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EDITED BY NIRANJAN ARASARATNAM AND SHANE BARBER Vol 20 No 4 200"

The Role of the Mediain a, Time of Crisis

Vlnce-dt elo,-~ne winner of CAMLAs 2001 Essay Competition, provides a timely examination ofthe conflict between the media’s responsibility to ensure the public’s right to know and theirmoral obligations to those they could endanger.

"Of all the foundations of a freedemocratic socieo; that most basic -the j~eedom to kno~: to be injbrmed- lugs guaranteed that such knowledgeand such inft~rmation c¢ltt befitshione~t by the fimatic thtvntgh theconduit ¢~the medhl Q’e. ~ ch~se thato-e would en~de a fimdanu’ntal right,

with little hope of audience

J. Bowyer Bell

THE DILEMMA

The abo,.e quote captures the essence ofthe ten-orism dilemma facing the media.[t is ,.’,’ell recognised Ihat a degree ofsymbiosis exists between the media and~he perpetrators of terror. The newscompetition and sensationalism Ihatcbaracrerise Weslern media lendthemselves to exploitation by te~orists.These I~atures enable terrorists to ase thefree media as a platform for theirpropaganda nnd recruitment. Modernterrorists have learned to cunninglyexploit the media’s own modus operandito draw attention to their causes. InrettlQ1, the actions of terrorisls exposemedia s[alions and newspapers Iomillions of viewers and boosts ratings skyhigh.

To illustrate this, the attacks on the WorldTrade Centre on Septem~r I 1,2001 were

, committed on a scale nnparalleled in the

history of modern terrorism. The terroristacts were perpetrated in a way that wouldmaximise television coverage, with thegraphic images broadcast live to millionsof appalled viewers all around the world.Major television channels had no optionbut to broadcast what was happening live,as the events taking place were far toosignificant to delay’. No other terroristincident in modern history has socaptivated ~md at the same time horrifiedso many people.

The access to the media as a result of theterrorist attacks ~as utter and complete.Instantly. Osama Bin Laden became arecognised household name. his exposurea[m,.~st as great in the United States asthat of the President. Throughout partsof the world he has been venerated as ahero and his AI-Qaeda movement hasenjoyed new found legitimacy in thehearts and minds of many Who harbour a

deep resentment of the United States.Intelligence officials warned members ofthe United States Congress in earlyOctober Ihat "there is a high probability’of a future attack.-" Sure enough, anotherterrorist attack to gain the media’sattention was not long in coming and thistime it was aimed by unknown parties atthe media itself.

The anthrax attacks deadly as they were,represented a most efficacious means ofutilising the media vehicle to amplify fearinto a national phenomenon. There aregood grounds to presume that anyterrorist action initiated in the future willbe duly reported by the mainstreammedia, and via this conduit, thesignificance and status of the perpetratorsgreatly magnified.

Muslims the world over have foundthemselves the victims of attacks inobvious racial hate crimes. In the United

INSIDE THIS ISSUE

The Role of the Media in a Time of Crisis

Freedom - Lost or LoanedAustralian Celebrity Endorsments:

The Need for an Australian Right of Publicity

Cultural Parochialism and Free Trade

Internet Dumping and Regulation of theAudiotex Industry

Cross.Media Rules to be Revisited Again or Not

Legislation Note: Some Final Words on Privacy

CONTENTS

The Role of the Media in a Time of CrisisVincent Ho, the winner of CAMLA’s 2001 Essay Competition, provides a timely examination of the

conflict between the media’s responsibility to ensure the public’s right to know and their moral obligations

to those they could endanger,

Freedom - Lost or LoanedMr Kerry Stokes. AO, in his 2001 Andrew Olle Media Lecture provides this personal account of his

reaction to the events of September 11 2001 and their impact on the role of the media.

Australian Celebrity Endorsments: The Need for an Australian Right of PublicityScott Ralston, in his highly commfinded entry in this year’s CAMLA Essay Competition, compares the US

and Australian approach to this topical issue.

Cultural Parochialism and Free TradeTim Magarey, another highly commended entry in this year’s CAMLA Essay Competition, argues that the

output of the ’cultural industries’ should not be exempt from the ambit of free trade agreements.

Internet Dumping and Regulation of the Audiotex IndustryJohn Corker examines the risks associated with using 190 and 0011 services and some possible solutions.

Cross-Media Rules to be Revisited Again or NotRaani Costello reviews the legislative and policy background of media ownership restrictions

Legislation Note: Some Final Words on PrivacyCatherine Dickson provides some final words on implementation of privacy law compliance

for the private sector.

States a wave of fear has spreadthroughout the Islamic community, ascries for vengeance turn to persecution.Among the most gut-wrenching attacksinclude the murder of a Pakistani Muslimstore owner in Memphis. the murder of aSikh man in Arizona for appearingMuslim and the stoning of a pregnantMuslim woman in Rhode Island) Manythousands more Muslims in the UnitedStates have felt the hand of intimidation.Here in Australia, an Islamic school inPerth has had its windows smashed,Muslim women and children have beenvilified and several mosques defaced?

The media cannot be held responsible forthe repression and victimisation ofMuslims. However, just as AsianAustraliaas were vilified after PaulineHanson made her views known throughthe media mouthpiece, it should berecognised that there exist barbarousmembers of our society actively seekingscapegoats, upon whom they unleashtheir frustrations and rage. For thesepersons, the media is the principle sourceof information upon which they feed.

Media then, have the difficult task ofweighing up their moral obligations to

those they could endanger against theirinherent responsibility to ensure thepublic’s right to know.

Freedom of expression is a fundamentaltenet of modern democratic principles.There is a strong moral, ethical andphilosophical imperative to allow theemergence and growth of ideas withoutinhibition or restraint. Freedom ofexpression importantly is not just thedomain of the indi’,’idual. In modem masssociety, Vincent Blasi argues that themass media have the power and influenceover the opinion process to properlymonitor government: the individual nolonger does.s Therefore, the media are anecessary and appropriate countervailingforce to government, essential for theperpetuation of any free democracy.

The imperative for freedom of expressionhowever is put into question when theissue of a terrorist crisis comes into play,particularly where hostages are involved.The issue then becomes one ofproportionality not absolutes. It isjustified to say that media should notinterfere in a process that may lead tojeopardising the safety of hostages, andindeed the media has as important a

responsibility to the safety of the hostageas it does to the public’s right to know.

Media interference in the Lafthansahijacking in 1977 and the Hanafi Muslimtakeover in Washington D.C. earlier onin the same year was strongly criticisedfor being potentially dangerous and in theLufthansa case, media coveragecontributed directly to the death of ahostage2

There is also an element of accountabilityto the nation when reporting terroristincidents. The reporting of terroristincidents may generate contagioneffects] for example with anthrax hoaxesin America. There is the opportunity forvilification to be wreaked upon innocentvictims. And of course, as noted, there isthe greater issue of the media’s symbioticrelationship with terrorists, increasing thelikelihood of further terrorism against thestate.

THE LEGISLATIVE ANDJUDICIAL RESPONSE

For these reasons, codes have been drawnup to try and find a compromise betweenthe media’s desire and duty to exercise

Page 2 Communications Law Bulletin, Vo120 No 4 2001

free speech and the safety of the people.In Australia, a system of voluntaryrestraint by media organisalions has beenadopted rather than outright censorship.Justice Hope’s Protective Securi .tv Reviewcommissioned in 1979 slmsscd the needfor media cooperation in terrorist crises.~

However, the review also recommendedthe use of police powers against mediaorganisations that do not cooperate withgovernment and security guidelines.Although this may be seen as aninfringement of civil liberties, the reasonsfor this are at least understandable if theaction is taken in the best interests ofcitizens. Where hostages are involvedthere is an apriori interest in their well-being and safety, one that can justifiablyoverride the national interest forimmediate news coverage. Similarrestraints would be cadled upon tbe mediain times of national security or if therights and liberties of citizens were putinto true jeopardy.

More distugoing are issues where nationalsecurity interests are not clear-cut and thegovernment has raised insufficientgrounds to explain the case for theendangerment of citizens. When asituation arises where the need forinformation is more urgent andcompelling than the case forendangerment of citizens and the nation,the media can appeal to the judicialsystem. However, as courts do not like top~obe government motive, the result isoften an enforced denial of informationto the public?

There are legal constraints on what themedia can report on terrorism. In theUnited States, section 793 (d) and (e) section 798 of the Espionage Act~ o allowwide ranging powers for prosecution forthe possession and publication ofunauthorised national materials wheninterpreted in full technical sense;applying equally to journalists andmembers of the public. The successfulprosecution of Samuel Morison, a civilianintelligence analyst employed by theUnited States navy, for passing photos toa private weekly defence magazine,exemplifies the vulnerability media andindividuals face as a result of legislation’snebulous definition of national security.~t

The United States District Cour~ rejecteda defence argument in United States vs.Morison that the Espionage Act appliedonly to the secret transmission ofinformation to foreign powers?2 The

o

court held that ’the danger to the UnitedStates is as great when this informationis released to the press as it is when it isreleased to the agent of a foreigngovernment’. The court deemed thatMorison’s motive, whether to injure thesecurity of the United States or whetherto inform the public, was irrelevant to afinding of guilty under section 793 (d)and (e). This decision was later affirmedin the Fourth Circuit Court of Appeals.~ 3

Section 78 of the Crimes Act 1914 is theAustralian equivalent,t’ Like sections793 (d) and (e) of the AmericanEspionage Act, the provision can beextended to have a wide range. In lhcUnited Kingdom, active wide rangingpowers of the Official Secrets Act whichprovided the direct model for Australianlegislation, has already led to penaltiesfor political dissent and criticism ofgovernment activity. ~ ~

THE ISSUE OF CENSORSHIP

Media organisations respectfully complywith national security interests but thereshould be reasonable justificationpresented for grounds of censorship. This

is not to say that reporters shouldpresumptively embark upon a course ofaudacious coverage but rather, shouldtread a judicious course vis-a-vis theirprinciple mandate of reperting the news.

The request by the White House to majornews organisations to censor bin Laden’svideo messages is highly questionable.United States National Security AdvisorCondeleeza Rice has said that bin Ladenmay be using video messages to relaycoded instructions for operatives in theUS to stage retaliatory attacks for the USbmnbardment of Afghanistan and hasrequested that American televisionnetworks self-censor the messages of binLaden.~ 6

Asked for evidence about possible crypticmessages, the White House said it hadnone. Despite the paucity of evidence ofany security threat to citizens, medianetworks nonetheless acceded to therequest of the White House, in deferenceto the patriotic fervour sweeping theUnited States.

The government-funded internationalradio station ’Voice of America’ protestedattempts by the U.S. Government toprevent broadcasts of an exclusive

Communications Law Bulletin, Vo120 No 4 2001 Page 3

inlc~ v, ~v ~t aft lllc l!lliban Leader MullahOnl;u ,’ t ,,h~, I’mvell apparcnlly made -

~m. ’ ah ~, ~hidl considers itself the

h is h I~hl~ I"ohable there will be no

aml ,Ytrq,j,~, I~hl Phillip Knightley that

bul h~ ~l~,~lq Ibis. Despite the sheerimpo~lm~. ~1 Ih¢ First Amendment, it isunhhJ.lv Ihal Ihe media would prevail in

Judge,l ’duqq~ d~ not like to dete~ine

Lord I’aO,,,~ ~1 Waddington stated in

judge,, ~1 ~ hal Ihe national security

,i II Pictures vs. Defence

War ~as launched post-Gulf

a U.S Ah t ~t~c Ilase, under the FirstAnlcudnw~tt I’hc Irial judge ruled that

govclnllh,~ll,a coulrol’. Sadly, the largerquesl~on -I the c.astitutional validi~ of

COlICt’InN th,, pall of censorship self-impuscd m,,~ Ihc United States in the

who Ibcl I ~ ~ policies were to blame for

after Ilk, Ie~ I ~ ~1 allacks. Censo~hip has

l~cor~l,, ,f ii ~t ~ I.Ikou off~e air by the ~C

reference t~, the hijackers. Maher was

Both Toni Gutling and Dan Gutbrie.columnists for the Texc~v Ci~v Sun and TheDaily Courier respectively, criticiscdPresident Bush and both were promptlysacked. The Texas City Sun’s publishermade a front-page apology to "all ourcounh’y’s leaders and especially PresidentGeorge W. Bush" and the editor of TheDaily Courier announced that only"responsible and appropriate" criticismof Mr Bush would be permitted in futuremedia coverage.

Criticism of the other side has also beenpunished harshly. Ann Coulter was firedby the NationalReview Online for postinga racist article encouraging attacks on thePalestinian state~ ~. Coulter’s words whichwere unquestionably inflammatory.offensive and most certainly untrue.nonetheless are in the form of opinionsand deserve protection for their right toexist.

The aftermath of September l I has unitedpeople in a way that was hithertounimagincable and in the prevailingpolitical climate dissent is all but nou-existent. Rousseau articulates the pox~crof patriotism in his writings. 2~ ToRousseau, patriotism is a passion, aslrength of the soul that empowers action.Along with amor patriae or love ofcountry, patriotism is a zeal for justiceand an enihusiasm for civil benevolence.An attack on one is an attack on all.

The media in the prevailing nationalisticspirit most understandably want to playtheir part as patriotic citizens in thesetroubled times. But jourualists are imbuedwith the unenviable responsibility todiscern and report the truth. It is throughtheir vigilance that the war on terror isprevented from devolving into a war ontruth.

John Stuart Mill once wrote

’Not the violent conflict between partsof the truth, but the quiet suppressionof half it, is the formidable evil. Thereis alwqvs hope when people are forcedto listen to both sides ’J s

Unpleasant and frightening as the truthmay be, there is an inherent duty by themedia who are the custodians of free voicein our modem society to voice this truth.Any self-imposed prior restraint by themedia organisations necessarily denypeople the opportunity to receiveimpartial information which may changetheir mode of thiuking. The exceptionsof course as noted previously are where

nalional security interests and the rightsof citizens become paramount.

hi the same way that the flag desecrationcase Texas vs. Johnson ~ ~ was held by theUS Supreme Court to ~’mbolise a keybed-rock principle - "Government may’not prohibit the expression of an ideasimply because society finds the idea tobe offensive’, there is an inherent rightfor media to present without governmentrestraint, opinions and more importantlyfacts which may run counter to the views,perceptions and beliefs held by themajority of American people. Detailedexposure and recognition of the plight ofthe Afghan people in this war may becounter to the aims of the United StatesGovernment but may ultimately result inaction that can realistically lead to a betterlife for the Afghan people.

LESSONS TO BE LEARNT

There are lessons that Australia can learnfrnm what is happening in the UnitedStates. In the recent Tampa boat crisis,uluoh criticism was justifiably levelled bythe media towards the government, fordenying relevant footage. While thegovcrmncnt’s action may be protected bya technicality in defence law~, it isdifficuh to see how the incident wouldhave endangered national security tb thepoint of censorship. Irrespective of themerits of the case, the media has the rightto’ portray the story with all its essential£~cts.

Tcrrorian is a crime on humanity and noless a tragedy. It is not an easy subject tograsp and more difficult still to presentobjective truth. Consideration and anawareness of the moral, ethical andlegalistic issues involved in a time ofcrisis will enable media to determine thebest way to forge ahead in fulfilling itsduty to the people.

1 Bell J.Bowyer, ’Terrorist Scripts and live-actionSpectaculars’, Columbia Journalism Review,1978, 17(1), 50.2 Schmidt S., Woodwardin B, ’Intelligence ChiefWarns of New Attaok’, Sydney Morning Herald,06/10/2001, p13.3 Biema D.V, ’As American as..? Time Australia,1ii0/2001, pp90-92.4 Clausen L, ’Mates in the Mosque’, TimeAustralia, 1/10/2001. pp94-95.5 Blasi V. ’The Checking Value Jn FirstAmendment Theory’, (1977), A.B.E Res. J, 521,5616 Wardlaw G, Political Terrorism (1982)Cambridge University Press, Great Britain, p797"" p7B8 Hope, Justice RM. Protec~ve Security Review

Page 4

Communications Law BulletM, Vol 20 No 4 2001

Report, AGPS, Canberra, 1979.

9 Gillmor D.M. Sarron J.A., Simon TF., TerryH,A., Fundamentals of Mass CommunicationLaw. (1996) West Publishing Company.Minneapolis, p15,

t 0 Espk~nage Act 18 United States Constitutions 793 (d), (e) 6798.11 Lee HP, Hanks pJ, Morabito V, In the Nameof National Security: the Legal Dimensions.(1995) LBC Information Services, Sydney, p165,

12 United States vs. Morison 604 F Sup# 655 at660 (D.Md. 1985).

13 United States vs. Morison 844 F.2d 1057 (4~

Cir,1988),

14 Crimes Act 1914 (Cth) s78,15 Lee HP, Hanks p J, Morabito V, In the Nameof National Security: the Legal Dimensions,(1995) LSC Information Services. Sydney. p146.

16 Lusetich R, ’TV Chiefs Agree to Gag binLaden’, The Australian, 12/10/2001, p3,

17 Witcover J, ’Attempt to Muz.zle VOA RevealsIgnorance of Media Role’, Baltimore Sun, 28/9/Of In:__http:liwww.latimbs.comlnewslnationworldlw~re/bal-op.witcove/28sep28.ston/

18 Fisk R, ’A bold and original TV station thatAmerica wants to censor’, The Independent. 1111012001,

t9 Knightley P, *When the media are a menace’,Sydney Morning Herald, 27-28/10/2001, p37.

20 Zamora [1916] 2 AC 77 per Lord Parker ofWaddington

21 J.B. Pictures, Inc vs. Defence Depadment,21 Med.L.Rptr. 1564 (D.D.C. 1993).

22 The Pew Research C_ ~=nter. ’Americans Ocento Dissentino Views on the War on Terrorism’http://www.peopte-press.org/octOltpt.htm~

23 Atcorn G, ’Patriotism is A/ways more Evidentin Arnerica...but Not since the Cold War has it

Seen Compulsot’J’, The Age, 3/10/2001, p11.

24 Press B. ’Don’t let Terrorist K~ll Free Soesoh’.Tdbune Me¢iia Services. In: h6p:/hwlN.cnn.co~m/20011ALLPOLiTICSllOlOglcolumn,bitlpreasJindex.htmt. Washinoton. 9/10/2001.

25 Cobban A. Rousseau and the Modem State,1968, Allen and Unwin Ltd, Great Britain, ppl03.105,

26 Cited in: Chomsk’J N. Necessary Busion=:Thought control in democratic societies, (1989)Pluto Press, UK, p132.

27 Texas vs, Johnson (1990) 491 U.S. 397, 109S.Ct. 2404.

28 ASIa Act (Cth) 65 (1)b.

V~ncent Ho is a fifth year medicnl

student at the University of New SoathW~des.

Freedom - Lost or LoanedMr Kerry Stokes, AO, in his 2001 Andrew Olle Media Lecture provides this personal accountof his reaction to the events of September 11 2001 and their impact on the role of the media.

"The world as we know it has changedforever." You’ve heard those wordscountless times since the events ofSeptember the IPh. Yet somehow theysound obvious, hollo~v, and inadequate.

I was shocked and horrified as I watchedlive pictures of people jmuping to theirdeaths. Knowing that as I watched thosebuildings cmmble to the ground I was infact witnessing the deaths, of thousandsof people. Innocent people who, like us,were just going about their everyday lives.

I said aloud: "The world will never be

Those horrific images we saw over andover will forever be etched in ourmemories. We’re now forced to questioneverything. The way we live our lives,the way we conduct business the way we,as media, fulfil our role.

I’d suggest, now is a time forcontemplation: The MacquarieDictionary defines contemplation as:"thoughtful-observation &consideration", "continued attention andreflection". Never before hascontemplation been more important,more relevant. Now is the time as anation, and indeed for the world, we mustplan for peace. This is not a newchallenge for our civilisation. AsAristotle said:

"lt is more difficult to organise peace,than to win a war, but the fruits ofvictory will be lost, if the peace is notwell organised"

It is imperative that we develop a cohesivestrategy and plan in response to this eventand to put this plan in place for the future.I call it an event because it didn’t happenin isolation. This is not the firsL nor sadlythe last, act of terrorism. Although inmy view these are the most cold bloodedacts of murder more horrific than anyfiction Hnll~vood could dream of.

The full impact of this horror is yet to befell. There is liltle doubt lhere are morehorrors to come. Around the world, aadindeed in Australia, it’s like the wavesthat follow the tidal wave.

This address is probably the most difficultI’ve had to give. I found it impossiblenot to become emotional, angry,frustrated. Yet that is what we must putaside if we are to contemplate the future.My first tlmughts when considering atopic were of the media’s role in ourevolving multi-cnltural Australia. Theevents of September 11 brought multi-culturalism and tolerance into evensharper focus:

And like the continuing pall of smoke thatstill comes from the ruins of lowerManhattan so too the world is stillabsorbing the consequences. I believe theworld is at an incredible turning point.

I’d like to pose some questions. I hopethat collectively we will have some oftbeanswers.

This is the time for us to put aside ourcommercial and philosophical

differences. If wc get it right, the peoplein our industry can play an integral rolein identifying and determining the typeof country we want to call home. We,people in the media, can assist in shapinga better future for Australia. Because, itis you who are respected. It is you, thepeople in this room, with whom millionsof Australians identify. It’s therefore up1o us collectively to be not mere observersin this issue but active participants in thesolution.

Let’s reflect firstly on our response to theevents.

At one point I was watching just oneinternational feed from one mediaorganlsation on every single network inthis country. Even at the SOUrce in NewYork, the home of media, they were illprepared to provide coverage. From NewYork we would have expected to have aninstant critical response. Initially they~vere too dismayed to mount a cohesiveand adequate coverage in their own town.

Given it was eleven at night here inAustralia, we could be forgiven for takinglime to marshal our own resources. As aresult, in the world of globalisation andimqnlte choices there was in reality, onlyone: CNN. The fact that networks inAustralia were able to go into a 24 hourcoverage, that the television, radio,newspapers and even on-line, producedoutstanding coverage is testament to thededication and commitment of the peopleinvolved in all of our newsrooms.

Communications Law BulleUn, Vol 20 No 4 2001 page 6

When we look back over the past decadeit seems bhndingly obvious that theseterrorist assassins would strike again, lsuppose the difference this time is noneof us ever contemplaled lhe extent towhich they’d succeed in their macabreobjectives of worldwide terror. But wasit all that surprising? They’d blown upAmerican embassies. They’d blown upan American destroyer. They’d attemptedon at least one occasion that we’re awareof to demolish the World Trade Centre.Apart from obvious Washington targets,the World Trade Centxe stood as a symbolof America and indeed the world’sdemocratic and capitalist societies.

They may be fanatics but they weren’tstupid. They may be fanatics but theydid have the cunning and intellectual-prowess to plan and execute thisoperation. They used our basicdemocralic freedoms to wreak havoc andput fear into the hearts ofmillions. Thesame freedoms we sometimes take forgranted. This causes us to question ourown personal values and bringsdivisiveness into our communities. It’schilling to realise that these peopleactually used e,,’erything in our free anddemocratic society against us.

They turned our domestic airlines intobombs. They used our banking systemsto fund it. They used our education andtraining systems to carw it out. They evenused our postal service and, for a 50 centstamp, they brought the frontline to eachand ever)" one of us.

We must meet the challenge by joiningother nations to combat and preventterrorism. We need to work towardssecuring a safer world for all of us. Thereare so many issues that need to be dealtwith, to be discussed, debated andunderstood:

the impact of democracy being usedagainst us;

¯ the impact on our freedoms;

¯ support and protection for theAustralians we sent to fight and

protection for their families at holne;and

support and protection for minoritiesisolated in our communities.

In these circumstances, how do we raisethe level of rational debate in a climateof outrage?

We have the natural desire for justice. Wewant to bring those responsible tojusticcand we want it to be swift because wcwant to go back to life as we knew it.But sadly, we’re no further eulightencdon tile very issues we need to understand.or the right path thai leads to a cohesiveresolution. Nor have we actively debatedor canvassed critical issues of importanceto us as a nation. Vital issues that ".’,’illkeep us cohesive and together as one.

We’re witnessing a dangcrons responsewithin some sections of our community.I’m talking of attacks on places ofworship, abuse and vilification. Tbisresponse can only be described as sad.misguided, and ignorant. It is a responseat home to the acts of terrorismworldwide; an illustration of what canfollow acts of terror especially of thismagnitude.

This can only be addressed at a grass rootslevel.

Should we be angry? Yes. Should we bcinvolved? Yes. Should we seek questionsand answers? Definitely.

Firstly, we bave to address the effects andimplications which occur as a result ofthese acts of violence and terror, ll’sincumbent on us. the media, as anindustry to provide the level of debate tofacilitate this understanding. As I lookaround me in this room Ionigbt I see someof our most eminent writers, reportcrs~commentatorsand presenters. Manywcllknown and trusted nationally.

Journalism has often been the catalyst forchange in the world, much of it positive.

Our views of the world and cbangcs inpolicy, have often been the result ofcourageous and forthright journalism, bcit from the fields of Vietnam wherenightly coverage on our television setschanged opinion and prompted wider andmore vigorous debate, or the WashingtonPost’s unravelling of the break-in of theWatergate Building, and as far back asthe First World War and reports byfamous and trusted correspondents suchas Sir Keith Murdoch.

Historically, politicians and policymakers have always been swayed bypublic opinion. It is our reporting of theconflicts and issues that have opened uppublic debale and set the agenda. This isthe foundation of a strong democracy. Butagainst the background of this insidiousenvironment and conflict, it won’t be that

casy. Tbcre are some parallels with twoconflicts of the recent past: The FalklandsWar and Desert Storm. These were thefirst examples of "media managedconflicts". Limitations were placed ononr ability 1o accuralely reflecl events asthey occurred. Again. thal’s‘,vhat we’refacing today.

The repercussions from September 11comiuue In resonate around the world.A~ the conflict escalates, it’ll be subjectto further restrictionson reporting. Noneof us want to pul at risk our own nationalsecurity. Nor the safety of our troops. Theissue for us is the balance and that balanceis an awesome responsibility.

But where’s the debate? We seem to havebccn remarkably quiet on how thishmdseape of restriction, based partly onfacl and cmotion, will be managed in thenalional interest. So we accept that ouroxen freedom of speech and independencehas become an unwitting even unlikelyvictim. But how far are we prepared togo to continue to enjoy the freedom we

All of us have been asked to surrendercertain freedoms. But in surrenderingthose rights, we’ve placed a condition.And like Justice Kirby, I believe thatwh~tcvcr freedoms we do give up at thispoint..., we want them back. They areonly ou loan. They should not be givenin perpetuity. Will these changes placeour own democratic process at risk? 1suggest it will only be al risk if we don’tget the balance right.

We’ve just celebrated our first hundredyears of Federation. We’ve come from aclose group of almost warring states, to atight-knit federation. We have ourparochial differences, which is healthy,but even in Western Australia we considerourselves part of the federation. WhenIlook round at our country, I feel satisfiedthat democracy has delivered. We maybc the lucky country but we’ve also madeour own luck. We do have an ingrainedsense of fairness and resolve that shouldc~mble us to pass through this dark periodof time. And lerrorism is a passingdarkness.

We might have had, and Continue to have,our arguments and fights over ideologies.But the difference in this country betweenrigllt and left and centre is in fact muchnarrower than in most other countries.We have a history in recent times whenelections of governments are won and lost

page 6 Communications Law Bulletin, Vol 20 No 4 2001

on the votes of a hundred thousandpeople. This in a country of 18 millionpeople. And this polarisation hasn’tdivided tbe nation. We ahvays cometogether on tire really imporlant issues.

Which brings me back to the contributionwe can offer.

A century ago, the nredia was limited tonewspapers and magazines; no radio, notelevision, no tools of newsgatheringbeyond a pencil and notepad. But onecould argue, that the issues of publicimportance received far greater publicinvolvement and were subjected torigorous debate.

The legacy of those formative)’cars of ourfederation, can be found in theextraordinary writings of people such asCJ Dennis, Banjo Patterson and HenryLawson. Not just creative writers, butintuitive writers and visualcommunicators. Their major concernswere the differences bet~vcen the bush andcity. With today’s vigilant scrutiny bylawyers, most of their comments andobservations would probably have beenhighly defamatory.

Some of our greatest advances as a sociei"yoccurred as a result of vigurous debatingof the issues, ironically, at a time whenthe media as we know it today barelycxisled. Today we have more media~ butare we, as Australians, better enlighlencd,more ilfformed?

Isn’t our role in the media to ensure thatall Australians understand the issues andare given the facts, to be able toparticipate objectively? People who havean opinion have the right to express thatopinion. Where are the forums that givethem the opportunity to do so?

The ABC, through radio and television,has played a critical and vital role overthe years in that democratic process.Programs like "Australia Talks" are aninitiative that demonstrates why the ABCshould not be judged on its ratings alone.Wilh programs like that the ABCprovides the alternative mix tocommercial television and adds to a richerfabric of media in Australia. It bringsfar greater value to our conununities thanratings can interpret.

If you believe that we must continue tostrive to become a truly multi-culturalsociety then you would expect the mediato show leadership in these mostdangerous of times. People look to the

OAY

WOf~LD’S POPULATION OF BEARI~~, 114TACT LINtBS DECREAS~...

media to prmnote debate and consider thebroader issues. The proliferation ofnational and international media hasremoved the focus from the grassroots ofour own communities. Ourneighbourhood, our cities, our states, ourcountry, are now part of the world’sproblems. I don’t know about you butthis is certainly not what I had in mindwhen we talked of globalisation.

For the first time in our history we hadthe means to produce, express anddistribute information to most of thepeople on this planet. A test for our newteclmohigy. But how did it measure up?

As communication slinks this planet arewe also shrinking diversity of opinion?Do we actually end up with just onesource?

Diversity is a cornerstone of our count ry.It represents our "Auslralian-ness" andis something that unites us all. Now isno~t the time for our country to moveagainst diversity of opinion and return tothe isolation of minorities. Minorilygroups cannot be allowed to be isolated.disenfranchised. They must be heard.

We have to rely on and trust the strength

of our democracy. It is these foundationsthat we have to trust so that we can listento minority opinions, respect them andconsider them, and take them intoaccount, before moving on to do what isright for this country.

Someti~nes in the past we haven’t had agreat history for tolerance. We’ve onlyjust begun to deal with the problems ofour own indigenous people. But we’vefound that by putting the issues on thetable and discussing them it develops abroader understanding of how to resolvethem. And resolve them for the benefitof all of Australia.

Now, we’re faced with dealing withprejudice, at times,inberited in oursystem, at other times, imported. Buthaving made the decision that we’regoing to be a multi-racial, multi-religioussociety we have no choice but to make it

Mahatma Ghandi best Sums up the way Ifeel towards this. When talking ofculture, he said:

"1 do not want my house to be walledin on all sides and my windows to bestuffed I want the cultures of all lands

Communications Law Bulletin, Vol 20 No 4 2001 Page 7

to be blown about my house as f~eelyas possible. But I refuse to be blownoff my feet by any."

And can it work? I think so.

Let me share a personal experience. LastSaturday I was excited to be invited to awedding of two young people in Perth.It was held at the Uniting Church. Thefoundation stone was laid by Lord Forestin 1908. This was the beginning of anew life together but also the beginningof a new Australian generation.

I first met the groom’s Vietnamese mother22 years ago when she fled to the safetyof Australia. Her biggest concern washer husband and oldest son who was five.They’d been separated. By sheer luck theywere reunited in Perth four months later.This woman and her husband were bothhighly educated but when they arrived,with broken English, accepted any workthey could, becoming a valuable part ofour community.

Several years later this woman went tobuy a house. She paid cash. She hadsaved every single pay packet sincearriving in this country. Her familysurvived on her husband’s dishwasherwages alone. In Vietnam he was a bankmanager. Today, their two boys are bothuniversity graduates making an importantcontribution to this country. The bride’sfamily in this story also came to Australiato seek better opportunities for theirfamily¯ The bride and one of her brothersare now caring for the people of Perth intheir role as doctors¯

The importance of this story is that twentyyears ago we regarded the Vietnameserefugees as liabilities. Even families whohad come here from other countriesdemonstrated a prejudice. Two decadeson they represent an important part of thefuture of this country. And I believe thisprocess has enriched our country.

It’s worth noting that these Vielnameserefugees were of a different time, adifferent age. All borders surroundingtheir country were closed. Their onlychoice apart from beats was Cambodia.And the second family in this story camehere 13 years ago as legitimateimmigmnts in their own right¯

I think we all agree we need a greaterunderstanding of the real issues that candivide us and turn them into issues thatunify us. For every problem brings its o~vnopportunity.

I encourage us all to create thoseoppo~tanities. Let’s make a starl in tryingto find some of the solutions¯ Let’s havesome clarity. Perhaps it’s time we fallback on the very basic, simple andfundamental philosophies that help forgeour federation. Only today we havebetterfacilities than street corners or a soapbox.Let’s go back to the grass roots, back tothe local public meetings, open publicforums for members of our communities,no matter what their views orbackgrounds, to canvas those views andopinions¯ Forums that would encourageinclusion rather than exclusion,providing an opportunity for citizens tointeract with their neighbours and airtheir grievances, discuss their differencesin a secure and open environment. Achance too for interaction with ourelectoral representatives. Once they arcinformed and understand all the issuesmost concerning their local communitiesthey are far better placed to take themfurther to slate government, to federalgovermncnt, to the places of power wherechange can be driven¯ What seems tohave been forgotten are the people in localcommunities. They also cannot bcisolated¯

Some local councils across Australia dohave annual general meetings where themayor and councillors address ratepayersand review the council’s performance ina constructive and formal way.

This morning, as chairman of a publiccompany, I was held accountable to myshareholders who elected their directurs.I addressed them. Reviewed the year.Talked about the company and itsopportunities and what we can expect forthe rest of the year. I answered theirquestions, while they were able to observethe questions posed by media andanalysts.

It’s a process that works. The directors.executives and I spent time preparing andcontemplating this process¯ I can tell youpersonally I am always nervous andexcited before and at an AGM. Whyshouldr~’t we expect our elected officialsto be held accountable in the same wayand by the people who elected them? Theimportance is what is between elections.

This doesn’t have to be complex¯ Themodel of an AGM is an interesting one.Perhaps elected members could beexpected to have one or two publicmeetings each year to both report and tomore importantly listen to the issues of

their constituents. That’s one possibleluodel.

Another could well be the one used tuaddress reconciliation. We hadcmnmunity involvement, high profilemedia commentators, opinion makersand leaders who lent their support andparticipated in the process.

Wc haven’t completed that process, infact, we’ve only just begun. It’s anoogoing process. By its nature, it willnever be completed. However, it doescusure all issues past, present and future,arc addressed, analysed and understood.That better enables us to find solutions¯Perhaps the word "reconciliation" canhave wider implications in bringing allof our communities together¯ These twoidcus are not mutually exclusive and infact I think they work better together thanindividually.

My challenge tu you as people in themcdia, and It all our leaders, is to set thecxan~ple and become part of the solution.Ifyou’rc still asking how this affects you,here are some suggestions: Help to set-up those local meetings. Contribute. Yourrole could be as host, mediator, facilitator,or guiding the experts who join thedcbales or simply to kick-start thisprocess, aud give some credibility, so thatwe as Australians and we in the media,arc more than just observers in our owncounlry.

I don’t have the solutions, just suggestionsas to hoxv we can start the journey to find

It’s worfl~ contemplating whether in factthe media has played a part in isolatingonr local communities. Let’s make a

to nurtare the future of Australia as a truemulticultural society Together,personally, we might just be able to makea difference¯ "

I’m here tonight tu pay tribute to thememory of Andrew tile and hiscontribution to the media and publicdebate. He is remembered for hisiavolvement in this area. Those of youwho knew him better than I would knowhow he would have responded to thesequestions and challenges I’ve posedtonight.

l~lr Kerry Stokes, AO, is the Executive

Chairman of Seven Network Limited

Published with the kind permission of MrKerry Stokes, AO and the AustralianBroadcasting Corporation.

Communications Law Bulletin, Vol 20 No 4 2001

Australian Celebrity Endorsements:the Need for an Australian

Right Of Publicity~©ott Ralston, in his highly commended entry, in this year’s CAMLA Essay Competition,compares the US and Australian approach to this topical issue.

Celebrity endorsements are big business,t

We are surrounded by product promotionsfrom the stars of sport, television andcinema. 2 The ubiquity of theseendorsements testifies to thcir impact ina complex, communications basedsociety. Endorsement occurs xvbcn

"a product is associated with adesirable personality, in whosereflected light it will appear morepleasing.’’~

But what happens when tbc associationis made without the celcbrity’s authority?The future valne of the cclebrity’sendorsement is usually diminished byexposure. In America, the celebrity mayrely ou the "right of publicity" in orderto seek compensation for this loss. Atpresent, this rigbt does not exist inAustralia. A prospective plaintiffmust tryto found their action in copyrigbt,trademark, slatutory misrepresentation orpassing off. I suggest that tbis state ofaffairs sbould be rectified. Part 1 of thispaper examines the American Right ofPublicity. Part 1I colnpares the right withthe relatively meagre Australian law inthis area. Part 1II examines some of theissues of policy and principle that needto be considered before adopting the right.

PART I - THE RIGHT OFPUBLICITY UNDER UNITED

STATES LAW

At last count twenty-seven US states havea right of publicity at common law orstatute.4 The right of publicity is the right"of every person to control thecommercial use of his or her identity.’’~

Identity in this sense is an umbrellaconcept that includes image, likeness,voice, name, nickname and slogans.~ Thetouchstone of liability is the identificationof the celebrity, identification withoutconsent suggesting an appropriation ofthe celebrity’s interest in the goodwillassociated with their identity. 7 TheMidler decisions exemplifies the breadth

of the right. In that case, the FordCompany bought the rights to a BelleMidler hit song and asked Ms Midler ifshe would re-record the song for their use.When she declined, the company hiredanother singer who was asked to mimicMidler’s voice as closely as possible.When Midler sued. she received damagesfor loss occasioned to her right ofpublicity. In another example, a footballstar witb the nickname"Crazylegs" suedfor the uuauthorisud use of the nicknameand playing number in a commercial forwomen’s shaving gel.9

But the right is not as expansive as thesecases may at first imply. It is limited toprotecting an individual’s identity frmncommercially’ exploitative uses. It doesnot extend to

"the use of a person ’s identity in newsreporting, cort~mentar).,entertainment, or in works of fictionor non-fiction or in ach,ertising thatis incidental to such uses.

Since the right of publicily’s relativelyrecent gencsis,~) it has proved "’one of themost dynamic and fluid areas of law inlhe United States. ’’~ Contemporarydebales revolve around the application ofthe right to the internal, ~3 fictionalcharacters,t’ and proposals for a federalstalule to regulate the right.’s

PART II- THE PROTECTIONOF IDENTITY UNDER

EXISTING AUSTRALIA LAW

In the Tansing case,’6 a full bench of ti~eFederal Court held that the right ofpublicity does not presently exist atcommon law but did leave the possibilityof future development open. There is nostatutory tort protecting such a rightdespite positive recommendations.’:Presently the prospective plaintiff muslfound their claim in other availablecauses of action, which are examined inthis Part.

Copyright is of limited utility inprotecting celebrities againstunauthorized use of their identity. It existsfor the protection of original literary,dratnatic, musical, artistic works andother such subject matter, not facets ofidentity such as image or nickname.~

Similarly, many facets of identity do notcome within the definition of atrademark~9 or fail to meet the furtherrequirements for registration?~ And forinfringement to be made out, thetrademarked facet of identity must be usedusa trademark.~ Consequently, it wouldbe difficult for Ms Midler to protect theonuuthorised use of a sound-alike, or MrHirsch to prevent the use of his nicknameusing these regimes. Under the Tradel~ractices Act 19 74 (Cth), the seemingly

suitable provisions of Section 53(c) and(d) have been interpreted narrowly mean formal endorsement must besuggested before liability will follow.2~

Protecting celebrity identity is letl largely,therefore, to the realms of passing offandstatutory misleading or deceptiveconduct.:~ The statutory cause of actioncoufers wider protection~’ and is moreflexible in its remed.ies,~ but it is similarenough to be discussed together withpassing off.

For au action to be made out in passingoff (or misleading or deceptive conduct),a misrepresentation of approval, consentor connection between the endorser andendorsed product must be identified.~

Where no such connection is implied, theapplicant fails even if it is clear that sheis being referred to.:~ This means that ifthe ad’,rcl]iser refers to some aspect of thecclcbri~"s identity (voice or nickname forexa~nple) but members of the publicwould be unlikely to conclude such aconnection between endorser andendorsee exists, then liability is avoided.Thns. where there is a clear disclaimerof association, liability usually will becxcloded.:~ This appears unfair. Thecolcbrity has still suffered a loss in that

Communications Law Bulletin, Vol 20 No 4 2001 Page 9

the value of his or her endorsement hasbeen diminished by the exposure.

The Federal Court has arguablyrecognisod this injustice and have relaxedthe test for "misrepresentation" in theCrocodile Dundee cases.29 In these twodecisions, the Court appeared to suggestthat mere identification was enough tosuggest an association and therefore amisrepresentation?° This was despite thefact that the relevant advertisements wereunlikely to lead anyone to assume PaulHogan (the plaintiff) was actuallyparticipating, and in one case wereobvious parodies. These decisions revealthat the search for a misrepresentation issometimes artificial? ~ It is not difficultto sympathise with judges searching fora misrepresentation in the subtle andsubliminal nature of modem associativeadvertising. But the question is whetherthis often troublesome search disguiseswhat the comas are really looking for. Wemay recall that identification is thetouchstone of liability for the Americanfight of publicity. The Federal Court maybe, in substance, already applying a right

of publicity-style approach.

The clearest indication of the affinity ofAustralian judicial reasoning with thefight of publicity occurs when the courtsseek to fashion a remedy. In Hendersonv. Radio Corporation3~ (a case.in whichpassing off wa,s established), the courtsaid that the plaintiff had been"wrongfully deprived" ~3 of his right torecommend any given product. In a morerecent case concerning the swimmer

Kieran Perkins,~ the court said:

"the damages claim was based uponthe premise [hat the publicationdiminished the opportunity tocommercially exploit his name, imageand reputation"~

Such judicial language discloses thenature of the interest protected. It is notso much protecting the consumer from amisrepresentation, as the celebrity’sproprietary interest in exploiting theg(xxiwill, or potential goodwill, in theiridantity or repubation. What the courts areguarding against is not so much amisrepresentation but an appropriation.AS Jusrce Pincus l’ds put it, dle"wrong~lappropriation of a reputation.’’~ Courtswould be more candid about the natureof the cause of action if they were toackno~vledge the a~ficiality of searclfingfor a misrepresentation, and be moreexplicit about the element of

appropriation, a p~int succinctly made byFisher J of the New Zealand High Court:

"And what of the credibili.ty of courtsif they are seen to strain towards aparticular finding of fact in order toadapt an ill-fitting cause of action?ls it really necessary to force thesquare peg of charactermerchandising into the round hole ofpassing of[?

The answer to that question should beno?s A right of publicity that does notrequire a misrepresentation for the causeof action to be made out is the logical

solution to the incidental and artificialprotection afforded by the current stateoftbe law.

- PART Ill - WHY AUSTRALIASHOULD ADOPT THE RIGHT

OF PUBLICITY

The High Court of Australia hasemphatically dealed the existence of ageneral tort of unfair competition?~ InNike ]nternationail° a unanimous cout~cited with approval an earlier slatementfrmn Dixon J who said that in "Britishjurisdictions" courts of equity have not:

~thrown lhe protection ofinjunction around all the intangibleelements of value, that is, value iaexchange, w#ich may flow from theexercise by an individual of hispowers or resources whether in theorganization of a business orundertaking or the use of ingenuity,knowledge, skill or labour: This issufficiently evidenced by the historyof the law of copyright and by the factthat the exclusive right to ira,eolian,trade marks, designs, trade name andreputation are dealt with in Englishlaw as special heads of protectedinterests and not under a widegeneralisation.’’~

On conventional reasolfing, it follows thatan intangible value outside the boundariesof recognised heads of protected interests,such as personal identity, will not receiveprotection from appropriation. But whileDixon J’s statement is axiomatic in ageneral sense, it precedes a tremendousgrowth in the existing categories ofintelleclual property, in Australia as wellas other common lawjurisdic tions.~ TheCanadian common law has not escapedthe influence of the American right ofpublicity and includes a tort preventingthe appropriation of identity ?~ TheAthans case" is an instructive example

of the Cauadian tort. A likeness of George

Athaus. a famous water skier, was usedwithout his permission to promotesummer camps. He failed in an action forpassing off because no deception of the

Court implicitly followed Americanauthority and held he succeeded in a tort

actiou for appropriation of personalily

"’it is clear that ~[r Athans has apraprietary right in the exclusivemarketingfor gain ofhis personality,image and name, and that the lawetltitles hint to protect that right, i fitis im,oded.’’~

hi Australia, as Dearie J points out, therejection of a general action for unSaircompetition:

"~does not involve a denial of thedesirability of adopting a flexibleapproach’to traditional forms of

What is needed then is justification forthe right of publicity as a "special headof protected interest". Morally speaking,a Lockean defence of the right wouldsuggest that the celebrity dese~.es to bercwardod for the fruits of his skill andk~bour in creating his persona?~ At leasti~l tllC case of a professional sportsporson,advctaising power comes only as a resultof extremely h,’trd work. In a similar vein,it ~ould be unjust for the exploiter to beenriched by using someone else’s identityfor his or her gain?9

Ouc way of separating the tort from awider tort of unfair competition might bebx the hmnan element of the interest 0far~al person in his or her own identity.Properly limited by principle,~° such anevolution in tort law need not result inlilt "high-sounding generalizati°ns’’~t towhich a more general tort of unfaircompetition might gNe rise,

Consumers might also benefit from theintegrity of endorsements that is a by-product of the right of publicity. TheAmerican right of publicity exists inaddition lo trade practice legis|ation~ andis a useful, if indirect, addition toconsulner protection legislation.

Iu the US, the right is not without itscritics? ~ They argue that celebrityidentity is as much a product of societyas of the celebrities themselves and shouldbe reserved:

Communications Law BulleUn, Vo120 No 4 2001page ~0

"as part of our cultural conmmns,freely available.for use in the creationof new cultural meanings and socialidentities, as well as new economic

But we may quet3, whether such a right

would place too great a restriction onculture, or as one critic put it, allowcelebrities to censor popular culture."

The right affects only commercial speech.Those who would gain from commercialspeech unrestricted by the right aretypically large corporations? 6 Thishighlights a point identified previously;that it is the celebrity that should gainfrom their own skill and labour, not theperson who seeks to trade on their

reputation.

CONCLUSION

In terms of the protection conferred onpersonal identity, the state of Australianlaw compares unfavourably with itsAmerican equivalent. Australian courtshave been forced to use the legal fictionof misrepresentation to protect personalidentity from appropriation by others.This need not be the case. The right of

publicity shares an affinit.~with thecurrent judicial approach in this area ofthe laxv, even if this affinity is nol alwaysexplicit. The right is consistent with the

fundamental rationales underlyinginfellectual property law. It is a feasibleand desirable evolution in thedevelopment of law in this area and it is

likely the courts will be given anopportunity to take this path before long.

1 By "celebrity" I mean any real person famousenough for their identity to have commercial value.2 See, for example, "Oh Brother! It’s Jemma’sJocks v O’Hare’s Chesty Bonds", AustralianFinancial Review" 25 August 2001.3 Shoshana Ply Ltd v lOth Cantanae Pty Ltd(1987) 11 IPR 249 at 250-1. [Hereafter"Shoshana"].4 Fleischer S.M., "The Right of Publicity:Preventing an Identity Crisis" (2000) 27, NorthernKentucky Law Review, 985 at 986.5 McCarthy J.T., "The Human Persona asComrr~rcial Property: th~ Right of P ublici~’, 19967(1), Australian Inteflectual Property Journal 20at 21.6 See respectively: Wendt v Host International125 E3d 806 (9th Cir. 1997) [Hereafter "Wendf’];All v Playgirl, Inc., 447 F.Supp. 723 (S.D.N.Y.1978); Midler v Ford 849 F.2d 460 (9th Cir. 1988)[Hereafter "Midler"]; Apple Corps. Ltd vAdirondack Group 476 N.Y.S.2d 716 (Sup. Ct.1983); Nirsch v S.C. Johnson & Sons, Inc.280N.W.2d 129 (VVis. 1979) IHereatter "Hirsch"];Carson v Here’s Johnny portable Toilets. Inc,.698 F.2d 831 (6th Cir. 1983)7 Haelan Laboratories v Topps Chewing Gum202 E2d 866 (2d Cir. 1953). [Hereafter "Hae/an"].

McMullan, =Personality Rights in Australia"(1997), 8, Australia Intellectual Properly Journal86 at 94.8 Midler, note 6; see, for a similar case Waits vFrito-Lay, Inc, 978 F2d 1093 (9th Cir, 1992).9 Hirsch, note 6.10 US Restatement (Third) of the Law of UnfairCompeliiion 47 (1995); See, for an example, NewKids on the Block v News America PublishingInc., 745 F Supp 1540.11 Generally credited to Haelan, note 7.12 Fisher KM, "Comment: Which Path to Follow:A Comparative Perspective on the Right ofPublicity", (2000) 16 Connecticut Journal ofInternational Law, 95 at 95.13 Ezer D.J. "Celebrity Names as Web SiteAddresses: Extending the Domain of PublicityRights to the Internet", (2000), 67, University ofChicago Law Review, 1291 ; Fernandez C, "TheRight of Publicity on the Internet", (1998), Marquette Sporis Law Journal. 289.14 See Wendt, note 6, and Dav,~on D.H., "TheFinal Frontier: Right of Publicity in FictionalCharacters!’, (2001), University of Illinois LawReview, 635.15 Goodman E.J., "A National identity Crisis: TheNeed for a Federal Right of Publicity Statute"(1999) Journal ofArtand Entertainment Law.227; Robinson R.S., "Preemption, the Right otPublicity, and a New Federal Statute", (1998), 16,Cardozo Arts & Entertainment Law Journal, 183.

16 Sony Music Australia & Michael Jackson vTensing (1993), 27 IPR 649 (Full Federal Court).17 Australian Law Reform Commission ReportNo, 11 of 1979, Unfair Publicali~n: Defamationand privacy.

18 Copyright Act 1968 (Cth) Pts Ill and IV.19 Trade Marks Act 1995 (Cth) ss 6, 17.20 Trade Marks Act 1995 (Cth) ss 41,44.21 See Konink#jke Phi#ps Electronics NV vRemington Products Australia Ply Linked [1999]FCA 816; and on appeal to the Full Federal Court[2000] FCA 876.22 Shoshana, note 3, per Gumrnow J at 316;We#man v Ka#es (1979) 29 FLR 336 at 344 perFranki J. Though for a successful use of s53(c)see Wickham v Associated Pool B~lidet~ ~y Ltd12 IPR 567; [1988] ATPR 910. [Hereafter"Wickham"].23 Trade Practices Act 1974 (Cth) s 52.24 Parkdale Custom Built Furniture ProprietaryLimited v. Puxu Proprietary Umited (1982) 149CLR 191 per Mason J at 205.25 Trade Practices Act 1974 (Cth) ss 80,82.26 Shoshana, note 3, per Wilcox and GummowJ J; see for a discussion of the generalrequirements of passing off, Conagra Inc.vMcCain Foods (Aust) Ply Ltd (1 ~2) 23 I PR 193;(1992) 33 FCR 302.27Honey vAustra/ian Airlines (1990) 18 IPR 185(Fu[l Federal Court); Wickham, note 22.28 Newton-John v. ScholkP/ough (Austra#a) Ltd(1986) 11 FCR 233 c1. Hutchence (trading as/NXS) v South Sea Bubble Co Ply Ltd [1986]ATPR 40-667.29 See Pacific Dunlop v Hogan (1989) AIPC 90-578, 12 I PR 225; Hogan vKoa/a Designs (1988)20 FCR 314 [Hereafter "Koala Designs"].30 Howell R.G.,"Persenality Rights: A CanadianPerspective: Some Comparisons w~th Australia’,(1990), 1, /nte//ectua/Ptopedy Journal, 212 at219.

Communications Law Bulletin, Vo120 No 4 2001 page 11

31 Ricketson S, "Chsracter Merchandising inAustralia: Its Benefits and Burdens", (1990).

¯ Inte#ectualPmper~Journal, 191 at 192; CoteriesS,G,, "Basking in Reflected Glories: RecentCharacter Merchandising Cases", (1990), 18,ABLR 5.32 (1960) SR (NSW) [Hereafter"Henderson"],33 Henderson, note 32, per Evatt CJ and MyersJ at 595.34 Talmax v Telstra Corp (1996) 36 IPR [Hereafter "Talmax~]. For a good discussion ofthis case see McMullan, note 7.35 Ta/max, note 34, at 53.36 Kosia Designs, note 29, at 325,37 Tot Toys v Mitche# t/a Stanton ManufacturingHC (NZ) (1992) 25 IPR 337 at 38 See, for a contrary view, Katekar B.F., =Copingwith Character Merchandising: Passing OffUnsurpassed", (1996), 7. Australian/ntsi/ectua/Property Journal, 178,39 Moorgate Tobacco Co Ltd v Philip Mords Ltd(’No2) (t984l 156 CLR 414 (Hereafter"Moorgate’]; Campomar Sociedad Limitada vNike International Ltd (2000) 169 ALR 677

[Hereafter "Nike Interna#onar1.40 Nike/ntemationa/, note 39. at 680.41 Victoria Park Racing and Recrea#bn GroundsCo Ltd v Taylo~ (1937) 58 CLR 479 at 509.42 Consider the rejection of the same field ofactivi~ test in passing off in Henderson, note 34.43 It is actually part of the common law of anumber of Provinces, the most readily identifiablebeing Ontario¯ See generally C Nest "From Abbato Gould: A Closer Look at the Development ofPersonality rights in Canada" (1999) Appeal12.44 Athens v Canadian Adventure Camps Ltd(1977) 17 OR (2d) 425. 80 DLR (3d) [Hereafter "Athens"].45 Athens, note 44, at 433.46 Athans, note 44, at 434.47 Moorgate, note 39, at 44.5.48 Pendleton M.O..’Character Merchandisingend the Proper Scope of Intellectual Properly",(1990)./nte/lectual Property Journal. 242 at 249;Fisher, note 12, at 97.49 Zacchini v Sc#pps-Howard Bmadcas#ng Co433 US 562 (1977); see also S Ricketson

"’Reapir’~J Witt’,~ut Sov~r~J’: Unfair Competitionand Intellectual Property Rights in Anglo-Australian Law~ (I 984) Universily ofNSWLawJournal t at 3,50 Consider the limits on the American rightreferred to above, or the Candian application of aba~ar~cing of interests test: Gould Estate v.Stoddan Publishing [1998], 321 DLR (4th) 161(Ontario Court of Appeal).51 Moorgate, note 39, at 446.52 For example the Lanham Act s 43(a) prohibitsfalse or misleading statements in relation tosponsorship of goods and services.53 Madow M. "Pdvate Ow~erahip of Public Image:Popular Culture and Publicity Rights", (1993), 81California Law Review, 125; Sen S, "Fluency ofthe Flesh: Perils of an Expanding Right ofPublicity", (1995), 59, Alberta Law Review, 739.54 Madow, note 53. at 238-9.55 Madow, note 53, at 144-6,58 McCarthy, note 6, at 27.

Scott Ralston is a final year law studentat the Australian National University.

Cultural Parochialism and Free TradeTim Magarey, another highly commended entry in this year’s CAMLA Essay Competition, arguesthat the output of the ’cultural industries’ should not be exempt from the an~bit of free tradeagreements.

Australia maintains a policy of protectionfor local film, television and other mediaproducers through the mechanism of suchlegislative regimes as the BroadcastingServices Act 1992 (Cth) (BSA).Australian content restrictions onprogramming and foreign ownershiprule.s operate to shield domestic producersfrom the ravages of the internationalmarketplace. Many commentators arguethat it is only because of the existence ofthis protection that local industries areable to survive. Legislative measures ofthe k~nd embodied in the BSA, however,are inconsistent with the provisions ofinternational free trade instruments suchas the General Agreement on Tariffs andTrade (GATT). It is only by virtue exceptions such as that contained inArticle IV of the GATT~ that theseregimes, which are by no means uniqueto Australia. persist free frominternational legal and politicalrepercussions.

This paper considers the exclusion ofculture from free trade instruments suchas the GATT and from the auspices ofthe World Trade Organisation (WTO).It is argued that, given the benefits of freetrade and the objectives of suchagreements, there is no sufficient reasonwhy goods and services which are

produced by tbc "cultural industries"should be exempt from the ambit of freetrade agreements.

FREE TRADE AND THE GATT

The GATT has its origins in thenegotiations at Bretton Woods followingthe end of the Second World War. It ",’*’asone of a series of instruments andorganisations which were uslablished bythe Allied Powers after that conflict withthe principal objective of avoidinganother ,,vat. ~ The premises on whichthe provisions of the GATT are based are:

¯ International trade raises the level ofmaterial wealth and thus the standardof living of individuals inparticipating nations. The theory ofcmnparalive advantage suggests thatall trading nations benefit irrespectiveof their relative starting wealth.

Free tmd, e obligations prevent nationsfrom deploying self-interested,beggar-thy-neighbour economicpolicies which in the inter-war periodcontributed significantly to theinstability and conflict in theinternational system

Multilateral consensus is importantbecause it prevents individual nationsdestabilising the system fromwithout.~

Prm,a facie these premises are b~oadenough Io have been generally acceptedas sufficient justification for thejurisdiction of free trade agreementsembodied in the GATI" and the WTO.The detail of the provisions of lheinsmmmnts themselves, however, hasbccn the subject of hot debate since theGATT first came into force. Theexclusion of particular industries from fl~ep ro~iocc of the GATT has been expressedin the terms of their being "exceptions"to principles of general prevalence. Theexception in Article IV,~ for example, ;,,’asincorporated into the GATT in 1947 andhas remained since then despite the effortsof the United States to have it removedor nltcred? Today, as was the case then,such exceptions have to be justified as acotmtcrvailing good which outweighs thebenefits of trade.

INFORMATION FLOWS

In addition to general premises about thebenefits of free trade, however, it isarguable that particular benefits attach tothe free flow of information. WhiIesomeof these are avowedly economic inflavour, others subsist in ideas abouthmnan rights which hold that access toinformation is essential to political and

page 12 Communications Law Bulletin, Vol 20 No 4 2001

economic freedom and personaldevelopment.6 If we regard thebcncfitsof free access to information as real, thenwe muSl not allowbarriers to informationflows to be erected unless somecompelling reason exists why we should.

Some of the arguments for exceptions tothe general principles laid out above willbe considered. It is argued that they arenot convincing enough to warrant thesignificant exception to which they layclaim. In fact. such exceptions operatespecifically in opposition to theseprinciples and should be resisted.

ARGUMENTS FROMECONOMIC MODELS

Many of the arguments against free tradein cultural products draw on cconomicmodels wlfich suggest that these produclsare consumed in a manner which makesthe application of the premises of GATTinappropriate. Foremost among these arearguments based on the public goodaspects of cultural prodncts.

Most cultural products possess thecharacteristics of public goods - that isthey exhibit the conditions of non-excludability and non-rivalness,r Bynon-excludability it is meant that it isimpossible to prevent the consumption ofa good. By non-rivalocss it is meant thatonce the good is produced, consumptionof it does not "use up" the good so that itcannot be consumed by another person.A pure public good is both non-excludable and non-rival. While bothcharacteristics rarely subsist perfectly inan.’,’ given cultural product, these productsare distinguishable on these bases fromprivate goods such as food.8 Movies andbooks, for example, exhibit thecharacteristic of non-rivalness. Havingbeen consumed by one person they areavailable at a low marginal cost of supplyfor consumption by others. Free-to-airtelevision and radio broadcasts are bothnon-rivalrous and non-excludable -anyone in the broadcast area can receiveand consume for no cost the signal at noloss to any other person.9

The conditions for efficient allocation ofpublic and private goods differconsiderably. This is because the lowmarginal cost of supply of public goodsmeans that once the sunk cost ofproducing the good is recouped it isinefficient to exclude any consumer whoplaces positive value on the good and is

CULT

willing to pay a price higher than tile(probably nominal) marginal cost supply.~° Thus, if one consumer valuestile good at $15, and another at $5, it isinefficient to refuse to supply the secondconsumer on tile grounds they are notwilling to pay the same price as the firstbecause there is no lower cost-based limiton the price which should be charged.The most efficient outcome, then, is tohave every consumer pay a different pricedepending upon the peculiar value theyplace on the good. There are considerabletransaction costs, however, associatedwith applying this in practice." Becausethe cost of negotiating with eachindividual consu~ner is prohibitive.producers of public goods tend to fixprices at a given level and charge allcoiners that single price. This solutionwill always be less than optimal becausethere will be some consumers who placepositive value on the good but do notpurclmse it because that value is less thantheaskingprice?~ At thesamelime, free-riders, who value the good above theasking price, will exploit thecircumstances to make a windfall welfareprofit. The chances of setting the priceat a median level such that the revenue

returned on the good is equal to the netwelfare achieved in the community areslim. and the spectacular profits andequally spectacular losses made onindividual fihns and television programs,for example, testify to the difficulties themarket has in setting the priceappropriately. For this reason, opponentsof free trade argue, the market is not anappropriate place for the production andconsumption of public goods. The marketis incapable of producing an efficientprice and fires a net allocative inefficiencyis bound to result.~3

This is really an argument aboutuurcgulated markets rather than aboutfrec trade between nations. Its logicalconclusion with respect to internationaltrade, however, is that the size of theglobal marketplace exacerbates the scaleof the inefficiencies which arise out theproduction of public goods capable ofbeing consumed by an internationalaudience. Moreover, trade betweentuitions confers advantages on producersin uations with large native audienceswhich allow the recouping of sunk costsat honre and the "dumping" nf product atlow prices for windfall profit abroad.

Communications Law Bulletin, Vol 20 No 4 2001 Page 13

Regulation by nations, they argue, wouldeliminate the difficulties of pricing in themarket, operate to divide up theinternational market to preventinefficiencies spreading beyond themarket immediately affected, and preventdumping by applying tariffs and settingquotas on imports.

It is by no means clear that this is thecase. It is difficult to see howgovernments are capable of pricing publicgoods more efficiently than markets.Governments possess no readymechanism for determining the pricewhich should be charged for access tosuch goods?~ Permitting individualnational governments control over thetrade flows and pricing of importedproduct would simply introduce varietyinto the field of choices of inefficientoutcomes in the trade in cultaml products.

Furthermore. "dumping," as the practiceof price discrimination is oftenpejoratively referred to, is not necessarilyinconsistent ~vith efficient outcomes?~

This is especially true in the case of publicgoods. As was outlined above,inefficiencies arise in markets for publicgoods because the need to charge uniformprices prevents price fluctuating to matchthe peculiar value each individualconsumer places on the good. Chargingdifferent prices for, for example,television rights or cinema rentals andadmissions in different territories permitsthe matching of different median pricesto different social and economiccircumstances. In thisway, acrude formof price discrimination, founded in thepractice of licensing intellectual propertyrights on the basis of territorialdistribution exclusivity, permits therecouping of a return which in sum ismore likely roughly to approximate thenet welfare value placed on theconsumption of the good by individualsin an) given territo~’.’6

CULTURALSOVEREIGNTY

Economic considerations, however, onlyaccount for stone of the resistance to theinclusion of cultural products within theambit of free trade instruments. Perhapsof greater concern to the proponents ofcultural protectionism than doubts as towhether the market is capable ofallocating resources for the production ofcultural products are questions aboutwhether the market, .even an efficient

market, should be permitted exclusivedominion over the field of culture at all.

CenU-al to this position seems to be a greatresistance to commercialisation. Manyadvocates of protection reject the idea thatculture is capable of being priced andbought and sold in the market. It hasinherent value. Culture, they argue, issomething more fundamental to societythan the instrument of economic theoryand the mechanism of the marketplace.To subject it to the vulgarities of acommercial environment is to rob it ofthat which makes it valuable,t~

A corollary of this argmnent, ofteulevelled at the Americans, is that cultureis part of the social foundation on whichthe institution of the market is built, andthat the degree of importance ascribed tothe market in different societies is afunction of the veu’ culture which it isproposed should be subject to marketforces. In the United States, a nation ofentrepreneurs and businesspeople, themarket is parl of the spirit of the society.It is deeply intertwined with other valncsAmericans hold dear. In some parts of

Europe. by c.,ontrast, this is not the case.The role of the marketplace can beseparated from other aspects ofcommunity life in a way which might notoccur in the U.S. The point is that it isculture which determines the function ofthe market, not .the other way arouudFree Traders confuse this relationshipwhen they advocate the abolition of traderestrictions on cultural products.

Another theme is that of "culturalsovereignty." Culture and the freedomof self-determination are linked in thisidea. It is argued that culture is the stuffof which conununities and individuals aremade. It is the meta-narrative which ~eemploy to understand the world andwhich permits us to generate choicesabout the way we choose to live ourlives?s It is thus vital to individuals’freedom that their heritage is not erodedby the imposition of alien cultures.Nations have an obligation to theircitizenry 1o protect the national culturefrom the threat posed by the allure ofexotic cultural imports.

There are fundamental difficulties witheach of these arguments. First, and mostobvionsly, they all assume that culture issomething which is capable of beingdefined to a satisfactory degree to permitit to be the subject of specific protection.

It is not at all clear that the things whichwe collectively refer to as "culture" aresusceptible of definition for suchpurposes. In the absence of accurateidentification of those things whichrcqnire protection, the measures whichamy be taken will necessarily besomewhat arbitrary in their focus andscope.

Secondly. even if culture is capable ofbeing adequately delineated for theporposes of targeted protection, it may notbc the case tlmt cultural unity is congruentwith nations or jurisdictions. Australia’scuhural mix is testimony to this fact.Where national or jurisdictionalboundaries take in a number of cultures,the same problems which arise at theiutcrnational level may manifest inmicrocosm within those boundaries.Trade barriers are no answer to thisproblcm.

Thirdly. Irade barriers to protect culture:~s manifest in movies, television or booksmay be the top of a slippery slope.Exrension of the logic of culturalprotectionism into other industries couldnudcrminc the gains of fifty years of tradeucgotiations. While absolutism isnalurally to be avoided, argumenls for themat atcn~mce of trade barriers lose a greatdeal of their cogency when viewed in lightof claims by French and Swiss farmersfor stdosidy protcclion to support their role~ls h~lstions of European culture.

Fourthly there is the difficult question ofmoney. Who is to pay for the subsidiesgr~mtcd to and the high prices chargedby coddtcd domestic producers? The~mswcr, of course, is that it is the taxpayerand the consumer who pay foriucfficicncies which the motivating forceofcompctition could alleviate. We mustquestion ~vhethcr the price to be paidrcprcsents value for money when theoutcome is arbitrary and uncertain.

Yet. more important, perhaps, than all ofthese objections, is one which is notrestricted to economic or financialcouccrns. The GATT was originallycouceived as a stabilising influence in aworld ~here econotnic tensions have thepotcnlial to develop into war.t9 Thepotential for the collision of cultures hasnc~cr been thro~vn into starker relief thanin the period since September 11t~. It isargnablc that the combination of culturaldifferences and third world povertycoutributcd to tbis dangerous situation.

page 14 Communications Law Bulletin, Vol 20 No 4 2001

While it is not suggested that free tradeis the answer to all the world’s ills, northat broadcasting Neighbours or Seventhlleaven into every home on the planetwould prevent hostility romed in culturalmisunderstanding from erupting intoconflict, defiant economic and cuhuralisolationism is surely the wrong postureto be taking at this time. Such anapproach is contrary to the spirit of theGATT, and is counterproductive in aworld which now, more than ever, needsall the unity it can get.

CONCLUSION

All this is not to be taken as suggestingthat the objectives of culturalprotectionism are not noble andadmirable in and of themselves. What issuggested is that in view of uncertaintyas to the benefits flowing fromprotectionist measures, and the presentpressing need for the global stabilitywhich instrmnents such as the GATTwere specifically designed to foster, thecosts of putting such measures intopractice far outweigh the benefits derivedfrom them. In the current environment,an exception to the principles on whichthe GATT is based cannot becountenanced.

1 For "Cinematographic Films"2 Jackson J., The Wodd Trading System, 2nded., 1997, Cambridge, M IT Press, p.13.

3/bid pp.11-20.

4 See note 1, infra.

5 "US Urges Free Worldwide Trade in Movies,Radio Programs During Uruguay Round Talks",7 International Trade Report (BNA) No. 36 1369 and more recently, "ComrnunicaO~n fromthe United States: Audiovisual and RelatedServices’, WTO StCSS/W/21, 18 December2000 available at ~w.wto~0~q~

6 These ideas have been taken so seriously thatthey have been enshrined in a series ofinternational treaties. The principal instrumentsare the Universal Declaration of Human Rights,art. 19, GA Res 217A UN Doe. A/810 (1948) andthe International Covenant on Civil and PoliticalRights, art 19, GA Res 2200, UN GAOR, 21stSess., Supp. No. 16 at 55, UN D~ .&J~316 (19~6)

7 Brown C.V. & Jackson P.M., Pubtic SectorEconomics, Cambridge, MIT Press, 1991, p.28.8 The classic example of a private good is ahamburger. It is excludable, because only oneperson can consume it at a time, and rivalrysubsists over it because once it is consumed itcannot be consumed again.

90wen B.M et. al., Television Economics,Lexington, Lexington Books, 1974 p.57.

10 Picard R., Media Economics, London, Sage,1969, p.52.

11 Transaction costs may be defined as anythingwhich reduces the incentive to trade with anotherrather than produce oneself; hence, "transactioncosts comprise all those costs that cannot beconceived to exist in a Robinson Crusoe (one-man) economy." Cheung, "On The NewInstitutional Economics," in Lars Werin and HansWijkander (eds), Contract Economics, Oxford,Black’well, 1992 at 366.12 Owen, p.20.

13 C.E. Baker, An Economic Critique of FreeTrade in Media Products, (2000) 78 NorthCarolina Law Review 1357 at 1384

14 Ming Shao W., "Is There No Business LikeShow Business? Free Trade and Cultural

Protectionism," 20 Yale Journal of InternationalLaw 105at 137-13~.

15 In tact, dumping is a particular form ofanticompetitive price discrimination whereproduct is sold at a loss (at a pdce below themarginal cost of supply) on o~erseas markets withthe purpose of driving out eempelition. Not allprice discrimination amounts to dumping, and thetest for determining whether dumping hasoccurred is complex and is beyond the scope ofthis discussion.

16 tt is to be noted, of course, that the practiceof price discrimination is the subject of somecontroversy amongst proponents of free trade incultural products. It is arguable that it is notconsistent with economic models of workablecompetition. This controversy is pert of a widerdebate about the competition issues which adeewith respect to territorial exclusivib/in intelleotualproperty licensing, which is, again, outside thescope of this paper. Mention should be made,however, of the tact that an international effort toencourage the abolition of territorial exclusivitypractices and the permitting of "parallelimportation" is being undertaken in the name offreer trade. The recent amendment of theCopyhght Act to permit the parallel importationat audio compact discs is an example of this.

17 Witness the comment by fon’ner French PrimeMinister Edouard Balladur during the UruguayRound of GATT negotiations in 1993: "[TheFrench] cannot accept everything related to thefundamental values of our tradition, our culture,our civilisation being treated like ordinary tradedgoods." Qtd in K. Auletta, "Television’s New GoldRush," New Yorker, Dec. 13, 1993, p.88.

18 Kymlicka W., Mu/ticuitural Citizenship, Oxford,Clarendon Press, 1995, pp. 84-5. ’=

19 Jackson, p.17; see note 2 infra.

??m Magarey is an Honours ~tudent inthe schools of International Relationsand Screen Studies at Flinders

University.

Internet Dumping and Regulation of theAudiotex Industry

John Corker examines the risks associated with using 190 and 0011 services and some possiblesolutions.

Internet Dumping occurs when a user’smodem is disconnected from their usualdial-up number and reconnected to aninternational (0011) or premium ratephone number, such as 190 numbers(without their knowledge). Mostcommonly it occurs on adult sites. Inmany cases people are not aware that theyhave been dumped until they receive anunusually high phone bill. 2 Someconsumers have reported lmving received"international phone bills for thousandsof dollars’’~¯

Internet Dumping has occurred inAustralia at least since mid 2000~. As atJune 2000 about 2 users a week registered

complaints with the TelecommunicationsIndust~ Ombudsman (TIO). Howeverthe average number of complaints for the9 months to end of September 2001 isabout 80 complaints a month. The totaloflnternet Dumping complaints receivedby the TIO to end September 2001 is closeto 1000.s Complaints to Telstra areunderstood to be higher than lhis.

THE AUDIOTEXT INDUSTRY

The Audiotex or Telemedia industryprovides access to a range of recordedinformation and interactive services(speech, facsimile or data) via premiulnor international telephone lines. In

Australia premium rate services wereinilially provided by Telstra in the mid"90s using the 0055 prefix. This prefixwas phased out in August 1998 andreplaced by the 190 prefix. Cable andWireless Optus also provided TelephoneInformation Services at premium ratesfrom 1995-2000 but no longer offers theservice.

In the US use of 0011 numbers for accessIo adult services first appeared in the late1980’s and operated without any form ofrcgnlation’~. It has grown as an industD,and now provides access to a range ofrecorded information and interactiveservices (speech, facsimile or data): The

CommunlcaBoss Law Bulletin, Vol 20 No 4 2001 Page 15

international Audiotex or Telemediaindustry is said to be valued at betweenUS$2-6bn a year globally and calls aloneaccount for around 2-4% of outboundinternational tralT~c for those NetworkOperators who participate.’

HOW DOES DUMPINGOCCUR?

In most cases the re-connection of acomputer to a 190 or 00tl line occurswhen a redialler program is downloadedfrom a site, disconnects the user’s modemfrom their ISP, and reconnects them tothe interrtet via the 190 or 0011 number.This connection then allows access to a’private internet area’ where theparlicular content is found. Some adultsites offer this method of access as analternative method of payment to anonline credit card payment.

Once the user has completed their visilto this area, a number of things mayhappen. There may be an automaticdisconnection when the user leaves thearea. To resume access to lhe internetthe user has to reconnect through theirox~a ISE However in many ca~es the usermay leave the adult site and continue tosurf the net still incurring premium rateor0011 phone charges. Many users haveclaimed that they are unaware at any stageat all of being connected to a 190 or 0011line,

Many users say they are not aware thatthey have downloaded a redialler. Somewebsites refer to the redialler as a’registration tool’, ’drop dialler’ orsimply software that provides ’freemembership to various adult sites’.

Recent research by the InternationalAudiotex Regulators Network (IARN)’shows that there are just a fewmanufactures offering these programmesand most of them have no ’uninslall’facili~’.

THE T|O’S ROLE

The TIn administers thetelecommunications complaints scbemefor unrriers and carriage sewice pros4dersin Australia. ISPs are required Ioparticipate in the scheme by reason ofbeing considered carriage serviceproviders. The TIn has acknowledged~

that a major ditlqculb" ~.n investigatinginternet dumping cases has been to

establish whether or not a user was in factnotified of call charges. Throughextensive investigation it has found thatin art cases where it has been able to visitthe disputed websites there was someform of notice on the relevant websitcadvising the user that higher call chargescould be expected. One key issue thathas been raised b.v their investigations isthe adequacy and visibility of thesenotices.

-- TELSTRA’S ROLE

Premium rate calls are presently onlyavailable via Tels~.ra. With the Telstra’lnfocall" service, the rate can be between35 cents and $5.50 a minute. Telstra statethat entry to the industry involves acapital cost of up to $150,000 for the

purchase of specialiscd

telecommunications equipment. Thcrc

are presently only 39 Telstra premium c.allservice providers. Telstra charges sop.aceproviders about one third of every dollargenerated in gross revenue from thec.aller ~°. The ACCC issued a prcliminaD’view in July 2001 that portability forpremium rate numbers should bcmandated as soon as possible thusallowing olher carriers to provide thesescrvices.

Generally, Tclstra is unsympathetic Iodumping cases and has been loathe tosettle any disputed bills for telephonecharges.

Telstra states on its website:

"Telstra does not know of a~v provencases of fraud in relation to lnternet’dunlping ’. b~ all cases u,e know of, a

person has actively accepted theterms and conditions of downloadingthe site using an lnternet dialler andthe lessee of the phone line is legallyliable for the charges.

If an IDD charge is proven to be dueto fraudulent activi.ty, the fraudulentcharges are reimbursed and thematter is directed to the police. ]f acustomer suspects a fraudulentcharge in relation to 190 numbers,they should contact TISSC. ’"

ROLE

Australia~s Telephone Information

Services Standards Council Lid (T1SCC)is an independent regulatory body fundedby the telephone information services

indostry. Tile Council is made upof fourcommunily and four indust~ members(two from tile service provider sector andtwo from the carrier sector), and aniudcpcndcnt Chairman

The TISCC Code of practice deals onlywith domestic premium rate services iecalls beginning with the prefix 190.Compliance with the TISCC codeprovisions is enforceable by being madea term of the agreement between theservice provider and the carrier.

As of t July 2001, a new Schedule 12 tothe TISCC code was introduced titledqutcroct Dialler Services". It sets out

prescriptive provisions that requireservice providers to display, in a separatefixed dialogue box. prior to connectionto the service, a 16 point font messageIhal provides the 190 number and tilep]’cmitun call rate and requires the userto click to accept before proceeding. Afurther dialog box requires the user toclick ou YES to indicate he or she is thebill payer or has the bill payer’spermission Io accept these charges.

The provisions also state that dialling and

illodelll Io~es are not to be suppressed, adigit~d clock is to be displayed showingIhe time elapsed for the call and everyIc~(10) minules a dialog box is to appearshowing the thne elapsed and displayingm~ OK button that when clicked on makesIho di~l-log box disappear. At any pointIhc oscr clicks on an EXIT box, thecxisling ISP default connection is to bem;fintained. Most of the rediallerscxmnincd by lhe TIn will not meet thislast rcqniremcnt.

The Code also states that Internet Diallersmust not activate a premium rate serviceremotely without the intervention andiuformed consent of the user.

UK POSITIOt~

h~ the UK, ICSTIS, the IndependentCommittee for the Supervision ofStandards and Telephone InformationServices. regulates the content andpro~olion of domestic premium ratetelephoue services but, similar toAustralia. not international services. Itis a non-profit body funded by industrybut its committee members must beh~dcpcudcnt of the premitun rate industry.

Three o[ lhe more relevant provisions ofthe ICSTIS code are as follows:

Co~mu~ications Law BulleUn, Vol 20 No 4 2001page 16

All rccordcd services of a sexualnature must. as soon as is reasonablypossible after the caller has spent£10.00, and aflcr each £10.00 of callspent thereafter, do the following:

(a) inform the caller of the priceper minute of the call,

(b) require callers to provide positive response to confirm thatthey wish to continue the call.If no such confirmation is given,the service must be terminated.

All services over £1.00/min andcertain services at £1.00/min willrequire ICSTIS’ prior permissionbefore operating.

All new live services require ICSTIS’prior permission before operating,regardless of cost.

PREMIUM RATE ANDINTERNATIONAL SERVICES

There is a sharp distinction to be drawnbetween premium rates and internationalservices. The charge to the caller forpremium rote services is set by the serviceprovider or protnoter who rnay also bethe information provider.

International services’are howevercharged at standard IDD call rotes. Theyinvolve an originating and a terminatingcarrier, a service provider and ~lninformation provider. The originatingcarrier based in Australia establishes theoverall fee charged to a caller (CollectionRate) based on three factors: its owntransport costs, the fee charged by theterminating carrier (Settlement Rate)and profit.

The terminating carrier pays a portion ofthe settlement rate to a service provideras a commission for generating minutesof telephone traffic. The service providerpays a portion of revenue received fromthe terminating carrier to the informationprovider. Rates paid will usually varyaccording to the volume of trafficgenerated.

In both models the information provideris dependent on the service provider forrevenue but the fee paid by the caller isset, in the 190 model, on a sliding scaleby the service provider and, in the 0011model, at a fixed rate by the originatingcartier.

THE INTERNATIONALTELEMEDIA ASSOCIATION

(ITA)

The International Telemedia Association(ITA) is a self regulatory body based London that comprises service operator,information provider and carriermembers. It is concerned only withrecorded information and interactiveservices available through 0011 lines.ITA claims a membership who betweenthem account for an estimated 85% of allinternational telemedia traffic althoughthe list of members on its website is ratherlimited. It includes originating andterminating carriers, fraud detectionspecialists and trade associationsrepresenting network and customerinterests.

The ITA Code covers fair businesspractice, advertising and content and alsothe important area of fraud detection andprevention. Its code is much lessprescriptive than those of the premiumrate service regulators but includes thesetwo key provisions.

5.2.11 - No caller shall remainconnected to a programme or servicefor more than thirty (30) minutes.After thirty minutes any such call willbe disconnected by the TelemediaService Operator.

5.2.2 - All prograrnmes shallnormally be preceded by anannouncement that:

callers should be 18 years or over(adult services)

international call charges apply

Complaints can be made online. ITAstates~ that where aviolation of the Codeis established, enforcement of ITAsanctions is provided in conjunction withthe terminating carrier. ITA has theagreement of member carriers and non-member networks to enforce sanctions.Complainants are kept informed duringthe investigalion process and nolified ofthe case conclusion. A database ismaintained on Code violations and casesof fraud. This information is available toregulatory authorities where a workingrelationship exists.

IARN

The International Audiotex Regulators’Network, IARN, was set up in 1995.

IARN has established guidelines for themini mum standards that may be expectedto apply to not only domestic premiumrate services but also cross-border (0011)and global premium international roteservices (979) when provided betweenIAKN member countries.

IAKN has recently changed its name fromEARN, the European AudiotexP, egulators Network indicating itsEuropean origins but also its desire to bean international organisation. It has 17members from European countries allrevolved in the regulation of, or settingstandards for, content and promotion forpremium rate telephone services(audiotcx) in their own countries. TheUK based ICSTIS is a member but its onlymcrabcr outside of Europe is TISCC fromAustralia. There doesn’t appear to be anycross membership between ITA andIARN.

Its ,guidelines include the following:

before commencing a premium rateservice, the correct rate per minute orper call should normally be stated.Where technically possible, this ratestatement should not be charged for.It must be unambiguous and clearlyaudible.

price reminders should be given everyfive(5) minutes.

service providers should take everypossible precaution to ensure thatminors do not gain access toiuappropriate services such as adultservices, dating and virtual chat.

The complaints handling provisionsprovide an interesting model for co-opcr,~tion bel~veen member countries andare based on Art 3 of the EuropeanUnion’s E-commerce Directive whichstates that the service is subject to the lawapplicable in the country of origin of theservice.

The regulator in the country of thecomplainant:

is to be the first and main point ofcontact for any consumer with acomplaint.

must identify the country of origin ofthe service complained about and therelevant national regulator and thenhand over the complaint to thatregulator for investigation.

Communications Law Bulletin, Vol 20 No 4 2001 page 17

must keep the complainant informedon progrcss and the final outcome ofthe complaint

is responsible for chasing up the oilierregulator to ensure that theinvestigation proceeds.

INTERNATIONAL PREMIUMRATE SERVICES (IPRS)

The International TelecommunicationsUnion (ITU) headquartered in Geneva,Switzerland is an internationalorganisation within which governmentsand the private sector coordinate globaltelecom networks and services.

It has recently approved aRecommendation for a numbering planfor international premium rate services.These new 12 digit numbers, starling witha 979 prefix, have been available byapplication to the 1TU since April 2001 ~2although may take some time to appearcommercially in Australia.

The operation and management of theIPRS service is provided on a managed

obasis by a Recognized Operating Agency(ROA) in the country of the informationservice provider in conjunction with anROA in the country of the caller. AnROA is any individual, company,corporation or governmental agency thatoperates an internationaltelecommunication service to carry publiccorrespondence~. In Australia this islikely to be the carrier providing carriageservices to places outside Australia.

The original 1998 ITU Recommendationfor these services imposes responsibilityon the terminating Recognized OperatingAgency to noti .fy the information serviceprovider of the regulation in the countryof call origination as follows:t*.

The terminating ROA has theresponsibility of processing allapplications received on behalf of theInformation Service Provider and willnoti~, the 1PBS Information Service

Provider:

of the service/call charge andrevenue options provided;

of the local code(s) of practice the count~, of call origination forinformation service providers,and that failure to comply mayrequire the 1PRS originating ROAto withhold or withdraw access.

The terminating ROA has overallc~mtn~l responsibilities to ensure thesatis~ctory completion of sen,iceorders for initiation, change,su.wension and disconnection."

As the new 979 numbers becomeavailable, it seems likely that theAudiotex industry will move traffic to thenew intcruational premium rote servicesas it will provide greater flexibility withcharging The domestic premium rateindustry may also seek to use theseservices if they are cheaper or lessregulated.

AUSTRALIAN GOVERNMENTPOSITION

On 12 July 2001, Senator Alston issueda media release indicating that the ACAwill bc directed to develop serviceprovider rules under s.99 of theTelecommunications Act 1997 so thatinternc~ premium rate adult services willbe treated similarly to telephone sexscrviccs. Thai is, access to these serviceswill only bc available where the customerhas agrccd in writing to their telephonehaving access to telephone sex servicesand access is restricted through a PersonalIdentification Number.

New reguhttions will also give the ACA’a range of flexible powers’ to makescrvicc provider roles over a broad raugcof issues relating not only to 190 servicesbut also 0011 services.

The Minister’s media release indicatesthut new rules could include:

requirements on carriers to noti~’cuslomers where bills exceed limits.

the establishment of a registrationsystem for carriage service providersand content service providersinvolved in the supply of premiumrate services.

restricted access and call barringarrangements.

PUBLIC INFORMATION

In recent months the number ofcomplaints about interact dumping to theTIO has remained steady. The TIO hastaken the lead in providing publicinformation and advice about how tominimise the risk of dumping and whatto do when you receive a surprisingly highphone bill. Useful in.formation has alsobeen published by the Minister’s office

and Telstra. However many lnternetScta’ice Provider sites seem only to havequite guneral information, if they haveany information at all, about the risks ofinteract dumping.

The TIO indicates that users can help toprcvcnt drooping by:

burring access to international and190 numbers

reading carefully any windows thatoffer downloads

pulling long expiry dates on internethistory files so dumped calls can betraced

turning off computers anddisconnecting a modcm when not inuse.

TROJANS

lnteruet dumping seems to be a problemunique to dial-up internet services.However for persons with a permanenlconnection the possibility of re-conncclion to a 190 or 001 service couldoccllr Ihrough lhe use oflrojao horses or

A trujan is a destructive program thatmasqncradcs as a benign application.Unlike a virus, trojans do not replicatethemselves but they can be just asdcstrnclivo~ . Once installed a trojan mayallow a person to take over a computerand "’rolnoto control" it.

The Cousumers’ TelecmnmunicatonsNct~ork report a trojan being brought totheir at/cation and watching it sileody rc-cmmecl a modem from a local call to a190 number. However, neither the T10or Tclstra have found evidunce of the useof Irojans in rcconnection disputes.

For Trojans to be operated for gain in thiscoutcxt, they would have to be operatedby or ou behalf of a particular serviceprovider. This would involve thecommission of criminal offences inAustralia. For this reason, if this isoccurring, it is more likely to be done byor ou behalf of overseas service providers.

The Leech case reported in the SMH~ inMarch 2001 was said to have possiblybeen caused by a trojan but is still beingiuvcstigated by the TIO.

The trojan type attacks are part of thewider issue of internet security. This is

page 18Communications Law Bulletin, Vol 20 No 4 2001

still a major issue for personal users andthe answer lies with the need foreducalion about the risks of iuternel useand the benefits of using personalfirewalls and anti-virus software.

CONCLUSIONS

The continued high incidence of theproblem indicates that a lot more needsto be done to inform the public of the risksofinternet dumping and how to minimisethem.

Carriers benefit significantly from the -provision of 190 and 0011 services toservice providers. With media publiciLyof the problem in April 2001, Telstraprovided some public cmnmcnt andadvice about the risks and implicationsof interuet users being reconnected to a190 or 0011 number bul many seem tohave not heard the message. There arenew interuct users every day and a muchbroader based information programseems to be necessary.

ISPs provide direct cmmcction to tileinternet and arguably therefore have alegal duty of care to advise theirsubscribers of the risks associated withuse of the interuct. Big Pond notified itscustomers in an April 2001 bulletin ofthe risks and state in that bulletin thatthey also did this earlier in June 2000.Other ISPs seem to have published littledetailed information about the problemanywhere at all, This may be due to thefact that the complaints about dmnpinggo to Telstra and the T10. not the ISPsand so most ISps are perhaps not awareof the extent of the problem. However,being in a direct relationship with thecustomer for interneI access it seemsreasonable to suggest that they shouldadvise their customers of the risksperhaps in their regular e-zinos.

The other end of the problmn is with theservice providers and websitc operators.

Different regulatory issues are raised byeach of the 190, 0011 and the anticipatednew international premium 979 services.

The TISCC code Internet Diallerprovisions which commenced 1 July 2001s6em to address tile consumer issues wellfor 190 services. These are:

prominent notice to lhe user of thetimed premium charges;

a clear de~ision is required by the userto accept the charges;

re.connection to the original ISP aflcruse of the sen’ice is mandated; and

notice to the caller of the length oftime of connection to the premiumservice is provided every 10 minutes.

Nevertheless the TIn complaint figures "for July to September 2001 show 190dumping complaints about 190 numbersand 70 for International numbers.Because of the quarterly lag in phonebills, it may be too early to draw anyconclusions from this data about tileeffectiveness of the new TISCC codeprovisions.

The TISCC code also prohibits activationof the service remotely thus indirectlymaking some reference to the use oftrojans.

One issue il doesn’t cover is therequirement for a redialler to have anuninstall capacity. Another issue that theTISCC code could not deal with is earlynotice to be given to phone accountholders when their bill goes over a certainmonetary, li~nit. The latter is importantto notify an account holder of anunauthorised use., of their account, forexample, use of the service by a childwithout the parent’s knowledge,particularly when hundreds of dollarsworth of charges can be incurred in asingle connection.

The Government’s response is useful inthat it directs the ACA to address thisissue and to look at both 190 and 0011services. The ACA should also look atthe new 979 services.

Regulation of international services isumre complex than the 190 services.

Effective regulation will require theoperation or coercion of the originatingcarrier, the service provider, theinformation setwice provider and theterminating carrier. 0011 services aresubject to the limited provisions of the1TA code, tile most i~nportant one beingmandalory disconnection after 30minutes, but many other issues are notaddressed.

The industry self-regulation option is tohave IARN adopt more prescriptiveprovisions in its guidelines and to go ona drive for new members. Its country co-operation, role and responsibilityprovisions provide a useful model for aglobal code.

Global codes are appropriate whenaddressing regulatory issues arising fromtransbordcr communications. However,many countries will not join aninternational regulatory regime unlessthere is a commercial incentive 1o do so.IARN aud ITA still have some way to gobefore a global self-regulatory modelcould be considered adequate.

The ITA code contributes the idea of aco-regulatory model where the industryrepresentative body is global but nationalgovernments can insist on particularmatters. It does this by providing,alongside the common code provisions,country schedules that set out the specificprovisions to apply in that country.

Australia has headed down a path ofdirect regulation with the Ministerdirecting the ACA to develop appropriateservice provider rules under s.99 of theTclcconununications Act 1997.

One option ~nay be I’or the ACA to usethe service provider rules to prohibitcarriers carrying audiotex services unless:

contractual provisions exist in theagrce~ncnt between the originatingand terminating carriers requiting theservice provider to require theinformation provider to comply withprovisions similar to Schedule 12 ofthe TISCC Code.

tile originaling and terminatingcarriers follow complaintsmechanisms similar to those set d6v,’niu the IARN guidelines.

This ;vould at least be enforceable by theoriginating carrier against theterminating carrier but not as against anoverseas service or information provider,This approach would seem to marry theIARN approach, where primaryresponsibility for file relationship with tilecomplainant lies with the originatingcarrier, and the ITU approach whereprimary responsibility, for regulation lieswith the terminating carrier.

However, the danger of too prescriptivedomestic regulation is industry movingoffshore and Australian users having lessreconrse against unscrupulous overseasoperators.

22 TIO Media release, 6 Mamh 2001.30p Cil 2

4 Australian IT, 27 June 2000. ’Criminals cash inon ca~l scare’ by Hayes S.

5 Figures provided by the DeputyTelecommunications Industry Ombudsman.

Communications Law Bulletin, Vol 20 No 4 2001 Page 19

6 Jackson M, Director Carrier Relations,International Telemedia Association: "The F utureof Internationa~ Telemedia Services in aDeregulating European Market’, 1999.Mtp:/lwv~w.telemedia-~ta.org/NEWS!7 ibid.8 htip://v, ww.iarn.org9Op C~t 1,

tO The Intocall Service Information Pack, Te]stra,Sept 2001, p.3,

13 Definition from the ITU.~ 4 ITU-T Recommendation E.15515 Definition from www,webooedia.com16 Davies A, ’How a Family Ran up a $700 Phone

Bill One Day When Nobody Was at Home’,Sydney Morning Herald, 5 March 2001, p.3.

John Corker is a senior associate ofClayton Utz seconded to theCammunicutions Law Centre as itsprlncipal solicitor. He is manager ofitslnternet law t~ractice, Oz NetLm~.

Cross-Media Rules to beRevisited Again or Not

Raatti Costello reviews the legislative and policy background of media ownership restrictions

Doing away with Australia’s cross-mediaownership laws is on the media policyagenda again following the Coalition’sre-election to Federal Government inNovember 2001. The Coalition’s electionplatform included the twin objectives of:

giving media companies exemptionsfrom the cross-media ownershiprestrictions if undertakings are givento maintain separate editorialprocesses and maintain existing levelsof local news and current affairs; and

abolishing the media-specific foreignox~aaership restrictions that apply tonexvspapers and television.

Tl’,is article provides the legislative andpplicy background necessary tounderstand the present revival of thisissue and why it may be difficult for theGovcrnmen~ to achieve its policyobjectives. Following his re-election,Prime Minister John Howard t~as madethe comment that he is:

"not going to bloody his nose on it ifthe minor parties in the Senate remainopposed’’~

CROSS.MEDIARESTRICTIONS

Over the last five years, the CoalitionGovernment has unsuccessfullyattempted to revisit and repeal theprovisions of the Broadcasting ServicesAct 1992 (Cth)(BSA) which prevent single entity from controlling any two ofthe following in any geographic licence

a commercial free-to-air televisionIicence;

a commercial radio licence; and

a wide circulation newspaper.~

These restrictions were introduced by theFederal Labor Government in 1987 andthe oft-quoted remark of then TreasurerPaul Keating that media proprietors

"mo.v be princes of print or queens ofthe screen, but not both"

reflects the underlying policy intenlionof preventing a media cmnpany frmncontrolling broadcast and print media inthe same geographic area.

These restrictions have been criticisedsince their creation as stifling the growthof Australian media companies and havebeen a constant barrier to muchanticipated changes in the control of theFaiffax newspaper group, publisher of theS.vdney Morning lterald, The Age.and tile

Australian Financial Review.

1996 REVIEW OF CROSS-MEDIA AND FOREIGN

OWNERSHIP

In late 1996, the Coalition Government,through tile Department ofCommunications and the Arts,cotnmenced a review of the cross-mediarules which it later abandoned withoutmaking any formal recommendations.

The Government also sought to reviewthe media-specific foreign ownershiprestrictions. Australian foreignownership policy is primarily controlledunder the Foreign Acquisitions andTakeoversAct 1975 (COO and associatedpolicies (FATA). In summary~ :

all direct (ie, non-portfolio) proposalsby foreign interests to invest in themedia sector irrespective of size aresubject to prior approval under theforeign inveslment policy. Proposalsinvolving portfolio share holdings of5% or more must also be submittedfor examination;

foroigu investment in mass circula6onnalional, metropolitan, suburban andprovincial newspapers is restricted.All proposals by foreign interests toacquire an interest of 5% or more inan existing newspaper or to establisha ucw newspaper in Australia aresubject to a case-by-case examination.TI~c maximum permitted aggregateforcigu interest (non-portfolio)invcslmcnVinvolvemenl in naliunaland metropolitan newspapers is 30%with any single foreign shareholderlimited to a maximum interest of 25%(and in that instance unrelated foreigninlcresls would be allowed to haveaggregate (non-portfolio)shnrcholdings of a further 5%).Aggregate foreign interest directinvolvement in provincial andsuburban newspapers is limited to lessthou 50% for non-portfoliosharcholdings.

aggregate foreign ownership ofTclstra is restricted to 35% of theprivatised equity (presently 49.9%)and individual foreign inveslors areonly allowed to acquire a holding ofno more than 5% of that privatisedequity. Prior approval is required forforeign involvement in theestablishment of new entrants to thetelecommunications sector orinvcshncnt in existing businesses inthe telecommunications sector.Proposals above the notificationthresholds will be dealt with on a case-by-case basis and will normally beapproved unless judged contrary tothe national interest.

The BSA also contains specific foreignownership restrictions with respect tofree-to-air and pay television licences,namely that:

foreign interests in commercial free-lo-air television licences are limitedto a 20% company interest in

Page 20 Communicationa Law Bulletin, Vol 20 No 4 2001

aggregate. A foreign Person may notbe in a position to exercise control ofa free-to-air commercial televisionbroadcasting ficenee. No more than20% of directors of a licensee may beforeign persons~ ; and

with respect to subscription (pay)television broadcasting licences,foreign interests are limited to a 20%company interest for an individualand a 35% company interest inaggregate?

No change to the law was made arisingfrom the 1996 review due to theopposition to the changing of the cross-media and foreign ownership rules bothfrom within the Coalition Government(parlicularly regional National Partymembers) and the opposition parties.

Submissions to the 1996 review byinterested parties highlighted thefollowing:

some parties ’,,,’ere generallyfavourable to the repeal of the cross-media rules but wished foreignownership restrictions to bemaintained. For example, Publishingand Broadcasting Limi~d, owner ofthe Nine television network,submitted that Australian mediacompanies ~c forced to stay strmll andnon-competitive due to artificialcross-media restraints and are unableto compete with foreignconglomerates.6

some parties were favourable to therepeal of the cross-media roles and therelaxation of foreign ownershipregulations. For example, NewsLimited (publisher of The dustralian,

The Herald Sun, The Daily Telegraphand The Courier ~Iail amongstothers) submitted that foreignownership rules remain a substanlialbarrier to entrants and investors in themedia industry and combined with thecross-media limits are out of s.tep withthe trend in economic regulationwhich is to expose industry tocompetitive pressures.7

the Australian Competition andConsumer Commission (ACCC),Australia’s competition regulator, wasof the view that the BSA and FATAcould be impediments to internationalcompetition, as they could be used toblock acquisitions of Australianmedia outlets by foreign mediaproprietors, he ACCC believed that

as c~mpetition is reduced, so are theprospects for greater plurality anddiversily in the media.~

it was the widespread view of mediacompanies that the cross-media rulesare antiquated and piecemeal becausethey did not acknowledge digitalconvergence and the rise of newmedia such as the Interuct and paytelevision which they arguedincreased the plurality of views andmade concentration of ownership andinfluence more unlikely. Crilics of thisposition, such a public interest groupsand the journalists’ union, argued thatthe same media companies tend todominate new forms of media suchas pay television and [nternet contentportals and in any event, print mediaand free-to-air television remain themost influenlial media. As such, theymaintain that cress-media restrictionsprevent concentration in theownership and control of the mostpolitically influential media.

gOMMI$$1ON INQUIFIY INTOBROAOCASTING

In 1999, the Federal Treasurer PeterCostello referred the BSA and relatedbroadcasting legislation to theProductivib, Commission and asked theCommission to advise on practicalcourses of action to improve competition,e~ciency and the interests of consumersin broadcasting services. As with theinquiry" of 1996, consultation with keyinterest groups and affected parties wassought.

The Commission’s Broadcasting lnquiryReport, released in April 2000~,

recommended that:

Foreign investment in broadcastingshould be covered by Australia’sgenera/foreign investment policy. Allrestrictions on foreign investment,ownership and control in the BSAshould be repealed, t° If theimmediately precedingrecommendation is not adopted, theBSA shotfld be amended inunediatelyto remove restrictions on investmentby foreign managed, but Australiansourced, funds in Australiancommercial television businesses, u

The Trade Practices Act 1974 (Cth)(TPA) should be amendedimmediately to include a media-

specific public interest test whichwould apply to all proposed mediamergers. This test would beadministered by the ACCC, andrequire that /he ACCC seekAustralian Broadcasting Autho~ty(ABA) input on ,social, cultural andpolitical dimensions of the publicinterest, n The cross-media rulesshould be removed only after thefollowing conditions are met:

removal of regulatory barriers to entryby new entrants into broadcasting,together with the availability ofspectrum for new broadcasters;

~’epcal of BSA restrictions on foreigninvestment, ownership and control;and

amcndinent to the TPA to provide fora media-specific public interest test toapply to mergers and acquisitions inthe media industry. ~

To date, the Commission’srecommendations have not been formallycommented on by the Government andno legislation was proposed arising outof the recommendations. While theCommission’s recommendations onforeign ownership are not too far removedfrom the Government’s election policy(see below), the Commission’srecommendation that the cross-mediarules should only be removed on thecondition that new entrants be allowedinto the broadcasting market is in conflictwith lhe Government’s policy regardingcommercial free-to-air television and theintroduction of digital terrestrialtelevision. The Government has grantedincumbenl free-to-air licensees a periodof protection, ending in 2007 at theearliest, in which no new free-to-aircommercial television licences, may begranted by the ABA.

The Commission also recommended thatcertain intra-media ownershiprestrictions be removed, namely, theprohibition on the control of more thanone commercial free-to-air televisionlicence in the same licenee area;~ andthe prohibition on the control of morethan hvo commercial radio licences in thesame liccncc area." The Commission isof the view that the normal competitionprovisions of the TPA are sufficient toachieve public policy objectives ofcompetition and diversity.~

Communications Law Bulletin, Vol 20 No 4 2001Page 2~ .

"CURR~NT POLICIES OF THEGOVERNMENT AND MAJOR

OPPOSITION PARTIES

The newly re-elected Government’scurrent policy on broadcasting,Broadcasting for the 21st Century, setsout their policy on media ownership~7.

In summary, the Coalition’s position isas follows:

the cross media rules areanachronistic and mediaorganisations should be able to obtainexemptions from the roles if they giveundertakings to maintain separate anddistinct editorial processes; and retainexisting levels of local news andcurrent affairs production ontelevision and radio;

the existing media-specific foreignownership rules that apply totelevision and newspapers arepreventing the introduction of newplayers and a more competitive mediasector. They should be abolished, withmedia acquisitions considered underFATA; and

if the above objectives cannot beachieved, the restrictions on thebroadcasting sector in relation toforeign managed funds will bereviewed as a matter of priority. Thisis an express acknowledgement of theProductivity Commission’srecommendalions on foreign mediamvnership policy.

Labor’s media ownership policy is partof their overall arts policy entitled ALPPlatform 2000 and had not been formallyrevised during the election campaign)8

In summary:

¯ Labor is committed to diversity inboth the ownership and operation offree to air and pay television, radio,newspapers and emerging onlinemedia. Labor recognises that the

~ convergence of new technologies doesprovide new opportunities andchallenges for Australia’s media butbelieves that the strategic objective ofdiversity can continue to be securedby a range of measures. To this endLabor will retain cross mediaownership laws.

no express mention is made of Labor’sposition on foreign ownership ofmedia companies. However, StephenSmith (the Shadow Minister forCommunications) was reportedduring the election campaign asstating that:

"the continuing existence of the crossand foreign media ownership rules asthe tactical devices currently neededto secure a ve~. ’fundamental strategicobjective in media and broadcastinglaws, and that’s called diversi.ly".~9

The Democrats’ media ownershippolicy 2° does not expressly state theparty’s position on the cross-media rules.However,

the Democrats’ policy states that:

"Australia has one of thehighest concentrations of mediaownership. This has seriouspolitical and economicconsequences which must beaddressed. The best guaranteeof independence in the media isthe widest possible spread ofownership. The Democratsbelieve that Australians shouldown the majority of Australianmedia outlets, but acknowledgethere may be special

proprietors add to the diversityand plurality of content."

a spokeswoman for Democrat SenatorVicki Bourne ’,*,’as reported during theelection campaign as saying,:

"We think the regime as itstands has added to Australia’sdiversit.v of ownership aadplurality of opinion and thatserved audiences as well as canbe expected. Unless we actuallysee what the Government isproposing then we can ~ say oneway or another whether we’dsupport it.

Along with Labor and the Democrats, theAustralian Greens are likely to be animportant force in the Federal Senate andthe composition of the Senate may impedethe Coalition’s chances of achieving itspolicy objectives. The Greens’ policyobjective with respect to media ownershipis:

"the regulation of media andpublishing to ensure diversity of local,regional and national products."~

It will be interesting to observe how theGovernment goes about pursuing itspolicy objectives - whether it ~vill conductanother public inquiry as il did in 1996and 1999 or alternatively, introducelegislation into Parliament withoutundertaking such a process. It appears

that the Coalition strategy ofcharactcrising the changes to the cross-media restrictions as one of creatingexemptions rather than wholesale repealof the cross-media rules supports the viewthat it might be a lower profile attemptthis time round. However, even this mayprove too difficult given the compositionof the Senate, as noted by Prime MinisterHoward in his recent comments.

it should be noted that the non-BSAforeign ownership restrictions are easierto change than the cross-media andforeign ownership restrictions in the BSArelating to television. For example, theGovermnent could relax the 30% foreignlimit on newspapers without the need forSenate approval.

11 Gilchrist M and Doman M, "PM Takes BackPromise to Media", The Austrafan (15 November2001) at http:lltheaustralian.news.¢omaulcam man/st dry ne~el0,5744,3252530%255E2702.00.ht ml2 BSA, s 60.3 See the Foreign Investmer~t Review Board’swebsite for a summary at http:/Ntww.firb.qov.au/policy pubs/polJcysummaryl a htm#Media4 BSA, s 57 and s 58.5 BSA, s 109.6 Pubtishing and Broadcasting Limited,Submission to the Cross-Media Review, 1996, p

7 News Limited, "Reforming Media Policy",Submission to the Cross-Media Review, 1996, p

8 ACCC, Submission to the Cross-Media Review,1996, pare 74.9 Available at http://www.pc.qqv.ag/inquiry/

10 Recommendation 10.1.11 Recommendation 10.2.12 Recommendation 10.3.13 Recommendation 10,4.14 BSA, s 53(2).f 5 BSA, s 54.16 Recommendation 10.6.17 Pt 4, p 18. It can be accessed at htt_~.//www liberal, or.q. aB r oadcashng%20policy pd f18 h~:llwww.all~ora.ault~olicylplatform20001chapter 14,html#619 Crabb A and Lawson A, "Media OwnershipLimits May be Relaxed", The Age (30 September2001) at h!’~p:llwwwAhea~e.com.aulnew~nationaf/2OOl lOSf30/FFXN_SAJQ Y QC.html20 http ;i ~w~w. democrats, oro. autnolicies/21 Banham C. "Alston Flags Overl~aul on TV,Newspaper Ownership", Sydney Morning Herald(30 September 2001) at htte://wv, w.smh.com.au/news/0108/30/national/national11 .h’~mt22 h~tp:llwww.greens.org,a~J

Raaoi Costelloe is a senior associate inthe Intellectual Property,Communications & Technology group atAliens Arthur Robinson

pa~ 22 Communications Law rtutMt~n, Vat 20 No 4 2001

Legislation NoteSome Final Words On Privacy

Catherine Dickson provides some final words on implementation of privacy law compliancefor the private sector.

With December 21 2001 having been &gone, most organisations should be in fullswing implementing.the National PrivacyPrinciples (NPPs). With your preparation

almost complete, you may be consideringsome of the more difficult aspects of thenew privacy legislation. Dealing withinformation that is sent overseas is anissue that most orgaoisations have left tolast. This activity is regulated by NPP 9.It is a difficult area to prepare for,particularly given the lack of guidance

as to what constitutes effective dataprotection standards in other countries.However, transborder transfers ofinformation should not be ignored. Theyare high risk because the Australian entityis effectively responsible for the handlingof all personal information collected inAustralia that it sends overseas. Someimportant.issues to consider in this

Who are you transferring to? If you aretransferring within the Australian-basedcollecting entity then NPP 9 does notapply. There is a/so an a~urnent that ifthe disclosure is to a related bodycorporate, then it is not an interferencewith privacy by virtue of section 13B ofthe new privacy laws, so NPP 9 does notapply. However the better view is thatNPP 9 applies to transfers rather thandisclosures so that NPP 9 applies to anydisclosnre that involves a transferoverseas.

How are yoa transferring? Personalinformation that is collected at anAustralian website and transferred to anoverseas company (whether related ornot) for processing will be subject to NPP9.

What are yoa transferring? Rememberthe employee records exemption only

applies to employee information when itis in the hands of the employer. Once itis transferred overseas to a parentcompany the NPPs apply.

Wh3~ are you transferring? You may alsobe wondering about the utility of so~ne ofthe conditions listed in NPP 9. You arenot alone[ Contracts concluded in theinterest of the individual are going to bedifficult to establish. Also satisfaction ofall but the conditions allowing transferwith consent or to a recipient that issubject to an equivalent law, bindingscheme or contract, will most likely haveto be established on a case by case basis,

Catherine Dickson is Counsel in theInformation Technology andTelecommunications practice atPricewaterhouseCoopersLegal.

Communications Law Bulletin, Vo120 No 4 2001 Page23

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