Australia: Foreign owners of interests in media companies required to notify under new Australian law

Last Updated: 15 September 2018
Article by Angela Flannery and Rebecca Kazzi

Most Read Contributor in Australia, October 2018

From 1 September 2018, any foreign person with an interest of 2.5 per cent or more in an Australian media company must notify the Australian Communications and Media Authority.

The Broadcasting Legislation Amendment (Foreign Media Ownership, Community Radio and Other Measures) Act 2018 (Cth) (Registration Act) became law on 1 September 2018. The Registration Act, amongst other matters, amends the Broadcasting Services Act 1992 (Cth) to require each foreign person, as defined in the Foreign Acquisitions and Takeovers Act 1975 (Cth) (FATA), that has a company interest of 2.5 per cent or more in an Australian media company to notify Australia's communications sector specific regulator, the Australian Communications and Media Authority (ACMA).

The Registration Act requires notification only, and the rules requiring Australian Foreign Investment Review Board approval for acquisitions of interests in Australian media companies as set out in the FATA remain unchanged. Furthermore, no other notification regimes applicable to shareholdings (such as applying to media companies listed on the Australian Stock Exchange) have been altered.

Background

In introducing the Registration Act to Parliament, the Government stated the new notification requirements are intended to improve transparency regarding foreign investment in Australian media companies. The Government promised to introduce the Registration Act as part of the package of concessions that were agreed with the minor parties in the Senate to obtain support for the legislation to abolish the so called "75 per cent reach" and "2 out of 3" rules governing cross media ownership which took effect in late 2017 (see our article on these reforms here).

Elements of the regime

Foreign persons

The notification requirement applies to "foreign persons" within the meaning of the FATA.

Broadly speaking, this covers:

  • individuals not ordinarily resident in Australia
  • corporations in which an individual not ordinarily resident in Australia, a foreign corporation or a foreign government holds an interest of 20 per cent or more (or corporations in which two or more such persons hold in aggregate an interest of 40 per cent or more)
  • trustees of trusts in which an individual not ordinarily resident in Australia, a foreign corporation or a foreign government holds an interest of 20 per cent or more (or trusts in which two or more such persons in aggregate hold an interest of 40 per cent or more)
  • foreign governments and foreign government investors
  • general partners of limited partnerships in which an individual not ordinarily resident in Australia, a foreign corporation or a foreign government holds an interest of 20 per cent or more (or trusts in which two or more such persons in aggregate hold an interest of 40 per cent or more).

Australian media company

The rules apply to company interests held in an "Australian media company", being any company that:

  • holds an Australian commercial television broadcasting licence
  • holds an Australian commercial radio broadcasting licence
  • is a publisher of a newspaper associated with the licence area of an Australian commercial television broadcasting licence or a commercial radio broadcasting licence (provided that the company falls within section 51(xx) of the Australian Constitution, which covers trading or financial companies formed within Australia and also foreign companies).

Company interests

The notification regime applies only where the foreign person has a "company interest" of 2.5 per cent or more. A company interest is a beneficial interest in shares or a voting interest or dividend entitlement in respect of a company or a right to share in the property of a company in its winding up.

Information to be contained on ACMA's register

ACMA will maintain the Register of Foreign Owners of Media Assets. This register will be publicly searchable and will include not only the name of each relevant foreign person, but the company interest held and details of how the company interest was determined, among other matters. ACMA has not yet published the form of that Register.

When is registration required?

Existing foreign investors have until the end of February 2019 to notify ACMA. A foreign investor who acquires an interest in an Australian media company that takes that foreign investor over the threshold must notify ACMA within 30 days of the acquisition and a foreign investor that ceases to hold 2.5 per cent or more must also notify ACMA within 30 days of that change occurring.

An additional notification is required at the end of each 12 month period ending 30 June, with that notification required by 30 July each year.

What are the rules under the FATA?

As mentioned, no changes have been made to Australia's foreign investment laws under the Registration Act. Under the FATA, the acquisition of an interest by a foreign person of 5 per cent or more in an entity or business that wholly or partly carries on an Australian media business is a notifiable acquisition.

Interest, as defined under the FATA, is a broader concept than company interest, as applies under the Registration Act. The definition of an Australian media business also differs between the two legislative regimes. Under FATA, an Australian media business is any business of publishing daily newspapers, or broadcasting television or radio, in Australia (including on websites from which all or part of those newspapers or broadcasts may be accessed, as long as publication or broadcast does not exclusively occur through such websites).

What does this mean for foreign investors in the media sector?

There are civil penalties for a failure to comply with the Registration Act. Therefore foreign investors who have any interest in an Australian media company should carefully consider whether the new regime applies to them. The fact that consent may not have been required for the acquisition of that interest under the FATA is not determinative of whether notification is required under the new Registration Act.

This publication does not deal with every important topic or change in law and is not intended to be relied upon as a substitute for legal or other advice that may be relevant to the reader's specific circumstances. If you have found this publication of interest and would like to know more or wish to obtain legal advice relevant to your circumstances please contact one of the named individuals listed.

To print this article, all you need is to be registered on Mondaq.com.

Click to Login as an existing user or Register so you can print this article.

Authors
Similar Articles
Relevancy Powered by MondaqAI
 
Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
 
Similar Articles
Relevancy Powered by MondaqAI
Related Articles
 
Up-coming Events Search
Tools
Print
Font Size:
Translation
Channels
Mondaq on Twitter
 
Register for Access and our Free Biweekly Alert for
This service is completely free. Access 250,000 archived articles from 100+ countries and get a personalised email twice a week covering developments (and yes, our lawyers like to think you’ve read our Disclaimer).
 
Email Address
Company Name
Password
Confirm Password
Position
Mondaq Topics -- Select your Interests
 Accounting
 Anti-trust
 Commercial
 Compliance
 Consumer
 Criminal
 Employment
 Energy
 Environment
 Family
 Finance
 Government
 Healthcare
 Immigration
 Insolvency
 Insurance
 International
 IP
 Law Performance
 Law Practice
 Litigation
 Media & IT
 Privacy
 Real Estate
 Strategy
 Tax
 Technology
 Transport
 Wealth Mgt
Regions
Africa
Asia
Asia Pacific
Australasia
Canada
Caribbean
Europe
European Union
Latin America
Middle East
U.K.
United States
Worldwide Updates
Registration (you must scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions

Mondaq.com (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of www.mondaq.com

To Use Mondaq.com you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.

Disclaimer

The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.

General

Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions