of music in the Association's repertoire or represented by the Association to the Commission as such and the Association further agrees to indemnify the Commission its servants and agents in respect of all legal costs incurred by it or them in defending any such actions or suits which may be brought against it or them as aforesaid PROVIDED THAT the Commission shall promptly notify the Association of any such actions or suit and shall permit the Association to conduct the defence thereto in the name of the Commission.
Irrespective of the date upon which this Licence comes into operation it shall be deemed to have commenced as from20 February 1981~and subject to the terms and conditions hereof and subject also to any order made by the Copyright Tribunal shall remain in force until terminated by the giving of not less than three months notice in writing from either party to the other to expire on the 30th June in any year.
SCHEDULE
In respect of the licence granted to the Commission the Commission shall pay to the Association in respect of each licence year covered by this agreement the. following fees:
(a)2% of
(i)the Commission’s gross operational expenditure incurred in the provision of radio broadcasting services (including the Domestic Service and the Overseas Service)
less
(ii)total direct expenditure incurred by the Commission in the broadcasting of proceedings of the Parliament of the Commonwealth; and
(b)1.5% of
(i) the Commission's gross operational expenditure incurred in the provision of television broadcasting services.
less
(ii)total direct expenditure of the Commission on the purchase, hiring or production of television programmes provided that the total amount so deducted shall be no more than 40% of the Commission’s gross expenditure under sub‑paragraph (i) of this paragraph during the relevant licence year.
For the purpose of determining the fees payable under clause 1 of this schedule, the Commission’s gross operational expenditure incurred in the provision of radio and television broadcasting services shall be taken to mean and include all of those items of expenditure set out in the Annual Statement of Receipts and Payments of the Commission under the heading "payments ‑ Operational", for the licence year under determination.
A proper statement of the expenditure claimed to be deductable from gross operational expenditure pursuant to sub‑clause 1(a)ii verified by a responsible officer of the Commission shall be supplied to the Association before the Commission shall be entitled to have any such deduction taken into account in calculating licence fees.
Payment of the Licence fees under this Licence shall be made as follows:
(a)In respect of the period commencing on the date upon which this Licence comes into operation and ending on 30th June, 1985 ("the said period"), the Commission shall pay the Association on or before the 31st December, 1985 the difference between (i) the amount produced by the application of the formula set out in clause 1 of this Schedule to the said period, and (ii) the amount already paid by the Commission to the Association as Licence fees in respect of the said period.
(b)In respect of the licence year commencing 1st July, 1985, the Commission shall:
(i)make a provisional payment on or before the last day of each of the twelve months in the said licence year of $250,000; and
(ii)pay the balance (if any) of the actual fees due for the said licence year, ascertained in accordance with clause 1 of this Schedule, on or before 31st December, 1986.
(c)In respect of the licence year commencing 1st July, 1986, the Commission shall:
(i)make a provisional payment on or before the last day of each of the twelve months in the said licence year of $260,000; and
(ii)pay the balance (if any) of the actual fees due for the said licence year, ascertained in. accordance with clause 1 of this Schedule, on or before 31st December, 1987.
(d)In respect of the licence year commencing 1st July, 1987, and each succeeding year, the Commission shall:
(i)make a provisional payment on or before the last day of each of the twelve months in licence year under determination of an amount equal to one‑twelfth of. the total fees paid for the whole of the licence year ended twelve months prior to the commencement date of the licence year under determination; and
(ii)pay the balance (if any) of the actual fees due for the said licence year, ascertained in accordance with clause 1 of this Schedule, within six months after the expiration of the licence year under determination.
If, in respect of any licence year during the currency of this agreement, the total of provisional licence fees paid in respect of such licence year exceeds the total of licence fees finally payable in respect of such year, the Association shall make an appropriate refund of the excess fees to the Commission.
ATTACHMENT B – See page 61
Statement, of Receipts and Payments for the
year ended 30 June 1984
General Activities
RECEIPTS
Notes 1983‑84 1982‑83
$ $ $ $
Funds on hand 1 July (2) 220 61
Net Parliamentary Appropriations
Operational 274 356 000 246 406 000
Capital 18 061 000 14 380 000
292 417 000 260 786 000
Other Receipts
Merchandising (including
Publications) 5 950 778 4 804 528
Public Concerts 5010 465 5 247 983
Subsidies for Symphony
Orchestras 1 366 597 1 281 708
Sale of Programs 1 341 112 1 090 210
Sate of Land and Buildings 91 915 ‑
Miscellaneous 385 719 400 333
14 146 586 12 824 762
TOTAL RECEIPTS $306 563 806 $273 610 823
PAYMENTS ‑ OPERATIONAL
Notes 1983‑84 1982‑83
$ $ $ $
Radio ‑ Domestic Service
Salaries
General Program Service 36 979 383 26 705 539
News Service 9 091 898 8 484 718
Engineering 8 314 985 14 934 011
$54 386 266 $50 124 268
Expenses
Production of Programs
General Program Service 13 605 781 10 178 254
News Service 2 941 933 2 491 354
Engineering 2 713 446 3 450 444
$19 261 160 $16 120 052
Purchase of Programs 250 347 325 696
Broadcasting Rights 800 878 1 074 112
Transmission Channels 3 223 762 2 885 245
$23 536 147 $20 405 105
Total Radio – Domestic Service $77 922 413 $70 529 373
Statement, of Receipts and Payments for the
year ended 30 June 1984
General Activities
PAYMENTS – OPERATIONAL(continued)
Notes 1983‑84 1982‑83
$ $ $ $
Television
Salaries
General Program Service 44 769 199 24 211 184
News Service 6 078 469 5 733 849
Engineering 18 227 585 32 195 800
Production Services 11 727 536 11 404 499
Film Services 12 008 913 11 915 225
$92 811 702 $85 460 557
Expenses
Production of Programs
General Program Service 22 178 990 15 654 023
News Service 4 414 342 4 021 314
Engineering 6 884 954 8 180 750
Production Services 2 484 411 2 205 651
Film Services 3 011 955 2 781 091
$38 974 652 $32 842 829
Purchase of Programs 14 163 861 11 827 208
Broadcasting Rights 2 925 511 3 455 710
Transmission Channels 15 613 656 13 288 115
$71667 680 $61 413 862
Total Television $164 489 382 $146 874 419
Other Activities
Orchestras and Concerts
Salaries
Musicians 13 309 639 12 953 587
Other 2 452 840 2 332 083
$15 762 479 $15 285 670
Expenses 6 732 212 6 659 976
Total orchestras and
Concerts $22 494 691 $21 945 646
Merchandising (including
Publications)
Salaries 1 328 455 878 812
Expenses 4 459 750 3 728 437
Total Merchandising $5 788 205 $4 607 249
Total Other Activities $28 282 896 $26 552 895
Administration (7)
Salaries 13 386 415 12 116 784
Expenses 4 418 717 3 157 106
Total Administration $17 805 132 $15 273 890
TOTAL OPERATIONAL EXPEND. $288 499 823 $259 230 577
General Activities (continued)
PAYMENTS – CAPITAL
Notes 1983‑84 1982‑83
$ $ $ $
Plant and Equipment
Engineering 9 943 076 9 149 742
Production Services 222 104 224 302
Film Services 1 124 823 1 217 684
General Equipment 2 596 150 1 839 176
Total Plant and Equipment $13 886 153 $12 430 904
Construction of buildings $1 730 219 $1 479 139
Acquisition of sites and buildings $1 916 529 $469 983
TOTAL CAPITAL EXPENDITURE $17 532 901 $14 380 026
TOTAL PAYMENTS $306 032 724 $273 610 603
Funds on hand 30 June (2) 531 082 220
$305 563 806 $273 610 823
The accompanying notes to the accounts are an integral part of and are to be read in conjunction with the Statement of Receipts and Payments
Radio – Overseas Service (Radio Australia)
RECEIPTS
Notes 1983‑84 1982‑83
$ $ $ $
Funds on hand 1 July (2) 58
Net Parliamentary Appropriations
Operational 8 715 000 8 317 000
Capital 2000 000 $8 915 000 940 000 $9 257 000
TOTAL RECEIPTS $8 915 058 $9 316 986
PAYMENTS – OPERATIONAL
Salaries
General Program Service 4 938 549 4 213 074
News Service 1 647 699 1 497 639
Engineering 273 885 805 891
$6 860 133 $6 516 604
Expenses
Production of Programs
General program Service 1 300 242 1 135 214
News Service 357 795 347 166
Engineering 463 357 160 066
$1 721 394 $1 642 446
Transmission Channels 118 460 157 936 $1 839 854 $1 800 382
TOTAL OPERATIONAL EXPEND. $8 699 987 $8 316 986
PAYMENTS – CAPITAL
Plant and Equipment 180 338 804 898
Construction of buildings - 135 058
TOTAL CAPITAL EXPENDITURE $180 338 $939 956
TOTAL PAYMENTS $8 880 325 $9 256 942
Funds on hand 30 June (2) 34 73358
$8 915 058 $9 257 000
The accompanying notes to the accounts are an integral part of and are to be read in conjunction with the Statement of Receipts and Payments
ATTACHMENT C - see page 61
COMPARISON OF PAYMENTS MADE TO APRA BY (a) ABC (b) COMMERCIAL RADIO STATIONS (C) COMMERCIAL TELEVISION STATIONS 1954 – 1984
Year ABC Australian Australian
Commercial Radio Commercial Television
1953‑ 1954 $ 95,891 $ 106,202 $
1954‑1955 97,744 110,988
1955‑ 1956 98,461 113,390
1956‑ 1957 102,682 115,415 15,194
1957‑ 1958 104,947 119,593 28,000
1958‑ 1959 114,174 123,701 36,000
1959‑ 1960 124,228 128,002 48,298
1960‑ 1961 150,000 159,448 52,000
1961‑1962 162,000 199,340 52,020
1962‑1963 174,000 212,304 52,002
1963‑1964 186,000 219,888 245,080
636,110
(including retrospective judgement)
1964‑1965 192,982 260,324 413,002
1965‑1966 210,442 324,362 570,806
1966‑1967 223,317 360,325 449,145
1967‑1968 240,450 415,152 509,230
1968‑1969 240,423 470,920 667,092
1969‑1970 246,844 549,453 618,798
1970‑1971 258,392 684,006 658,945
1971‑1972 266,853 704,712 745,689
1972‑1973 263,681 760,133 896,733
1973‑1974 287,812 846,549 1,031,099
1974‑1975 521,697 919,713 1,210,155
1975‑1976 513,451 1,029,560 1,375,273
1976‑1977 597,312 1,194,696 2,334,508
1977‑1978 656,241 1,431,522 2,986,251
1978‑1979 718,591 2,759,836 3,212,456
1979‑1980 802,798 2,102,373 3,893,237
1980‑1981 894,205 2,468,157 4,330,447
1981–1982 1,012,445 2,711,235 5,394,112
1982‑1983 1,149,496 3,038,056 6,813,301
1983‑1984 1,252,021 3,499,242 7,005,338
ATTACHMENT D - See Page 62
ABC PAYMENT TO APRA ABC PAYMENT TO APRA AS A PERCENTAGE OF EXPENDITURE TOTAL OPERATIONAL EXPENDITURE ABC RADIO & TV & RADIO/AUST TOTAL OPERATIONAL EXPENDITURE ABC TOTAL OPERATIONAL EXPENDITURE RADIO AUST 1960 – 61 150,000 0.887% 16,916,728 ₤8,458.364 1961 – 62 162,000 0.861% 18,817,048 ₤9,408,524 1962 – 63 174,000 0.844% 20,626,170 ₤10,313,085 1963 – 64 186,000 0.749% 24,822.952 ₤12,411.476 1964 ‑ 65 192,982 0.616% 31,320,853 $30,572,832 $748,02 1965 – 66 210,412 0.607% 34,651,878 $33,877,379 $774,49 1966 – 67 223,317 0.574% 38,893,618 $37,953,151 $940,46 1967 – 68 240,450 0.576% 41,709,843 $40,684,028 $1,025,81 1968 – 69 240,423 0.523% 45,999.674 $44,804,608 $1,195,06 1969 – 70 246,844 0.484% 51,006,790 $49,734,178 $1,272,61 1970 – 71 258,392 0.452% 57,167,902 $55,663,089 $1,504,81 1971 – 72 266,853 0.417% 63,992.813 $62,241,023 $1,751,79 1972 – 73 263,681 0.374% 70,548,630 $68,560,549 $1,988.08 1973 – 74 287,812 0.324% 88,856,603 $86,195,100 $2,661,50 1974 – 75 446,697 0.388% 115,264,261 $111,744,433 $3,519,828 1975 –76 513,451 - - - TOTAL OPERATIONAL EXPENDITURE OF DOMESTIC RADIO TOTAL OPERATIONAL EXPENDITURE OF TELEVISION 1976 – 77 597,312 0.537% 111,131,000 $36,462,000 $70,164,000 $4,505,000 1977 – 78 656,241 0.559% 117,338,000 $38,249,000 $74,344,000 $4,745,000 1978 – 79 718,591 0.601% 119,512,000 $39,633,000 $78,691,000 $5,188,000 1979 – 80 802,798 0.598% 134,199,000 $42,404,000 $86,045,000 $5,750,000 1980 – 81 894,205 0.585% 152,805,000 $47,923,000 $98,648,000 $6,234,000 1981 – 82 1,012,445 0.514% 196,913,000 $61,624,000 $127,208,000 $8,081,000 1982 – 83 1,149,496 0.509% 225,719,086 $70,529,000 $146,874,000 $8,316,986 1983 – 84 1,252,021 0.499% 251,110,987 $77,922,000 $164,489,000 $8,699,987
0
2
0