summary

In accordance with the practice of the Federal Court in some cases of public interest, the following Summary has been prepared to accompany the reasons for judgment delivered today.  The Summary is intended to assist understanding of the decision of the Court.  It is not a complete statement of the conclusions reached by the Court or the reasons for those conclusions.  The only authoritative statement of the Court’s reasons is that contained in the published reasons for judgment.  The published reasons for judgment and this Summary will be available on the Internet at www.fedcourt.gov.au.

SUMMARY

The Australian Communications and Media Authority is the regulator of the Australian broadcasting media.  It applied to the Federal Court to impose civil penalties on Radio 2UE Sydney Pty Ltd for 13 breaches of the Broadcasting Services Act 1992 (Cth) by failing to comply with a condition of its commercial radio broadcasting licence.  This is the first case brought under the recent amendments to the Act that allow ACMA to seek the imposition of civil penalties by the Court.

The parties agreed that the breaches of the Broadcasting Services (Commercial Radio Current Affairs) Standard 2000 were committed by Radio 2UE through its radio presenter, Mr John Laws.  The condition of the licence required Radio 2UE to cause Mr Laws to make a disclosure statement that he had a commercial sponsorship agreement with a sponsor every time the products, goods, services or name of the sponsor was mentioned on his radio show.  He did not do that on 13 occasions.  The breaches related to Mr Laws’ sponsorship arrangements with Qantas, Toyota, Hamilton Island, Roche, Oatley Family Wines and Byron Bay Beer.  The parties agreed that Mr Laws had sponsorship arrangments with all of those entities for over $100,000 each per year, except Byron Bay Beer which paid Mr Laws between $10,000 and $100,000 per year.

Before the case came to Court, Radio 2UE and ACMA agreed, on the suggested amount of the penalty that Radio 2UE should be required to pay for each breach. This is called an ‘agreed penalty’, and the amount agreed was $10,000 for each breach, totalling $130,000.  The maximum penalty provided by the Act for each breach is $55,000 which would amount to a total of $715,000 for the 13 breaches.

In agreed penalty cases the Court will not impose a different penalty unless it considers the agreed penalty to be inadequate or inappropriate.  The Communications Law Centre intervened in the case and argued that a higher penalty should be imposed.

The Court has decided not to impose the agreed penalties because it has concluded that they were manifestly inadequate. The Court has imposed penalties of varying amounts totalling $360,000. The Court has recognised that Radio 2UE cooperated with ACMA, even before the proceedings were begun, and had established a new compliance program to seek to ensure no further breaches would occur. The Court has accepted that Radio 2UE has shown genuine contrition for the breaches.

Nevertheless, the Court has concluded that it should impose a higher penalty for the reasons set out in the judgment, and which include the following.  The Court found that overall, the contraventions were of a serious nature.  They indicated that there was a significant failure of Radio 2UE to take proper and sufficient steps to ensure that Mr Laws, in fact, complied and continued to comply with the disclosure standard.  The Act and Radio 2UE’s licence required it to ensure that Mr Laws complied with the disclosure standard;  and it had recently given an enforceable undertaking that it would bring this about directly, following an inquiry by ACMA that had established previous breaches of the standard by Radio 2UE and Mr Laws.  The Court held that the obligations imposed on Radio 2UE as conditions of its public broadcasting licence were to protect the public.  The Court found that Mr Laws earned substantial amounts of money for himself through his commercial agreements using its licence that made it all the more incumbent on Radio 2UE to ensure that Mr Laws did not contravene the conditions of the licence again.

The Court found that the breaches were committed because of the conduct of Mr Laws, who had a significant history of failing to comply with the disclosure standard and Radio 2UE was aware that Mr Laws disliked having to comply with the standard.  Several of the breaches were reckless and the Court found that in one breach Mr Laws treated the requirements of the Act with contempt.