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2019-2020
THE PARLIAMENT OF THE COMMONWEALTH OF AUSTRALIA
HOUSE OF REPRESENTATIVES
TREASURY LAWS AMENDMENT (NEWS MEDIA AND DIGITAL PLATFORMS
MANDATORY BARGAINING CODE) BILL 2020
EXPLANATORY MEMORANDUM
(Circulated by authority of the
Treasurer, the Hon Josh Frydenberg MP)
Table of contents
Glossary................................................................................................. 5
General outline and financial impact ...................................................... 7
Chapter 1 News Media and Digital Platforms Mandatory
Bargaining Code .......................................................... 9
Chapter 2 Digital Platforms Inquiry: Supplementary
Analysis on options for a Mandatory Code ................ 53
Chapter 3 Statement of Compatibility with Human Rights .......... 59
Glossary
The following abbreviations and acronyms are used throughout this
explanatory memorandum.
Abbreviation Definition
ACCC Australian Competition and Consumer
Commission
ACMA Australian Communications and Media
Authority
Bill Treasury Laws Amendment (News Media
and Digital Platforms Mandatory Bargaining
Code) Bill 2020
CCA Competition and Consumer Act 2010
Code News Media and Digital Platforms
Mandatory Bargaining Code
Digital Platforms Inquiry Final Digital Platforms Inquiry Final Report
Report published on 26 July 2019
5
General outline and financial impact
News Media and Digital Platforms Mandatory Bargaining Code
This Bill establishes a mandatory code of conduct to help support the
sustainability of the Australian news media sector by addressing
bargaining power imbalances between digital platforms and Australian
news businesses.
Date of effect: The day after this Bill receives the Royal Assent
Proposal announced: This Bill partially implements the Government's
response to the Digital Platforms Inquiry Final Report.
Financial impact: Nil.
Human rights implications: This Bill is compatible with human rights.
See Statement of Compatibility with Human Rights -- Chapter 3.
Compliance cost impact: This measure will result in a medium increase
in compliance costs. It is expected that the measure will increase costs for
businesses by $10.5 million to $13.0 million per year.
Summary of regulation impact statement
Regulation impact on business
Impact: News media businesses and digital platforms will be incentivised
to reach agreements for remuneration for news content on digital platform
services. There will be a medium increase in compliance costs associated
with this measure, largely affecting digital platforms.
Main points:
• The ACCC found in its Digital Platform Inquiry (July 2019)
that there is a bargaining power imbalance between digital
platforms and news media businesses so that news media
businesses are not able to negotiate for a share of the revenue
generated by the digital platforms and to which the news
content created by the news media businesses contributes.
Government intervention is necessary because of the public
benefit provided by the production and dissemination of
news, and the importance of a strong independent media in a
well-functioning democracy.
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• The Digital Platforms Inquiry has been certified as an
independent review which involved a process and analysis
equivalent to a Regulation Impact Statement.
• The Inquiry report can be accessed at this address:
https://www.accc.gov.au/publications/digital-platforms-
inquiry-final-report
• The scope of the certified review covers the scope of the
policy proposal with the exception that it does not
recommend a mandatory code with arbitration on
remuneration as an immediate measure. Rather, the ACCC
recommended a code requiring designated digital platforms
to develop codes including a commitment to fair negotiation
about remuneration.
• In its December 2020 response to the ACCC Digital
Platforms Inquiry Final Report, the Government asked the
ACCC to work with the digital platforms and news media
businesses to develop voluntary codes, and to provide a
progress report by May 2020.
• The Government then requested an update on progress
towards a voluntary code from the ACCC ahead of May
2020. The ACCC noted that, whilst discussions between the
parties had been taking place, progress on a voluntary code
had been limited. The ACCC considered it unlikely that any
voluntary agreement would be reached with respect to the
key issue of remuneration for content.
• Following this report from the ACCC, on 20 April 2020 the
Government committed to developing a mandatory code of
conduct to address bargaining power imbalances between
Australian news media businesses and digital platforms,
specifically Google and Facebook.
• To address the gap in the analysis between the ACCC's
inquiry and the Government's consideration of options for a
mandatory code, supplementary analysis on the costs,
benefits and risks associated with a mandatory code was
prepared, consistent with the Australian Government Guide
to Regulatory Impact Analysis.
• The supplementary Regulation Impact Statement is at
Chapter 2.
8
Chapter 1
News Media and Digital Platforms
Mandatory Bargaining Code
Outline of chapter
1.1 This Bill establishes a mandatory code of conduct to help
support the sustainability of the Australian news media sector by
addressing bargaining power imbalances between digital platforms and
Australian news businesses.
Context of amendments
1.2 In December 2017, the Government directed the ACCC to
inquire into the impact of digital platform services on the state of
competition in the media and advertising services markets.
1.3 The ACCC's Digital Platforms Inquiry Final Report was
released in July 2019. Among the key findings was that the major
platforms are unavoidable trading partners for Australian news businesses,
and therefore possess substantial bargaining power over these businesses.
1.4 The Government Response to the Digital Platforms Inquiry
Final Report, released on 12 December 2019, directed the ACCC to work
with major platforms and Australian news businesses to develop and
implement a voluntary code of conduct to address bargaining power
imbalances between digital platforms and media businesses.
1.5 The ACCC was to provide a progress report to the Government
in May 2020, with the code to be finalised no later than November 2020.
If an agreement was not forthcoming, the Government would develop
alternative options, which could include a mandatory code (joint media
release by the Prime Minister, Treasurer, Attorney-General and Minister
for Communications, Cyber Safety and the Arts, dated
12 December 2019).
1.6 The Government requested an update on progress towards a
voluntary code from the ACCC ahead of May 2020. This update noted
that while discussions between the parties had been taking place, progress
on a voluntary code had been limited. The ACCC considered it unlikely
that any voluntary agreement would be reached with respect to the key
issue of remuneration for content.
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1.7 On 20 April 2020, the Government directed the ACCC to
develop a mandatory code of conduct. This reflected:
• that the Australian media sector was already under significant
pressure, which was being exacerbated by a sharp decline in
advertising revenue driven by the Coronavirus; and
• the advice of the ACCC that digital platforms and news
businesses were unlikely to reach voluntary agreement on the
key issue of revenue-sharing (joint media release by the
Treasurer and the Minister for Communications, Cyber
Safety and the Arts, dated 20 April 2020).
Summary of new law
1.8 The Bill establishes a mandatory code of conduct to address
bargaining power imbalances between digital platform services and
Australian news businesses.
1.9 It does this by setting out six main elements:
• bargaining - which require the responsible digital platform
corporations and registered news business corporations that
have indicated an intention to bargain, to do so in good faith;
• compulsory arbitration - where parties cannot come to a
negotiated agreement about remuneration relating to the
making available of covered news content on designated
digital platform services, an arbitral panel will select between
two final offers made by the bargaining parties;
• general requirements - which, among other things, require
responsible digital platform corporations to provide
registered news business corporations with advance
notification of planned changes to an algorithm or internal
practice that will have a significant effect on covered news
content;
• non-differentiation requirements - responsible digital
platform corporations must not differentiate between the
news businesses participating in the Code, or between
participants and non-participants, because of matters that
arise in relation to their participation or non-participation in
the Code;
• contracting out - the Bill recognises that a digital platform
corporation may reach a commercial bargain with a news
business outside the Code about remuneration or other
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News Media and Digital Platforms Mandatory Bargaining Code
matters. It provides that parties who notify the ACCC of such
agreements would not need to comply with the general
requirements, bargaining and compulsory arbitration rules (as
set out in the agreement); and
• standard offers - digital platform corporations may make
standard offers to news businesses, which are intended to
reduce the time and cost associated with negotiations,
particularly for smaller news businesses. If the parties notify
the ACCC of an agreed standard offer, those parties do not
need to comply with bargaining and compulsory arbitration
(as set out in the agreement);
1.10 The Bill provides that the Minister may designate a digital
platform corporation and digital services that must comply with the Code.
The Minister may only designate a digital platform corporation and
services if the Minister has considered whether there is a significant
bargaining power imbalance between Australian news businesses and the
digital platform corporation's corporate group. In forming a view, the
Minister may consider ACCC reports or advice.
1.11 A responsible digital platform corporation for a digital platform
service is required to participate in the Code if the Minister has made a
determination that a service is a designated digital platform service of the
corporation.
1.12 The responsible digital platform corporation will be either:
• A related body corporate (of the corporation identified in the
Ministerial determination) that is incorporated or managed in
Australia and operates or controls the designated digital
platform service; or
• if that subsidiary does not operate or control the digital
platform service by itself or with one or more other entities -
the designated digital platform corporation.
1.13 For a news business corporation to participate, it must be
registered by the ACMA. The ACMA must register a news business (and
the applicant corporation as the registered news business corporation) if
the applicant had an annual revenue above $150,000 in the most recent
year or in three of the five most recent years, and the news sources
comprising the news business:
• have the primary purpose of creating and publishing core
news content;
• are subject to relevant professional journalistic standards; and
• operate predominantly in Australia for the dominant purpose
of serving Australian audiences.
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1.14 Once a news business corporation is registered by the ACMA,
each responsible digital platform corporation that operates or controls a
designated digital platform service must comply with the general
requirements with respect to each registered news business. However, this
is subject to any agreement outside the Code which contracts out of the
general requirements.
1.15 Once a news business corporation is registered by the ACMA, it
may give notice of an intention to bargain under the Code with a
responsible digital platform corporation that operates or controls a
designated digital platform service in relation to its covered news content.
1.16 One or more registered news business corporations may form a
group for the purpose of bargaining collectively with a responsible digital
platform corporation under the Code. The collective may nominate one of
the group members or a third party to represent the group during the
bargaining process.
1.17 The Bill specifically authorises collective bargaining so that it
does not contravene the restrictive trade practices provisions in the CCA.
Nothing in the Bill is intended to prevent news business corporations from
engaging in discussions with one another about forming a collective. This
is because forming a collective is authorised under the Bill.
1.18 If a registered news business corporation or collective has
indicated an intention to bargain, a responsible digital platform
corporation and a registered news business corporation must negotiate in
good faith. Breaches of this requirement are subject to a civil penalty.
1.19 If an agreement is not reached between the parties within three
months of the registered news business corporation indicating an intention
to bargain, the matter will be subject to compulsory arbitration if the news
business elects to begin arbitration.
1.20 If a responsible digital platform corporation and a registered
news business corporation are subject to compulsory arbitration, an
arbitral panel chosen by the bargaining parties (or by the ACMA if the
parties fail to agree on panel members) will select between the final offers
made by the parties.
1.21 Both parties must submit a final offer to the arbitral panel stating
a remuneration amount. This amount is the amount of remuneration to be
paid by the responsible digital platform corporation to the registered news
business corporation in relation to making its covered news content
available on a designated digital platform service.
1.22 The arbitral panel must accept one of those offers, unless it
considers that the final offers are not in the public interest, in which case
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News Media and Digital Platforms Mandatory Bargaining Code
the arbitral panel may amend the more reasonable of the two offers. This
is expected to happen in very limited circumstances.
1.23 The Bill provides that a review of the Code will begin within
one year of the commencement of the new law.
1.24 All legislative references in this Chapter are to the CCA, unless
otherwise specified.
Comparison of key features of new law and current law
New law Current law
A responsible digital platform No equivalent.
corporation cane make deals outside
the Code about designated digital
platform services or other services.
A responsible digital platform No equivalent.
corporation can make a standard
offer to news business corporations.
Responsible digital platform No equivalent.
corporations must comply with
general requirements which require
them to provide registered news
businesses with advance notification
of planned changes to an algorithm
or internal practice that will
significantly affect covered news,
provide information about the
collection and availability of user
data, develop a proposal to recognise
original news and give advance
notification of changes affecting the
distribution of advertising.
Responsible digital platform No equivalent.
corporations must not differentiate
between the news businesses
participating in the Code, or between
participants and non-participants,
because of matters that arise in
relation to their participation or non-
participation in the Code.
Responsible digital platform No equivalent.
corporations and registered news
business corporations are required to
negotiate in good faith, once a
registered news business corporation
or collective indicates an intention to
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New law Current law
bargain.
If a responsible digital platform No equivalent.
corporation and a registered news
business corporation cannot reach an
agreement within three months, then
the parties may proceed to arbitration
about remuneration.
If a responsible digital platform No equivalent.
corporation and a registered news
business corporation proceed to
arbitration, the parties must each
make a final offer about
remuneration and the arbitral panel
will decide which of these final
offers to select.
The binding arbitration will only
relate to remuneration to be paid by
the responsible digital platform
corporation to the registered news
business corporation in relation to
making its covered news content
available on a designated digital
platform service.
Detailed explanation of new law
1.25 This Bill establishes a mandatory code of conduct to help
support the sustainability of the Australian news sector by addressing
bargaining power imbalances between digital platforms and Australian
news businesses.
Deals outside the Code - contracting out
1.26 Nothing in the Bill prevents a responsible digital platform
corporation from reaching a commercial agreement outside the Code with
a news business corporation about the matters subject to the Code.
[Schedule 1, item 1, sections 52ZZI and section 52ZZJ]
1.27 The Bill provides a pathway for a commercial agreement to be
reached outside the Code between a responsible digital platform
corporation and a news business corporation about the matters regulated
by the Code. The Bill allows agreements to disapply the general
requirements, bargaining and arbitration for the parties making the
agreement with respect to their obligations to each other. [Schedule 1, item 1,
sections 52ZZI and 52ZZJ]
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News Media and Digital Platforms Mandatory Bargaining Code
1.28 However, an agreement to disapply parts of the Code must be
reached before a determination has been made under the arbitration
process or before an information request is complied with under the Code.
[Schedule 1, item 1, section 52ZZL(3)]
1.29 An agreement outside the Code may also relate to one or more
non-designated digital platform services, including remuneration for such
services. Such an agreement may contain clauses that prevent the news
business from utilising the Code for one or more designated digital
platform services of that responsible digital platform corporation. [Schedule
1, item 1, sections 55ZZJ(4)(d) and 52ZZL(1)(f)]
1.30 Nothing in the Bill restricts the terms on which an agreement
outside the Code can be made with news business corporations in general.
[Schedule 1, item 1, section 52ZZM]
Standard offers
1.31 A responsible digital platform corporation may make a standard
offer to a corporation that operates or controls a news business, by itself or
together with other corporations. A news business corporation must be
registered under the new Part IVBA to accept a standard offer. [Schedule 1,
item 1, section 52ZZJ]
1.32 Regulations may be made that restrict standard offers to a class
of registered news business corporations. If no regulations are made, the
responsible digital platform corporation must make the standard offer to
every registered news business for the offer to be recognised by the Code.
[Schedule 1, item 1, section 52ZZJ(2)]
1.33 A standard offer may be made that relates to one or more
designated digital platform services of the responsible digital platform
corporation in respect of remuneration or other matters. [Schedule 1, item 1,
section 52ZZJ(5)]
1.34 A registered news business corporation that becomes bound by a
standard offer may receive the benefit of the general requirements.
However, becoming bound by a standard offer may prevent a registered
news business corporation from utilising the bargaining or arbitration
divisions of the Code. [Schedule 1, item 1, sections 52ZZJ(4) and 52ZZK(4)]
1.35 A responsible digital platform corporation may also make a
standard offer relating to one or more non-designated digital platform
services on terms that include that the registered news business
corporation would not be able to utilise the Code for one or more
designated digital platform services of that digital platform corporation.
[Schedule 1, item 1, section 52ZZJ(4)]
1.36 A standard offer will not exclude bargaining or arbitration if,
before the agreement became binding, a registered news business
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corporation has notified the responsible digital platform corporation that it
wishes to bargain. [Schedule 1, item 1, section 52ZZK(3)]
1.37 Standard offers must have a duration of two years in order to be
valid under the relevant provisions of the Code. [Schedule 1, item 1, section
52ZZJ(4)]
Process for making a standard offer
1.38 A responsible digital platform corporation may choose if and
when it wishes to make a standard offer for a future two year period to
registered news business corporations. [Schedule 1, item 1, sections 52ZZI and
52ZZJ]
1.39 A standard offer remains open for a period of 60 days unless
otherwise prescribed in regulations. If a registered news business
corporation wishes to be bound by the standard offer, it must accept the
offer during the offer period. [Schedule 1, item 1, sections 52ZZJ(3) and (8)]
1.40 At the end of the offer period, the offer becomes binding on the
responsible digital platform corporation and all registered news business
corporations who accepted the offer. [Schedule 1, item 1, section 52ZZK]
1.41 During the offer period, a responsible digital platform
corporation may withdraw the standard offer, in which case the offer will
not be binding under the Code. A registered news business corporation
may revoke any acceptance of the standard offer during the offer period.
[Schedule 1, item 1, section 52ZZJ(3)]
1.42 The content of the standard offer can be determined by the
responsible digital platform corporation. The regulations may prescribe
features that must be included in a standard offer in relation to
remuneration. [Schedule 1, item 1, section 52ZZJ(5)]
1.43 For example, the regulations could set out that remuneration
should be based on a percentage of the cost of producing covered news. A
responsible digital platform corporation would then need to decide what
percentage would be appropriate and include this as a term in any standard
offer.
1.44 The standard offer provisions do not prevent the responsible
digital platform corporation reaching agreements with registered or
unregistered news businesses through other similar processes (for
example, offers to certain kinds of news businesses, or offers subject to
deadlines for acceptance).
Which digital platforms must participate in the Code?
1.45 A digital platform must participate in the Code if one or more of
the services it operates or controls has been designated by the Minister as
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News Media and Digital Platforms Mandatory Bargaining Code
a designated digital platform service. The determination will also specify
the corporation as the designated digital platform corporation. [Schedule 1,
item 1, section 52E]
1.46 In making a determination, the Minister must consider whether
there is a significant bargaining power imbalance between Australian
news businesses and the group comprised of the corporation and all of its
related bodies corporate. The Minister may consider any reports or advice
of the ACCC. [Schedule 1, item 1, sections 52E(3), (4) and (5)]
1.47 'Digital platform' is not defined in the Bill and is intended to
take its ordinary meaning. It is intended that it will capture platforms that
deliver a wide variety of services such as social media services, search
engines and other digital content aggregators.
1.48 If a news business corporation wishes to approach a responsible
digital platform corporation to negotiate about its non-designated digital
platform services then it can do so in the ordinary course of commercial
dealings. The Code allows but does not require the responsible digital
platform corporation to bargain in relation to those other non-designated
digital platform services.
Responsible digital platform corporation
1.49 Under the Code, the party with whom the registered news
business corporations must bargain is known as the 'responsible digital
platform corporation'. This is also the party responsible for complying
with the general requirements and non-differentiation obligations.
1.50 The responsible digital platform corporation is either:
• an Australian corporation that is related to the corporation
identified in the Minister's designation, that either by itself or
together with other corporations operates or controls the
digital platform service in supplying services that are used by
Australians; or
• if there is no such corporation - the designated digital
platform corporation for the designated digital platform
service.
[Schedule 1, item 1, definition of 'responsible digital platform corporation'
in section 52A]
Which news businesses can participate in the Code?
1.51 To participate in the Code, a corporation must apply for their
news business to be registered by the ACMA. An 'applicant corporation'
seeking to register a news business must also apply to be registered by the
ACMA as a 'registered news business corporation' and demonstrate that
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they operate or control that news business, either by themselves or
together with other corporations. [Schedule 1, item 1, sections 52F and 52L]
1.52 When registering a news business with the ACMA, an applicant
corporation must list each 'news source' that makes up the news business.
It must also provide a point of contact for the corporation. [Schedule 1, item
1, section 52F(2)]
1.53 If the ACMA considers that the applicant corporation and any
nominated news business satisfies the eligibility criteria, then it must
register the applicant corporation as a registered news business
corporation and register the news business. The ACMA must also endorse
the registered news business corporation as operating or controlling the
particular registered news business. [Schedule 1, item 1, section 52G]
1.54 The ACMA may endorse a registered news business corporation
as controlling multiple news businesses, if the news business corporation
operates or controls those news businesses, either by itself, or together
with other corporations. [Schedule 1, item 1, section 52L]
1.55 The general requirements part of the Code applies separately in
relation to each registered news business. [Schedule 1, item 1, section 52Q]
1.56 A 'news business' means a news source or a combination of
news sources. A 'news source' includes:
• a newspaper masthead;
• a magazine;
• a television program or channel;
• a radio program or channel;
• a website or part of a website; or
• a program of audio or video content designed to be
distributed over the internet.
[Schedule 1, item 1, definitions of 'news business' and 'news source' in
section 52A]
1.57 The definition of 'news source' also requires the news source to
produce and publish news content online. News content is intended to take
its ordinary meaning under the Code. [Schedule 1, item 1, definition of 'news
source' in section 52A]
1.58 In order for a news business to be registered, each news source
in a news business must meet the following requirements:
• the content test;
• the Australian audience test; and
• the professional standards test.
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News Media and Digital Platforms Mandatory Bargaining Code
[Schedule 1, item 1, section 52G]
1.59 A news source cannot be registered twice. That is, the news
sources set out in the news business corporation's application cannot form
part of another news business that is already registered. [Schedule 1, item 1,
section 52G(2)(b)]
1.60 The ACMA must publish the details of the registration on its
website, including the registered news business corporation's contact
point for the purposes of facilitating communication between the
registered news business and the responsible digital platform corporation.
[Schedule 1, item 1, section 52G(3)]
1.61 A news business corporation is not required to nominate all of
its news sources. It may select the news sources that it wishes to
nominate, in any combination it chooses. [Schedule 1, item 1, section 52F(3)]
1.62 However, all negotiation, bargaining and arbitration facilitated
by the Code applies only to the covered news content of those news
sources. The Code does not apply to other content produced or published
by the registered news business corporation. The Code's general
requirements also only apply to covered news content of those registered
news sources.
The revenue test
1.63 A news business corporation satisfies the revenue test if either:
• its annual revenue (or the annual revenue of a related body
corporate) in the preceding year exceeded $150,000; or
• its annual revenue (or the annual revenue of a related body
corporate) in at least three of the five preceding financial
years exceeded $150,000.
[Schedule 1, item 1, section 52M(1)]
1.64 This test is applied at the corporation level. A news business
corporation does not need to show that the revenue was generated by, or
relates to, the operations of its news sources.
1.65 The revenue must be set out in the news business corporation's
(or the related body corporate's) annual accounts prepared with generally
accepted accounting principles. [Schedule 1, item 1, section 52M(1)]
1.66 If a news business corporation has acquired a news business
over the preceding five years, and the business' previous annual revenue
is ascertainable from the annual accounts of its former owner, this annual
revenue can be used to support the revenue test of its new owner. This
allows the revenue test to be applied to newly acquired news businesses.
[Schedule 1, item 1, sections 52M(2) and (3)]
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The content test
1.67 A news business satisfies the content test if the primary purpose
of each news source is to create and publish core news content. [Schedule 1,
item 1, section 52N(1)]
1.68 Content does not need to be created solely for the purpose of
publishing it online, noting the definition of a news source requires the
publication of news content online. For example, a television news
broadcast may be produced primarily for a television audience but it
would satisfy the content test if it is also published online.
1.69 It is intended that a news source can be considered to have
created content even if it commissions or otherwise obtains the content
externally.
1.70 Core news content is content that reports, investigates or
explains:
• issues or events that are relevant in engaging Australians in
public debate and in informing democratic decision-making;
or
• current issues or events of public significance for Australians
at a local, regional or national level.
[Schedule 1, item 1, definition of 'core news content' in section 52A]
1.71 Core news content can relate directly to matters of public policy
and government decision making at any level of government. However, it
can also include other matters of public significance, such as reporting on
law and order, health, education, environmental issues, science, industrial
relations and business.
1.72 It also includes coverage of current issues or events where these
are of public significance at a local, regional or national level. Reporting
on community issues or events is considered core news content if they are
of public significance. Matters that are principally private or special
interest are not intended to be included.
1.73 Pure opinion or commentary on news content will generally not
be considered core news. Applicant corporations seeking to include
opinion based or editorial content will need to demonstrate how the
content plays a significant role in reporting, investigating or explaining
issues that are relevant in engaging Australians in public debate and in
informing democratic decision making.
1.74 There is no requirement that the content be produced by a
journalist. For example, news content produced by a team for broadcast
television and radio could meet the definition of core news content.
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News Media and Digital Platforms Mandatory Bargaining Code
1.75 The level of core news content a news source publishes may
fluctuate over the course of a year taking into account holiday periods and
peak news periods such as election cycles. The policy intent is that these
variations will not cause a news business to fail the content test.
[Schedule 1, item 1, section 52N(1)]
Example 1.1 Application of 'content test' to online news business
Maurice Media (MM) is an Australian corporation that produces a
news website called A+ Articles, which reports on Australian
economic, business and political issues. MM also produces a news
podcast called A+ Articles: Audio, which is hosted on the A+ Articles
website, and provides a shortened audio version of its online news
articles in the form of a daily news briefing.
In addition, MM publishes a separate website called Access: Aussie
Rules, which provides match scores, a blog of match highlights, and a
footy tipping competition for an Australian Rules football league.
MM seeks to register as a news business corporation under the Code,
and nominates A+ Articles (the website) and A+ Articles: Audio (the
podcast) as the news sources which make up its news business for the
purpose of the bargaining Code.
MM chooses not to nominate the Aussie Rules website as a news
source for the purpose of the Code because its primary purpose is not
the provision of core news and it would not meet the content test.
MM satisfies the other tests for registration. The ACMA registers MM
as a registered news business corporation, registers a news business
consisting of A+ Articles and A+ Articles: Audio, and endorses the
control relationship between the news business corporation and news
business.
Example 1.2 Application of 'content test' to online and offline news
business
Commercial Broadcast Network (CBN) is a major Australian
commercial free-to-air television network. CBN airs a wide variety of
programs, including several dedicated news and current affairs
programs. CBN also broadcasts a series of lighter 'infotainment'
programs, such as its daily morning show, which includes a short
regular news segment.
CBN offers a live stream of its television broadcast online. It also runs
a popular CBN news website consisting of both original news articles
and video clips from across its news programs and its morning show.
CBN applies to the ACMA to register a news business under the Code
and lists its CBN news website and its designated news and current
affairs TV programs as its news sources. CBN decides not to include
its daily morning TV show, as it cannot demonstrate that its primary
purpose is creating core news content.
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The CBN news website and the designated news and current affairs TV
programs are considered eligible news sources under the content test.
The Australian audience test
1.76 A news business satisfies the Australian audience test if the
news sources comprising its news businesses operate predominantly in
Australia for the dominant purpose of serving Australian audiences.
[Schedule 1, item 1, section 52O]
1.77 A foreign news business that only occasionally produces
Australian news content, or that has an Australian news segment, may
have a dominant purpose of serving Australian audiences, or those
interested in Australia, but does not qualify under the Australian audience
test unless it is also operating predominantly in Australia. [Schedule 1,
item 1, section 52O]
Example 1.3 Application of 'Australian audience test' to
international news outlet
Overseas News Network (ONN) is an international news organisation,
headquartered in the United Kingdom. The ONN website provides a
mix of UK domestic and world news, including an Australian news
tab. This Australian tab links to a page containing curated ONN
articles and videos covering Australian news (or news of relevance to
Australian audiences). ONN applies to the ACMA, seeking to register
a news business under the Code based solely on their Australian news
page.
While ONN meets the content test by providing core news content to
Australians, the news business will be ineligible based on the
Australian audience test. This is because ONN is unable to show that
its news business (the Australian page on its website) operates
predominately in Australia, as it has no operations in Australia, and has
no local newsroom or locally-employed staff producing its news
content.
The professional standards test
1.78 A news business satisfies the professional standards test if each
of the news sources in the relevant application has editorial independence
from the subjects of its news coverage and is subject to a professional
standard.
1.79 A news source is subject to a professional standard for the
purposes of the Code if:
• it is subject to the rules of the Australian Press Council
Standards of Practice or the Independent Media Council
Code of Conduct;
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• it is subject to the rules of the Commercial Television
Industry Code of Practice, the Commercial Radio Code of
Practice or the Subscription Broadcast Television Codes of
Practice;
• it is subject to the rules of the Australian Broadcasting
Corporation or Special Broadcasting Service codes of
practice;
• it has internal editorial standards that are analogous to the
above mentioned rules regarding internal editorial standards
relating to the provision of quality journalism;
• it is subject to rules specified in the regulations that replace
the above rules; or
• it is subject to other rules specified in the regulations.
[Schedule 1, item 1, section 52P]
1.80 A news source has editorial independence from the subject of its
news coverage if it is:
• not owned or controlled by a political or advocacy
organisation (such as a political party, lobby group or a
union); and
• not owned or controlled by a party that has a commercial
interest in the coverage being produced (for example, a
publication that covers a sport that is owned or controlled by
the sport's governing body).
1.81 The editorial independence requirement is not intended to
exclude a news source that otherwise qualifies on all the tests, and
occasionally includes reporting about itself or a related business, or about
an issue affecting itself or a related business.
1.82 However, an advocacy body that mainly publishes news about
its own sector will not meet the professional standards test.
Example 1.4 Application of 'professional standards test' to advocacy
organisation
Caterers First is a lobby group in Australia that advocates for catering
industry policies and raises money for catering industry events and
causes. Caterers First employs a small team of journalists to produce
Caterers First News - a news website and daily email newsletter which
reports on topical Australian catering news and events. Caterers First
News has robust internal editorial guidelines and processes to ensure it
operates at arm's length from the lobbying side of the business.
Despite these internal measures, Caterers First News is unlikely to be
eligible under the professional standards test. This is because the news
source is controlled by an advocacy organisation and reports
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exclusively on the subject related to their advocacy work, raising
legitimate concerns about its editorial independence.
Loss of eligibility of a registered news business corporation
1.83 The ACMA may revoke the registration of a news business
corporation if:
• one or more of the news sources that form part of the
registered news business form part of another registered news
business; or
• the content, Australian audience or professional standards
tests are no longer being met.
[Schedule 1, item 1, sections 52H(1) and (2)]
1.84 A registered news business corporation for a registered news
business must notify the ACMA as soon as practicable, in writing, if it is
no longer eligible to be registered under the Code. [Schedule 1, item 1,
section 52J]
1.85 A failure to notify is subject to a maximum civil penalty of 600
penalty units. [Schedule 1, items 7, 9 and 10, sections 76(1)(a)(iaa), 76(1A)(bab)
and 76(4A)(a)]
1.86 If a corporation is the registered news business corporation for
multiple registered news businesses, and one of its registered business'
has its registration revoked, the corporation remains the registered news
business corporation for its other registered news businesses.
1.87 It is intended that short term changes or fluctuations in the type
of content that a registered news business publishes will not result in the
registered news business being required to notify the ACMA that they are
no longer eligible. For example, if a registered news business usually
creates content that is core news content but for one day after registering
they cover more celebrity news than core news content, they do not need
to notify the ACMA that they are no longer eligible.
Change in ownership of a registered news business
1.88 The Code contains a process for the transfer of ownership of
registered news businesses between registered news business
corporations. A registered news business corporation must notify the
ACMA if they no longer operate or control (by themselves or with other
corporations) a registered news business. [Schedule 1, item 1, sections 52J
and 52G]
1.89 A registered news business corporation can apply to the ACMA
to be endorsed in relation to a news business which has already been
registered and endorsed to another registered news business corporation.
[Schedule 1, item 1, section 52G]
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1.90 If the ACMA is satisfied that the new applicant news business
corporation has purchased the registered news business and is now in
control of, or operates the registered news business, the ACMA may
reflect the transfer of the ownership of the registered news business by
endorsing the new applicant registered news business corporation. The
ACMA will also revoke the endorsement of the previous registered news
business corporation. [Schedule 1, item 1, sections 52G, 52H(6) and (7)]
Adding or removing a news source to a registered news business
1.91 A registered news business corporation can apply to the ACMA
to add or remove a news source from one of the registered news
businesses for which it has been endorsed. [Schedule 1, item 1, section 52K]
1.92 The addition or removal of a news source does not affect any
existing agreements a registered news business corporation may have with
a responsible digital platform corporation. The registration of a new news
source does not trigger a right to bargain in relation to the news source,
until the next round of bargaining.
False or misleading information
1.93 The ACMA may revoke the registration of a registered news
business or registered news business corporation and the endorsement of a
news business corporation for a news business if the ACMA considers
that the corporation gave the ACMA information that was false or
misleading in a material particular. [Schedule 1, item 1, section 52I]
General requirements
The general requirements - overview
1.94 Once a news business corporation is registered by the ACMA,
each designated digital platform service must comply with a number of
general requirements. This includes general requirements which relate to
covered news content of the registered news business. [Schedule 1, item 1,
sections 52Q and 52R]
1.95 A digital platform service can make available covered news
content in a number of ways, and the Code does not exhaustively detail all
of these. However, the following are listed in the Code as ways a service
makes content available:
• the service allows for covered news content to be reproduced,
or otherwise placed on the digital platform service, in whole
or in part (including in the form of snippets); or
• the service allows for links to covered news content to be
placed on the service.
[Schedule 1, item 1, section 52B]
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1.96 The responsible digital platform corporation must ensure the
general requirements, including the minimum standards, are met. This
reflects its responsibility for compliance, even if another entity in the
corporate group carries out the task because, for example, the other entity
controls a relevant algorithm or possesses relevant information. [Schedule 1,
item 1, section 52Q]
1.97 The minimum standards require the responsible digital platform
corporation to ensure registered news businesses are:
• provided with clear explanations of the types of data
collected by the designated digital platform service in
relation to users' interaction with covered news content,
where the designated digital platform service has shared this
data with one or more other registered news businesses;
• notified in relation to planned changes to designated digital
platform service algorithms and internal practices that are
likely to significantly affect the referral traffic to registered
news businesses' covered news content;
• notified in relation to planned changes to designated digital
platform service algorithms and internal practices that are
likely to significantly affect the referral traffic of covered
news content that is behind a paywall; and
• notified in relation to planned changes to designated digital
platform service algorithms and internal practices that are
likely to significantly affect the distribution of advertising
directly associated with the registered news business'
covered news content.
[Schedule 1, item 1, sections 52R, 52S, 52T, 52U, 52V and 52W]
1.98 The minimum standards extend beyond the core news content of
the news source of the registered news business to covered news content
produced by the registered news business.
1.99 Covered news content is a broader category than core news
content and includes:
• core news content; and
• any other content that reports, investigates or explains current
issues or events of interest to Australians.
[Schedule 1, item 1, definition of 'covered news content' in section 52A;
sections 52R, 52S, 52T, 52U, 52V and 52W]
1.100 Covered news content is intended to capture content including
sports and entertainment news such as interviews with coaches and
players, reporting about the entertainment industry, coverage of reality
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television and certain talk-back radio discussions. However, covered news
content is not intended to include:
• broadcasts of sports games or publication of sports results or
scores; and
• entertainment content such as drama or reality TV
programming.
1.101 Further, covered news content is intended to exclude:
• specialty or industry reporting;
• product reviews; and
• journals and publications intended primarily for academic,
rather than general, audiences.
1.102 The minimum standards apply to the broader category of
covered news content, as many news businesses publish a mix of stories
of broad interest to cross-subsidise the production of core news content.
Content that is neither covered nor core news does not benefit from the
minimum standards. The cross-subsidisation business model means that it
is important for registered news businesses to receive information relating
to, and can bargain over, a broader range of content than just their core
news content.
Example 1.5 Core news content versus covered news content
Tom's News Network (TNN) is a news business that produces several
news websites. The websites focus on national and regional political
news reporting (considered core news content in the Code), but also
feature some sports reporting and entertainment news.
TNN applies to be registered by the ACMA to participate in the Code,
nominating all its news websites as news sources. The ACMA finds
that each source has the primary purpose of producing core news
content and TNN meets all the other criteria. The ACMA registers
TNN as a news business corporation.
The general requirements that the responsible digital platform
corporation must meet in the Code apply in relation to all of the
covered news content TNN produces, not just its political news and
court reporting (core news), and may include its sports reporting and
entertainment news. This will allow TNN to gain a full picture of the
performance of its stories on the digital platform service and to bargain
with the responsible digital platform corporation under the Code in
relation to this content.
Example 1.6 Core and covered news content
Ros' Review is a news business that maintains a website. The site
features articles on topical issues and events, written either by
academics who are expert in the field or 'in house' by journalists who
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Ros' Review employs. Ros' Review's journalists also make editorial
revisions to the articles written by academics.
Ros' Review applies to be registered by the ACMA to participate in
the Code, nominating its website as its sole news source. The ACMA
finds that the site's primary purpose is the creation and publication of
core news content and Ros' Review meets all the other criteria. The
ACMA registers Ros' Review.
Even if a small portion of Ros' Review's content would not be
considered core news content, it would all be considered covered news
content.
1.103 Information provided to registered news businesses by the
responsible digital platform corporation under all the general requirements
must be provided in terms that are readily comprehensible. [Schedule 1,
item 1, sections 52R(1)(b), 52S(2)(c), 52T(2)(c) and 52U(2)(c)]
1.104 None of the general requirements require giving information the
disclosure of which would reveal a trade secret, or which is personal
information within the meaning of the Privacy Act 1988. [Schedule 1, item 1,
sections 52R(5), 52ZA and 52ZB]
Minimum standards - giving explanations about types of data provided
1.105 Where a responsible digital platform corporation provides data
about user interactions with covered news content to one or more
registered news businesses, it must inform all other registered news
business corporations about the types of data it has provided. [Schedule 1,
item 1, sections 52Q and 52R]
1.106 This obligation to inform registered news businesses about the
provision of data to other registered news businesses is limited to data
about user interactions with covered news content made available on a
designated digital platform service.
1.107 A user interacts with content made available by a service by
commenting, sharing, modifying or otherwise engaging with the content
in some way. The concept is intended to be broad and include brief and
minimal interactions with content such as pausing, scrolling through, or
hovering a cursor over the content, or portions of the content.
1.108 A user who interacts with a link to content made available by a
designated digital platform service, interacts with the content, even if the
linked material is contained on a website separate to the designated digital
platform service. [Schedule 1, item 1, sections 52C and 52R]
1.109 This provision is not intended to require the designated digital
platform corporation to provide information about data it collects from
websites that are not part of a designated digital platform service.
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1.110 There is no obligation on a responsible digital platform
corporation to share any user information. Nor is there any requirement to
make the same data available to all registered news businesses if data is
shared with one registered news business. This provision only requires
that if a responsible digital platform corporation chooses to share user
interaction data with one or more registered news businesses, it must
inform all other registered news businesses, at least in general terms,
about the types of data it has provided by listing and explaining the shared
data. [Schedule 1, item 1, section 52R]
1.111 The information about types of data provided must relate
specifically to the designated digital platform service that collects the
information. [Schedule 1, item 1, section 52R(1)(c)]
1.112 The responsible digital platform corporation must ensure the
information is provided to registered news business corporations within
28 days of their registration by the ACMA. The responsible digital
platform corporation then has an ongoing obligation to update that
information every 12 months. [Schedule 1, item 1, sections 52R(1)(d) and 52R(4)]
1.113 The intent behind the obligation is to provide a minimum level
of transparency so that all registered news businesses are aware of the
types of information that are being provided to other news businesses.
1.114 The ACCC may issue an infringement notice of 600 penalty
units for a failure to comply. In the alternative, a maximum civil penalty
of 6000 penalty units applies. [Schedule 1, items 1, 7, 9 and 10, sections 52ZZG,
76(1)(a)(iaa), 76(1A)(baa) and 76(4A)(c)]
Minimum standards - referral traffic to covered news content
1.115 A responsible digital platform corporation must give 14 days
advance notice to a registered news business corporation of planned
changes to an algorithm or internal practice of its designated digital
platform services, where:
• the dominant purpose of the change is to bring about an
identified alteration to the distribution of content on the
designated digital platform service; and
• the change is likely to have a significant effect on the referral
traffic to covered news content made available by the
designated digital platform service.
[Schedule 1, item 1, section 52S]
1.116 The Bill aims to clarify, without limiting, the ways in which a
digital platform service can distribute content made available on the
service. Broadly, distribution methods include ways to rank, curate,
impact prominence or alter the extent to which a user would be likely to
interact with the content on the service. [Schedule 1, item 1, section 52D]
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1.117 The Bill also provides a number of examples of the way a digital
platform service can alter the distribution of content. [Schedule 1, item 1,
section 52D(3)]
1.118 A notification is only required in relation to planned changes to
an algorithm or internal practice. [Schedule 1, item 1, section 52S(1)(a)]
1.119 This is intended to capture algorithm or internal practice changes
which involve an active decision to modify how content will be
distributed on a designated digital platform service. The provision is not
intended to capture:
• changes that are generated by a review process which is
almost entirely automated (such as a change designed and
implemented almost entirely by machine learning);
• changes which are not planned; and
• routine updates which may be made with high frequency.
1.120 An internal practice may include a policy or procedure of a
designated digital platform service which is implemented by individuals,
as opposed to an automated algorithmic process. Examples could include
the policies and procedures around appeals against the removal of
inappropriate content, suspending of user accounts and rules around
permitted types of advertising content. [Schedule 1, item 1, sections 52S(1)(a),
52T(1)(a) and 52U(1)(a)]
Dominant purpose
1.121 The dominant purpose of the planned change must be to bring
about an identified alteration to how content is distributed on a designated
digital platform service. This means the planned change to an algorithm or
internal practice must be intended by the responsible digital platform
corporation to bring about a predetermined identified alteration to the
distribution of content. [Schedule 1, item 1, section 52S(1)]
1.122 A change will not have the dominant purpose of bringing about
an identified alteration to the distribution of content on the designated
digital platform service if the planned change is:
• a change made as part of routine maintenance with the
dominant purpose of ensuring the ongoing effectiveness of
the algorithm; or
• a change made with the dominant purpose of ensuring that
the algorithm operates more quickly or efficiently.
[Schedule 1, item 1, section 52V]
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Significant effect on covered news content on the designated digital platform service
1.123 The Bill sets out a number of matters which should be
considered or disregarded when assessing whether a change is likely to
significantly affect the referral traffic to covered news content of
registered news businesses.
1.124 The matters that should be considered are:
• whether, as a result of the change, there is likely to be a
significant variation to the amount of covered news content
made available by the designated digital platform service;
• whether, as a result of the change, there is likely to be a
significant variation to the proportion of content made
available by the designated digital platform service which is
covered news content; and
• any other relevant matter.
[Schedule 1, item 1, section 52W(1)]
1.125 The matters that are to be disregarded are:
• whether, as a result of the change, there is likely to be a
significant increase or decrease to the proportion of a
particular registered news business' covered news content
that makes up all the covered news content made available by
a designated digital platform service;
• the relative turnover of registered news businesses whose
covered news content is made available by the designated
digital platform service;
• the relative volume of covered news content created by
registered news businesses whose covered news content is
made available by the designated digital platform service;
and
• the relative financial position of registered news businesses
whose covered news content is made available by the
designated digital platform service.
[Schedule 1, item 1, section 52W(2)]
1.126 A change may significantly affect the referral traffic to covered
news content of registered news businesses even if it does not affect
every, or even a majority, of registered news business. If the change
affects a small number of news businesses who produce the vast majority
of covered news content on the designated digital platform service, then
the change may still have a significant effect on covered news content.
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1.127 The policy intent is that changes are likely to be considered
significant if they are likely to result in an approximately 20% or greater
change in referral traffic to registered news businesses as a whole.
1.128 'Referral traffic' from the designated digital platform service is
not defined in the Bill and the term will take its ordinary meaning. It is
intended to cover the situation where a digital platform service refers a
user to an external website, app or news source via a link.
Other requirements
1.129 The notice must describe the change and effect on referral traffic
in a way that is readily comprehensible. The notice must relate only to the
designated digital platform service to which the planned change relates
and not to any other designated digital platform service of the responsible
digital platform corporation. [Schedule 1, item 1, sections 52S(2)(c) and (d)]
1.130 If the algorithm change relates to a matter of urgent public
interest, no advance notice is required, but the responsible digital platform
corporation must ensure that the news business corporation is notified
within 48 hours after the change. This exception recognises that urgent
algorithm changes such as those that might be required in relation to
information about an event such as an earthquake or a terrorist event
cannot be notified in advance. [Schedule 1, item 1, section 52S(2)(b)]
1.131 The ACCC may issue an infringement notice of 600 penalty
units for a failure to comply. In the alternative, a maximum civil penalty
of 6000 penalty units applies. [Schedule 1, items 1, 7, 9 and 10, sections 52ZZG,
76(1)(a)(iaa), 76(1A)(baa) and 76(4A)(c)]
Minimum standards - referral traffic to paywalled content
1.132 A responsible digital platform corporation must give 14 days'
advance notice to a registered news business corporation of planned
changes to an algorithm or internal practice of its designated digital
platform services, where:
• the dominant purpose of the change is to bring about an
identified alteration to the distribution of content on the
designated digital platform service; and
• the change is likely to have a significant effect on the referral
traffic from the designated digital platform service to covered
news content behind a paywall of registered news businesses.
[Schedule 1, item 1, section 52T]
1.133 As with the notice of planned changes that are likely to have a
significant effect on referral traffic to covered news content, a notification
need only be provided in relation to active (not automated decisions) to
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modify how content will be distributed on the designated digital platform
service.
1.134 The concepts of dominant purpose, significant effect and referral
traffic also apply to this provision in the same way that they apply to the
notice in relation to algorithm or internal practice changes. [Schedule 1,
item 1, section 52W]
1.135 If the change relates to a matter of urgent public interest, no
advance notice is required, but the responsible digital platform corporation
must ensure the news business corporation is notified within 48 hours.
[Schedule 1, item 1, section 52T(2)(b)]
1.136 The obligation will apply in relation to notifying each registered
news business from 14 days after the day on which the news business is
registered. [Schedule 1, item 1, section 52T(3)]
1.137 The ACCC may issue an infringement notice of 600 penalty
units for a failure to comply. In the alternative, a maximum civil penalty
of 6000 penalty units applies. [Schedule 1, items 1, 7, 9 and 10, sections 52ZZG,
76(1)(a)(iaa), 76(1A)(baa) and 76(4A)(c)]
Minimum standards - distribution of advertising
1.138 A responsible digital platform corporation must give 14 days
advance notice to a registered news business corporation of planned
changes to an algorithm or internal practice of its designated digital
platform services, where:
• the dominant purpose of the change is to bring about an
identified alteration to the distribution of content on the
designated digital platform service; and
• the change is likely to have a significant effect on the
distribution of advertising directly associated with the
registered news business' covered news content which is
made available by the designated digital platform service.
[Schedule 1, item 1, section 52U]
1.139 As with other minimum standard notice provisions in relation to
planned changes to an algorithm or internal practices, a notification need
only be provided in relation to active decisions (not automated decisions)
to modify how content will be distributed on the designated digital
platform service.
1.140 Again, if the change relates to a matter of urgent public interest,
no advance notice is required, but the responsible digital platform
corporation must ensure the news business corporation is notified within
48 hours. [Schedule 1, item 1, section 52U(2)(b)]
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1.141 The obligation will apply in relation to each registered news
business 14 days after the day on which the news business is registered.
[Schedule 1, item 1, section 52U(3)]
1.142 The ACCC may issue an infringement notice of 600 penalty
units for a failure to comply. In the alternative, a maximum civil penalty
of 6000 penalty units applies. [Schedule 1, items 1, 7, 9 and 10, sections 52ZZG,
76(1)(a)(iaa), 76(1A)(baa) and 76(4A)(c)]
Recognition of original news
1.143 A responsible digital platform corporation must consult with
registered news business corporations and publish a proposal to
appropriately recognise original covered news content within 6 months of
the ACMA registering the first news business corporation on its
designated digital services. This is a one-off obligation. [Schedule 1, item 1,
section 52X]
1.144 The ACCC may issue an infringement notice of 600 penalty
units for a failure to comply. In the alternative, a maximum civil penalty
of 6000 penalty units applies. [Schedule 1, items 1, 7, 9 and 10, sections 52ZZG,
76(1)(a)(iaa), 76(1A)(baa) and 76(4A)(c)]
Facilitating open communication
1.145 The responsible digital platform corporation must:
• set up a point of contact in Australia no later than 28 days
after the day the Minister makes a determination that a digital
platform must participate in the Code;
• ensure the point of contact meets the requirements specified
in regulations;
• give details of that point of contact to every registered news
business corporation either 10 business days after the point of
contact is set up, or 10 business days after the news business
is registered, whichever is later;
• acknowledge every communication made to that point of
contact from the registered news business corporation; and
• ensure the acknowledgement meets any requirements
specified in regulations.
[Schedule 1, item 1, section 52Y]
1.146 Each registered news business corporation must ensure that:
• a point of contact is set up no later than the day on which it is
registered by the ACMA;
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• the point of contact meets the requirements specified in
regulations;
• the point of contact acknowledges every communication
from a responsible digital platform corporation that relates to
the registered news business' covered news content; and
• the acknowledgement meets any requirements specified in
regulations.
[Schedule 1, item 1, section 52Z]
1.147 The ACCC may issue an infringement notice of 600 penalty
units for a failure to comply. In the alternative, a maximum civil penalty
of 6000 penalty units applies. [Schedule 1, items 1, 7, 9 and 10, sections 52ZZG,
76(1)(a)(iaa), 76(1A)(baa) and 76(4A)(c)]
1.148 Nothing prevents a responsible digital platform corporation
identifying the same point of contact for multiple registered news business
corporations, provided it can still fulfil the requirements for availability
and responsiveness.
1.149 Regulations can be made that contain requirements for the
registered point of contact and acknowledgement of the contact. The
regulations will be subject to disallowance by the Parliament and therefore
will be subject to Parliamentary scrutiny. [Schedule 1, item 1, sections 52Y(b)
and (e) and 52Z(b) and (d)]
1.150 The regulations could, for example, provide that the points of
contact must be available during Australian business hours and that
acknowledgment must occur within two business days.
Non-differentiation requirements
1.151 The non-differentiation provisions apply to any digital service
(however described, such as a platform, social media website or mobile
phone news app) that is operated or controlled by the responsible digital
platform corporation. This includes digital services the responsible digital
platform corporation operates or controls together with other corporations.
This means that it applies to both digital services which have not been
designated, as well as designated digital platform services. [Schedule 1,
item 1, section 52ZC(1)]
1.152 The obligation under this provision requires a responsible digital
platform corporation to ensure that in supplying a digital service, the
corporation does not differentiate between registered news businesses or
between registered and unregistered news businesses in relation to
crawling, indexing, distributing or making available news businesses'
covered news merely because of any of the following:
• a notice of intention to bargain under the Code has been
given to a designated digital platform service;
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• a notice of intention to arbitrate under the Code has been
given to the ACCC;
• a registered news business or news business is receiving
remuneration for the making available of the news business'
covered news content;
• a registered news business or news business is, or is not,
subject to a standard offer with a responsible digital platform
corporation; or
• a registered news business or news business is, or is not,
subject to an agreement contracting out of the Code.
[Schedule 1, item 1, section 52ZC(2)]
1.153 For the avoidance of doubt, this requirement is not intended to
interfere with the ordinary operation of the proprietary algorithms of a
digital platform.
1.154 Furthermore the non-differentiation provision does not prohibit
the making of deals and agreements, the substance of which may include
terms about remuneration for the making available of covered news
content or the way in which covered news content is distributed.
Differentiation on the basis of the terms of an agreement, such as
providing covered news content on a specific topic or presented in a
specific way that meets the digital platform's business needs, will not be a
breach of the provision.
1.155 However, if differentiation occurred only because a responsible
digital platform corporation paid remuneration to a registered news
business for the making available of covered news content, then this will
likely breach the provision.
1.156 A failure to comply with the non-differentiation requirements is
subject to a maximum civil penalty of the greatest of:
• $10 million;
• if the court can determine the value of the benefit obtained
and that is reasonably attributable to the act or omission -
three times the value of that benefit; and
• if the court cannot determine the value of that benefit -
10% of annual turnover during the period of 12 months
ending at the end of the month in which the act or omission
occurred.
[Schedule 1, items 7, 8 and 10, sections 76(1)(a)(iaa), 76(1A)(b) and
76(4A)(d)]
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News Media and Digital Platforms Mandatory Bargaining Code
Bargaining
Topics that may be bargained about
1.157 Once an Australian news business is registered by the ACMA,
the registered news business corporation can notify a responsible digital
platform corporation of its intention to bargain under the Code in relation
to one or more 'specified issues'. [Schedule 1, item 1, section 52ZE]
1.158 The issues can be about remuneration or another topic but, in
order for the Code to apply, they must relate to the registered news
businesses' covered news content which is made available on (or via) a
designated digital platform service. [Schedule 1, item 1, sections 52ZE(1) and
(4)(e)]
1.159 Separately to those topics specified in the notice, the parties can
agree in writing to bargain under the Code about issues relating to covered
news content made available by designated or non-designated digital
platform services. [Schedule 1, item 1, section 52ZG(2)]
1.160 As explained above in relation to the general requirements, a
digital platform service makes available covered news content if it:
• allows for covered news content to be reproduced, or
otherwise placed on the digital platform service, in whole or
in part (including in the form of snippets); or
• allows for links to covered news content to be placed on the
service.
[Schedule 1, item 1, section 52B]
1.161 As explained above in relation to the general requirements,
covered news content is a broader category than core news content and
includes:
• core news content; and
• any other content that reports, investigates or explains current
issues or events of interest to Australians.
[Schedule 1, item 1, definition of 'covered news content' in section 52A]
1.162 Nothing prevents the bargaining parties seeking to conduct
commercial negotiations on their own initiative on any other matter.
However, this is considered to occur outside the Code, which means the
responsible digital platform corporation cannot be penalised under the
Code for failing to participate in good faith because the good faith
requirement only applies to the core bargaining issues. [Schedule 1, item 1,
sections 52ZG(3), 52ZH and 52ZJ]
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News business corporations can bargain individually or collectively
1.163 Under the bargaining and arbitration Divisions of the Code, a
registered news business corporation for a registered news business is
known as the bargaining news business representative. [Schedule 1, item 1,
section 52ZD]
1.164 However, a registered news business corporation may appoint a
third party to be its bargaining news business representative. [Schedule 1,
item 1, section 52ZD]
1.165 A registered news business representative can bargain with a
responsible digital platform corporation. Under the bargaining and
arbitration Divisions of the Code, these are the bargaining parties.
[Schedule 1, item 1, section 52ZG]
1.166 Two or more registered news business corporations can agree to
collectively bargain with a designated digital platform. [Schedule 1, item 1,
section 52ZZP]
1.167 The collective can select one of its members to be the bargaining
news business representative or appoint a third party to perform that role.
The third party could be a peak body, industry association, legal
representative or other appointed agent. Each member of the collective
must agree in writing who will be the bargaining news business
representative. [Schedule 1, item 1, section 52ZD]
1.168 If two or more news business corporations join together to
negotiate with a responsible digital platform corporation, that collective
bargaining is specifically authorised for the purposes of subsection 51(1).
[Schedule 1, item 1, section 52ZZP]
Indicating an intention to bargain
1.169 The notification must be made by the bargaining news business
representative and set out the matters detailed in the Bill. [Schedule 1, item 1,
section 52ZE(4)]
1.170 Each registered news business to which the notification relates is
a represented registered news business. A notification cannot be varied to
include additional registered news businesses at a later time. [Schedule 1,
item 1, sections 52ZE(5) and 52ZG(4)]
1.171 A registered news business is not required to give notice to
bargain under the Code. If a registered news business chooses not to
bargain, the general requirements will still apply in respect of that news
business' covered news content. [Schedule 1, item 1, sections 52ZE, 52ZR, 52S,
52T, 52U, 52X]
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News Media and Digital Platforms Mandatory Bargaining Code
Bargaining in good faith
1.172 Once a bargaining news business representative indicates an
intention to bargain in relation to its covered news content, the bargaining
news business representative and the responsible digital platform
corporation must act towards each other in good faith. [Schedule 1, item 1,
sections 52ZF and 52ZH]
1.173 A failure to bargain in good faith is subject to a maximum civil
penalty of the greatest of:
• $10 million;
• if the court can determine the value of the benefit obtained
and that is reasonably attributable to the act or omission -
three times the value of that benefit; and
• if the court cannot determine the value of that benefit -
10% of annual turnover during the period of 12 months
ending at the end of the month in which the act or omission
occurred.
[Schedule 1, items 7, 8 and 10, sections 76(1)(a)(iaa), 76(1A)(b) and
76(4A)(e)]
1.174 Whether or not a party has acted in good faith will depend on the
facts and circumstances of each case.
1.175 Some examples of conduct which would likely breach the good
faith obligation include avoiding or refusing to engage in discussions with
the other party, making clearly unreasonable offers or failing to consider
or accept reasonable offers made by the other party.
1.176 A party will not breach the good faith obligation for putting its
own commercial interests ahead of the other party's or rejecting
unreasonable offers or demands from the other party.
1.177 This good faith bargaining obligation only applies to the core
bargaining issues, which are the specified issues set out in the bargaining
notification. Parties may agree in writing to bargain about other 'specified
issues'. These may be about the designated digital platform service or
other services. These specified issues will also be core bargaining issues.
As such the good faith obligation will apply to these specified issues also.
[Schedule 1, item 1, section 52ZG(3) and 52ZH]
1.178 The parties are able to engage in ordinary commercial
bargaining over any other issue at any time but the Code's protections and
obligations will not cover any of these additional issues. [Schedule 1, item 1,
sections 52ZG(3) and 52ZH]
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Notifying the ACCC of agreements reached
1.179 Both parties must ensure that the ACCC is notified as soon as
practicable if they successfully reach an agreement during the bargaining
phase. [Schedule 1, item 1, section 52ZI]
1.180 A failure to notify is subject to a maximum civil penalty of
600 penalty units. [Schedule 1, items 7, 9 and 10, sections 76(1)(a)(iaa), 76(1A)(bab)
and 76(4A)(b)]
Arbitration about the remuneration issue
1.181 Where parties cannot come to a negotiated agreement about
remuneration relating to the making available of covered news content on
designated digital platform services, the Code sets out a process for an
arbitral panel to select between two final offers made by the parties.
Starting arbitration
1.182 If a bargaining news business representative indicates an
intention to bargain with a responsible digital platform corporation and an
agreement about remuneration in relation to a designated digital platform
services is not reached within a three month period, the matter can
proceed to compulsory arbitration. [Schedule 1, item 1, sections 52ZL(1) and
(2)(a)]
1.183 The matter can proceed to arbitration earlier if both parties agree
to this. This cannot occur until at least 10 business days after the
bargaining news business representative indicates an intention to bargain.
[Schedule 1, item 1, section 52ZL(2)(b)]
1.184 In order to commence arbitration, the bargaining news business
representative must give a written notice to the ACCC. Only the
bargaining news business representative can initiate the arbitration, and
only after three months have elapsed since bargaining began. Nothing in
the Bill requires a bargaining news business representative to proceed to
arbitration. [Schedule 1, item 1, section 52ZL]
1.185 As soon as practicable after receiving the notice, the ACCC
must give the ACMA and the bargaining parties a notice stating that an
arbitral panel is to be formed. [Schedule 1, item 1, section 52ZL(5)]
1.186 The Chair of the arbitral panel will notify the bargaining parties
that arbitration will start on a specified day. That day must be within five
business days (unless another period of time is prescribed in regulations)
of the arbitral panel Chair's appointment. [Schedule 1, item 1, section 52ZP]
1.187 A bargaining news business representative cannot trigger
arbitration more than once within a two year period, in relation to each
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News Media and Digital Platforms Mandatory Bargaining Code
registered news business and designated digital platform service.
[Schedule 1, item 1, section 52ZL(4)]
Register of bargaining Code arbitrators
1.188 A register of bargaining code arbitrators will be appointed and
managed by the ACMA. [Schedule 1, item 1, section 52ZK]
1.189 Each person on the register must be a person experienced in at
least one of legal, economic or industry matters (relevant to digital
platforms and news media) or considered by the ACMA to have
appropriate experience to be a member of the arbitral panel. The ACMA
must consider relevant regulations in appointing individuals to the
register. [Schedule 1, item 1, section 52ZK]
The arbitral panel
1.190 When compulsory arbitration begins, an arbitral panel is to be
formed by agreement of the bargaining parties. The panel will include a
Chair of the panel and, unless the bargaining parties agree that the Chair
should be the sole member of the panel, two other members. [Schedule 1,
item 1, section 52ZM]
1.191 Appointed panel members need not be on the ACMA register if
they were appointed by agreement of the bargaining parties. The panel
must comply with the arbitral process set out in the Code. [Schedule 1,
item 1, section 52ZM]
1.192 The bargaining parties have 10 business days (unless otherwise
prescribed by regulations) to agree on the membership of the panel and
inform the ACCC and the ACMA of the appointments. [Schedule 1, item 1,
sections 52ZM(6) and (7)]
1.193 If the bargaining parties do not notify the ACMA of the
membership of the panel within that period, the ACMA will appoint any
remaining panel members from the register as necessary. [Schedule 1, item 1,
section 52ZM(8) and (9)]
1.194 Before the ACMA appoints a person to be a member of an
arbitral panel, the person must declare any conflicts of interest. [Schedule 1,
item 1, sections 52ZN(1),(2) and (6)]
1.195 The ACMA may also remove and replace an ACMA-appointed
panel member if it has reason to consider that the person has an actual or
potential conflict of interest, whether or not the person previously
declared it. [Schedule 1, item 1, sections 52ZN(3)-(6)]
1.196 Bargaining parties will share equal responsibility for the
arbitration costs. Each member of a panel is to determine that member's
costs, worked out as daily costs. This will include where the members are
appointed by the ACMA. [Schedule 1, item 1, section 52ZO]
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The arbitration process
Topic of arbitration
1.197 If the arbitration process is triggered, the only mandatory topic
for arbitration is the remuneration issue (the remuneration to be paid to a
registered news business for the making available of the registered news
business' covered news content by the designated digital platform
service). [Schedule 1, item 1, section 52ZL(1)(b)]
1.198 However, the bargaining parties can agree to arbitration on the
remuneration issue about an expanded set of services and if they notify the
Chair of the panel accordingly, the panel can make a determination that
includes remuneration for both the designated and non-designated services
accordingly. [Schedule 1, item 1, sections 52ZQ and 52ZX]
Good faith requirement
1.199 The bargaining parties must participate in the arbitration in good
faith. [Schedule 1, item 1, section 52ZS]
1.200 A failure to participate in arbitration in good faith is subject to a
maximum civil penalty of the greatest of:
• $10 million;
• if the court can determine the value of the benefit obtained
and that is reasonably attributable to the act or omission -
three times the value of that benefit; and
• if the court cannot determine the value of that benefit -
10% of annual turnover during the period of 12 months
ending at the end of the month in which the act or omission
occurred.
[Schedule 1, items 7, 8 and 10, sections 76(1)(a)(iaa), 76(1A)(b) and
76(4A)(f)]
Early termination of arbitration by agreement
1.201 If the parties are able to resolve the remuneration issue before
the panel makes its remuneration determination, they can agree to
terminate arbitration if neither party has yet made an information request.
The parties must notify the Chair of the agreement as soon as practicable
for the termination to take effect. If they fail to notify the Chair in time
and the panel proceeds to make its remuneration determination, the
remuneration determination prevails. [Schedule 1, item 1, section 52ZW]
Final offers
1.202 Each of the bargaining parties must submit to the panel a final
offer on the remuneration amount to be paid by the responsible digital
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News Media and Digital Platforms Mandatory Bargaining Code
platform corporation to the registered news business corporation for
making available the registered news business corporation's covered news
content. [Schedule 1, item 1, section 52ZX]
1.203 Final offers are due within the time specified in the Code, unless
the panel grants an extension for exceptional circumstances (or if the
regulations set another period). Each party must give a copy of its offer to
the ACCC, who will then give a copy to the other party. [Schedule 1, item 1,
sections 52ZX(2)-(4)]
1.204 The bargaining parties may submit a response submission to the
panel about the other party's final offer. The response submission may
only deal with issues that are dealt with in the material accompanying the
respective final offers. As with final offers, parties are to give a copy of
their response submission to the ACCC, who will then give a copy to the
other party. [Schedule 1, item 1, sections 52ZX and 52ZZB]
1.205 The ACCC may also provide a submission to the panel in
relation to the final offers of the bargaining parties. The bargaining parties
may submit a response submission to the ACCC's submission. [Schedule 1,
item 1, section 52ZZC]
1.206 The panel must accept one of the final offers, unless the panel
considers that each final offer is not in the public interest because it is
highly likely to result in serious detriment to the provision of covered
news content in Australia or to Australian consumers. [Schedule 1, item 1,
section 52ZX(7)]
Arbitration is time-limited
1.207 The panel must make the written final determination for
remuneration no later than 35 business days (unless another deadline is
prescribed in regulations) after the latest of the deadline for final offers,
the deadline for response submissions, the deadline for an ACCC
submission or the deadline for bargaining party responses to an ACCC
submission. This accounts for the fact that parties or the ACCC may opt
not to make response submissions. [Schedule 1, item 1, section 52ZZA]
What must the panel consider in making its determination?
1.208 In making a determination on the remuneration issue, the panel
must consider the benefit (monetary or otherwise) of the registered news
business' covered news content to the designated digital platform service
and the benefit (monetary or otherwise) to the registered news business of
the designated digital platform service making available the registered
news business' covered news content. [Schedule 1, item 1, section 52ZZ]
1.209 The panel must also consider the cost to the registered news
business of producing covered news content and whether a particular
amount of remuneration would place an undue burden on the commercial
interests of the designated digital platform service. [Schedule 1, item 1,
section 52ZZ]
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1.210 When considering all the matters above, the panel must consider
the bargaining power imbalance between Australian news businesses and
the designated digital platform corporation. This allows the panel, in
making their determination, to consider the outcome of a hypothetical
scenario where commercial negotiations take place in the absence of the
bargaining power imbalance. [Schedule 1, item 1, section 52ZZ(2)]
Example 1.7 Panel determination
The Daily Chronicle (DC) is a registered news business that receives a
benefit from referrals to its website from Digiplat, a designated digital
platform service that holds a significant bargaining power imbalance in
its commercial relationships with Australian news businesses including
DC. When assessing both parties' final offers, the panel considers how
the benefit that DC receives from Digiplat is affected by this
bargaining power imbalance derived from Digiplat's status as an
'unavoidable trading partner' for Australian news businesses.
To do this, the arbitrator considers arguments in the final offers about
the size of the benefit that would likely be provided by Digiplat to DC
when compared to a hypothetical scenario where there is an absence of
any bargaining power imbalance.
The hypothetical scenario the panel decides is appropriate in this
circumstance is one in which audiences may reach DC through other
means (such as users directly visiting DC's website or accessing it
through other news aggregators) and where DC and other Australian
news businesses are not reliant on Digiplat to reach those audiences.
1.211 The Bill does not specify what form remuneration must take,
which will allow the registered news business corporation and responsible
digital platform corporation to determine their own approach to
remuneration (for example, lump sum, regular payments calculated with
respect to volumes or amounts of news content or other measures of user
engagement). However, if a party submits offers for non-lump sum
payments, these offers should include estimates amounting to a single
two-year payment figure.
1.212 If the panel does not accept one of the final offers made by the
parties, it must adjust the most reasonable of those offers in a manner that
takes into account the above factors, and results in that offer being in the
public interest. [Schedule 1, item 1, section 52ZX(8)]
1.213 If one of the parties fails to make a final offer, the panel must
accept the final offer submitted by the other party, or adjust that offer in
accordance with the above factors. [Schedule 1, item 1, section 52ZX(9)]
1.214 If neither party makes a final offer within the mandatory
timeframe set out under the Code, the arbitration terminates the next day,
and the parties cannot utilise the arbitration process under the Code for a
period of two years. [Schedule 1, item 1, sections 52ZL(4) and 52ZY]
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News Media and Digital Platforms Mandatory Bargaining Code
Decision-making by the panel
1.215 The Bill provides that panel members must endeavour to make
unanimous decisions. Where a unanimous decision is not possible, the
panel must make the determination by majority decision of the members
of the panel. [Schedule 1, item 1, section 52ZZA(2)]
Effect of arbitral determination
1.216 The bargaining parties must comply with the arbitral panel's
determination. [Schedule 1, item 1, section 52ZZE]
1.217 A failure to comply is subject to a maximum civil penalty of the
greatest of:
• $10 million;
• if the court can determine the value of the benefit obtained
and that is reasonably attributable to the act or omission -
three times the value of that benefit; and
• if the court cannot determine the value of that benefit -
10% of annual turnover during the period of 12 months
ending at the end of the month in which the act or omission
occurred.
[Schedule 1, items 7, 8 and 10, sections 76(1)(a)(iaa), 76(1A)(b) and
76(4A)(h)]
1.218 The obligation to pay the remuneration amount consistent with
the arbitral determination is also enforceable by private action. As with
any breach of the Code, the standard provisions in the CCA for
injunctions and damages apply, which would, for example, enable the
registered news business corporation or the ACCC to seek a court order
for payment. [Schedule 1, items 11 and 12, sections 80(1)(a)(iiaa) and 82(1)(a)]
Duration of arbitral determination
1.219 The amount determined by the arbitral panel is for remunerating
the registered news business for making its covered news content
available by the designated digital platform service for two years.
[Schedule 1, item 1, section 52ZX(1)(b)]
1.220 Nothing prevents the parties agreeing to continue the
arrangement into subsequent years.
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Information requests
1.221 During arbitration, either of the bargaining parties may make
one request that the other bargaining party provide it with information if
the request is reasonable for the purposes of the arbitration. The
requesting party must also give the panel a copy of the request. [Schedule 1,
item 1, sections 52ZT(1) and (4)]
1.222 This request may relate to information held by the responsible
digital platform corporation and any related bodies corporate or
information held by the registered news business corporation for the
registered news business and any related bodies corporate. That is, the
bargaining parties are responsible for ensuring information in the control
of their respective corporate groups is provided, regardless of whether it is
in their direct possession. [Schedule 1, item 1, section 52ZT(2)]
1.223 The request must be made in writing, set out reasons why it is
reasonable for the information to be provided and comply with any
regulations. [Schedule 1, item 1, section 52ZT(3)]
1.224 The other bargaining party must ensure that the request is
complied with no later than 10 business days after it was made or ruled
reasonable by the panel (unless another deadline is prescribed in
regulations) and that the information is given in terms that are readily
comprehensible, compliant with any regulations, and specific to the
service in question. [Schedule 1, item 1, section 52ZT(5)]
1.225 Alternatively, the other bargaining party may apply to the panel,
in writing, for a ruling that it was not reasonable for the other bargaining
party to make the request for the purposes of the arbitration, in relation to
all or parts of the information requested. This application must be made
within 10 business days of receiving the request (unless another deadline
is prescribed in regulations). [Schedule 1, item 1, sections 52ZU(1), (2) and (4)]
1.226 The panel may find that such a request is not reasonable, in
which case the bargaining party who received the request need not
comply. Otherwise, the receiving party must comply within 10 business
days (unless another deadline is prescribed in regulations) from the
panel's decision. [Schedule 1, item 1, sections 52ZT(5) and 52ZU(6)]
1.227 The panel must make its finding within 10 business days (unless
another deadline is prescribed in regulations). In making its finding, it
must consider the factors set out for making the remuneration
determination during final offer arbitration. [Schedule 1, item 1,
sections 52ZU(3) and (5)]
1.228 The parties are not required to give information which, if
disclosed, would reveal a trade secret or give information that is personal
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News Media and Digital Platforms Mandatory Bargaining Code
information within the meaning of the Privacy Act 1988. [Schedule 1, item 1,
sections 52ZV(1) and (2)]
1.229 If the responsible digital platform corporation gives information
or data to the bargaining news business representative, the bargaining
news business representative must ensure that the information is not used
for any purpose other than the arbitration. [Schedule 1, item 1, section 52ZV(3)]
1.230 A failure to comply with a reasonable information request is
subject to a maximum civil penalty of 600 penalty units. The same applies
if a recipient of information uses the information for a purpose other than
the arbitration. [Schedule 1, items 7, 9 and 10, sections 76(1)(a)(iaa), 76(1A)(bab) and
76(4A)(g)]
The role of the ACCC
1.231 The ACCC may make written submissions to the arbitral panel.
[Schedule 1, item 1, section 52ZZC]
1.232 As stated above, the ACCC will receive copies of final offers
and any response submissions by parties. Any submission made by the
ACCC on its own initiative must be provided to the arbitral panel and a
copy provided to the bargaining parties within 10 business days of
receiving each bargaining party's final offer. Any responses the
bargaining parties may wish to make to the ACCC submission must be
provided to the panel within five business days, with a copy to the ACCC
(who will then give a copy to the other party). [Schedule 1, item 1, section
52ZZC]
1.233 Any submissions made by the ACCC do not bind the arbitrators
to any particular course of action.
1.234 The ACCC may also make guidelines relating to the conduct of
arbitration under the Code. The arbitral panel may take them into account
in conducting the arbitration. The validity of the arbitration will not be
impacted if the panel chooses not to take the guidelines into account.
[Schedule 1, item 1, section 52ZZD]
1.235 However, the ACCC cannot include matters related to the
following in its guidelines without the approval of the Minister:
• how a panel makes a ruling on information requests;
• the content of bargaining parties' final offers;
• the content of bargaining parties' response submissions; and
• how a panel makes the remuneration determination.
[Schedule 1, item 1, section 52ZZD(2)]
1.236 The Bill clarifies that the ACCC guidelines are not a legislative
instrument. This clarification is merely declaratory of the law as the
guidelines would not be a legislative instrument within the meaning of
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Treasury Laws Amendment (News Media and Digital Platforms Mandatory Bargaining Code)
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section 8(1) of the Legislation Act 2003, and is included merely to assist
readers of the legislation. [Schedule 1, item 1, section 52ZZD(7)]
1.237 General information made available by the ACCC in accordance
with subsection 28(1) of the CCA must not relate to the conduct of
arbitration under the Code. [Schedule 1, item 1, section 52ZZD(6)]
Record keeping and information-gathering powers
1.238 Regulations may specify requirements for responsible digital
platform corporations to generate and keep records relating to the
operation of the Code. [Schedule 1, item 1, sections 52ZZF(1) and (2)]
1.239 A failure to comply is subject to a maximum civil penalty of 600
penalty units. [Schedule 1, items 7, 9 and 10, sections 76(1)(a)(iaa), 76(1A)(bab) and
76(4A)(i)]
1.240 The ACCC may give the responsible digital platform
corporation a notice requiring it to produce those records. The existing
investigation power framework for industry codes under the CCA is
applied for this purpose. [Schedule 1, item 1, section 52ZZF(3)]
1.241 Whether or not regulations prescribe record-keeping
requirements as explained above, the ACCC's standard information-
gathering powers under section 155 of the CCA also apply. Notices issued
under section 155 are used by the ACCC to gather information,
documents and evidence about potential contraventions of the law or that
are relevant to specific ACCC functions and powers. [Schedule 1, items 1, 19
and 20, sections 52ZZF(4), 155(2)(b)(ib) and 155(9AB)]
1.242 The ACMA's information-gathering powers in Part 13 and
power to seek civil penalties in Part 14B of the Broadcasting Services
Act 1992 are also applied to the operation of the Code. In particular, these
powers enable the ACMA to address non-compliance with the Code's
eligibility requirements. The maximum civil penalty for obstruction of a
hearing or non-compliance with a requirement to give evidence is set at
600 penalty units. [Schedule 1, item 1, section 52ZZN]
1.243 No Ministerial directions may be made to the ACMA in relation
to the exercise of these information-gathering powers, or in relation to any
other power or function the Code confers on the ACMA. [Schedule 1, item 1,
section 52ZZO]
Consequences of contravention
Civil penalties
1.244 Civil penalties apply for many (but not all) contraventions of the
new Part IVBA.
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News Media and Digital Platforms Mandatory Bargaining Code
1.245 The Code also contains a number of procedural requirements, a
breach of which attracts a procedural consequence but not a liability for
any pecuniary penalty.
1.246 In the case of non-differentiation, good faith obligations and
compliance with an arbitral determination, the maximum civil penalty for
an act or omission, is the greatest of:
• $10 million;
• if the court can determine the value of the benefit obtained
and that is reasonably attributable to the act or omission -
three times the value of that benefit; and
• if the court cannot determine the value of that benefit -
10% of annual turnover during the period of 12 months
ending at the end of the month in which the act or omission
occurred.
[Schedule 1, items 7, 8 and 10, sections 76(1)(a)(iaa), 76(1A)(b) and 76(4A)]
1.247 This is consistent with the maximum penalties applicable under
section 76 for a number of contraventions of the CCA.
1.248 Compliance by responsible digital platform corporations and
registered news business corporations with all of their respective
obligations under the Code is critical to the integrity of the scheme and the
achievement of its objectives. The maximum civil penalty reflects the
seriousness of the most egregious instances of non-compliance with the
Code. Flexibility in the penalty amount is provided to enable the ACCC to
seek penalties proportionate to the conduct. Minor breaches are not
expected to attract significant penalties under the Code.
1.249 For the purposes of calculating annual turnover under the third
limb of the maximum civil penalty, the turnover of related bodies
corporate is included. However, only turnover connected with the supply
of goods and services in Australia is relevant.
1.250 If a responsible digital platform corporation has contravened the
Code and it is not the designated digital platform corporation (that is, it is
an Australian entity), both the responsible digital platform corporation and
the designated digital platform corporation are jointly and severally liable
for the civil penalty. [Schedule 1, item 1, section 52ZZH]
Infringement notices
1.251 The ACCC may issue an infringement notice for a contravention
of the general requirements. The infringement notice penalty amount is
600 penalty units. This is consistent with the infringement notice penalty
amount applicable to certain contraventions of the Australian Consumer
Law by listed corporations. [Schedule 1, item 1, section 52ZZG]
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Other enforcement and redress mechanisms
1.252 On application from the ACCC, a registered news business
corporation, a responsible digital platform corporation or another person,
the court may grant an injunction in relation to a breach or proposed
breach of any provision of the Code. [Schedule 1, item 11, section 80(1)(a)(iiaa)]
1.253 The ACCC may accept a court enforceable undertaking under
section 87B in relation to matters arising under the Code.
1.254 A registered news business corporation can bring an action
seeking damages for loss or damage by conduct of a responsible digital
platform corporation in contravention of the Code. [Schedule 1, item 12,
section 82(1)(a)]
1.255 Non-punitive orders and other compensatory orders available
under the CCA also apply to contraventions of the Code. [Schedule 1,
items 15 to 18, sections 86C(4) and 87]
1.256 In the case of damages and other compensatory orders, the court
may make an order against a person involved in the contravention,
including, among other things, aiding, procuring and being knowingly
concerned in the contravention. [Schedule 1, item 6, section 75B(1)]
Review of the Code
1.257 A review of the Code will begin within one year of the new law
commencing and must be completed within a period of 1 year. A written
report of the review must be made publicly available by the Minister as
soon as practicable after the period of 28 days from when the Minister is
given the report. [Schedule 1, item 1, section 52ZZS]
Electronic transactions
1.258 Under the Electronic Transactions Act 1999, parties are required
to seek consent for providing written information or producing documents
to each other by electronic communication. However, the Code ensures
that the parties do not need to seek this consent before doing so. [Schedule
1, item 1, section 52ZZR]
1.259 Nothing in the Part affects how the Electronic Transactions
Act 1999 applies to the Broadcasting Services Act 1992 including Part 13
of the Broadcasting Services Act 1992, as that Part applies in relation to
this Part.
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News Media and Digital Platforms Mandatory Bargaining Code
Other amendments
1.260 The new Part IVBA will bind the Crown. [Schedule 1, item 2,
section 2B(1)(aaa)]
1.261 The new Part IVBA operates concurrently with State and
Territory laws. [Schedule 1, item 1, section 52ZZQ]
1.262 The new Part IVBA will extend to engaging in conduct outside
Australia by bodies corporate incorporated or carrying on business within
Australia. [Schedule 1, items 3 and 4, sections 5(1)(aa) and 5(1)(f)]
1.263 The Minister cannot use the general directions power under the
CCA to direct the ACCC with regard to the new Part IVBA. [Schedule 1,
item 5, section 29(1A)(a)]
1.264 Other amendments are also made to certain provisions about
findings and admissions of fact in prior proceedings, and conduct by
directors, employees or agents. [Schedule 1, items 13 and 14, sections 83(1)(b)(i),
84(1)(b) and 84(3)(b)]
1.265 The new Part IVBA is also added to the definition of 'core
statutory provision' in subsection 155AAA(21) to ensure that the
information protection provisions (about the use of information by the
ACCC) in the CCA also apply to the Code. [Schedule 1, item 21,
section 155AAA(21)(a)]
Application and transitional provisions
1.266 The Bill commences on the day after it receives the Royal
Assent. [Schedule 1, clause 2]
51
Chapter 2
Digital Platforms Inquiry: Supplementary
Analysis on options for a Mandatory Code
Background
2.1 On 4 December 2017, the then Treasurer, the Hon Scott
Morrison MP, directed the ACCC to conduct an inquiry into the impact of
digital platform services on the state of competition in media and
advertising markets, in particular in relation to the supply of news and
journalistic content and the implications of this for media content creators,
advertisers and consumers.
2.2 On 26 July 2019, the ACCC published the Final Report of its
Digital Platforms Inquiry. This report identified that Facebook and Google
had each become unavoidable trading partners for Australian news media
businesses in reaching audiences online, resulting in an imbalance in
bargaining power. The ACCC recommended that designated digital
platforms be required to provide codes of conduct governing their
commercial relationships with Australian news media businesses to the
ACMA.
2.3 In December 2019, as part of its response to the Digital
Platforms Inquiry, the Government directed the ACCC to facilitate the
development of voluntary codes to address bargaining power imbalances
between digital platforms and news media businesses. The Government
indicated that if an agreement was not forthcoming, the Government
would develop alternative options to address concerns raised, which may
include the creation of a mandatory code.
2.4 On 20 April 2020 the Government asked the ACCC to develop a
mandatory code of conduct to address bargaining power imbalances
between Australian news media businesses and digital platforms,
specifically Google and Facebook, to help support a sustainable
Australian media landscape in the digital age. In making this decision, the
Government was concerned that the Australian media sector was already
under significant pressure which was being exacerbated by a sharp decline
in advertising revenue driven by the COVID-19 pandemic. Further, while
discussions between the parties about voluntary codes had been taking
place, advice provided to the Government by the ACCC suggested limited
progress had been made. Crucially, the ACCC considered it unlikely that
any voluntary agreement would be reached with respect to the key issue of
payment for content.
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Treasury Laws Amendment (News Media and Digital Platforms Mandatory Bargaining Code)
Bill 2020
2.5 This analysis is intended to supplement the analysis in the
Digital Platforms Inquiry Final Report for the purpose of consistency with
the Australian Government Guide to Regulatory Impact Analysis. It
considers the impacts of two possible designs of a mandatory code.
Impact analysis
2.6 A qualitative cost-benefit analysis of each option is below.
Option 1
2.7 A mandatory code of conduct between digital platforms and
news media businesses, with minimum standards of information sharing
for digital platforms, bargaining requirements and arbitration to resolve
disputes about remuneration.
Option 1: Mandatory code of conduct
Benefits Costs
Remuneration for news content Parties to the code would face
through negotiation or arbitration could compliance costs to register under the
contribute to sustainable employment code.
of journalists and production of news Digital platforms would have
content. compliance costs associated their
Remuneration for covered news obligations under the minimum
content could sustain the current standards.
availability of news media for Parties to the code would incur costs as
consumers. part of the bargaining and arbitration
Consumers may also benefit from processes. In the case of arbitration,
news media companies no longer being both parties would share equally the
as reliant on paywalls to pay for arbitrator's fee. These costs could be
journalism, as a result of remuneration reduced for news media businesses by
for covered news content. This would engaging in collective bargaining.
improve access to news media content Digital platforms designated under the
and reduce consumer prices. code would face uncertainty regarding
News media businesses would benefit the number of arbitrations and possible
from greater awareness of changes to outcomes of those arbitrations.
digital platform services through the Digital platforms could restrict or
code's minimum standards, improving withdraw services in Australia to
their ability to monetise content. minimise financial liabilities under the
code. This would result in a reduction
in available digital services for
consumers.
The Government would incur costs to
administer and enforce the code
through the ACMA and the ACCC.
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Digital Platforms Inquiry: Supplementary Analysis on options for a Mandatory Code
Option 2
2.8 A mandatory code of conduct with the same features as option 1,
but with the additional of frameworks to encourage deals outside the code,
in the form of a "standard offer" that digital platforms would be able to
make available to news media businesses. This option would allow news
media businesses to receive remuneration without having to go through
protracted negotiations or arbitration. If a news media business elected to
take up one of these standard offers, the negotiation and arbitration
provisions of the code would be unavailable to them.
Option 2: Mandatory code of conduct with a framework to encourage deals
outside the code
Benefits Costs
Remuneration for news content Parties to the code would face
through negotiation or arbitration could compliance costs to register under the
contribute to sustainable employment code. However, these would be lower
of journalists and production of than option 1, given fewer registrations
journalism on topics of public interest. could be expected owing to the out-of-
Remuneration for covered news code bargaining framework.
content could sustain the current Digital platforms would have
availability and variety of news media compliance costs associated with their
for consumers. obligations under the code's minimum
Consumers may also benefit through standards.
news media companies no longer being Parties to the code would incur costs as
as reliant on paywalls to pay for part of the bargaining and arbitration
journalism, as a result of remuneration processes. In the case of arbitration,
for covered news content. This would both parties would share equally the
improve access to news media content arbitrator's fee. However, these costs
and reduce consumer prices. would be lower in aggregate than
News media businesses would benefit option 1, given the out-of-code
from greater awareness of changes to bargaining framework would
digital platform services through the incentivise deals that do not draw on
code's minimum standards, improving the negotiation and arbitration
their ability to monetise content. These provisions of the code. The standard
minimum standards would apply to offer process similarly provides a
news businesses that did negotiate with mechanism to avoid these costs, and
platforms within the framework of the may be attractive for smaller news
code, and it would also be open to media businesses, including those in
news businesses negotiating outside regional Australia.
the code to incorporate elements of the Digital platforms designated under the
minimum standards into these code would face some uncertainty
negotiations. regarding the number of arbitrations
and the outcomes of arbitration.
However, the standard offer provision
would allow them to target offers to
news media businesses and in doing so
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Treasury Laws Amendment (News Media and Digital Platforms Mandatory Bargaining Code)
Bill 2020
Option 2: Mandatory code of conduct with a framework to encourage deals
outside the code
Benefits Costs
this would reduce the uncertainty.
The Government would incur costs to
administer and enforce the code
through the ACMA and the ACCC.
Identified risks from proposed options
Risk - Reduced availability of digital services for consumers
2.9 In response to an early exposure draft Code released in July
2020 by the ACCC, Google publicly stated that it would affect its
provision of relevant search and other services due to a number of
concerns about how the code would operate in practice. Facebook
publicly stated that it would stop users sharing news on Facebook
NewsFeed. The final code:
• addresses concerns about unbalanced arbitration, by ensuring
that the code considers the value digital platforms provide to
news businesses, as well as the benefits that news businesses
bring to digital platforms;
• makes clear that digital platforms will not be required to hand
over trade secrets, protecting confidential algorithms. While
platforms will be required to give advanced notice to news
businesses of some planned changes to algorithm changes, no
information about the algorithm itself need be provided;
• addresses concerns about being required to share user data,
by making it clear that digital platforms are in no way
obliged to provide any user data in breach of the Privacy Act;
• addresses concerns that digital platforms would be required
to provide tools to news businesses that would allow them to
moderate user comments; and
• better targets services that distribute news content where it
has been proven that a significant bargaining power
imbalance exists. Similarly, the minimum standard
obligations have been amended to only apply to services the
Treasurer designates- not any other services provided by
digital platforms.
Risk - Court proceedings following introduction of legislation
2.10 The Code has been constructed to minimise the potential for
successful legal challenge under the Australian law. Nevertheless, it is
56
Digital Platforms Inquiry: Supplementary Analysis on options for a Mandatory Code
possible that, for example, decisions by the Treasurer to designate digital
platforms could be subject to legal challenge.
Regulatory burden estimate (RBE) table
2.11 In estimating regulatory burden costs, it is assumed that under
both options two digital platforms will be designated under the code
initially, based on the findings of the Digital Platforms Inquiry that two
digital platforms have a bargaining power imbalance with news media
businesses.
2.12 Under both options, it is assumed that between 100 and 200
news media businesses will be part of the code. This is based on available
public information of news media businesses which, based on a desktop
assessment, meet the eligibility criteria to register for the code. Public
information includes the ACMA's media ownership and control registers
and the membership of the Press Council. Further assumptions include:
• 20 news media businesses would have the financial resources
to pursue individual negotiations and arbitrations. This
reflects the relative concentration of the Australian media
market;
• The remainder would form collectives for the purpose of
bargaining, comprising on average 10 per cent of the
remaining news media businesses; and
• 75 per cent of bargaining processes will ultimately proceed to
arbitration. This is a conservative estimate, given the
difficulties estimating the variables associated with
approaches parties take to commercial bargaining which
influence the possibility of a deal being reached before
arbitration.
2.13 The differing assumptions under option 2 are as follows:
• 20 news media businesses would have the financial resources
to pursue individual negotiations and arbitrations. This
reflects the relative concentration of the Australian media
market;
• 80 per cent of the remainder would use the standard offers to
agree remuneration with the digital platforms;
• The remainder would form collectives for the purpose of
bargaining, comprising on average 25 per cent of the
remaining news media businesses; and
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Treasury Laws Amendment (News Media and Digital Platforms Mandatory Bargaining Code)
Bill 2020
• 75 per cent of bargaining processes will ultimately proceed to
arbitration. This is a conservative estimate, for reasons
discussed above.
2.14 The costs of options 1 and 2 largely reflect the costs of
registration under the code, the compliance obligations created by the
minimum standards, and the costs incurred through negotiation and
arbitration. The lower cost of option 2 reflects the reduced number of
negotiations and arbitrations taking place, owing to news media
businesses which take up a standard offer.
2.15 The substantive compliance costs which contribute the most to
the overall regulatory costs are:
• the requirement to provide information in an arbitration if the
arbitrator determines a request is reasonable, given the
expense parties will incur in gathering financially sensitive
information and determining what they are legally required to
provide;
• the costs of engaging the arbitrator or arbitral panel, which
reflects the conservative estimate of the number of
arbitrations likely under the code; and
• the requirements for the digital platforms to provide
registered news businesses corporations with advance
notification of algorithm changes.
2.16 Note that the regulatory costs below do not include estimates of
any payments from digital platforms to news media businesses, as these
are considered a direct financial cost and are therefore excluded from a
regulatory cost assessment. Under both options, there are no impacts on
community organisations or individuals, as only businesses can be parties
to the code.
Average annual regulatory costs (from business as usual)
Change in Business Community Individuals Total change in
costs organisations cost
Option 1 $11,783,675.93 - Nil Nil $11,783,675.93 -
$16,379,917.45 $16,379,917.45
Option 2 $10,464,256.58 - Nil Nil $10,464,256.58 -
$12,986,507.23 $12,986,507.23
58
Chapter 3
Statement of Compatibility with Human
Rights
Prepared in accordance with Part 3 of the Human Rights
(Parliamentary Scrutiny) Act 2011
Treasury Laws Amendment (News Media and Digital Platforms Mandatory
Bargaining Code) Bill 2020
3.1 This Bill is compatible with the human rights and freedoms
recognised or declared in the international instruments listed in section 3
of the Human Rights (Parliamentary Scrutiny) Act 2011.
Overview
3.2 The Bill establishes a mandatory code of conduct to address
bargaining power imbalances between digital platform services and
Australian news businesses.
3.3 The Bill achieves this by creating a set of rules and obligations
that news media businesses and digital platform corporations must abide
by when bargaining about the news media business' covered news content
which is made available by the digital platform service. These rules and
obligations include:
• that news media businesses and digital platform corporations
must bargain in good faith;
• where the parties cannot come to an agreement during the
bargaining, that the news media business can commence
arbitration over the issues by notifying the ACCC;
• that digital platform corporations must provide registered
news business corporations with advance notification of
planned changes to an algorithm or other internal policies
that will have a significant effect on covered news content;
• a prohibition on responsible digital platform corporations
treating the news media content of news media businesses
participating in the code differently to the news media
content from news media businesses who are not
participating in the Code;
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Treasury Laws Amendment (News Media and Digital Platforms Mandatory Bargaining Code)
Bill 2020
• that a news media business cannot commence bargaining
with a digital platform corporation if they have already
reached a commercial agreement outside the Code; and
• that a digital platform corporation can make a standard offer
to news media businesses which disapply the bargaining and
arbitration rules under the Code if news media businesses
accept the offer.
3.4 The Bill provides that the Code will apply to digital platform
corporations and digital services which have been designated by the
Minister. The Minister may only designate a digital platform corporation
and digital services if the Minister has considered whether there is a
power imbalance between the news media business and the digital
platform corporation.
Human rights implications
Right to a fair trial
3.5 The Bill engages the right to a fair trial in Article 14 of the
ICCPR by making many contraventions of the new Part IVBA subject to
the imposition of a civil penalty.
3.6 The civil penalty provisions contained in the new Part IVBA are
not 'criminal' for the purposes of human rights law. While a criminal
penalty is deterrent or punitive, these provisions are regulatory and
disciplinary as they aim to encourage compliance with the obligations
under the Code.
3.7 The provisions are intended to target relevant corporations.
Furthermore they do not apply to the general public, but to a class (news
media businesses and digital platform corporations) who should
reasonably be aware of their obligations under the CCA.
3.8 Imposing these civil penalties will enable an effective response
to non-compliance. The maximum civil penalty amounts that can be
imposed under the new Part IVBA are intentionally significant and are in
line with the penalties for other provisions in the CCA.
3.9 The judiciary continues to have discretion to consider the
seriousness of the contravention and impose a penalty that is appropriate
in the circumstances. The civil courts are experienced in making civil
penalty orders at appropriate levels having regard to the maximum penalty
amount, taking into account a range of factors including the nature of the
contravening conduct and the size of the organisation involved.
60
Statement of Compatibility with Human Rights
3.10 Therefore, a relevant consideration in setting a civil penalty
amount is the maximum penalty that should apply in the most egregious
instances of non-compliance with the new Part IVBA.
3.11 Finally, the civil penalties carry no sanction of imprisonment for
non-payment of the penalty. Based on the above factors, the nature and
severity of the civil penalties in the new Part IVBA are not 'criminal' for
the purposes of human rights law.
Protection from arbitrary or unlawful interference with privacy
3.12 The Bill does not engage the right to protection from arbitrary or
unlawful interference with privacy under Article 17 of the International
Covenant on Civil and Political Rights (ICCPR).
3.13 The Bill provides that a digital platform corporation must
provide, to a registered news media business, a list and explanation of data
that relates to user interactions with the news media business' covered
news content to that news media business. The list and information must
be updated annually. [Schedule 1, item 1, section 52R]
3.14 Under the Code, parties may also bargain to receive data that
may include personal information, under the existing operation of the
Privacy Act 1988, by specifying this as a 'specified issue' for bargaining
about. [Schedule 1, item 1, section 52ZG]
3.15 Under the arbitration framework in the Bill, parties may ask
each other for information, including personal information, but only as
permitted by the existing Privacy Act 1988. [Schedule 1, item 1, section 52ZT]
3.16 These obligations and abilities do not interfere with Article 17 of
the ICCPR because they do not require or authorise any additional use or
disclosure of information than what is already regulated under the Privacy
Act 1988, so the Bill does nothing to change the privacy protections for
personal information already in place under Australian law. [Schedule 1,
item 1, sections 52ZB and 52ZV]
Conclusion
3.17 Accordingly, to the extent that Schedule 1 engages with the
rights under Article 14 and 17 of the ICCPR, it is compatible with human
rights as any limitations are reasonable, necessary and proportionate.
61