FEDERAL COURT OF AUSTRALIA

Phonographic Performance Company of Australia Limited v Copyright Tribunal of Australia [2019] FCAFC 95

ORDERS

THE COURT ORDERS THAT:

1.    Pursuant to s 16(1) of the Administrative Decisions (Judicial Review) Act 1975 (Cth), that part of the decision of the Copyright Tribunal of Australia made on 5 January 2018 that varied the first applicant’s licence scheme by the inclusion of the range of rights to be licensed by the first applicant which have not themselves been licensed to the first applicant from its own members (non-PPCA rights) be set aside.

2.    The matter be referred to the Copyright Tribunal of Australia for further consideration of such confirmation, variation or substitution of the scheme as the Tribunal considers reasonable in order to remove the non-PPCA rights from the licence, and any consequential matters that the Tribunal sees fit to consider, in accordance with the reasons of the Full Court of the Federal Court of Australia published this day.

3.    Each party who seeks an order for costs shall file and serve within seven days written submission limited to five pages setting out the order sought and the submissions in support thereof, and each party who opposes an order for costs against them, shall file and serve within 14 days written submissions limited to five pages in response.

4.    Until further order of the Court or a judge of the Court, pursuant to s 37AF of the Federal Court of Australia Act 1976 (Cth) (the Act) and on the ground identified in s 37AG(1)(a) of the Act, publication or disclosure of the unredacted reasons for judgment of this Court be restricted to the legal advisers of the parties.

5.    Until further order of the Court or a judge of the Court, for the purposes of r 2.32 of the Federal Court Rules 2011 (Cth), the unredacted reasons for judgment of this Court be confidential.

Note:    Entry of orders is dealt with in Rule 39.32 of the Federal Court Rules 2011.

REASONS FOR JUDGMENT

THE COURT:

INTRODUCTION

1    This is an application for judicial review by the Phonographic Performance Company of Australia Limited (PPCA) of a decision of the Copyright Tribunal of Australia (the Tribunal). PPCA invokes the jurisdiction of the Court in s 5 of the Administrative Decisions (Judicial Review) Act 1977 (Cth) (the ADJR Act) and s 39B of the Judiciary Act 1903 (Cth) (the Judiciary Act). The decision of the Tribunal was made on a reference under s 154(4) of the Copyright Act 1968 (Cth) (the Act) and resulted in an order made on 5 January 2018 to the effect that the licence scheme referred to the Tribunal be varied in the form of the scheme annexed to the Tribunal’s orders. The respondents to the application are the Tribunal and Foxtel Management Pty Limited (Foxtel). The Tribunal filed a submitting notice.

2    The Tribunal delivered three sets of reasons which are relevant to the order which it made. They are as follows: Phonographic Performance Company of Australia Limited under s 154(1) of the Copyright Act 1968 (Cth) [2016] ACopyT 3 (RD 1); Phonographic Performance Company of Australia Limited under s 154(1) of the Copyright Act 1968 (Cth) (No 2) [2017] ACopyT 1 (RD 2); Phonographic Performance Company of Australia Limited under s 154(1) of the Copyright Act 1968 (Cth) (No 3) [2017] ACopyT 2 (RD 3).

3    In its Further Amended Originating Application for Judicial Review, PPCA seeks three declarations. First, it seeks a declaration that the Tribunal does not have the power under s 154(4) of the Act to make an order varying the licence scheme so as to include rights which, by reason of the terms of PPCA’s input agreement with its member licensors, PPCA does not hold, is not authorised by its member licensors to grant, and does not have the power to grant. Secondly, further, or in the alternative, PPCA seeks a declaration that such a variation order could not or would not be “reasonable in the circumstances” within the meaning of that phrase in s 154(4). Thirdly, and in the alternative to the first or second declaration, PPCA seeks a declaration in terms of the first or second declarations sought, but including the identification of the rights which should not have been included in the licence scheme as follows:

(i)    the Audiovisual Streaming Rights, to the extent that those rights include the right to permit users to make and store copies of the Audiovisual Content for later viewing on a one-off basis (RD 2 at [31]–[32]);

(ii)    the On-demand Offering Rights, to the extent that those rights apply to Programs or feature films that have not previously been Broadcast or will not in the next 30 days be Broadcast by the Subscription Television Provider (RD 2 at [36]–[37]); and

(iii)    the Digital Content Rental Rights, to the extent that those rights apply to Programs that have not been Broadcast (RD 2 at [42]– [44]).

4    PPCA also seeks an order setting aside the order made by the Tribunal from the date on which it was made. Finally, in terms of substantive orders, PPCA seeks an order remitting the matter to the Tribunal for reconsideration according to law and in accordance with the reasons of the Court.

5    The Tribunal included a judge of this Court and, in those circumstances, this Court is constituted as a Full Court (Federal Court of Australia Act 1976 (Cth) s 20(2)).

6    On 23 July 2018, Sony Music Entertainment Australia Pty Ltd (Sony), Universal Music Australia Pty Limited (Universal) and Warner Music Australia Pty Limited (Warner) (collectively, the Majors) were each joined as an applicant to the proceeding. Their role in the proceeding was limited by order of the Court to submissions on what is hereafter described as Issue 5 or the Power Issue.

THE PARTIES TO THE APPLICATION AND THEIR ACTIVITIES

7    PPCA is a copyright collecting society which was established in 1969. It represents the interests of its copyright licensors and registered artists, including record companies and Australian recording artists who are the owners or exclusive licensees for Australia of the copyright in commercially released sound recordings and associated cinematographic films and who have licensed their rights to PPCA. PPCA grants licences authorising the exploitation of the sound recordings and music videos in its repertoire, including their public performance and, importantly, forms of communication, including broadcast. PPCA receives and distributes licence fees for these uses to its licensors and registered users (at [4] of RD 1).

8    PPCA is a company limited by shares and its shareholders are Sony, Universal and Warner. Those companies are Australia’s major record companies.

9    The agreements between PPCA and their licensors under which PPCA obtains rights to grant licences of the copyright in sound recordings are called “input agreements”. Under the input agreements, the licensors grant PPCA the non-exclusive right to grant non-exclusive licences of the copyright in the sound recordings owned or controlled by them. The Tribunal set out a non-exhaustive list of the rights in relation to sound recordings granted to PPCA under the input agreements as follows (at [6] of RD 1):

  (i)    public performance (causing sound recordings to be heard in public);

(ii)    broadcasting (transmission of content via radio frequency spectrum, cable, optical fibre or satellite);

  (iii)    datacasting;

  (iv)    simulcasting;

(v)    webcasting (non-interactive pre-programmed transmissions over the internet or a mobile telecommunications network);

  (vi)    interactive webcasting;

(vii)    audiovisual streaming (communication of audiovisual content to the public over the internet, a mobile telecommunications network or any other communications network, including by means of an interactive service or linear channel where no copy is created);

(viii)    music on hold (communicating sound recordings to telephone callers on hold by any means);

(ix)    on-demand offerings of programs which have been broadcast, by streaming or timed-out podcasts;

(x)    digital content rental (making available rental content by broadcast, streaming or timed out podcasts);

(xi)    technical copying (the right to make copies of sound recordings for the purpose of exercising the above rights in circumstances where s 107 of the Act does not apply); and

(xii)    ephemeral copying (the right to make and use a copy of a sound recording in circumstances referred to in s 107(3) of the Act or retain a copy of a sound recording after the expiry of the 12 month period referred to in s 107(5) of the Act).

10    A licence granted by PPCA covering all sound recordings in its repertoire is referred to as a “blanket” licence.

11    The Tribunal noted that as at April 2015, PPCA had over 1,766 licensors covering what was described as a vast repertoire. It includes over 40,000 licensor labels.

12    Foxtel is Australia’s largest provider of subscription television services. It is the manager of the Foxtel Partnership between Telstra Corporation Limited (Telstra) and News Corp Australia. The partnership interests in Foxtel are held in equal proportions by Telstra Media Pty Limited and Sky Cable Pty Ltd. In May 2012, Foxtel completed its acquisition of all of the issued shares in Austar United Communications Limited (Austar). Foxtel now provides subscription television services to former Austar subscribers.

THE GROUNDS OF JUDICIAL REVIEW AND ISSUES

13    Before identifying the grounds of judicial review, it is convenient to refer to the matters PPCA relies on to establish that it is a person aggrieved by the decision.

14    PPCA submits that although the Tribunal concluded that it was entitled to a substantial increase in the fees which it receives from the subscription television industry, the Tribunal’s decision was contrary to its interests and those of its members because (1) it refused to confirm the licence scheme referred to the Tribunal by it; (2) it determined a percentage increase that is not a “substantial” increase; and (3) it made an order that was not “reasonable in the circumstances”, including the circumstances as found by the Tribunal, as required by s 154(4) of the Act.

15    PPCA advanced six grounds of judicial review in its Further Amended Originating Application for Judicial Review. Those grounds, minus the substantial particulars which accompanies each of them, are as follows:

1.    The Tribunal did not have jurisdiction to make the Decision;

2.    The making of the Decision involved an improper exercise of the power conferred by s 154(4) of the Act, in that the Tribunal took into account irrelevant considerations and failed to take into account relevant considerations;

3.    The Decision involved an error of law;

4.    There was no evidence or other material to justify the making of the Decision, in that the Tribunal based the Decision on the existence of particular facts that did not exist; and

5.    The making of the Decision involved an improper exercise of the power conferred by s 154(4) of the Act, in that the exercise of that power in the Decision was so unreasonable that no reasonable person could have so exercised the power.

6.    A breach of the rules of natural justice occurred in connection with the making of the decision.

16    In its written outline of submissions and then orally at the hearing of the application, PPCA advanced its arguments by reference to five issues which it had identified and which are as follows:

(1)    The Tribunal itself asked the wrong question and did not provide procedural fairness to PPCA;

(2)    The Tribunal failed to consider the charges payable by Foxtel for use of the Australian Performing Rights Association (APRA) rights;

(3)    The Tribunal failed to consider the charges payable by commercial television providers;

(4)    The calculation of a “substantial” percentage increase misfired; and

(5)    The Tribunal erred by including rights in the scheme that PPCA had no authority to licence.

17    It will be convenient to analyse the Further Amended Originating Application for Judicial Review by reference to these five issues.

18    We should make it clear that the focus of PPCA’s application insofar as it relies on s 39B of the Judiciary Act was jurisdictional error. Other errors are identified under s 5 of the ADJR Act, such as error of law in s 5(1)(f). As it happens, almost all of the alleged errors advanced by PPCA were jurisdictional, such as asking the wrong question, a constructive failure to exercise jurisdiction and a failure to take a relevant consideration into account, and many of the cases to which the Court was referred by the parties were cases involving claims of jurisdictional error. We will express the Court’s conclusion in terms of judicially reviewable error which includes jurisdictional errors and errors identified in s 5 of the ADJR Act.

THE KEY ASPECTS OF THE TRIBUNAL’S DECISION

19    In this section of our reasons, we will summarise the key aspects of the Tribunal’s decision. It will be necessary to examine particular aspects of the Tribunal’s reasons in greater detail when we come to consider each of the five issues.

20    The issues on the reference related principally, but not exclusively, to the issue of price.

21    PPCA has licensed to Foxtel and other subscription television providers the use of the sound recordings in its repertoire since approximately 2001. The “current” licence granted by PPCA to Foxtel was dated 20 December 2004, but was backdated to March 2001. The licence fee paid by Foxtel to PPCA was calculated by reference to fixed fees per month for each subscriber. The subscribers were placed in various groups and there was provision for annual increases by reference to the Consumer Price Index. The agreement was terminated on 30 June 2011.

22    The scheme PPCA referred to the Tribunal (the PPCA proposed scheme) involved a non-exclusive licence, which was to run from 1 July 2011 until 30 June 2016. Significantly, the proposed scheme would impose in its final year, the financial year ending 30 June 2016, a fee of 0.24% of Foxtel’s gross revenue. The initial rate in 2011 was to be 0.12% which would gradually increase to 0.24%. The rates in the PPCA proposed scheme would increase the fees payable by Foxtel in the 2014 year by 846%.

23    The Tribunal said that, in the main, the dispute between the parties was concerned with the ascertainment of an appropriate fee and a determination of whether it should be paid by reference to revenue or continue on a Per Subscriber Per Month (PSPM) basis.

24    As we will explain in more detail later, in approaching its task concerning the appropriate price and pricing structure, the Tribunal, without complaint, followed an approach which was well-established as considering the following:

(1)    whether there is a market price and, if so, that price will be imposed;

(2)    if a market price is not available, the Tribunal will consider whether it can determine the bargain the parties might have reached in a hypothetical negotiation on a willing, but not over anxious basis;

(3)    if it is not possible to determine the bargain the parties might have reached in a hypothetical negotiation, then the Tribunal will examine comparable transactions to see whether they can throw any light on price; and

(4)    if the exercise in (3) does not provide the answer, then the Tribunal will engage in a process of judicial estimation which will involve “a synthesis of the relevant facts and circumstances into a rate which the Tribunal regards as reasonable or equitable in the circumstances”.

25    The Tribunal found that there was no means by which the market value of the rights in the PPCA proposed scheme may be ascertained and that there was no means by which it could determine how PPCA and Foxtel might deal with each other on a hypothetical basis. There are no grounds in PPCA’s Further Amended Originating Application for Judicial Review which challenge the Tribunal’s conclusions on this point.

26    The Tribunal then turned to consider whether there were any comparable bargains which provided assistance.

27    The Tribunal identified a number of what it said were potentially comparable transactions. The main transactions (in light of the grounds in PPCA’s Further Amended Originating Application for Judicial Review) identified by the Tribunal were as follows:

(1)    the 2004 PPCA-Foxtel agreement;

(2)    the 2006 APRA-Foxtel agreement;

(3)    the 2010 PPCA-FreeTV agreement;

(4)    the 2012 APRA-FreeTV agreement; and

(5)    the 2013 APRA-Foxtel agreement.

28    PPCA and Foxtel each called an expert in economics and economic theory who formulated and applied a valuation methodology which incorporated one or more of these agreements.

29    PPCA relied on expert evidence from a Mr Thorpe who advanced two approaches to the valuation exercise in the alternative. The first was the “top down” approach which involved primarily the use of the 2010 PPCA-FreeTV agreement. The second was the relativity approach which involved a formula incorporating the rates in the 2010 PPCA-FreeTV agreement, the 2012 APRA-FreeTV agreement and the 2013 APRA-Foxtel agreement.

30    Foxtel relied on expert evidence from a Dr Pleatsikas who, in many respects, adopted a similar approach to that used by Mr Thorpe in his relativity approach, save and except that the agreements he considered to be relevant were the 2004 PPCA-Foxtel agreement, the 2006 APRA-Foxtel agreement and the 2013 APRA-Foxtel agreement.

31    The Tribunal rejected the approach advanced by each expert because, for reasons it gave, it considered it unsafe to rely on the agreements (or at least some of them) the experts relied.

32    Many of PPCA’s complaints in its Further Amended Originating Application for Judicial Review relate to the Tribunal’s reasons for not relying on one or more of these agreements.

33    The Tribunal moved to the process of judicial estimation and in this context it referred to a number of matters. It expressed its conclusions on the issue of valuation as follows (at [124] of RD 1):

124    The Tribunal has concluded that PPCA is entitled to a substantial increase in the fees which it receives from the subscription television industry. The floor on this increase may be discerned by reference to the 59% increase which occurred after the Gyms Case, and Foxtel’s approximately 20% increase in channel numbers and [redacted] increase in ARPU over the relevant period. That this is a floor may be discerned from the growth of the on-line aspects of subscription television and the protected nature of sound recordings communicated to the public via such means. The Tribunal regards these as fundamental changes to the nature of the industry and the way in which Foxtel operates. The Tribunal has concluded that PPCA is entitled to a 150% increase in the fees it was being paid in the last year of the current agreement, i.e. the year ending 30 June 2011. Put another way, under the new licence scheme the percentage of revenue rate applying in the final year of the reference will be 2.5 times greater than the percentage of revenue rate implicit in the final year of the former agreement.

(redaction in original)

34    The Tribunal then considered and upheld a submission that the fee should no longer be calculated on a PSPM basis, but instead should be “made a function of the revenues derived from Foxtel’s subscription television business” (at [125] of RD 1]).

35    In RD 1, the Tribunal decided what it described as the direct pricing issues. In RD 2, the Tribunal resolved a number of other issues, including (importantly for the purposes of this application), the “Power Issue”, that is, whether the Tribunal could impose non-price terms by means of schemes which were inconsistent with the terms under which PPCA was itself licensed by its own members and what the Tribunal described as the “Streaming and On-demand Issues”. The principal issue addressed by the Tribunal in RD 3 was the drafting consequences of the Tribunal’s conclusions with respect to the Power Issue.

Issue 1: Did the Tribunal ask itself the wrong question and fail to provide procedural fairness to PPCA?

36    In order to make good its argument with respect to Issue 1, PPCA relies heavily on the approach which the Tribunal describes in [124] of RD 1. That paragraph is set out above (at [33] of these reasons). The current agreement referred to in [124] of RD 1 is the 2004 PPCA-Foxtel agreement.

37    PPCA submits that the Tribunal adopted an incorrect and unsafe reference point in identifying the 2004 PPCA-Foxtel agreement and that this was an outdated historical bargain which was entered into by the parties in 2004. PPCA identified two questions. It submits that the correct question on a reference under s 154(4) is whether the scheme as proposed or varied is reasonable in the circumstances. The question of whether there is or should be an increase in a rate found in an existing agreement and, if so, what should be the quantum of the increase, is not the correct question. PPCA submits that asking the wrong question is, by itself, a jurisdictional error as well as being likely to lead to other errors which are jurisdictional, such as failing to consider relevant considerations or considering irrelevant considerations.

38    PPCA submits that the Tribunal has in the past identified a number of possible approaches to the valuation task, that is, the task of determining whether the proposed licence fee is reasonable in the circumstances. In Reference by Phonographic Performance Company of Australia Ltd under s 154(1) of the Copyright Act 1968 [2007] ACopyT 1; (2007) 73 IPR 162 (Reference by Phonographic Performance Company of Australia Ltd), the Tribunal identified a number of these approaches in the following passages (at [11]–[12]):

11    In determining whether a proposed scheme, and the licence fee payable under it, are reasonable, a number of approaches might be adopted. The approaches include the following, which may overlap to a certain extent:

• Market rate: the rate actually being charged for the same licence in the same market in similar circumstances.

• Notional bargain rate: the rate on which the tribunal considers the parties would agree in a hypothetical negotiation, between a willing but not anxious licensor and a willing but not anxious licensee.

• Comparable bargains: bargains not in the same market but sufficiently similar to such a notional bargain as to provide guidance to the tribunal.

• Judicial estimation: the rate determined by the tribunal after taking into account a range of matters such as:

  • previous agreements or negotiations between the parties;

  • comparison with other jurisdictions;

• comparison with rates set by other licensors, capacity to pay, value of the copyright material, the general public interest and the interests of consumers; and

• administrative costs of a licensing body: see Audio-Visual Copyright Society Ltd v Foxtel Management Pty Ltd (No 4) (2006) 68 IPR 367 at [131] and [142].

12    The society contends, in essence, that there is no market rate or comparable bargain available in the present case. The tribunal’s approach, therefore, must be a combination of notional bargain rate and judicial estimation. It may be that the latter includes the former.

39    PPCA submits that the Tribunal did not adopt any of these approaches. It submits that the approach adopted by the Tribunal of fixing a floor based on an increase in fees in an unrelated industry indicates that the Tribunal strayed from its statutory task of determining whether the scheme, or a variation of it, was reasonable in the circumstances. In addition, PPCA submits that the Tribunal did not give it the opportunity to be heard on this approach and thereby denied it procedural fairness. This way of putting the procedural fairness argument differs from the way the argument was put in Dranichnikov v Minister for Immigration and Multicultural Affairs [2003] HCA 26; (2003) 197 ALR 389 (Dranichnikov). The argument in Dranichnikov was that the formulation of an incorrect question meant the case advanced was not properly considered by the decision-maker, whereas here, it is said that the formulation of the incorrect question meant that PPCA did not have the opportunity to address the basis upon which the case was actually decided.

40    PPCA submits that the steps in the Tribunal’s reasoning were as follows: (1) the Tribunal began by stating correctly the approach it should take; (2) the Tribunal accepted as essentially correct, a contention by PPCA that its licences have been historically undervalued; (3) the Tribunal then took a wrong turn by asking itself what was a substantial increase in the fees which PPCA received from the subscription television industry having acknowledged earlier in its reasons that the 2004 PPCA-Foxtel agreement was not a “safe source of data for the present exercise” (at [65] of RD 1) and that it would be “quite unsound to rely on the 2004 PPCA-Foxtel agreement to convey relevantly comparable information about the appropriate pricing structure in 2011” (at [91] of RD 1).

41    PPCA expanded on its submission that the Tribunal had erred in relying on a substantial increase in an unrelated industry by pointing to the fact that the percentage increase in licence fees for the use by gymnasiums of music in fitness classes was: (1) incorrectly used as a “floor” on the percentage increase the Tribunal was prepared to award PPCA; (2) the subject of an incorrect calculation by the Tribunal at 59% when, in fact, it was 158% and the Tribunal, in breach of the rules of procedural fairness, ignored PPCA’s submissions correcting the error; and (3) based on an assumption that was incorrect, namely, that agreements between PPCA and gymnasium owners were relevant to television, audiovisual use, broadcasting or communication. By contrast (so the submission proceeds), the contemporaneous bargains, namely, the 2013 APRA-Foxtel, the 2010 PPCA-FreeTV and the 2012 APRA-FreeTV agreements were in evidence and were, to use PPCA’s words, “obviously relevant to the statutory task”.

42    Foxtel submits that the Tribunal asked itself the correct question and that in deciding whether that is the case, the overall structure of the Tribunal’s reasons needs to be considered. That overall structure is as follows:

(1)    the Tribunal starts by setting out the correct test;

(2)    the Tribunal finds that there is no market rate principally because there is no market. PPCA occupies the position of a monopolist in the market for the provision of the sound recordings of the three major record labels. The Tribunal finds that, although in the market for the acquisition of rights to use sound recordings, Foxtel is most likely not a monopolist; in practical terms however, PPCA has no choice but to deal with Foxtel. The Tribunal was satisfied that there is no market price which it could determine and nor was there any way the Tribunal could determine how PPCA and Foxtel might deal with each other on a hypothetical basis. Having regard to those circumstances, the Tribunal considered whether there were any comparable transactions which threw any light on price;

(3)    the potentially relevant transactions were the 2004 PPCA-Foxtel agreement, the 2006 APRA-Foxtel agreement, the 2010 PPCA-FreeTV agreement; the 2012 APRA-FreeTV agreement; the 2013 APRA-Foxtel agreement; agreements between Foxtel and record companies licensing its broadcast of music videos and audio channels; three decisions of the Tribunal fixing the rate to be paid by Foxtel for the rebroadcasting of free to air television on Foxtel; and agreements under which Phonographic had licensed to Telstra, iiNet and Fetch TV the right to use its sound recordings in communicating audiovisual content to the public. The Tribunal rejected the approach of the experts for the respective parties, Mr Thorpe for PPCA, because it concluded it was not safe to use the 2010 PPCA-FreeTV agreement (at [56] and [60] of RD 1), and Dr Pleatsikas for Foxtel, because it concluded the 2004 PPCA-Foxtel agreement was not “a safe source of data for the present exercise” (at [65] and [91] of RD 1). Having reached these conclusions, the Tribunal turned to the methodology involving judicial estimation; and

(4)    the Tribunal described the judicial estimation process as “an assessment of the pertinent circumstances, many of which will conflict in the directions towards which they tend”, and as involving “questions of degree and judgment; it is not a calculus and no answer is right, although some will be more right than others”. The Tribunal’s key conclusions were as follows. First, the Tribunal, in considering the extent of Foxtel’s need for a PPCA blanket licence, concluded that Foxtel was a substantial user of PPCA’s repertoire and it generally required PPCA’s permission under a blanket licence, but not infrequently this was not so. Secondly, the Tribunal found that some credit was to be given to PPCA for the historic undervaluation of its licences, although it was not possible to put a precise figure on the extent of the undervaluation. It is not entirely clear what the Tribunal meant by this comment. We think that it was acknowledging that for the purposes of determining the weight which should be given to the fees paid in the past, some allowance (which the Tribunal could not quantify) should be made for the fact that the licence(s) in the past were undervalued in terms of the fees paid for them. Thirdly, the Tribunal found that changes in content, platform and revenues needed to be taken into account. Fourthly, the Tribunal found that the agreements put forward by the parties were not useful in terms of being able to derive a value for what PPCA would provide to Foxtel, but they did provide a range with the 2004 PPCA-Foxtel agreement at the bottom end and the 2010 PPCA-FreeTV agreement at the top end. Fifthly, the Tribunal found that none of the other agreements to which it was referred provided any assistance. Sixthly, the Tribunal considered the convenience to the parties of a licence and stated that, although it was convenient to both parties, the balance favoured PPCA because without a licence, Foxtel would incur significant administrative costs in dealing with copyright owners individually. Seventhly, the Tribunal considered the significance of commercial sound recordings in television. Eighthly, the Tribunal considered prior payment to copyright owners. Ninthly, the Tribunal considered the value of recorded music in general. Finally, the Tribunal expressed its conclusions in [124] of RD 1 (set out above at [33]).

43    We turn now to address briefly the relevant legal principles.

44    A tribunal which falls into an error of law which causes it to ask itself the wrong question thereby commits a jurisdictional error: Craig v South Australia [1995] HCA 58; (1995) 184 CLR 163 at 179; Kirk v Industrial Court of New South Wales [2010] HCA 1; (2010) 239 CLR 531 at [67] per French CJ, Gummow, Hayne, Crennan JJ, Kiefel J (as her Honour then was) and Bell J; Probuild Constructions (Aust) Pty Ltd v Shade Systems Pty Ltd [2018] HCA 4; (2018) 351 ALR 225 at [65] per Gageler J.

45    A tribunal which asks itself the wrong question may also ignore relevant material, or take into account irrelevant material. In ignoring relevant material, it may fail to address a substantial, clearly articulated argument. As the plurality in the High Court said in Minister for Immigration and Multicultural Affairs v Yusuf [2001] HCA 30; (2001) 206 CLR 323 (Yusuf) at [82], the different kinds of error may well overlap and

[t]he circumstances of a particular case may permit more than one characterisation of the error identified, for example, as the decision-maker both asking the wrong question and ignoring relevant material.

46    The failure of a tribunal to respond, that is, to deal with, a substantial clearly articulated argument relying on established facts is (at least) a failure to accord natural justice: Dranichnikov at [24] per Gummow and Callinan JJ.

47    In our opinion, the Tribunal did not ask itself the wrong question.

48    Section 154(4) of the Act provides:

The Tribunal shall consider a scheme referred under this section and, after giving to the parties to the reference an opportunity of presenting their cases, shall make such order, confirming or varying the scheme or substituting for the scheme another scheme proposed by one of the parties, as the Tribunal considers reasonable in the circumstances.

49    The Tribunal described its function and its conclusions in the following terms (at [14] of RD 1):

14    The Tribunal is authorised to approve the licence scheme or to substitute another scheme proposed by a party on such terms as it considers reasonable in the circumstances: s 154(4) of the Act. It can do this only after giving the parties to the reference an opportunity to present their cases. In relation to price terms or pricing formulae, the Tribunal should be satisfied that the remuneration provided by a scheme is reasonable or equitable.

That is a correct statement of the test in s 154(4).

50    The Tribunal then noted that the principal debate before it concerned the question of price and it then summarised its conclusions (at [15] of RD 1).

51    The Tribunal summarised the current agreement between PPCA and Foxtel, the scheme proposed by PPCA and the alternative scheme proposed by Foxtel.

52    The Tribunal then reverted to the topic of the approach it must take and said (at [34]–[35] of RD 1):

34    The statutory task before the Tribunal is the one conferred upon it by s 154(4) of the Act, that is to say, the making of an order to confirm, vary or substitute a scheme which the Tribunal considers reasonable in the circumstances.

35    That standard requires, in relation to the imposition of a pricing structure, that the remuneration be reasonable or equitable. In relation to non-price terms the question is whether the term is reasonable in the circumstances.

That is a correct statement of the test.

53    The Tribunal then referred to the four approaches identified in Reference by Phonographic Performance Company of Australia Ltd.

54    Having found that none of the first three approaches provided a solution to the issue, the Tribunal proceeded to engage in the task of judicial estimation. There are other grounds in PPCA’s Further Amended Originating Application for Judicial Review which challenge particular matters and we discuss those matters below, but the point to note at this stage is that, having stated the test correctly, there is no indication in the Tribunal’s reasons to the stage where it considered that it must approach the issue as an exercise in judicial estimation that it departed from the correct test.

55    The Tribunal stated, without error in our opinion, that the process of judicial estimation involved a synthesis of the relevant facts and circumstances into a rate which the Tribunal regards as reasonable or equitable in the circumstances (at [36] of RD 1).

56    The Tribunal considered the following matters as part of engaging in the process of judicial estimation:

(1)    the extent of Foxtel’s need for a PPCA blanket licence;

(2)    the historic undervaluation of PPCA’s licences;

(3)    changes in content, platform and revenues;

(4)    agreements in the industry, including the 2004 PPCA-Foxtel agreement, the 2006 APRA-Foxtel agreement, the 2010 PPCA-FreeTV agreement, the 2012 APRA-FreeTV agreement, the 2013 APRA-Foxtel agreement and (a) Foxtel’s music video and audio channel licences; (b) Foxtel’s production music licence; and (c) Tribunal determinations involving screen rights;

(5)    IPTV agreements;

(6)    convenience to the parties;

(7)    the significance of music;

(8)    prior payment; and

(9)    the value of recorded music in general.

The Tribunal then expressed its conclusions as to the appropriate valuation.

57    We are unable to see in any of this analysis that the Tribunal departed from the correct test which it had previously stated. The fact that it proceeded to arrive at its valuation by reference to increases over the existing agreement does not of itself indicate that it changed from the correct test to an incorrect test. As we have said, we will come to consider the particular matters which PPCA submits involve judicially reviewable error when considering its other grounds, but, in our opinion, the Tribunal did not err in asking itself the wrong question. As it did not ask itself the wrong question, it did not fail to accord procedural fairness to PPCA.

Issue 2: Failure to consider the charges payable by Foxtel for use of the APRA rights

58    One of the main agreements relied on by PPCA is the 2013 APRA-Foxtel agreement. This agreement was made on 18 July 2013 and is entitled “Subscription Television Services Licence Scheme”. Under the agreement, Foxtel was granted a non-exclusive licence to broadcast or otherwise communicate musical works and associated lyrics within the APRA repertoire. The [REDACTED] licence fees payable to APRA by Foxtel for the period from 31 January 2013 to 31 December 2018 were provided to the Tribunal and were and are the subject of confidentiality orders.

59    In its written submissions on the application, PPCA produced a table which sets out the charges payable under the licence scheme, as proposed by PPCA and as varied by the Tribunal, and charges payable under other licences in the same industry, being the charges payable under the 2013 APRA-Foxtel agreement, the 2010 PPCA-FreeTV agreement and the 2012 APRA-FreeTV agreement. The information concerning the charges payable under the other licences is confidential. The table is Confidential Annexure A to these reasons. The table shows that the charges under the 2013 APRA-Foxtel agreement are [REDACTED] of the charges payable under the scheme approved by the Tribunal.

60    As we have said, PPCA is a copyright collecting society for the publication of sound recordings. Sound recording copyright is copyright relating to the recording of a particular performance or embodiment of that work. It is protected under Part IV of the Act. One of the rights in the bundle of rights comprising the copyright is the exclusive right to communicate the relevant subject matter to the public, which may include its broadcast, and to authorise others to do so. APRA is a collecting society for the communication to the public of musical works. A musical work copyright is protected under Part III of the Act. Again, one of the rights in the bundle of rights comprising the copyright is the exclusive right to communicate the relevant subject matter to the public, which may include its broadcast, and to authorise others to do so. A person who broadcasts or otherwise communicates to the public commercially released music typically requires a licence of both the musical work copyright and the sound recording copyright. The Tribunal observed that PPCA’s licensing of the right under Part IV of the Act to communicate its sound recordings to the public is “not so very different, in principle” to the licensing of the right under Part III of the Act to communicate to the public an original musical work, that is, a composition or score, as contrasted with a particular recording of that score by an artist (at [41] of RD 1).

61    It should be noted that the Tribunal in Reference by Phonographic Performance Company Australia Ltd in the passages set out above (at [38] of these reasons) said that the various approaches “may overlap to a certain extent” and that there was no market rate or comparable bargain available and that, in those circumstances, the Tribunal’s approach must be a combination of notional bargain rate and judicial estimation. The Tribunal in that case said that judicial estimation may include notional bargain rate. The Tribunal also said that the question in the context of comparable bargains was whether they provide “guidance” to the Tribunal and that in the context of judicial estimation, a range of matters are taken into account, including previous agreements or negotiations between the parties and a comparison with rates set by other licensors. In this case, the Tribunal considered the four approaches identified by the Tribunal in Reference by Phonographic Performance Company of Australia Ltd sequentially, eliminating one approach and then moving to the next. The Tribunal found that there was no market rate and no notional bargain rate and the focus of the Tribunal’s inquiry was comparable transactions and matters relevant to the task of judicial estimation. PPCA does not suggest that there is any error in the Tribunal’s approach to this point. Even if it did, we would firmly reject such a challenge.

62    The Tribunal did consider the 2013 APRA-Foxtel agreement in considering whether there were any comparable transactions which provided guidance as to the appropriate charges. As we have said, in that context PPCA adduced evidence from Mr Thorpe and Foxtel adduced evidence from Dr Pleatsikas. We need to refer to their respective approaches in more detail.

63    Mr Thorpe’s two approaches –– the top down approach and the relativity approach –– both involved the use of the 2013 APRA-Foxtel agreement as an integer in a formula which he said could be used as the basis for determining a fee to be paid by Foxtel to PPCA. As we have said, Mr Thorpe’s top down approach involved the use of the 2010 PPCA-FreeTV agreement as the key agreement. The Tribunal did not explain how the 2013 APRA-Foxtel agreement was used as an integer in Mr Thorpe’s top down approach. Nevertheless, it rejected Mr Thorpe’s top down approach because it concluded that it would be quite unsafe to use the 2010 PPCA-FreeTV agreement as a comparable transaction.

64    Mr Thorpe’s relativity approach also involved the use of the 2013 APRA-Foxtel agreement as an integer. In the case of this approach, the relativity between the rate in the 2010 PPCA-FreeTV agreement and the rate in the 2012 APRA-FreeTV agreement was determined and then applied to the rate in the 2013 APRA-Foxtel agreement. There were a number of complexities with this approach which the Tribunal did not identify or resolve. It seems that it did not need to because it concluded that it could not utilise the approach because it was not safe to use the 2010 PPCA-FreeTV agreement.

65    The Tribunal’s reasoning and conclusion that it was not safe to use the 2010 PPCA-FreeTV agreement is the subject of other challenges by PPCA to the Tribunal’s decision which we will consider in due course. For the purposes of considering the Tribunal’s approach to the 2013 APRA-Foxtel agreement we will assume that the Tribunal’s reasoning and conclusion with respect to the 2010 PPCA-FreeTV agreement is correct.

66    Dr Pleatsikas’ approach also involved the use of the 2013 APRA-Foxtel agreement as an integer. As we understand it, his approach was similar to Mr Thorpe’s relativity approach, save that he used the 2004 PPCA-Foxtel agreement and the 2006 APRA-Foxtel agreement. The Tribunal rejected his approach because, for various reasons which the Tribunal identified, it did not consider the 2004 PPCA-Foxtel agreement “is a safe source of data for the present exercise” (at [65] of RD 1).

67    The Tribunal reached the conclusion that none of the comparable transactions relied upon by the parties were suitable and proceeded to undertake the task of judicial estimation.

68    In that part of its reasons referring to the task of judicial estimation, the Tribunal referred to the lengthy submissions provided by the parties which it said it had considered. The Tribunal’s reasons dealt with what it considered most relevant to its decision. It did not find it necessary to refer to everything to which it had been referred, and where it had not referred to a matter, it was generally because “the Tribunal did not regard the material in question as advancing matters very far or not sufficiently far to have any meaningful impact on the process of judicial estimation” (at [94] of RD 1).

69    The Tribunal did consider agreements in the industry to be potentially relevant. It referred to the agreements involving Foxtel, FreeTV, PPCA and APRA and said that it had already dealt with these agreements. It said that none of the agreements proved to be useful to derive a value for what PPCA will now provide Foxtel. However, they did provide a range with the 2004 PPCA-Foxtel agreement likely to lead to an undervaluation of PPCA’s rights and the 2010 PPCA-FreeTV agreement likely to lead to an overvaluation of those rights.

70    In its Further Amended Originating Application for Judicial Review, PPCA identified a number of errors by the Tribunal with respect to the 2013 APRA-Foxtel agreement. These errors were a failure to take into account relevant considerations (grounds 2(d)(iii), (e)), errors of law (grounds 3(d)(e)) and an exercise of the power so unreasonable that no reasonable person could have so exercised the power (grounds 5(a) and (c)). As a general comment, we observe that the grounds in the Further Amended Originating Application for Judicial Review were allocated to one or other of the five issues and refined by the time submissions were made.

71    The errors which PPCA identified in relation to the 2013 APRA-Foxtel agreement were as follows. First, the Tribunal failed to take into account a mandatory relevant consideration and the failure was material to its decision. Secondly, the Tribunal failed to accord procedural fairness to PPCA in that the Tribunal did not deal with a clearly articulated case or, in the alternative, it should be inferred from its reasoning that it has misconstrued the statutory phrase, “in the circumstances” in s 154(4) of the Act.

72    It is clear that these submissions were advanced in relation to the Tribunal’s consideration of the 2013 APRA-Foxtel agreement in the context of the process of judicial estimation. It was less clear whether they were advanced in the context of the Tribunal’s consideration of comparable transactions. PPCA did submit that the 2013 APRA-Foxtel agreement was a “closely comparable bargain” and that the failure to take it into account was a failure to take into account a mandatory relevant consideration. In those circumstances, we will consider the submissions in both contexts.

73    We start with the Tribunal’s consideration of the 2013 APRA-Foxtel agreement in the context of its consideration of comparable transactions. We have concluded that the 2013 APRA-Foxtel agreement was not a mandatory relevant consideration, or even if it was, it was taken into account by the Tribunal.

74    The relevant principles as to mandatory relevant considerations are well-known. First, it is necessary to identify a consideration a decision-maker is bound to take into account. The consideration or considerations may be identified by an express statement in the relevant Act. That is not the case here. The particular matters identified in s 154(4) are a licence scheme (as defined in s 136(1)), the parties being given an opportunity to present their cases and the Tribunal’s jurisdiction being limited to schemes it considers reasonable in the circumstances. There is no reference in the relevant section or sections to the 2010 APRA-Foxtel agreement as a relevant consideration or, more sensibly, to industry agreements or comparable transactions or transactions the Tribunal considers comparable. Clearly, that is not the end of the inquiry because the subject matter, scope or purpose of the relevant Act may indicate that a particular matter must be taken into account (Minister for Aboriginal Affairs v Peko-Wallsend Ltd [1986] HCA 40; (1986) 162 CLR 24 (Peko-Wallsend) at 39–40 per Mason J (as his Honour then was)).

75    The inquiry is to be conducted, primarily, perhaps even entirely, by reference to the Act rather than the particular facts of the case that the decision-maker is called upon to consider (Yusuf at [73] per McHugh, Gummow and Hayne JJ), The plurality in Yusuf went on to say (at [74]):

74    This does not deny that considerations advanced by the parties can have some importance in deciding what is or is not a relevant consideration. It may be, for example, that a particular statute makes the matters which are advanced in the course of a process of decision-making relevant considerations for the decision-maker. What is important, however, is that the grounds of judicial review that fasten upon the use made of relevant and irrelevant considerations are concerned essentially with whether the decision-maker has properly applied the law. They are not grounds that are centrally concerned with the process of making the particular findings of fact upon which the decision-maker acts.

(emphasis added)

76    We do not think that industry agreements or comparable transactions, or what the Tribunal considers comparable transactions, is a mandatory relevant consideration. The Tribunal is given a broad power to make such order as it considers reasonable in the circumstances and it must make an evaluative judgment. A variety of approaches are possible as the Tribunal said in Reference by Phonographic Performance Company of Australia Ltd and the appropriate approach may well be dictated or defined by the facts of the particular case. A failure to take what is said to be a comparable transaction into account may constitute a judicially reviewable error on the ground that it indicates that the Tribunal asked itself the wrong question or on the ground that it failed to deal with a clearly articulated claim advanced before it, but not, in our respectful view because industry agreements or comparable transactions, or what the Tribunal considers comparable transactions, is a mandatory relevant consideration.

77    In any event, the 2013 APRA-Foxtel agreement was taken into account by the Tribunal. The Tribunal analysed (and rejected) the evidence of both experts who had incorporated the 2013 APRA-Foxtel agreement as an integer in their opinions as to the fees to be paid by Foxtel to PPCA. There is no requirement that the agreement be given a particular weight. As Mason J said in Peko-Wallsend (at 40–41), even if a matter is a relevant consideration which must be taken into account, then unless the Act prescribes the weight to be given to the particular consideration, the weight to be given to the particular consideration is a matter for the decision-maker.

78    A failure by a decision-maker to consider a clearly articulated argument may give rise to a failure to accord procedural fairness and, therefore, jurisdictional error (Dranichnikov at [24] per Gummow and Callinan JJ). Foxtel submits that this particular type of jurisdictional error was not identified in PPCA’s Further Amended Originating Application for Judicial Review despite the fact that that application has been amended on more than one occasion. We have decided that this argument should be rejected on the merits and we do not need to deal with this objection. We would say that had the substantive argument had merit, we would have been disposed to allow PPCA to raise it because the Further Amended Originating Application for Judicial Review raises closely allied points and Foxtel has had sufficient notice of the argument.

79    In any event, the submission in the context of the Tribunal’s treatment of comparable transactions has no merit. The Tribunal has clearly dealt with PPCA’s case with respect to the 2013 APRA-Foxtel agreement as advanced through its expert, Mr Thorpe.

80    We turn now to PPCA’s arguments concerning the 2013 APRA-Foxtel agreement in the context of the Tribunal’s process of judicial estimation. For the reasons we have already given, industry agreements, comparable transactions, or what the Tribunal considers comparable transactions, are not a mandatory relevant consideration.

81    The more substantial submission made by PPCA is that the 2013 APRA-Foxtel agreement was also advanced by it as a freestanding agreement which was relevant to the Tribunal’s process of judicial estimation and yet the Tribunal failed to deal with it. It was said that the agreement was for the same period, involved the same licensee, similar rights and the fact that those rights were to be put to use by Foxtel in providing the same subscription television service. PPCA submits that there was such a disparity between the fees under the 2013 APRA-Foxtel agreement and the fees under the scheme approved by the Tribunal that the former must have been ignored or overlooked by the Tribunal.

82    Foxtel raised two preliminary objections to this argument. First, PPCA did not, in fact, raise before the Tribunal a clearly articulated claim that the 2013 APRA-Foxtel agreement was a freestanding agreement relevant in the process of judicial estimation. PPCA submits that it had raised the matter and pointed to its closing written submissions dated 30 April 2015 (at [6.249]–[6.251]). Those paragraphs are as follows:

6.249    The rates that apply pursuant to the 2012 APRA-FreeTV Agreement and the 2013 APRA-Foxtel Agreement are set out in Part 6(e) above. [REDACTED]. Even when allowance is made for material differences between PPCA and APRA, including an appropriate discount to reflect the fact that APRA’s repertoire is [REDACTED].

6.250    Consolidating the contemporaneous APRA agreements and the contemporaneous 2010 PPCA-FreeTV Agreement, the following table indicates how PPCA’s historical subscription TV agreements, and proposed PPCA-Foxtel Licence fee compares:

    …

6.251    The consolidated table above indicates the extent to which PPCA’s proposed licence fee arrangements, if accepted by the Tribunal, would bring the quantum of PPCA-Foxtel Licence Fee closer to the most relevant and analogous industry bargains. The table above consolidates in one place PPCA’s licence agreement with Foxtel’s closest competitor (ie FreeTV) and the licence arrangements of both Foxtel and FreeTV with the most closely analogous licensor to PPCA (ie APRA). It makes eminent sense that these are the agreements to which the Tribunal ought place its greatest attention and reliance in determining a reasonable fee that compensates PPCA for the nature and extent of Foxtel’s exploitation in present circumstances (as opposed to more than ten years ago) of the copyright the subject of a PPCA blanket licence.

In our opinion, the argument was advanced.

83    Secondly, Foxtel again raised the point that the failure to deal with a clearly articulated claim of the type advanced is not a ground PPCA had identified in its Further Amended Originating Application for Judicial Review. We take the same approach to this objection as we have taken in the context of the Tribunal’s consideration of comparable transactions (see [80] of these reasons).

84    The submission that the 2013 APRA-Foxtel agreement as a freestanding agreement was relevant to, and part of, PPCA’s case with respect to the process of judicial estimation must be considered in the following factual and legal context:

(1)    The 2013 APRA-Foxtel agreement was an integer in a valuation analysis for the purposes of considering comparable transactions and the analysis was rejected by the Tribunal.

(2)    We do not understand PPCA to submit in the context of the process of judicial estimation that reliance on the APRA-Foxtel agreement produces a particular result in terms of figures. Its relevance on PPCA’s case is in pointing to higher ([REDACTED]) figures than those in the scheme ultimately approved by the Tribunal.

(3)    On one view, it is very difficult to see precisely how the agreement can be used once it was found, in the context of the Tribunal’s consideration of comparable transactions, that the relativity between PPCA and APRA could not be established. As we understand it, both experts sought to establish that relativity by reference to a direct comparison involving other agreements; in Mr Thorpe’s case the 2010 PPCA-FreeTV agreement and the 2012 APRA-FreeTV agreement, in Dr Pleatsikas’ case, the 2004 PPCA-Foxtel agreement and the 2006 APRA-Foxtel agreement.

(4)    The matters potentially relevant to the process of judicial estimation are numerous. It is not a question of a handful of matters; the matters are numerous and, as a general proposition, it is unsurprising if, in those circumstances, only the more significant matters are mentioned.

(5)    There is no reason to think that the Tribunal was unaware of the charges under the 2013 APRA-Foxtel agreement as set out in the table put before them, or that it did not (despite what it said) consider the submissions advanced by the parties in circumstances in which it said that it did so.

(6)    There is no reason to think that when considering agreements in the industry and their relevance in the process of judicial estimation the Tribunal did not consider the 2013 APRA-Foxtel agreement. True it is that the Tribunal said that it had already dealt with the agreements, but it did select one as providing the bottom end of a range and the other as providing the top end of the range and there is no reason to think that it did not then consider again all of the five major agreements relied on by the parties, including the 2013 APRA-Foxtel agreement.

(7)    As we have already said, generally speaking, questions of the weight to be accorded to a matter are for the decision-maker. As the Full Court of this Court said in SA Power Networks v Australian Competition Tribunal (No 2) [2018] FCAFC 3; (2018) 259 FCR 388 at [14]:

14    In AER v Australian Competition Tribunal, the Court considered at some length, at [133]–[159], the Tribunal’s authority and the function of the Court on judicial review of a decision of the Tribunal. We do not repeat that analysis here, except to repeat the observations made by an earlier Full Court in Pilbara Infrastructure Pty Ltd v Australian Competition Tribunal (2011) 193 FCR 57 at [16], as follows:

It is not this court’s function to resolve the difficult and complex matters of judgment raised by the evidence and resolved by the Tribunal. This court’s role in reviewing the decision of the Tribunal is to ensure that the decision of the Tribunal accords with the law. In Re Minister for Immigration & Multicultural Affairs; Ex parte Applicant S20/2002 (2003) 198 ALR 59; 77 ALJR 1165 at [114] it was said that it is no part of the supervisory jurisdiction of this court to

… enter upon a consideration of the factual merits of the individual decision. The grounds of judicial review ought not be used as a basis for a complete re-evaluation of the findings of fact, a reconsideration of the merits of the case or a re-litigation of the arguments that have been ventilated, and that failed, before the person designated as the repository of the decision-making power.

(8)    There is no requirement that a tribunal in the position of the Copyright Tribunal in this case refer to every submission and evidentiary matter put before it. In Australian Energy Regulator v Australian Competition Tribunal (No 2) [2017] FCAFC 79; (2017) 255 FCR 274 at [278], the Full Court said:

278    As we have said, Ground 7 of the applications under the ADJR Act alleges that the Tribunal did not take into account reasons given by the AER or arguments raised by the AER. We will come to deal with the particular matters raised by the AER. At this stage, and at a general level, we note the observation of the Full Court of this Court in Applicant WAEE v Minister for Immigration and Indigenous Affairs (2003) 236 FCR 593 at [47]):

The inference that the Tribunal has failed to consider an issue may be drawn from its failure to expressly deal with that issue in its reasons. But that is an inference not too readily to be drawn where the reasons are otherwise comprehensive and the issue has at least been identified at some point. It may be that it is unnecessary to make a finding on a particular matter because it is subsumed in findings of greater generality or because there is a factual premise upon which a contention rests which has been rejected. Where however there is an issue raised by the evidence advanced on behalf of an applicant and contentions made by the applicant and that issue, if resolved one way, would be dispositive of the Tribunal’s review of the delegate’s decision, a failure to deal with it in the published reasons may raise a strong inference that it has been overlooked.

85    We have considered the foregoing matters carefully. We do not consider it to be at all apparent that the Tribunal overlooked the 2013 APRA-Foxtel agreement. Nor would we infer that it has done so. In our opinion, the Tribunal did not consider the 2013 APRA-Foxtel agreement to be of any real assistance once it was “uncoupled” from the relativity analysis as it was by the Tribunal. The merits of that approach may be debated, but it does not involve judicially reviewable error for failing to consider a clearly articulated claim or argument.

Issue 3: Failure to consider the charges payable by commercial television providers

86    The commercial television providers referred to in this statement of issue are free to air television providers and the agreements specifying the charges are the 2010 PPCA-FreeTV agreement and the 2012 APRA-FreeTV agreement.

87    PPCA’s general submission with respect to this issue is similar to its general submission with respect to the second issue, that is to say, that the Tribunal ought to have had regard to these agreements in determining the charges to be paid by Foxtel. However, the Tribunal failed to do so.

88    The relevant grounds in the Further Amended Originating Application for Judicial Review in relation to this issue are similar to those raised in relation to the second issue (Grounds 2(d), (e) (a failure to take into account relevant considerations), 3(d), (e) (error of law) and 5(a) and (c) (exercise of power so unreasonable that no reasonable person could have so exercised the power)) with one major addition. PPCA claims that the Tribunal made a number of specific errors in the course of its analysis rejecting the 2010 PPCA-FreeTV agreement as a comparable bargain and in deciding to place no weight on the fact that the FreeTV parties could have terminated the agreement, but elected not to. PPCA’s claim is a curious one. Under the rubric of failing to take into account relevant considerations, or taking into account irrelevant considerations, Ground 2(f) pleads a number of errors in the Tribunal’s decision to reject the 2010 PPCA-FreeTV agreement as a comparable bargain, and the nub of the allegation is complaints about the fact finding process. Ground 2(h) is materially similar. The use of the phrase “failing to take into account” a particular fact in deciding whether an agreement is a comparable bargain does not convert a complaint about a particular finding into a complaint about a failure to take into account a relevant consideration within s 5(1) and (2) of the ADJR Act and at common law. In Ground 4, PPCA makes an allegation with respect to two of the specific matters in Ground 2(f) (i.e., (i) and (ii)), and one of the matters in Ground 2(h) (i.e., (i)) that there was no evidence or other material to justify the making of the decision because the Tribunal based the decision on the existence of a particular fact that did not exist.

89    PPCA again points to the disparity between the charges under the scheme approved by the Tribunal and the agreements relied on by it, in this case, the 2010 PPCA-FreeTV agreement (see Confidential Annexure A). It is no doubt true that there is a significant disparity in the charges.

90    PPCA’s first submission is that the Tribunal applied too high a standard for determining whether an agreement was a comparable bargain for the purposes of its analysis. PPCA referred to a comment made by the Tribunal to the effect that for the top down approach to be viable it would be necessary to be satisfied that the 2010 PPCA-FreeTV agreement was itself “the product of circumstances which might reasonably be thought to be reflective of the situation free, so far as possible, from market imperfection” (at [47] of RD 1). PPCA’s argument is that this is too high a standard when regard is had to the ultimate criterion for the Tribunal’s decision, that is to say, “reasonable in the circumstances”. This particular alleged error is not identified in the grounds in the Further Amended Originating Application for Judicial Review. In any event, we reject the argument. The Tribunal’s reasons must be read as a whole. There is no indication that the Tribunal rejected any reliance on an agreement unless it was entirely free of market imperfection, or that the Tribunal was not alive to the need to adopt a practical approach. The remark relied on by PPCA itself contains a reference to “as far as possible”. In the context of discussing the 2010 PPCA-FreeTV agreement, the Tribunal used phrases such as “reason to doubt”, “there is a substantial risk” (at [53] of RD 1) and “that uncertainty is sufficient to persuade” (at [56] of RD 1).

91    PPCA also submits that the Tribunal erred in concluding that the market conditions in which the 2010 PPCA-FreeTV agreement was negotiated were imperfect. To the extent that this argument was particularised, it is dealt with below.

92    PPCA submits that the 2010 PPCA-FreeTV agreement was a mandatory relevant consideration and that, as a substantial and clearly articulated part of its case, had to be considered by the Tribunal in order that it be accorded procedural fairness. The arguments in this context are similar to those put by PPCA in relation to the 2013 APRA-Foxtel agreement and we reject them for the same reasons. There is an additional matter to be noted in the case of the 2010 PPCA-FreeTV agreement and that is that it is specifically mentioned by the Tribunal in the context of the process of judicial estimation and, in fact, formed the basis for the upper limit of the range adopted by the Tribunal. It is trite to say that the issue is not whether the Tribunal was correct, but whether it considered a matter that it was legally obliged to consider.

93    PPCA submits that there were two findings made by the Tribunal for which there was no evidence, or which were irrational.

94    The Court was referred to a number of authorities dealing with the no evidence ground of judicial review at common law and under s 5(1)(h) and (3) of the ADJR Act. It is clear that at common law a skerrick of evidence will rebut a no evidence allegation and that there is no error of law in making a wrong finding of fact (Australian Broadcasting Tribunal v Bond [1990] HCA 33; (1990) 170 CLR 321 at 355–357 per Mason CJ). As we have concluded that there is no finding of the Tribunal for which there is no evidence, we do not need to discuss the circumstances in which a finding for which there is no evidence gives rise to an error of law which goes to jurisdiction (see Australian Postal Corporation v D’Rozario [2014] FCAFC 89; (2014) 222 FCR 303). Nor do we need to consider the issues which arise in connection with s 5(1)(h) and (3) of the ADJR Act as discussed by the High Court in Minister for Immigration and Multicultural Affairs v Rajamanikkam [2002] HCA 32; (2002) 210 CLR 222. Finally, the Tribunal’s conclusions are not without an evident and intelligible justification or irrational and it is not necessary for us to consider issues which have arisen in relation to the grounds of unreasonableness and irrationality (Minister for Immigration and Citizenship v Li [2013] HCA 18; (2013) 249 CLR 332; Minister for Immigration and Citizenship v SZMDS [2010] HCA 16; (2010) 240 CLR 611).

95    The first of the two findings identified by PPCA was that the Tribunal assumed without evidence that the FreeTV parties may have attributed an inflated value to PPCA’s rights in July 2010 on the basis of the Tribunal’s public decision in the Gyms Case (Reference by Phonographic Performance Company of Australia Limited under section 154(1) of the Copyright Act 1968 [2010] ACopyT 1; (2010) 87 IPR 148). It was argued that that was a conclusion which should not have been drawn in the absence of direct evidence in light of, or particularly in light of, the following matters:

(1)    The Tribunal’s decision in the Gyms Case was under challenge at the time the 2010 PPCA-FreeTV agreement was being negotiated and that challenge was subsequently upheld (Fitness Australia Ltd v Copyright Tribunal [2010] FCAFC 148; (2010) 89 IPR 442);

(2)    The Gyms Case related to materially different uses in an unrelated industry; and

(3)    The FreeTV parties are highly sophisticated and well-resourced parties who had both legal advice and more information, through discovery and the service of lay and expert evidence, than a licensee negotiating a licence would ordinarily have.

96    All of these matters are true at a general level. The Gyms Case concerned how much Fitness Australia Ltd, a body representing the interests of the fitness industry, should have to pay the owner of the copyright in the sound recordings for the right to play those recordings during exercise classes.

97    There is nothing to suggest that the Tribunal was not aware of these matters and did not take them into account. It is not a case of no evidence or irrationality in the finding. The Tribunal’s conclusion was that there was reason to doubt the reliability of the 2010 PPCA-FreeTV agreement as a measure of the correct value of PPCA’s rights in that there was a substantial risk that the fee values it disclosed may be too high. It seems to us that this is a case where there were a number of undisputed facts and the Tribunal drew certain inferences from those facts. Another decision-maker may have drawn different inferences and, had this been an appeal, it might even have been said that the Tribunal erred (Warren v Coombes [1979] HCA 9; (1979) 142 CLR 531). We do not express a view about that matter. The critical point is that there is no basis to conclude that there was no evidence to support the inferences drawn by the Tribunal, or that they were irrational or illogical.

98    In our opinion, the same analysis applies to the second finding raised by PPCA. It submits that the Tribunal’s decision to place no weight on the fact that the FreeTV parties subsequently had the opportunity to terminate the agreement but decided not to do so was a decision for which there was no evidence, or which was irrational. The Tribunal took the view that there were other possible explanations for FreeTV’s position. The Tribunal said (at [55] of RD 1):

55    Each of the 57 constituent members who signed the agreement may have conflicting views, terminating would mean, at the very least, further complex negotiations with PPCA and quite possibly further litigation in this Tribunal; it may be that FreeTV regards the whole episode as closed or, in a related sense, that costs may already have been passed through to the budgets of others. It is not possible to say which of these, if any, is the case, or even to exclude the possibility of other explanations.

99    In our opinion, the same analysis and conclusion applies with respect to this second finding as applies in the case of the first finding. The fact that there is no evidence which enables the Tribunal to make a definite finding as to the explanation for FreeTV’s position does not mean that the Tribunal is not entitled to take into account other possible explanations for FreeTV’s position. The Tribunal is an expert body and it is entitled to take the approach it did. Again, whilst another decision-maker might have taken a different view, that circumstance does not establish judicially reviewable error.

100    PPCA also argued that the Tribunal erred in its approach to the 2012 APRA-FreeTV agreement. Its arguments in relation to this agreement were similar to the arguments it advanced with respect to the 2013 APRA-Foxtel agreement. We reject the arguments for the same reasons we reject the arguments in relation to that agreement.

Issue 4: The calculation of a “substantial” percentage increase misfired

101    We have rejected PPCA’s primary submission that the Tribunal erred in approaching the matter by nominating a percentage value that it considered to be a substantial increase in the fees which it receives from the subscription television industry. PPCA submits that even accepting this conclusion (which it does for the purposes of Issue 4), there were other errors in the Tribunal’s assessment of the appropriate percentage increase.

102    PPCA submits that the percentage increase should not have been determined by reference to the increase which occurred after the Gyms Case, that is, 59%, by reason of the fact that the differences between television use and fitness classes were and are clear. PPCA submits that there was no evidence before the Tribunal that rendered agreements with gymnasium owners relevant to the circumstances of the subscription television scheme before the Tribunal.

103    Secondly, PPCA submits that the Tribunal failed to take into account evidence of a fee increase in the nightclub industry of a figure in the order of 1400%. It submits that in adopting its “percentage increase” approach, the Tribunal unreasonably focused on setting a “floor” for a range, but did not consider what might be other and more relevant guides to an appropriate percentage increase. Furthermore, it submits that the percentage that was calculated was wrong even on the limited evidence that was before the Tribunal.

104    Thirdly, PPCA submits (as we understood it) that there was an inconsistency between the Tribunal relying on the negotiated outcome in the Gyms Case in settlement of litigation as being of relevance to its task of judicial estimation on the one hand, and rejecting as “not safe” the percentage increase over historical licence fees reflected in a contemporaneous bargain within the commercial television industry itself, namely, the [REDACTED] increase achieved by PPCA in its settlement with FreeTV on the other.

105    None of these alleged errors involves judicially reviewable error. They are matters going to the merits involving an assessment or evaluation by the Tribunal of the weight to be accorded to factors the Tribunal is able, but is not bound, to take into account. For example, not giving weight to a fee increase in the nightclub industry does not go to the Tribunal’s jurisdiction or involve an error of law and an error of fact about a percentage increase (assuming it to have occurred) is not without more a jurisdictional error or an error of law.

Issue 5: Did the Tribunal err by including rights in the scheme that PPCA had no authority to license?

The Tribunal’s reasoning

106    The Tribunal determined the direct pricing issue between the parties on 13 May 2016, in RD 1. After doing so, there remained for resolution a number of further issues, which the Tribunal identified and resolved in its decision of 21 July 2017, RD 2. One of these was defined by the Tribunal as the “Power Issue” as follows:

The Power Issue. The question here was whether the Tribunal could impose non-price terms by means of a scheme which were inconsistent with the terms under which PPCA was itself licensed by its own members. That licensing took place under an agreement called the input agreement. PPCA’s submission was that the Tribunal could not, by a scheme, license Foxtel to do acts which PPCA was not itself authorised to do under the input agreement.

107    The Power Issue arose from a disagreement between PPCA and Foxtel on certain of the non-price terms of the licence scheme. These were described by the Tribunal in RD 2 as “The Streaming and On-demand Issues”:

The Streaming and On-demand Issues. Under the scheme proposed by PPCA, Foxtel was to receive, inter alia, a right to use PPCA’s sound recordings as part of the audio visual content streamed by Foxtel over the internet or other communications networks (i.e. not as part of a ‘broadcasting service’ within the meaning of Part 2 of the Broadcasting Services Act 1992 (Cth)). Under PPCA’s proposed scheme, Foxtel will not, however, be permitted to keep a copy of the program which is streamed, the nature of which remains from the subscriber’s perspective, ephemeral. Foxtel submits that users should be permitted to keep a temporary copy for subsequent replay. A similar debate remained for the on-demand right that PPCA proposes. Unlike the streaming right, the on-demand right contemplates that a subscriber will be permitted to receive content and store it for a period of time on their device. However, under PPCA’s proposal this can only occur where the content has itself been broadcast as an actual part of Foxtel’s regular subscription television service (i.e. via HFC cable or satellite) or will be so broadcast within a further 30 days. Foxtel seeks to modify this right so as to delete this requirement. There is also a debate as to how long the subscriber may store such a program. Foxtel resists PPCA’s argument that any such storage should be capped at 12 months.

108    The Tribunal resolved the Power Issue in favour of Foxtel. In so doing it reasoned as follows:

(1)    The source of the Subscription Television Broadcast Licence Scheme proposed by PPCA is a set of licence agreements that it has with its own members which are called “input agreements”. Each of PPCA’s licensors executes an input agreement which grants to PPCA a non-exclusive licence of the rights relating to the exploitation of the relevant sound recordings and a non-exclusive licence of those rights to others. The terms of the input agreements are inconsistent with the terms proposed by Foxtel for the operation of the scheme in relation to the streaming issues and the on-demand issues. PPCA contended that it is not within the power of the Tribunal to approve a scheme that extends beyond the content of the agreement between it and its members.

(2)    The Tribunal considered that the legal effect of its power to approve a scheme does not derive from the existence of a licence which a collecting society may hold from its members. The Act does not require that such a licence exists and the machinery of the legislation does not operate by reference to any such licence. Rather, the critical provisions concerning the power of the Tribunal are in subsections 154(4) and 159(1) of the Act (which we set out below at [118]–[119]). The former authorises the Tribunal to confirm or alter a scheme referred to by a collecting society. The latter gives a defence to an action for infringement to a person operating under a scheme. The Tribunal reasoned:

25    Neither provision is consistent with the ability of a licence between a collecting society and its members to constrain what the Tribunal may, or may not, determine by way of a scheme under s 154(4). Section 154(4) in terms contemplates variation of, or indeed wholesale replacement of, the scheme put forward by the collecting society. It would be a lacuna in the scheme contained in Part VI Division 3 of the Act if a collecting society could prevent the Tribunal exercising this power of amendment or replacement by the device of entry into an input agreement with its members only authorising the scheme the society itself had put forward.

26    So too s 159(1) does not depend for its efficacy upon the existence of a licence from a collecting society’s members. It operated directly by reference only to the scheme approved by the Tribunal, which scheme the Tribunal is fully at liberty to amend as it sees fit.

27    …The point of the scheme of Part VI is to create the ability to license rights against their owners’ will, just as it is in the case of any decision-maker which, as here, regulates monopoly asset pricing. …the Tribunal would accept that the existence of an input agreement is a matter which it can take into account in assessing what is reasonable in the circumstances under s 154(4). However, it is not a controlling matter for the reasons already given.

(3)    The Tribunal then turned to consider the streaming and on-demand issues. The parties had agreed that the scheme should include the grant to Foxtel of an audiovisual streaming right and that it should be entitled to make a temporary copy for that purpose. However, Foxtel sought to ensure that users could also make a temporary copy on their own device (being a phone, tablet, personal computer and so on), with, as the Tribunal characterised it, the idea being to permit users to stream programs to their devices for subsequent replay. PPCA resisted the inclusion of this term on the basis that the Tribunal did not have power to do so absent PPCA being granted the rights in its input agreements with the copyright owners. Having rejected PPCA’s submission in relation to the Power Issue, the Tribunal concluded that the scheme should accommodate the right sought by Foxtel.

(4)    The Tribunal also noted that there was no dispute that the Scheme would involve the grant to Foxtel of an on-demand offering right to make content available over communications networks by streaming or through use of a podcast which expires after a fixed period. This differed from the audiovisual right in that it included permission for a user to make a copy, but only where the programs to which it applied had been broadcast or would be broadcast in the next 30 days by the subscription television provider. PPCA submitted that this restriction was required by its input agreement, but, the Tribunal notes, did not advance any substantive argument why such a restriction should exist. The Tribunal was not persuaded that the timing restriction was supported by the input agreement or justified for any other reason.

(5)    The next relevant dispute concerned the way in which the definition of the “On-demand Offering Rights” operated. This was defined to mean a right for a subscription television provider “to make available a Program … by Streaming or Timed-Out Podcast via the internet, mobile networks or any other communications network”. The problem was that the definition of “Program” had the consequence that only programs which had already been broadcast via satellite or hybrid fibre co-axial (HFC) services could be a “Program”, with the consequence that the on-demand offering right would not be available for programming which had not already been broadcast in that way. Foxtel submitted that there was no reason why the definition of “Program” should be limited to programs that had been broadcast. PPCA submitted that it was an internationally used definition of “program” that formed part of its input agreement. The Tribunal did not see the rationality of PPCA requirement and, having regard to its conclusion on the Power Issue, accepted the position advanced by Foxtel.

(6)    In the result, the Tribunal determined that a range of rights must be licensed by PPCA which have not been themselves licensed to PPCA from its own members. These have been identified within the licence scheme as the “non-PPCA rights”.

109    RD 2 resolved a number of other issues that we do not consider relevant to address. The work of the Tribunal was, however, not complete. In RD 3, dated 22 November 2017, the Tribunal resolved three further matters, one of which concerned the drafting implications of the Tribunal’s decision in relation to the Power Issue. More particularly, PPCA contended that the scheme should make it clear that it is not authorised to grant the non-PPCA rights but that the licence granted in the scheme is by reason only of the Tribunal’s decision.

110    The Tribunal agreed with this course, with the consequence that the following terms were inserted into the scheme. They provide a convenient means by which the non-PPCA rights may be identified:

2.1    In consideration of the payment by the subscription Television Provider of the Licence Fee in accordance with clause 5, and subject to the terms and conditions of this Agreement, PPCA grants Subscription Television Providers a non-exclusive licence under the Subscription Television Broadcast Licence Scheme within Australia which:

(a)    permits the exercise of the Broadcast Rights, for the Broadcast of PPCA Sound Recordings via Subscription Television Services to Residential Subscribers and Commercial Subscribers (Broadcast Rights Licence);

(b)    (on request) permits the exercise of the New Media Rights, for the Communication of PPCA Sound Recordings to Subscribers (New Media Rights Licence);

(c)    permits the exercise of the rights granted under the Broadcast Rights Licence and the New Media Rights Licence by way of Enhanced Content; and

(d)    permits the exercise of the Technical Copying Rights.

2.2    The parties acknowledge and agree that:

(a)    PPCA is not authorised under its input agreement with PPCA Licensors to grant licences of the following rights included in the definitions of certain of the New Media Rights, and accordingly does not grant a licence of such rights under clause 2.1:

(i)    the Audiovisual Streaming Rights, to the extent that those rights include the right to permit users to make and store copies of the Audiovisual Content for later viewing on a one-off basis;

(ii)    the Digital Content Rental Rights, to the extent that those rights apply to Programs that have not been Broadcast; and

(iii)    the On-demand Offering Rights, to the extent that those rights apply to Programs or feature films that have not previously been Broadcast or will not in the next 30 days be Broadcast by the Subscription Television Provider, (collectively, the Non-PPCA Rights); and

(b)    the Copyright Tribunal of Australia has determined that the Subscription Television Broadcast Scheme should nevertheless include a licence of the Non-PPCA Rights subject to the terms and conditions of this Agreement.

(emphasis added)

The challenge to the Tribunal’s reasoning

111    The applicants (i.e., PPCA and the Majors) contend that the decision of the Tribunal in relation to the Power Issue involves six errors within the provisions of the ADJR Act and s 39B of the Judiciary Act. First, they contend that the Tribunal did not have jurisdiction to make an order varying the licence scheme so as to include rights which, by reason of the terms of the input agreements with its members, PPCA does not hold (Ground 1). Secondly, they contend that the making of the decision involved an improper exercise of the power conferred by s 154(4) of the Act, in that it failed to take into account or wrongly regarded as irrelevant the terms of the input agreement (Ground 2). Thirdly, they contend that for the same reasons the decision of the Tribunal involved an error of law (Ground 3). Fourthly, they contend that there was no evidence or other material to justify the making of the decision, in that the Tribunal based the decision on the existence of particular facts that did not exist (Ground 4). Fifthly, they contend that the decision involved an improper exercise of power conferred by s 154(4) of the Act in that the exercise of that power was so unreasonable that no reasonable person could have so exercise the power (Ground 5). Sixthly, they contend that a breach of the rules of natural justice occurred in that the Tribunal made a determination about certain of the rights to be included in the proposed licence scheme without hearing from the parties on, or receiving evidence as to the rationale for the rights and exclusions from rights included in the licence scheme referred by PPCA (Ground 6).

The submissions of the parties

112    PPCA and the Majors adopt the same approach to the grounds. Their principal submission is that the Tribunal did not have the power to make an order under s 154(4) of the Act insofar as it extends to a licence scheme that includes a licence of the non-PPCA rights. This follows, they submit, from the correct construction of ss 136(1) and 154(1) of the Act, having regard to textual considerations, history and context. In this regard they commence with the proposition, which is not controversial, that the rights in sound recordings administered by PPCA are limited to the extent that those rights have been licensed to PPCA under input agreements between it and its members, who are the owners or controllers of sound recording copyright.

113    Foxtel contends that the Tribunal was correct to conclude that it had power to provide for the non-PPCA rights in the scheme. It submits that s 154(4) does not confine the respects in which a scheme referred to the Tribunal might be varied or substituted. Such a scheme might be varied with respect to charges or conditions and may be varied with respect to the classes of case that are the subject of licences from the licensor or owner. The only express limitation on the power of the Tribunal to vary a scheme is that it be “reasonable in the circumstances”. Foxtel submits that a fundamental error in PPCA’s attack on the Tribunal’s conclusion is the proposition that a scheme as varied or substituted under s 154(4) must comply strictly with the definition of “licence scheme” in s 136, in particular that it must reflect the classes of cases for which the licensor is “willing” to grant licences. Foxtel notes that the defined term “licence scheme” does not appear in s 154(4) and submits that it is wrong mechanically to read into the terms of s 154(4) a definition that would not appropriately work if so imported, citing Deputy Commissioner of Taxation v Mutton (1988) 12 NSWLR 104 at 108. To strictly and literally import the definition of “licence scheme” from s 136 would give an absurd and unworkable operation to s 154(4) because every scheme that is varied or substituted by the Tribunal would then be outside power since it would no longer be a scheme “formulated by a licensor”, as required by the definition. Similarly, to accept the proposition that the power is limited to circumstances where the licensor or a person on whose behalf the licensor acts is “willing” to grant licences is unworkable and absurd because the licensor and owner could then strike an agreement that specifies all of the matters that they are willing to include and the Tribunal would be powerless to depart from that state of affairs.

114    Further, Foxtel submits that there is no evidence, or finding in the Tribunal, that the Majors are unable to license the non-PPCA rights. The proper inference is that as copyright owners they are able to do so. Foxtel argues that it is a fundamental error on the part of the applicant to focus on PPCA as the “licensor” and on the content of the input agreements, to the exclusion of the Majors and other copyright owners. The submission that the Tribunal only has jurisdiction over the licensors is misconceived. The Tribunal has jurisdiction to consider a scheme referred to it under s 154(1) and power to vary it as it considers reasonable in the circumstances.

115    Turning to challenge the submission advanced by the applicants that a “licence scheme” must, in order to comply with the definition in s 136, be built around certain “classes of cases”, Foxtel submits that the scheme as varied by the Tribunal does meet this requirement. It is referable to, and built around, the relevant “classes of cases”, being classes of rights related to the right to communicate sound recordings. Foxtel submits that the scheme as originally proposed by PPCA to the Tribunal included within it as optional extensions to the licence (at no separate fee) the “Audiovisual Streaming Rights”, “Digital Content Rental Rights” and “On-demand Offering Rights” that are included within the right collectively defined as “New Media Rights”. The non-PPCA rights are accordingly to be understood as simply contested aspects of the three categories of New Media Rights that were required to be addressed by the Tribunal in the reference. The legal character of the controversial aspects of those New Media Rights is that they restrict the right to communicate PPCA sound recordings to the public. Those rights do not describe acts comprised in the copyright as expressed in s 85 of the Act. Nor are they substantive classes of conduct in their own right. Rather, Foxtel submits that they relax certain restrictions sought to be placed on such rights and accordingly are to be regarded as addressing “incidental conditions or characteristics” of the New Media Rights that PPCA otherwise has the right to license.

116    Foxtel also submits that the construction adopted by the Tribunal and for which it contends is supported by the history, context and purpose of s 154 of the Act.

The relevant terms of the Act

117    The definitions of “licence”, “licence scheme” and “licensor” are set out in s 136(1) of the Act and are as follows:

(1) In this Part, unless the contrary intention appears:

…

licence means a licence granted by or on behalf of the owner or prospective owner of the copyright in a work or other subject-matter to do an act comprised in the copyright.

licence scheme means a scheme (including anything in the nature of a scheme, whether called a scheme or tariff or called by any other name) formulated by a licensor or licensors and setting out the classes of cases in which the licensor or each of the licensors is willing, or the persons on whose behalf the licensor or each of the licensors acts are willing, to grant licences and the charges (if any) subject to payment of which, and the conditions subject to which, licences would be granted in those classes of cases.

licensor means a body corporate for which both the following conditions are met:

(a)    the body is incorporated under a law in force in a State or Territory relating to companies;

(b)    the body’s constitution:

(i)    entitles any owner of copyright, or any owner of copyright of a specified kind, to become a member of the body; and

(ii)    requires the body to protect the interests of its members connected with copyright; and

(iii)    provides that the main business of the body is granting licences; and

(iv)    requires the body to distribute to its members the proceeds (after deduction of the body’s administrative expenses) from payments to the body for licences; and

(v)    prevents the body from paying dividends.

118    Section 154 provides:

(1)    Where a licensor proposes to bring a licence scheme into operation, he or she may refer the scheme to the Tribunal.

 (2)    The parties to a reference under this section are:

(a)    the licensor referring the scheme; and

(b)    such organizations or persons (if any) as apply to the Tribunal to be made parties to the reference and, in accordance with the next succeeding subsection, are made parties to the reference; and

 (c)    the Australian Competition and Consumer Commission, if the Tribunal makes the Commission a party to the reference under section 157B.

(3)    Where an organization (whether claiming to be representative of persons requiring licences or not) or a person (whether requiring a licence or not) applies to the Tribunal to be made a party to a reference, and the Tribunal is satisfied that the organization or person has a substantial interest in the operation of the scheme to which the reference relates, the Tribunal may, if it thinks fit, make that organization or person a party to the reference.

(4)    The Tribunal shall consider a scheme referred under this section and, after giving to the parties to the reference an opportunity of presenting their cases, shall make such order, confirming or varying the scheme or substituting for the scheme another scheme proposed by one of the parties, as the Tribunal considers reasonable in the circumstances.

(5)    An order (other than an interim order) of the Tribunal under this section may, notwithstanding anything contained in the licence scheme to which it relates, be made so as to be in force either indefinitely or for such period as the Tribunal thinks fit.

(6)    Where a licence scheme has been referred to the Tribunal under this section, the licensor may do either or both of the following things:

(a)    bring the scheme into operation before the Tribunal makes an order in pursuance of the reference;

(b)    withdraw the reference at any time before the Tribunal makes an order in pursuance of the reference, whether the scheme has been brought into operation or not.

(7)    The scheme reflecting the Tribunal’s order:

(a)    comes into operation when the order is made, if the scheme referred to the Tribunal had not already come into operation; and

(b)    operates as long as the order remains in force.

This subsection has effect despite anything in the scheme referred to the Tribunal.

Note: Depending on the Tribunal’s order, the scheme reflecting the order will be the scheme confirmed by the order, the scheme as varied by the order or the scheme substituted by the order for the scheme referred to the Tribunal.

119    Subsections 159(1) and (2) of the Act provide:

Order under section 154, 155 or 156

(1)    Where an order made on a reference under this Part with respect to a licence scheme is for the time being in force and a person, in a case to which the scheme reflecting the order applies, does anything that, apart from this subsection, would be an infringement of copyright but would not be such an infringement if he or she were the holder of a licence granted in accordance with that scheme, in so far as the scheme relates to cases to which the order applies, that person shall, if he or she has complied with the relevant requirements, be in the like position, in any proceedings for infringement of that copyright, as if he or she had at the material time been the holder of such a licence.

(2)    For the purposes of the last preceding subsection, the relevant requirements are:

(a)    that, at all material times, the person concerned has complied with the conditions that, in accordance with the scheme reflecting the order, would be applicable to a licence in respect of the case concerned; and

(b)    where, in accordance with the scheme, any charges are payable in respect of such a licence—that, at the material time, the person concerned had paid those charges to the licensor operating the scheme, or, if at that time the amount payable could not be ascertained, he or she had given an undertaking in writing to the licensor to pay the charges when ascertained.

Consideration of the Power Issue

120    For the reasons that follow, we respectfully consider that the Tribunal erred in concluding that it had power to vary the licence scheme as proposed by PPCA to incorporate non-PPCA rights.

121    The relevant jurisdiction of the Tribunal is provided for in Part VI of the Act. Aspects of this Part were the subject of amendments introduced by the Copyright Amendment Act 2006 (Cth) (2006 amendments). As the Explanatory Memorandum to the Copyright Amendment Bill 2006 (Explanatory Memorandum) notes (at page 3), many of the changes implement the Government’s response to the report entitled Jurisdiction and Procedures of the Copyright Tribunal prepared by the Copyright Law Review Committee dated December 2000.

122    Section 154 of the Act is entitled “Reference of proposed licence schemes to Tribunal” and s 154(1) provides that where a licensor proposes to bring a licence scheme into operation, he or she may refer the scheme to the Tribunal. Subsection 154(2) provides that the parties to a reference in s 154 are (a) the licensor referring the scheme; (b) such persons (if any) as apply to the Tribunal to be made parties and are made parties by the Tribunal in accordance with s 154(3) (which, in turn, provides that such persons applying to be made parties must have a substantial interest in the operation of the scheme); and (c) the Australian Competition and Consumer Commission, if the Tribunal makes the Commission a party to the reference under s 157B.

123    The definitions of “licence”, “licensor” and “licence scheme” adopt some significance in the present debate. They appear in s 136(1), as set out in [117] above.

124    The definition of “licence” was introduced in the 2006 amendments. The Explanatory Memorandum states that the purpose of the amendment is to change the range of licences that can be the subject of an application to the Tribunal and goes on to say that “subject to having regard to the new definition of ‘licensor’, the new definition covers a licence to do any act comprised in the copyright in any work or other subject-matter”: Explanatory Memorandum p 174, item 1.

125    The earlier definition of “licensor” was repealed and replaced with the definition set out in [117] above. The Explanatory Memorandum indicates that the purpose of the amendment is to limit the licences and licence schemes that can be the subject of an application or reference to the Copyright Tribunal to those that are collectively administered. Accordingly, a licensor must be able to grant licences for a substantial number of copyright works or other subject matter in a class of such materials, for example, literary works or musical works or sound recordings which were made by various different creators. The licensor may have that authority as owner of the relevant copyrights, as exclusive licensee or as agent for the owners: p 174 item 2. As we have noted earlier, in the present case the licensor is PPCA.

126    The definition of “licence scheme” remains unaltered by the 2006 amendments.

127    A “licence scheme” is a scheme formulated by a licensor (a collecting body). It is to be recalled that a licence scheme is not of itself a copyright licence. It is a scheme that provides for the grant of a licence. The grant of rights arises when someone seeks a licence under the scheme and is granted one. According to the definition such a scheme must have three characteristics as follows.

128    First, it must set out the “classes of cases” which the licensor or persons on whose behalf the licensor acts (broadly, the copyright owners) are “willing” to grant licences. The words “classes of cases” refer, in our view, to such of the incidents of copyright that the owner gives permission to the collecting society to licence. This is apparent because the “licence” concerns (and is defined to be) that which is granted by the owner in a work or other subject matter to do an act comprised in the copyright. The use of the words “classes of cases” serves to leave open the precise incidents of copyright that the copyright owner might choose to authorise the collecting society to license in the scheme.

129    For instance, in the present case the scheme proposed by PPCA concerns copyright in sound recordings. The rights of copyright owners in this respect are set out in s 85(1) of the Act and involve the exclusive right to all or any of the following “acts”: (a) to make a copy of the sound recording; (b) to cause the recording to be heard in public; (c) to communicate the recording to the public; and (d) to enter into a commercial rental arrangement in respect of the recording. The use of “classes of cases” instead of classes of “acts” in the definition of a licence scheme indicates a more refined subdivision of the particular aspects of the copyright that may be licensed than the broader class of “acts” such as those nominated in s 85(1). In this regard, it is to be recalled that copyright is personal property that is transmissible by assignment, by will and by devolution by operation of law: s 196(1). An assignment of copyright may be limited in any way, including so as to apply to one or more of the classes of acts that, by virtue of the Act, the owner of the copyright has the exclusive right to do (including a class of acts that is not separately specified in the Act as being comprised in the copyright but falls within a class of acts that is so specified): s 196(2)(a). An assignment may also be limited to a place or part of Australia (s 196(2)(b)) or so as to apply for part of the period for which the copyright subsists: s 196(2)(c).

130    Similarly, such aspects of copyright may, in part or in whole, be the subject of either exclusive or non-exclusive licences granted in respect of some or all of those aspects of copyright, or parts thereof.

131    Section 137, which is entitled “Cases to which licence schemes apply” provides as follows:

(1)    For the purposes of this Part, a case shall, subject to the next succeeding subsection, be deemed to be a case to which a licence scheme applies if, in accordance with a licence scheme for the time being in operation, a licence would be granted in that case.

(2)     For the purposes of this Part, where, in accordance with a licence scheme:

(a)    the licences that would be granted would be subject to conditions by virtue of which particular matters would be excepted from the licences; and

(b)    a case relates to one or more matters falling within such an exception;

that case shall be deemed not to be a case to which the scheme applies.

132    The section identifies that a “case” is one to which a licence scheme applies if, in accordance with a licence scheme for the time being in operation, a licence would be granted in that case (s 137(1)), unless the licences that would be granted would be subject to conditions by which particular matters would be excepted from the licences, in which case the case is deemed not to be one to which the scheme applies (s 137(2)). In this way the potential overlap between a “condition” and a “case” is identified. A “case” concerns the licence of the whole or a part of the copyright. A condition will be any term that does not concern the scope of the rights granted. Instances include terms going to the provision of warranties, the mechanics of the payment regime, dispute resolution terms, and choice of law terms.

133    Reference is made to a class of cases in several other parts of the Act. For instance, in s 155 provision is made for reference of an existing licence scheme to the Tribunal where a dispute arises between the licensor and either an organization claiming to be representative of persons requiring licences “in cases included in a class of case to which the scheme applies” or any person claiming to require a licence in such a case. Similar provision is made in s 156(1). In both the reference to a “class of case” is to any aspect of the copyright in respect of which a licence is required.

134    The distinction between “case” or “cases”, “charges” and “conditions” is also reflected in the language of s 159. Subsection 159(1) provides that where an order with respect to a licence scheme is in force and a person “in a case” to which it applies does anything that, apart from that section, would be an infringement of copyright but would not be an infringement if he or she were a holder of a licence under that scheme, “in so far as the scheme relates to cases to which the order applies” that person shall have a defence to infringement proceedings if he or she has “complied with the relevant requirements”. The relevant requirements are identified in subsection 159(2) as being (a) compliance with the conditions that would be applicable to the licence “in respect of the case concerned” and (b) payment of any charges in respect of the licence.

135    Accordingly, in our view the definition of “licence scheme” identifies as a first characteristic of the scheme that it be formulated by a licensor and set out the aspects of the incidents of copyright in respect of which the licensor or licensors (or the persons on whose behalf they act) are willing to grant licences.

136    The second characteristic is that it must set out the charges (if any) subject to the payment of which licences would be granted in those classes of cases.

137    The third characteristic is that the scheme must set out the conditions subject to which licences would be granted. Section 136(2)(a) provides that a reference to conditions is a reference to any conditions other than conditions relating to the payment of a charge. As we have noted, s 137 deems that a case is not the subject of the licence if a condition provides that it is exempted from it.

138    The jurisdiction of the Tribunal arises where a licensor proposes to bring a licence scheme into operation and it refers that scheme to the Tribunal: s 154(1). Subsection 154(4) provides that the Tribunal shall consider “a scheme referred under this section”. That reference to “scheme” is to the “licence scheme” identified under subsection 154(1) having the three characteristics identified in the definition in s 136(1). Having regard to the context in which the reference to “scheme” appears, we are unable to accept the submission advanced by Foxtel that “scheme” should be regarded as having a different meaning. Our view is reinforced by the interchangeable references to “scheme” and “licence scheme” that appear in subsections 154(5)–(7). It is also apparent from the language of s 159(1), which refers to the consequences arising “[w]here an order made on a reference under this Part with respect to a licence scheme is for the time being in force”. This is plainly a reference to the defined term.

139    The Tribunal is by s 154(4) empowered to make such order, confirming or varying the scheme or substituting for the scheme another scheme proposed by one of the parties, as the Tribunal considers reasonable in the circumstances.

140    The applicant contends that the scope of the Tribunal’s power is constrained by the scope of the authority conferred on the licensor (that is, the collecting society) by the copyright owner. Where the input agreement between the copyright owners grants no licence to the collecting society in respect of an aspect of the copyright, the Tribunal has no power to add it to the referred scheme or in any substituted scheme. Foxtel submits that the Tribunal does have such power, subject only to the constraint that any variation or substitution be reasonable in the circumstances.

141    In our view, the reference to “scheme” in s 154(4) is to be understood consistently throughout the subsection to be a “licence scheme” as defined. Whilst the referred scheme may be varied or substituted, the end result approved by the Tribunal must still be a “scheme” that has the three characteristics that we have identified. Central to the first of these is the requirement that the classes of cases the subject of the licence be ones that the licensor (collecting society) or person on whose behalf the licensor acts (broadly, the owner of copyright) is willing to grant. The reference to “willing” in this context is to be understood to mean that those persons are prepared to offer for licence those particular aspects, or “classes of cases”, of the copyright the subject of the scheme. Taken together these matters indicate that the classes of cases in which the licensor or the person on whose behalf the licensor is willing to grant licences will be parts of the copyright interest of the owners that are offered by the collecting society in the licence scheme referred to the Tribunal (as may be varied by licensor from time to time).

142    The second and third characteristics, being the charges and conditions to be applied, do not contain reference to the willingness or otherwise of the licensor or person on whose behalf the licensor acts. Accordingly, a scheme as determined by the Tribunal that includes conditions and charges that conflict with proposals made by these people will remain within the definition of a licence scheme and be within the power of the Tribunal, provided that it is reasonable in the circumstances.

143    In our view this approach is consistent with the policy and purpose of Part VI of the Act, which is to confer on the Tribunal power to supervise the relationship between collecting societies and persons in need of licences. The starting point mandated by s 154(1) is the voluntary offer of a licence scheme by the licensor on behalf of its members. It is not a scheme for the compulsory license of rights, which are addressed in other provisions of the Act. Indeed, the absence of the prescriptive provisions applicable to compulsory licensing provides a further indication that this is the correct approach.

144    PPCA contends that it was not “willing” to grant licences in respect of the non-PPCA rights and also that its input agreement with the copyright owners whom it represents had not granted it a licence in respect of those rights. As a result, it submits that those owners were also not willing to grant licences for those classes of cases and, furthermore, PPCA was not able to do so. To some extent the reference to the input agreements distracts from the real point, which turns on the “willingness” or otherwise of the parties mentioned to grant the licence in respect of the classes of cases identified. That is to be ascertained from the form of licence scheme proposed by the licensor, which represents the interests of the copyright owners and accordingly may be taken to reflect the “willingness” of both.

145    The consequence of our construction is that the Tribunal does not have power to vary the scheme proposed by a licensor insofar as it affects the classes of cases in respect of which the licence is proposed to be granted. In our view this does not lead to an absurd or unworkable result (as Foxtel contends). Subdivision H (ss 154–159) of Division 3 of Part VI of the Act concerns the regulated approval of licence schemes volunteered by rights owners. These licence schemes are to be contrasted with the grant of statutory licences under the Act, where statutory mechanisms provide for the compulsory licence of certain acts within the copyright of an owner, subject to certain provisos. An example of the latter is s 108 of the Act, which provides a defence to copyright infringement in a sound recording performed in public on terms requiring, inter alia, the payment to the copyright owner of equitable remuneration the amount of which is to be determined by the Tribunal if the parties are unable to agree. Under s 154 of the Act a degree of decisional freedom is given to the Tribunal to impose reasonable charges and conditions on the licensor, but not to expand the cases in respect of which the copyright licence is to be granted. To do so would permit the Tribunal to impose a compulsory licence upon the rights owners in circumstances where the Act indicates that this is not its intention.

146    Foxtel submits that the approach taken in Universities UK Ltd v Copyright Licensing Agency Ltd, Design and Artists Copyright Society Ltd Intervening [2002] EMLR 35 (Universities UK), where the United Kingdom Copyright Tribunal (Christopher Floyd QC, Evelyn Cribb and Angela Howorth) considered a question of the jurisdiction of that Tribunal under the Copyright, Designs and Patents Act 1988 (UK) (UK Act) should be adopted. Section 116 of the UK Act relevantly provides that a “licensing scheme” means a scheme setting out (a) the classes of case in which the operator of the scheme, or the person on whose behalf he acts, is willing to grant copyright licences, and (b) the terms on which the licences would be granted in those classes of case. Section 118(1) provides that the terms of a licensing scheme proposed to be operated by a licensing body may be referred to the Tribunal “either generally or in relation to any description of case” and s 118(3) relevantly provides that the Tribunal shall consider the matter referred and:

… make such order, either confirming or varying the proposed scheme, either generally or so far as it relates to cases of the description to which the reference refers, as the Tribunal may determine to be reasonable in the circumstances.

147    The collecting society submitted that the Tribunal had no jurisdiction to compel the inclusion within a licence scheme that it approved a licence to copy material (here, certain “course packs”) that was not part of the input agreement with the collecting society and so not within the repertoire of its rights. The Tribunal rejected that submission, finding that once the licence scheme had been properly referred to it, the Tribunal had jurisdiction to consider what restrictions were reasonable in the circumstances (at [59]). The Tribunal said (at [65]):

But the exercise by the Tribunal of its jurisdiction cannot occur before the owner of the rights has voluntarily decided to participate in a licensing scheme. … [M]ost of the Tribunal’s work consists of imposing terms on parties who have been unable to agree. Where the Tribunal awards more favourable terms to the licensee than were on offer, those terms are imposed. But that does not mean that the Tribunal is creating a compulsory licensing scheme: the rights holder is always free to withdraw from the scheme.

148    Foxtel submits that this approach should be adopted in the present case. However, a number of factual and legislative differences indicate that it would be unsafe to apply this reasoning in the present case. First, the non-PPCA rights are not rights in respect of which the owner of the rights has voluntarily decided to participate. To the contrary, they do not appear in the input agreements and have not formed part of the licence scheme referred by PPCA to the Tribunal. Secondly, under the Act, the rights holder is not always free to withdraw from the scheme. Subsection 154(6) provides a limited right for the licensor (collecting society) to withdraw the reference at any time before the Tribunal makes an order, but that right is not conferred on the copyright owners. Further, the copyright owner is not automatically a party to the reference to the Tribunal. The Tribunal has discretion to grant leave for an owner to appear if he or she “has a substantial interest in the operation of the scheme to which the reference relates”: s 154(3). Thirdly, under the licence scheme approved by the Tribunal in the present case, clause 4 provides for the removal of sound recordings from the repertoire licensed under the scheme by licensors of PPCA, but the power to remove is limited to the rights granted by PPCA under clause 2 of the agreement. It would not, therefore, apply to the non-PPCA rights that have been included by the Tribunal.

149    Foxtel submits that the non-PPCA rights described in cl 2.2(a)(i)–(iii) of the scheme made by the Tribunal are simply contested aspects of three categories of New Media Rights. It submits that the legal character of the controversial aspects of these rights is that they restrict the right to communicate PPCA sound recordings to the public but they do not describe acts comprised in the copyright as expressed in s 85 of the Act, nor are they substantive classes of conduct in their own right. Rather, they relax certain restrictions sought to be placed on such rights, and therefore address incidental conditions or characteristics of the New Media Rights that PPCA otherwise has the right to license and that were put before the Tribunal for determination in the reference. As such, it submits that the scheme as varied by the Tribunal is “referable to and built around the “classes of cases” put forward by PPCA, being those particular classes of cases within the right to communicate sound recordings referred to as “Audiovisual Streaming Rights”, “Digital Content Rental Rights” and “On-demand Offering Rights”. For the reasons given, we do not agree that the “cases” identified in the definition of “licence scheme” are to be equated with “acts” comprised in the copyright as identified in s 85 of the Act. They may, depending on the licence scheme, include much narrower incidents of the rights conferred on a copyright owner.

150    Taking as an example the first of the three rights the subject of contention, in the case of “Audiovisual Streaming Rights”, PPCA proposed at 1.1(f):

Audiovisual Streaming Rights means the rights to Communicate Cleared PPCA Sound Recordings reproduced in Audiovisual Content and Enhanced Content (excluding for the avoidance of doubt Music Videos and radio programs) to the public over the Internet, a mobile telecommunications network or any other communications network now known or developed in the future, including by means of an interactive on demand service or linear channels where there is no copy of the Audiovisual Content (other than a temporary copy), or any other form of fixed file or data from which the user can subsequently re-play the Audiovisual Content, which is created on the user’s playback Device [fn Subject to Input Agreement (IA) amendment].

(emphasis added)

151    Foxtel submits that the practical effect of this is that the scheme would permit a user to stream and watch (and listen) as it came onto his or her device. It does not permit the user to stream it, delay and watch it later. It is a timing issue.

152    The Tribunal’s final version replaced the italicised words with:

… where there is no copy made by the Subscription Television Service of the Audio Visual Content other than a temporary copy for technical reasons but where the user can, instead of viewing the Audiovisual Content, store it instead for later viewing on a one-off basis.

153    This version permitted streaming, storage and watching later. Foxtel submits that the change is in the character of an adjustment to the conditions on which the audiovisual streaming rights are conferred. It alters the effect of the qualification, but makes no alteration in substance so far as the consumer is concerned, or so far as Foxtel is concerned about any further or other use of the sound recording. The applicant submits that under the scheme as varied the “right” (or class of case) has a completely different character. In PPCA version audiovisual streaming was a right to stream content that a user could watch immediately but not store and retain. Under the approved scheme, the user is granted the right to retain, for any length of time, the content that is provided. It is no longer a streaming right but a right to download and store.

154    We accept the submissions advanced by the applicant. The alteration in the terms of the Audiovisual Streaming Rights does not serve to impose a condition or a charge, but to alter the cases in respect of which a licensee may use the copyright work. PPCA proposal did not confer a right to download and store. It may be inferred that the rights owners were not willing to do so.

155    The changes to the Digital Content Rental Rights and On-demand Offering Rights are to similar effect. In each case, the licence scheme proposed by PPCA curtailed the use of those rights, with the result that had a person used the rights in a manner inconsistent with the scheme, he or she would not have benefited from the protection under s 159(1) of the Act. The changes made by the Tribunal were not to conditions, but to classes of cases in respect of which the licensor was not willing to grant a licence.

156    We accept that this conclusion has the consequence that the role of the Tribunal is to some extent more limited than under the approach it adopted in the present case. However, the Tribunal remains free to adjust charges where it considers that any constraint on the licence offered by the licensor relevantly diminishes the value of the scheme offered. In our view this is the approach that the legislative scheme intended.

157    It is not necessary for us to address in further detail each of the non-PPCA rights. We have found that a licence scheme that is the subject of the determination of the Tribunal must possess the characteristics of a defined licence scheme, including that the classes of cases be those that the relevant persons are willing to grant. Neither PPCA nor the copyright owners whom they represented were willing to grant licences in respect of the non-PPCA rights. As the example of the modification of the audiovisual streaming rights demonstrates, each of the non-PPCA rights is a class of case to which the scheme applied, it representing a basis upon which the copyright owner permits an aspect of the copyright in its work to be reproduced. For the reasons given, the Tribunal did not have power to propose a scheme that is not in respect of classes of cases that the licensor is willing to license.

158    Accordingly, we find that the Tribunal did not have jurisdiction to make an order varying the licence scheme so as to include the non-PPCA rights.

RELIEF

159    The Court has decided that the Tribunal erred by including the non-PPCA rights in the approved scheme. The Court has concluded that the other challenges to the Tribunal’s decision should be rejected. The parties in their written outlines and orally addressed the orders which should be made in the event of such an outcome. All the parties accepted that it was not for this Court to vary the approved scheme. The matter needed to go back to the Tribunal. The terms of the referral back to the Tribunal were in dispute.

160    Foxtel submitted that the referral back to the Tribunal should be limited. It proposed the following orders:

1.    Pursuant to s 16(1) of the Administrative Decisions (Judicial Review) Act 1975 (Cth), that part of the decision of the Copyright Tribunal of Australia made on 5 January 2018 that varied the First Applicant’s licence scheme by the inclusion of the Non-PPCA Rights be set aside.

2.    The matter be referred to the Copyright Tribunal of Australia for further consideration of such confirmation, variation or substitution of the scheme as the Tribunal considers reasonable in order to remove the Non-PPCA Rights from the licence, and any consequential matters that the Tribunal sees fit to consider, in accordance with the reasons of the Full Court of the Federal Court of Australia published on [date].

161    It submitted that the pricing decision had been found to be without error and had been treated separately by the Tribunal. It would be unfair, so Foxtel submitted, to make an order which had the effect of requiring the parties to start again with all the delay and costs that would involve.

162    PPCA submitted that the appropriate order was to set aside the Tribunal’s decision and refer the whole matter back to the Tribunal for reconsideration in light of the Court’s reasons.

163    The Court accepts Foxtel’s submission and will make the orders it has proposed. The Court has power to set aside part of the decision (s 16(1)(a) of the ADJR Act). We note that the High Court said in Minister for Immigration and Multicultural Affairs v Thiyagarajah [2000] HCA 9; (2000) 199 CLR 343 at [32] the terms of s 16 of the ADJR Act should not be the subject of any narrow or restrictive construction. The Tribunal treated the decision as to the price separately from that as to power and the former has been held not to involve judicially reviewable error. In our opinion, it should stand. In any event, the terms of the orders we will make gives the Tribunal the opportunity to deal with “any consequential matters that the Tribunal sees fit to consider”.

CONCLUSION

164    The Court will make the following orders:

(1)    Pursuant to s 16(1) of the Administrative Decisions (Judicial Review) Act 1975 (Cth), that part of the decision of the Copyright Tribunal of Australia made on 5 January 2018 that varied the first applicant’s licence scheme by the inclusion of the range of rights to be licensed by the first applicant which have not themselves been licensed to the first applicant from its own members (the non-PPCA rights) be set aside.

(2)    The matter be referred to the Copyright Tribunal of Australia for further consideration of such confirmation, variation or substitution of the scheme as the Tribunal considers reasonable in order to remove the non-PPCA rights from the licence, and any consequential matters that the Tribunal sees fit to consider, in accordance with the reasons of the Full Court of the Federal Court of Australia published this day.

165    The Court will hear the parties on the question of costs. Each party who seeks an order for costs shall file and serve within seven days written submissions limited to five pages setting out the order sought and the submissions in support thereof, and each party who opposes an order for costs against them, shall file and serve within 14 days written submissions limited to five pages in response. The Court will also make non-disclosure and confidentiality orders with respect to the unredacted reasons, that is to say, the reasons which include Confidential Annexure A.

Associate:    

Dated:    6 June 2019

ANNEXURE A

[REDACTED]