The Commerce Committee has examined the Television New Zealand Amendment Bill and the majority of us recommend that it be passed with the amendments shown.

Introduction

This bill seeks to amend the Television New Zealand Act 2003 (the Act). It proposes to

•replace the Television New Zealand Charter with a statement of functions, against which Television New Zealand would determine its own priorities
•allow the rescreening of television programmes that were produced before the establishment of the Broadcasting Commission (NZ On Air) in May 1989
•require Television New Zealand (TVNZ) to provide content through various media
•repeal provisions of the Act that are spent.

Our commentary covers the main amendments we recommend to the bill.

TVNZ archived works

Clause 10 would insert new Part 4A into the Act to provide for a scheme to allow TVNZ to re-screen works made before 27 May 1989 by its predecessor corporations, while compensating rights holders. These works have been unavailable for re-screening because of the need to negotiate with multiple contract-holders. While we agree that it is desirable that they be re-screened because of their historic and cultural value, which may be greater than their commercial value, we make a number of recommendations for amending the bill concerning TVNZ archived works.

Definitions

New section 29A of new Part 4A inserted by clause 10 of the bill sets out the definitions applying in new Part 4A. We recommend an amendment to the definition of “archived work” to make it clear that it would apply only to works for which TVNZ owns the whole copyright; pre-1989 commissioned works and co-productions made for the Broadcasting Commission of New Zealand or its predecessors are excluded from the definition.

We recommend amending the definition of “person with an interest in an archived work” to make it clear that the definition includes a person who was contracted for any one of the categories applicable to persons with an interest in an archived work listed in clause 1 of the new Schedule 3 to be added to the Act. This would ensure that the rights of a person in an archived work were protected. We also recommend that an employee of the Broadcasting Commission or its predecessors be excluded from this definition.

Screening of archived works

New section 29C of new Part 4A sets out the requirements that TVNZ must meet to re-screen an archived work. We recommend that new section 29C(1) be amended to make it clear that TVNZ could re-screen archived programmes only on the channels it owns at any time and on its on-demand internet site, as TVNZ owns the copyright.

We recommend deleting new section 29C(1)(iv) and inserting new subsection (iv) to make it clear that a programme could be re-screened by a provider of another delivery platform that had an agreement with TVNZ for the supply of that content.

We recommend amending new section 29C(2) to make it clear that an archived work screened under this section must be screened free of charge to the viewer. We believe that archived programmes constitute a public good, so the viewer should bear no cost.

We recommend inserting new section 29C(2)(b)(i) to require that TVNZ not schedule an archived work in prime time on any day of the week on its channels TV1 and TV2. We believe that TVNZ should not generate advertising revenue from these works by screening them during prime viewing hours.

The committee discussed the implications of the wording of new section 29C (2) (b)(i) which referred only to TV1 and TV2. This raised concerns about “future proofing” against other commercial channels emerging from TVNZ and any name change to TV1 or TV2. Some of us will undertake further consideration regarding this issue.

We also recommend inserting new section 29C(2)(b)(ii) to provide that an archived work must not be subject to a license that is sold for profit by TVNZ to be screened on any other platform. Our recommendation would not, however, preclude TVNZ from recovering reasonable costs associated with making these works available.

To avoid doubt, we clarify that the limitations under this clause would not preclude TV1 and TV2 from re-screening archived works during prime-time viewing, subject to negotiations and agreement with rights holders. In these instances the provisions of new Part 4A would not apply.

Rights of persons with interest in archived work to cease

We recommend amending new section 29D(1) to make it clear that the cessation of rights of persons with an interest in archived work would apply only to contractual rights and copyright under the Copyright Act 1994; moral and performers’ rights would remain unaffected. Our recommended amendment would ensure that the bill complied with the international conventions pertaining to these rights: the Berne Convention for the Protection of Literary and Artistic Work and the Agreement on Trade Related Aspects of Intellectual Property Rights (TRIPS). We believe that moral and performance rights should continue to be recognised.

We recommend inserting new section 29D(1A) to make it clear that the rights of a person in an archived work are not infringed if the work is screened in accordance with proposed new section 29C, and that they are replaced by the rights provided for elsewhere in new Part 4A.

Notices of screening of archived works

We recommend amending new section 29F(2)(d) to provide that a person with an interest in an archived work would have up to one month to register to participate in the scheme after a work was first screened or made available online. Under the bill as introduced, it could be interpreted that TVNZ could announce a date less than a month away. Our amendment would make it clear that a person with an interest in an archived work would always have a month to register their interest.

Establishment of TVNZ Archived Works Fund

New section 29G inserted by clause 10 provides for the establishment of the TVNZ Archived Works Fund, from which compensation would be paid for the screening of an archived work. It also prescribes the sum of money the Fund would have to contain for each half hour of an archived programme that was screened.

We disagree with the provision for a set fee for compensatory payments for a re-screened archived work, because not all works are of equal value, or indeed any market value. The proposed compensatory regime might also conflict with New Zealand’s international obligations under the Berne Convention and the TRIPS Agreement, under which an author is entitled to equitable remuneration set by an independent competent authority. In the light of this, we recommend a number of amendments to new section 29G, including requiring TVNZ to ensure that the Fund contains a sum that has been determined on the basis of the market value of an archived work that is re-screened.

We recommend inserting new section 29G(3) to require that a chief executive who has responsibility for the administration of the Act, after consultation with TVNZ, must appoint as an assessor an independent person with the expertise to assess the market value of an archived work.

We also recommend inserting new section 29G(4) to require that the market value of an archived work be assessed as at the time of its screening under section 29C.

Finally, we recommend requiring that the assessor, when making an assessment of the market value of an archived work, give regard to the uses permitted for the work by this part.

Payments from TVNZ Archived Works Fund

The Schedule proposes adding a new Schedule 3 to the Act that sets out the categories of persons with an interest in an archived work under the scheme, the proportions of the total sum available payable to each category, and the formula for calculating individual payments.

We recommend amending clause 1 of new Schedule 3 to expand the categories applicable to persons with an interest in an archived work under the scheme to include supporting performers, artists, or presenters, and those who hold a right in a work that is incorporated into an archived work. Our proposed amendment would ensure that more of those with an interest in an archived work would receive compensatory payments.

Access to archived works

We have considered the concerns raised by the Māori Television Service regarding access to archival material, particularly news and current affairs footage. TVNZ and the Crown have an agreement which allows the Māori Television Service reasonable access to archival material held by TVNZ, on a cost-recovery basis, for the purposes of making programmes to promote Māori language or culture. We understand that this agreement remains unaffected by the bill.

We have also considered the arguments regarding the cost of accessing news and current affairs archival footage by independent producers. TVNZ has catalogued and archived this content and makes it available to television producers for a price. Independent producers make arrangements to use archive footage in order to produce new works to be licensed and broadcast at the current commercial rate. We do not believe that it is necessary to require TVNZ to make available news and current affairs archival footage to television producers on a cost-recovery basis.

Measuring TVNZ’s performance

Clause 7 would repeal sections 22 and 23 of the Act, which relate to the reporting functions of TVNZ, now covered by the Crown Entities Act 2004. The Crown Entities Act requires TVNZ to provide information on the qualitative and quantitative performance measures to be used for measuring its performance against the Charter in its statement of intent, and to report on them in its annual report.

While we considered recommending requiring TVNZ to report against its statement of functions, the majority of us believe that the statement of intent process, set out in the Crown Entities Act, is the appropriate mechanism for requiring TVNZ to report on its performance.

Labour Party minority view

Labour opposes the TVNZ Amendment Bill on the basis that it replaces the TVNZ Charter in section 12 of the Television New Zealand Act 2003 with a statement of functions.

Labour opposes the removal of the TVNZ Charter. The removal of the charter weakens and essentially destroys TVNZ’s role as a public broadcaster because the statement of functions allows TVNZ to consistently put commercial priorities ahead of public broadcasting objectives.

Recent events have shown that TVNZ is currently conflicted in its role as State broadcaster with a responsibility to maintain a set of broadcasting standards and to develop and encourage New Zealand content on our screen and its role as a commercial entity in delivering a dividend to the Government.

We strongly agree with the majority of submitters to the Commerce Committee that the proposed statement of functions is inadequate.

The purpose of the new legislation is to “(a) provide for the functions of TVNZ, the Crown entity responsible for conducting a television and digital media business; and (b) ensure that TVNZ carries out its functions and maintains its commercial performance”.

These clauses replace the Television New Zealand Charter, which state TVNZ had some other obligations as the State broadcaster. It was asked to feature programming across all genres that informed, entertained, and educated New Zealand audiences.

Under the charter, TVNZ was required to feature New Zealand films, drama, comedy, and documentary programmes.

Instead this bill means TVNZ will no longer be required to support and schedule local content or support an independent production industry. Under this legislation we will see a further grinding back of the content that TVNZ provides.

We also believe that by including international content in the statement of functions and omitting reference to programming that meets the needs of special interest groups, that TVNZ will no longer serve a bicultural and diverse society. This point is made by the Human Rights Commission in its submission.

We are also concerned that there will no longer be any requirement for locally made content for children once the charter is removed.

And there is no requirement to measure TVNZ performance against the statement of functions as there is for charter performance.

We have serious concerns that the Government’s intentions are to dilute and reduce any requirement for local content development to be delivered to New Zealanders via a Freeview platform and place TVNZ’s commercial objectives ahead of its role as a public broadcaster.

For these reasons Labour cannot support this bill.

Green Party minority view

The Green Party opposes the TVNZ Amendment Bill because it strips Television New Zealand of its charter, and its public service obligations and responsibilities.

Stripped of its charter, this bill will turn TVNZ into a nakedly commercial broadcaster, focused solely on chasing ratings and advertising revenue, indistinguishable from any other commercial broadcaster, Once the bill becomes law, TVNZ will exist for the sole purpose of returning a profit and a dividend to the Government.

We can see little point in having a State-owned broadcaster that has no public service functions or responsibilities.

The charter spells out explicitly that TVNZ is expected to be a public service broadcaster, and to screen impartial news and current affairs programmes, along with drama, documentaries, children’s programmes, and minority interest programmes.

It also spells out that TVNZ should “promote understanding of the diversity of cultures making up the New Zealand population”––a provision that Paul Henry appears not to have read.

But once this bill becomes law, there will no longer be any obligation on TVNZ to provide impartial news and current affairs, or to screen local programmes, documentaries, children’s programmes, drama, or minority programmes.

The Paul Henry debacle was undoubtedly a foretaste of what is come, when all public service values and responsibilities have been removed from TVNZ. It also exposed the folly of requiring a State broadcaster to abandon its public service mandate and focus on chasing ratings instead.

We predict that after this bill is enacted, there will be fewer New Zealand programmes screened, and even less New Zealand content on TVNZ, because it is more expensive to produce New Zealand programmes than it is to import cheap programmes from overseas.

Once this bill is passed, New Zealand will be the only country in the OECD that does not have a public service broadcaster, and one of the only countries without a local content quota. We consider this a disgrace and share SPADA’s concern that in the absence of any commitment to local content in the bill, the financial stability of the screen production sector could be seriously eroded.

While the Minister has yet to outline any clear broadcasting strategy on the part of his Government, we assume the agenda behind this bill is to fully commercialise TVNZ and ready it for sale.

We are also concerned that funding for the two non-commercial niche channels which will continue to provide a small amount of public service broadcasting, TV6 and 7, is tenuous and short-term, and ends next year. The funding for Māori Television is not at a sustainable level either. In any event TV6 and 7, and having a dedicated children’s/family channel, are no substitute for high quality local content on TV1.

We are also concerned that the overriding of rights to royalties for archival programmes is unfair and without precedent, and is a breach of our obligations under the Berne convention. It takes away the legitimate contractual rights of interested parties.

Capping any royalty payment at $300 does not honour the contracts signed between performers and NZBC and later manifestations of national televison.

We are also concerned that once the bill has passed TVNZ will own the archive and will be able to charge exorbitant fees for access to pre-1989 material, which will restrict access to historical archival footage and the screening of this footage outside TVNZ.

Appendix

Committee process

The Television New Zealand Amendment Bill was referred to the committee on 29 April 2010. The closing date for submissions was 17 July 2010. We received and considered 55 submissions from interested groups and individuals. We heard 15 submissions,

We received advice from the Ministry for Culture and Heritage and Television New Zealand Limited.

Committee membership

Hon Lianne Dalziel (Chairperson)

John Boscawen (until 8 September 2010)

Charles Chauvel (until 21 July 2010)

David Clendon

Clare Curran

Hon Sir Roger Douglas (from 8 September 2010)

Te Ururoa Flavell

Melissa Lee

Peseta Sam Lotu-Iiga

Hon Nanaia Mahuta (from 21 July 2010)

Katrina Shanks

Jonathan Young

Key to symbols used

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This is an HTML version of the Bill. To see whether amendments are unanimous or majority, and whether they are select committee or committee of the whole House amendments, refer to the PDF version. Placing the cursor over the amendment will also give you this information.

Hon Dr Jonathan Coleman

Television New Zealand Amendment Bill

Government Bill

89—2

1 Title

2 Commencement

3 Principal Act amended

Part 1
Amendments to principal Act

Amendments relating to functions of TVNZ

4 Purpose of Act

5 Interpretation

6 New section 12 substituted

12 Functions of TVNZ

7 Sections 22 and 23 repealed

8 Powers of shareholding Ministers

9 Shareholding Ministers must not give certain directions

Amendments relating to archived programmes

10 New Part 4A inserted

Part 4A
TVNZ archived works

Subpart 1—Preliminary provisions

29A Interpretation

29B Purpose of this Part

Subpart 2—Screening of archived works

TVNZ's right to screen archived works

29C Archived works may be screened

29D Rights of persons with interest in archived work to cease

Subpart 3—Scheme

Overview of subpart

29E Overview of scheme under this subpart

Notices of screening of archived works

29F Notices advising that archived work to be screened

Funds that must be established for purposes of scheme

29G TVNZ Archived Works Fund

29H Contingency account

Participation in scheme

29I Registration to participate in scheme

29J Confirmation of registration

29K TVNZ to assess entitlement and make payment from Fund

Subpart 4—Review

29L Review process to be established

Review procedures

29M Application for review

29N Determination of application for review

29O Effect of review decision

Circumstance in which other relief may be sought

29P Applications from persons unable to register to participate in scheme

Subpart 5—Miscellaneous

29Q Regulations

29R Residual funds

29S Review of Part

11 New Schedule 3 added

Part 2
Repeals and related amendments

12 Spent sections of principal Act repealed

13 Amendment to Copyright Act 1994

14 New section 57A inserted

57A Making archived works available for public viewing

Schedule
New Schedule 3 added

The Parliament of New Zealand enacts as follows: