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[1998] HCA 28
appellant. Appeal allowed. Orders of the Full Court of the Federal Court set aside and in lieu thereof appeal to that Court allowed, orders of Davies J set aside, declaration that cl 9 of the Australian...
New Zealand film makers challenged an Australian TV content quota rule that guaranteed Australian shows at least half the daytime schedule because it discriminated against New Zealand content in breach of a trade treaty. The High Court held that the rule was made unlawfully because the Broadcasting Services Act requires the ABA to act consistently with Australia's international agreements. However the Court refused to strike the rule down as a legal nullity. Instead it declared the clause unlawful while leaving it in place unless further orders are made. The decision turns on whether Parliament intended breaches of the consistency obligation to wipe out everything the ABA does; the Court decided it did not, because that would cause too much disruption to broadcasting licences and the public.
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Project Blue Sky Inc, a company with the objective of encouraging the profitable growth of the New Zealand film and television industry, brought proceedings challenging the validity of the Australian Content Standard determined by the Australian Broadcasting Authority (ABA) on 15 December 1995. The Standard was made under s 122(1)(a) of the Broadcasting Services Act 1992 (Cth), which required the ABA to determine standards to be observed by commercial television broadcasting licensees relating to the Australian content of programs. Clause 9 of the Standard imposed a transmission quota: until the end of 1997 Australian programs had to comprise at least 50 per cent of all programming broadcast between 6.00 am and midnight (rising to 55 per cent from 1998) that was made without financial assistance from the television production fund. Clause 7 defined an "Australian program" by reference to creative control by Australians, compliance with tax certificate criteria, co-production agreements, or specified levels of Australian producers, directors, writers, actors and production location.
The appellants contended that this quota gave Australian programs preferential market access and treatment over New Zealand programs, contrary to Arts 4 and 5(1) of the Protocol on Trade in Services to the Australia New Zealand Closer Economic Relations Trade Agreement. Article 4 required each member state to grant persons and services of the other member state market access rights no less favourable than those allowed to its own persons and services. Article 5(1) required treatment no less favourable than that accorded in like circumstances to its own persons and services. Those obligations were said to engage s 160(d) of the Act, which provides that the ABA is to perform its functions in a manner consistent with Australia's obligations under any agreement between Australia and a foreign country.
At first instance Davies J declared that the Standard was invalid to the extent it failed to be consistent with the Protocol and ordered that unless revoked or varied by 31 December 1996 it would be set aside. The Full Court of the Federal Court (Wilcox and Finn JJ, Northrop J dissenting) allowed the ABA's appeal, holding that s 122(2)(b) and s 160(d) gave the ABA two mutually inconsistent instructions and that the specific provision in s 122 prevailed. By grant of special leave the appellants appealed to the High Court. The High Court allowed the appeal, set aside the Full Court's orders, and substituted a declaration that cl 9 of the Standard was unlawfully made, together with costs orders and liberty to apply (including liberty to seek further orders arising from any failure of other clauses to comply with the Protocol). The Court emphasised that while cl 9 breached the Act it was not invalid in the sense of being void ab initio.
The joint judgment of McHugh, Gummow, Kirby and Hayne JJ (with which the orders ultimately accorded) began from the principle that the primary object of statutory construction is to construe the relevant provision so that it is consistent with the language and purpose of all the provisions of the statute ([69]). A legislative instrument must be construed on the prima facie basis that its provisions are intended to give effect to harmonious goals; apparent conflict must be alleviated by adjusting the meaning of competing provisions to best give effect to the purpose and language of those provisions while maintaining the unity of the statutory scheme ([70]). Applied to ss 122 and 160, this required reading the power to determine standards relating to the Australian content of programs together with the mandatory direction that the ABA perform its functions consistently with Australia's international obligations.
The Court held that the grammatical meaning of s 122(1) and (2) would authorise standards inconsistent with international obligations, but when read with the express words of s 122(4) and the mandatory direction in s 160 the legal meaning of s 122 is that the ABA must determine standards relating to Australian content only to the extent that those standards are consistent with the directions in s 160 ([80]). Clause 9 was therefore made in breach of s 160(d) because it guaranteed Australian programs 50–55 per cent of broadcasting time while New Zealand programs had to compete for the remainder, giving Australian programs more favourable access and treatment contrary to Arts 4 and 5 of the Protocol ([84]). The Explanatory Memorandum to the Bill that became the Act expressly referred to consistency with Closer Economic Relations with New Zealand, confirming that s 160(d) applied ([82]).
However, breach of s 160(d) did not render cl 9 invalid. An act done in breach of a condition regulating the exercise of a statutory power is not necessarily invalid. The decisive question is whether it was a purpose of the legislation that an act done in breach of the provision should be invalid, ascertained by reference to the language of the statute, its subject matter and objects, and the consequences for the parties of holding void every act done in breach ([91]). The traditional mandatory/directory distinction deflects attention from this real issue and has outlived its usefulness ([93]). Section 160 proceeds on the hypothesis that the ABA has power to perform functions (including under s 158(j) and s 122) and directs that it is to perform them in a manner consistent with four specified matters. It therefore regulates the exercise of functions already conferred rather than imposing essential preliminaries to the existence of power ([94]).
Several textual and practical considerations demonstrated that invalidity was not the legislative purpose. Not every obligation in s 160 has a rule-like quality that can be easily identified and applied; consistency with objects, notified policies, ministerial directions and international obligations often leaves room for differing opinions ([95]). Australia is party to about 900 treaties, many expressed in indeterminate language as the result of compromises, more aptly described as goals than rules ([96]). Invalidity would produce public inconvenience, particularly in relation to the allocation and renewal of broadcasting licences under s 158(c) and (e); licensees and investors could not easily ascertain compliance with s 160, especially where general policies notified under s 161 are not required to be published in the Gazette ([98]). Courts have long accepted that public inconvenience tells against a legislative purpose of invalidity ([97]). Accordingly, while the making of cl 9 was unlawful, it was not invalid. A declaration that cl 9 was unlawfully made, together with liberty to apply for further relief, was the appropriate remedy ([100]–[101]).
Brennan CJ reached the same ultimate orders by a different route. His Honour considered that "Australian content" in s 122(2)(b) referred only to the matter contained in a program (sights, sounds and ideas evoking connection with Australia) and not to provenance; the Standard's reliance on provenance therefore exceeded the power conferred by s 122 ([22]–[26]). On the hypothesis that provenance could be taken into account, Brennan CJ agreed that cll 7 and 9 were inconsistent with s 160(d) and that the constraint in s 160 delimited the ambit of the power in s 122 so that a purported exercise in breach was invalid ([34]–[42]). The joint judgment's legislative-purpose analysis prevailed as the ratio of the Court.
Before the decision, the law governing validity of administrative acts done in breach of statutory conditions was dominated by the distinction between mandatory and directory provisions. Cases such as Montreal Street Railway Co v Normandin [1917] AC 170 and Clayton v Heffron (1960) 105 CLR 214 treated compliance with essential preliminaries as jurisdictional and non-compliance as producing invalidity, while directory provisions were those whose breach did not invalidate the act provided there had been substantial compliance. The Full Court below had treated s 122(2)(b) as a special provision prevailing over the general direction in s 160(d), reflecting an approach that gave priority to specific powers even where they appeared to conflict with general constraints ([8], [68]).
The transitional provisions in s 21 of the Broadcasting Services (Transitional Provisions and Consequential Amendments) Act 1992 (Cth) had continued TPS 14 (which itself contained Australian content quotas based on provenance) as a standard made under s 122, and had deemed provisions of s 114 of the repealed Broadcasting Act 1942 (Cth) to be program standards relating to the level of Australian content. The Minister had written to the ABA in 1992 noting that TPS 14 might breach the Protocol and urging reconsideration, yet the Standard ultimately made in 1995 replicated the preference ([83]). Legislative history therefore provided no clear guidance on the meaning of "Australian content" and appeared to tolerate temporary inconsistency with international obligations ([17]–[20]).
After the decision the law shifted decisively. The mandatory/directory classification is now regarded as recording a conclusion rather than supplying a test; the preferred approach is to ask directly whether the legislative purpose, gathered from language, subject matter, objects and consequences (including public inconvenience), was that breach should produce invalidity ([93]). Section 160(d) and analogous provisions in other statutes are to be treated as regulating the manner of performance of functions rather than conditioning the existence of power, so that breach renders the act unlawful but not void. Courts may declare the unlawfulness and, where appropriate, restrain further action based upon it, but the act retains legal effect unless set aside ([99]–[100]). The integrated construction of power-conferring and manner-directing provisions means that the legal meaning of a power is confined by consistency obligations from the outset ([80]). The decision also clarified that a standard may "relate to" the Australian content of programs even if it also deals with New Zealand content or combined Australian and New Zealand content, provided the requisite association exists ([87]–[89]).
Paragraph [69]: "The primary object of statutory construction is to construe the relevant provision so that it is consistent with the language and purpose of all the provisions of the statute."
Plain-English translation: When judges read an Act they must make sure every part fits together sensibly instead of letting one section cancel out another.
Paragraph [80]: "When s 122 is read with s 160, the legal meaning of s 122 is that the ABA must determine standards relating to the Australian content of programs but only to the extent that those standards are consistent with the directions in s 160."
Plain-English translation: The power to set Australian content rules is limited by the obligation to respect Australia's trade treaties; you cannot make a rule that breaks the treaty.
Paragraph [91]: "An act done in breach of a condition regulating the exercise of a statutory power is not necessarily invalid and of no effect. Whether it is depends upon whether there can be discerned a legislative purpose to invalidate any act that fails to comply with the condition."
Plain-English translation: Breaking a rule about how you must do your job does not automatically make everything you did worthless; it depends on whether Parliament wanted that result.
Paragraph [93]: "A better test for determining the issue of validity is to ask whether it was a purpose of the legislation that an act done in breach of the provision should be invalid. This has been the preferred approach of courts in this country in recent years, particularly in New South Wales. In determining the question of purpose, regard must be had to 'the language of the relevant provision and the scope and object of the whole statute'."
Plain-English translation: Stop asking whether a rule is mandatory or directory. Ask instead what Parliament intended to happen if the rule is broken, looking at the whole Act and what would follow if the act were treated as a nullity.
Paragraph [97]: "Courts have always accepted that it is unlikely that it was a purpose of the legislation that an act done in breach of a statutory provision should be invalid if public inconvenience would be a result of the invalidity of the act."
Plain-English translation: Judges will not lightly decide that Parliament wanted to throw the broadcasting system into chaos simply because the ABA overlooked one of its many international obligations.
Paragraph [99]: "Although an act done in contravention of s 160 is not invalid, it is a breach of the Act and therefore unlawful. Failure to comply with a directory provision 'may in particular cases be punishable'. That being so, a person with sufficient interest is entitled to sue for a declaration that the ABA has acted in breach of the Act and, in an appropriate case, obtain an injunction restraining that body from taking any further action based on its unlawful action."
Plain-English translation: The ABA broke the law, so a court can say so and stop it from acting on the broken rule, but the rule itself stays on the books unless a further order is made.
The precedent is triggered whenever an administrative body is given a power or function by one provision of an Act and another provision directs the manner in which that power or function must be exercised, and the question arises whether breach of the direction produces invalidity. Typical triggers include: (1) a statutory obligation to act consistently with international obligations, notified government policies, or ministerial directions of a general character (as in s 160(b)–(d)); (2) exercise of a power that has a real but not rule-like connection with the constraining obligation, such as setting broadcast content quotas that affect market access; (3) circumstances in which invalidity would disturb settled rights of third parties (for example broadcasting licensees who have relied on the ABA's act); and (4) regulatory schemes involving multiple overlapping obligations, some of which are expressed in broad or indeterminate language drawn from treaties.
The fact pattern does not require an actual international trade protocol; any statutory direction as to manner (objects of the Act, policies, directions, or treaty obligations) engages the legislative-purpose test. The precedent applies with special force where the consequence of invalidity would be widespread public inconvenience or where the obligation breached is one of many that the decision-maker must balance. It does not apply where the statute expressly makes compliance with a particular step a condition precedent to the existence of power, or where the breach is of a provision that on its proper construction limits the ambit of the power itself in the manner discussed by Brennan CJ at [34]–[36].
The judgment itself treats earlier authorities as supporting the legislative-purpose test. It follows the approach in Tasker v Fullwood [1978] 1 NSWLR 20 at 23–24 that the mandatory/directory distinction deflects attention from the real issue ([93]). It cites Montreal Street Railway Co v Normandin [1917] AC 170 for the proposition that public inconvenience tells against a purpose of invalidity ([97]). Institute of Patent Agents v Lockwood [1894] AC 347 is used to illustrate the need to determine which is the leading and which the subordinate provision when apparent conflict arises ([70]). Cooper Brookes (Wollongong) Pty Ltd v Federal Commissioner of Taxation (1981) 147 CLR 297 and Shanahan v Scott (1957) 96 CLR 245 are relied upon for the primacy of context and purpose in construction ([69], [61]).
The decision rejects the Full Court's characterisation of s 122 and s 160 as special and general provisions that cannot be reconciled; instead it treats them as interlocking provisions with s 160 supplying the dominant framework within which s 122 must be exercised ([81]). Brennan CJ's separate reasons are cited by the joint judgment at [31] for the proposition that, on the hypothesis that provenance standards were authorised, the legal meaning of s 122 is confined by s 160. The Court distinguishes cases that turn on conditions precedent to the existence of power from those that merely regulate the manner of exercise, citing Mark v Australian Broadcasting Tribunal (1991) 32 FCR 476 as an example of the former category that is not applicable here ([94]).
The judgment expressly leaves several issues unresolved. First, it does not decide which of the directions in s 160 prevails if two or more applicable directions are inconsistent with each other ([60]–[62]). The objects of the Act in s 3 and the regulatory policy in s 4 might in some future case pull against a notified policy or an international obligation; the Court notes only that nothing in the present case required that choice to be made. Second, although the Court held that cl 9 was made in breach of the Act, it heard no detailed submissions on the validity of cll 10–16 (which impose additional Australian drama, children's and documentary requirements) and expressly left open whether those clauses suffer the same fate ([85]).
Third, the precise boundaries of "the Australian content of programs" remain flexible. The Court accepted that a program contains Australian content if it shows aspects of life in Australia or is produced under Australian creative control, but it did not decide whether a standard could validly require a fixed percentage of combined Australian and New Zealand content without giving impermissible preference ([88]–[89]). Fourth, the interaction between s 160(d) and the transitional continuation of TPS 14 is noted but not fully explained; the Court describes the continuation as a probable stop-gap but does not decide whether the ABA could lawfully maintain an inconsistent standard pending its replacement ([83]).
Finally, the precise remedies available on liberty to apply remain open. The orders grant liberty to seek further or other orders arising from the alleged failure of any clause to comply with the Protocol, including potentially injunctive relief or variation of the Standard, but the Court gives no guidance on the circumstances in which such relief would be granted against an unlawful but not invalid administrative act ([101]). These open questions mean that future challenges to ABA standards, ministerial directions or decisions taken under other statutes containing analogous consistency obligations will require fresh application of the legislative-purpose test to their particular text, context and practical consequences.
High Court of Australia Brennan CJ McHugh, Gummow, Kirby and Hayne JJ Project Blue Sky Inc v Australian Broadcasting Authority [1998] HCA 28
The appeal be allowed and the orders made by Davies J set aside.
The Court Declares That cl 9 of the Australian Content Standard (the Standard) determined by the appellant on 15 December 1995 was unlawfully made.
The Appellant pay the costs of the appeal and of the proceedings before Davies J.
Each party has liberty to apply further, as it may be advised.
Without limiting the generality of O 4, the respondents have liberty to apply for such further or other orders as they may be entitled to arising from the alleged failure of a clause of the Standard to comply with Australia's obligations under the Australia New Zealand Closer Economic Relations Trade Agreement and the Trade in Services Protocol to that agreement.
There be no order in relation to the costs of the interveners.
The Australian Broadcasting Authority (the ABA) has a number of "primary functions" which are listed in s 158 of the Broadcasting Services Act 1992 Cth (the Act), including, inter alia:
(h) to assist broadcasting service providers to develop codes of practice that, as far as possible, are in accordance with community standards; and
(i) to monitor compliance with those codes of practice; and
(j) to develop program standards relating to broadcasting in Australia; and
Section 159 allows for "additional functions" which may be conferred on it by the Act or another Act. Section 160 imposes general obligations on the ABA in these terms:
The ABA is to perform its functions in a manner consistent with:
(a) the objects of this Act and the regulatory policy described in section 4; and
(b) any general policies of the Government notified by the Minister under section 161; and
(c) any directions given by the Minister in accordance with this Act; and
(d) Australia's obligations under any convention to which Australia is a party or any agreement between Australia and a foreign country.
In these proceedings, the appellants (to whom I shall refer as "Blue Sky"), which have the objective of encouraging the profitable growth of the New Zealand film and television industry, challenge the validity of a standard determined by the ABA on the ground that the ABA has not performed its function consistently with Australia's obligations under an "agreement between Australia and a foreign country". The agreement relied on is the Protocol on Trade in Services to the Australia New Zealand Closer Economic Relations Trade Agreement. The Protocol came into force on 1 January 1989. Article 4 of the Protocol reads as follows: Each Member State shall grant to persons of the other Member State and services provided by them access rights in its market no less favourable than those allowed to its own persons and services provided by them. Article 5(1) reads as follows: Each Member State shall accord to persons of the other Member State and services provided by them treatment no less favourable than that accorded in like circumstances to its persons and services provided by them.
Blue Sky contends that, by reason of Arts 4 and 5(1), Australia is under an obligation not to create or maintain any legal impediment which would adversely affect the capacity of the New Zealand film and television industry to compete equally with the Australian industry in the Australian market for the broadcasting of film and television products.
The impugned standard, known as the Australian Content Standard, was determined by the ABA on 15 December 1995 in purported exercise of the power conferred on the ABA by s 122(1)(a) of the Act. Part 5 of the Australian Content Standard, headed "Transmission Quota" contains but one clause: cl 9, headed "Australian transmission quota". Clause 9 reads:
(1) Subject to subclause (3), until the end of 1997, Australian programs must be at least 50% of all programming broadcast between 6.00am and midnight in a year that was made without financial assistance from the television production fund.
(2) Subject to subclause (3), from the beginning of 1998, Australian programs must be at least 55% of all programming broadcast between 6.00am and midnight in a year that was made without financial assistance from the television production fund.
(b) begins before midnight and ends on the next day;
the part of the program broadcast between midnight and 2.00am is taken to have been broadcast between 6.00am and midnight.
The quotas specified in cl 9 guarantee minimum periods between 6 am and midnight during which Australian programs are to be broadcast. New Zealand programs are left to compete with all other programs (including Australian programs) for the remainder of the periods between 6 am and midnight. Even if New Zealand programs were successful in obtaining transmission for the entire 50 per cent of the relevant periods which, until the end of 1997, were available after the Australian program quota was satisfied, the Australian Content Standard would preclude their achieving more than 45 per cent from the beginning of 1998. The definition of an Australian program is contained in cl 7 which reads:
(a) it is produced under the creative control of Australians who ensure an Australian perspective, as only evidenced by the program's compliance with subclause (2), subclause (3) or subclause (4); and
(b) it was made without financial assistance from the television production fund.
(a) the Minister for Communications and the Arts has issued a final certificate under section 124ZAC of Division 10BA of Part III of the Income Tax Assessment Act 1936 in relation to the program; and
(3) A program is an Australian program if it has been made pursuant to an agreement or arrangement between the Government of Australia or an authority of the Government of Australia and the Government of another country or an authority of the Government of another country.
(4) Subject to subclause (5), a program is an Australian program if:
(a) the producer of the program is, or the producers of the program are, Australian (whether or not the program is produced in conjunction with a co-producer, or an executive producer, who is not an Australian); and
(i) the director of the program is, or the directors of the program are, Australian; or
(ii) the writer of the program is, or the writers of the program are, Australian; and
(c) not less than 50% of the leading actors or on-screen presenters appearing in the program are Australians; and
(d) in the case of a drama program - not less than 75% of the major supporting cast appearing in the program are Australians; and
(i) is produced and post-produced in Australia but may be filmed anywhere; and
(ii) in the case of a news, current affairs or sports program that is filmed outside Australia, may be produced or post-produced outside Australia if to do otherwise would be impractical.
(a) is comprised of segments which, if they were individual programs, would not comply with subclause (4); and
(b) is not a news, current affairs or sports program;
only those segments that, if they were individual programs, would comply with subclause (4) are taken to be Australian programs.
The Australian Content Standard thus provides a minimum quota for the transmission of programs made in compliance with sub-cll (2), (3) or (4) of cl 7, that is, programs classified by the circumstances in which they were made. It is the provenance of a program, not its subject matter, which determines whether it is an "Australian program" for the purposes of the Australian Content Standard. The Australian Content Standard gives a competitive advantage to programs having an Australian provenance over programs having a corresponding New Zealand provenance. Thus the Australian Content Standard appears not to be consistent with Australia's obligations under Arts 4 and 5(1) of the Protocol.
In the Federal Court, Davies J made a declaration that the Australian Content Standard "is invalid to the extent to which it fails to be consistent with the Protocol". The consequential order that his Honour made was in these terms:
The power of the ABA to determine standards is conferred by s 122 which reads:
(a) determine standards that are to be observed by commercial television broadcasting licensees; and
(b) determine standards that are to be observed by community television broadcasting licensees.
(2) Standards under subsection (1) for commercial television broadcasting licensees are to relate to:
(3) Standards under subsection (1) for community television broadcasting licensees are to relate to programs for children.
(4) Standards must not be inconsistent with this Act or the regulations.
The standards which may be determined in exercise of the power conferred by s 122 are limited to standards relating to the matters specified in pars (a) and (b) of sub-s (2) - relevantly, "the Australian content of programs".
The majority of the Full Court pointed out [2] that the term "Australian content" is not defined by s 122 or by any other provision in the Act. The connotation which their Honours attributed to "Australian" was "something particular to this country". Then, noting that "a New Zealand program is not an Australian program", their Honours reasoned that [3] -
If the ABA specified the "Australian content" of television programs in such a way as to allow any of that required content to be satisfied by New Zealand programs, however they might be defined, it would fail to carry out its statutory task The only standard the ABA could set, consistent with the Protocol, would be one that allowed for there to be no Australian content programs at all, provided that New Zealand programs were broadcast in lieu of programs having Australian content. While one may be able to describe this as determining a standard, it is not one that puts into effect the statutory obligation to determine a standard that relates to the Australian content of programs. 1. Australian Broadcasting Authority (1996) 71 FCR 465 at 482. 2. Australian Broadcasting Authority (1996) 71 FCR 465 at 482.
Herein lies a difficulty. The proposition that a New Zealand program does not, or cannot, satisfy the "Australian content" requirement of a standard to be determined under s 122 is not self-evident. No doubt the proposition depends on the meaning to be attributed to Australian content in s 122, a question to which I shall return. The proposition led their Honours to the conclusion [4] that, in enacting ss 122 and 160 -
Parliament has given the ABA two mutually inconsistent instructions. It has said, first, that the ABA is to provide for preferential treatment of Australian programs, but, second, that it is to do so even-handedly as between Australia and New Zealand. Holding that there was an irreconcilable conflict between s 122(2)(b) and s 160(d), the majority regarded s 122(2)(b) as a special provision overriding the general provision in s 160(d) [5] . Accordingly, the validity of the Australian Content Standard was upheld. 1. Australian Broadcasting Authority (1996) 71 FCR 465 at 483. 2. Australian Broadcasting Authority (1996) 71 FCR 465 at 484.
In argument, Blue Sky attacked the reasoning of the majority but chiefly upon grounds which appear to assume that a standard prescribing a transmission quota for "Australian programs" as defined by cl 7 of the Australian Content Standard is a standard relating to the "Australian content" of programs within the meaning of that term in s 122(2)(b). On that assumption and on the further assumption that "Australian content" excluded non-Australian content, New Zealand programs could not satisfy either the Australian Content Standard or any other standard determined under s 122(1). Allowing that to be so, the argument relied on the wide import of the words "relate to" in s 122(2). The width of that phrase was said to permit the prescription of transmission quotas for Australian programs in terms which, in obedience to s 160(d), would also provide equal transmission quotas for New Zealand programs [6] . It was also submitted that a standard would "relate to" Australian content and would be valid if it prescribed Australian content without excluding non-Australian content.
Before any inconsistency can be found between s 122(2)(b) and s 160(d), it is necessary to ascertain the meaning of the terms used in the former provision. What is a "standard" and what is "Australian content"? The parties and the interveners made their submissions principally on the basis that Australian content could be seen or heard only in a program having an Australian provenance. The adoption of that common basis is understandable.
First, it is in the interveners' interests to assert that Australian content is to be found only in programs having an Australian provenance. If that be correct, s 122(2) authorises the determination of a standard that, by safeguarding Australian content, safeguards programs having an Australian provenance.
Secondly, the commercial interests represented by Blue Sky presumably recognise that the content of programs made in New Zealand or by New Zealanders will not be recognisably Australian or will be less likely to be recognisably Australian than programs having an Australian provenance. Blue Sky did not seek to have the Australian Content Standard set aside on the ground that the power to determine standards could be used only to prescribe the content of programs, whatever the provenance of those programs might be. However, Mr Ellicott, senior counsel for Blue Sky, accepted that to confine "Australian content" to what could be seen and heard in a program and to deny that the term includes the provenance of a program removes any possibility of inconsistency between s 122(2)(b) and s 160(d). In the course of argument, counsel submitted:
Obviously, if a standard could be devised which had no reference to - I have called them trade-related matters - then it may be that there was no need to be concerned about the international obligation.
May I say this if a standard was confined to content in the sense of subject matter, then anybody in the world could make or produce with whatever actors or writers, et cetera, they wanted to such films. Therefore, it could be argued everybody would be on a level playing field in relation to such a standard and there may not be any specific requirements for the application of section 160(d).
In other words, all I am positing is that it is quite possible, fully consistent with our argument, that you may have a case where a standard satisfies section 122 and is consistent with section 160(d), even though it does not have to mention New Zealand films or other films if they have a most favoured nation situation. (Emphasis added.)
But Blue Sky was not willing to advance that as the true construction of "Australian content", perhaps because it was thought that success on that ground might yield little commercial benefit. This seems to have been recognised by counsel who observed that "my clients might in another matter want to say otherwise".
However, the interests of persons concerned in the litigation and the assumptions made in the rival submissions cannot divert the Court from its duty to construe the statute. "Judges are more than mere selectors between rival views", said Lord Wilberforce in Saif Ali v Sydney Mitchell & Co [7] , "they are entitled to and do think for themselves".
Thirdly, the ABA relied on the legislative history relating to program standards in an attempt to show that Australian content in s 122(2)(b) requires the involvement of Australians in the making of the program and that cl 7 of the Australian Content Standard conforms with the historical understanding.
The issues for determination can now be stated:
(1) In subsection (2), a reference to a program standard is a reference to a program standard that was in force immediately before the commencement of this Act under paragraph 16(1)(d) of the Broadcasting Act.
(2) A program standard or a part of a program standard that related to programs for children or the level of Australian content of programs is taken, after that commencement, to be a standard determined by the ABA under paragraph 122(1)(a) of the new Act.
(3) For the purposes of subsection (2), the provisions of section 114 of the Broadcasting Act are taken to be program standards in force under the Broadcasting Act relating to the level of Australian content of programs.
(8) A program standard relating to a matter referred to in subsection (2) ceases to be in force upon the determination by the ABA under paragraph 122(1)(a) of the new Act of a program standard relating to that matter.
The ABA submits that the Parliament must have understood that the continuance of (TPS)14 and the continued operation of s 114 of the 1942 Act meant that the standard which the ABA was to determine under s 122(2)(b) was a standard governing the minimum use or the preferential use of Australian programs. Thus, so the argument ran, the Australian Content Standard was within the power conferred on the ABA by s 122.
The argument fails to take account of the text of s 21(2) of the Transitional Act and s 122(2) of the 1992 Act. Section 21 of the Transitional Act does not continue the entirety of a standard determined under the 1942 Act. Sub-section (2) provides that only a program standard or only that part of a program standard under the 1942 Act which related to "programs for children or the level of Australian content of programs" should be taken to be a standard determined under s 122(1)(a) of the 1992 Act. Section 21 of the Transitional Act textually follows the terms of s 122(2) of the 1992 Act. To ascertain what part of (TPS)14 was continued in operation when the 1992 Act commenced operation, it is necessary to construe the text of s 122(2) which accords with s 21 of the Transitional Act. To assume that (TPS)14 continued in undiminished force in order to illuminate the meaning of the words which governed whether and to what extent it was continued in force is a fallacy: it assumes the operation of a statute in order to discover its meaning.
However, the scope of s 21(2) of the Transitional Act is fictionally extended by sub-s (3) which requires the provisions of s 114 of the 1942 Act be taken to be a program standard in force under the 1942 Act "relating to the level of Australian content of programs". That deeming provision, which expired pursuant to sub-s (8), cannot illuminate the meaning of "Australian content" except in one respect. It indicates that preferential provisions such as those contained in s 114 of the 1942 Act would not fall within the concept of "a standard relating to the Australian content of programs" if there were no deeming provision.
Thus the legislative history of the relevant provisions of the 1992 Act sheds no light on the meaning of s 122(2)(b). It remains for this Court to ascertain the meaning of Australian content in s 122(2)(b) from the statutory context and to determine whether the Australian Content Standard, so far as it prescribes a transmission quota for programs having an Australian provenance, relates to the Australian content of programs.
The term "program" in relation to a broadcasting service is defined by the Act (s 6) to mean:
(a) matter the primary purpose of which is to entertain, to educate or to inform an audience; or
(b) advertising or sponsorship matter, whether or not of a commercial kind.
The "content" of a "program" is what a program contains. The Act calls that content "matter": it is what the broadcast audience sees or hears. "Australian" is the adjective describing the matter contained in the program; but the matter contained in a program is not its provenance. The content of a program for broadcast may be difficult to define in a statute, for it has to do with the communication of sights and sounds that convey ideas and the classification of an idea as "Australian" is a rather elusive concept. But that is not to deny the reality of Australian ideas; they are identifiable by reference to the sights and sounds that depict or evoke a particular connection with Australia, its land, sea and sky, its people, its fauna and its flora. They include our national or regional symbols, our topography and environment, our history and culture, the achievements and failures of our people, our relations with other nations, peoples and cultures and the contemporary issues of particular relevance or interest to Australians. The conferring of power on the ABA to determine a standard relating to the Australian content of programs accords with one of the objects prescribed by the Act, namely, "to promote the role of broadcasting services in developing and reflecting a sense of Australian identity, character and cultural diversity" (s 3(e)).
The "Australian content of a program" is the matter in a program in which Australian ideas find expression. The ABA is empowered by s 122(1)(a) to determine a transmission quota for programs in which Australian ideas find expression and the manner in which and the extent to which such programs must contain Australian ideas.
Also, s 125 empowers the ABA to determine standards in relation to a matter referred to in s 123(2) if a code of practice governing such a matter has not been registered or is not operating to provide appropriate community safeguards. The "matters" referred to in s 123(2) are all concerned with the content of programs to be broadcast, the last of which is expressed (s 123(2)(l)) as "such other matters relating to program content as are of concern to the community". That "content" is a term which connotes what is to be seen and heard in a program is confirmed by the provisions of s 129. That section ensures that the ABA's power to determine standards does not empower the ABA to require the approval by it of programs before broadcasting except in relation to children's programs. The purpose of the provision seems to be to deny the ABA general power to require a program, other than children's programs, to be seen and heard by the ABA before broadcasting.
A distinct regime applies in respect of "Australian drama programs" which might be broadcast by subscription television broadcasting licensees. The definition of Australian drama program in s 6 draws a distinction between the provenance of a drama program and its content. That definition selects Australian provenance and Australian content as alternative criteria of Australian drama programs. These are the programs for which a minimum expenditure requirement is imposed on subscription television broadcasting licensees by s 102. Although s 215 includes a minimum expenditure requirement as an item to be reviewed by the Minister when the Minister reviews "the operation of the condition relating to Australian content on subscription television broadcasting licensees", the circumstance that either criterion will identify a program as an Australian drama program does not mean that "Australian content" includes Australian provenance. The "condition" relating to Australian content is prescribed [10] by pars (b), (e), (f) and (g) of cl 10(1) in Sch 2 to the Act. All of these paragraphs relate to the matter to be broadcast, not the provenance of the programs broadcast.
The provisions of the Act uniformly point to one meaning of "the Australian content of programs", namely, the Australian matter contained in a program. There is neither historical nor textual foundation for the proposition that the term can be used to classify programs by reference to their provenance. The determination of the Australian Content Standard adopts an impermissible basis for classifying programs as the subject of a standard under s 122. It follows that I would hold the Australian Content Standard to be invalid, but for a reason other than the reason advanced by Blue Sky and debated by the ABA and the interveners.
If, contrary to my view, s 122(2)(b) empowered the ABA to determine and prescribe a transmission quota for programs having an Australian provenance, is it consistent with s 160(d)?
Section 160 defines four categories of constraint on the ABA's performance of its functions. The "objects of this Act" in par (a) are to be collected from the terms of the Act. As the particular terms of the Act would prevail over the general requirements of s 160 in any event, the "objects of this Act" requirement in par (a) - but not "regulatory policy" - must prevail over the other requirements in s 160. The "objects of this Act" in par (a) and "Australia's obligations" in par (d) prescribe existing constraints on the ABA's performance of its functions; the constraints imposed by pars (b) and (c) await the notification of general policies or the giving of directions and the constraint of "regulatory policy" awaits the formulation of that policy. As there is nothing which suggests that Parliament contemplated that the four categories of constraints might be inconsistent or incompatible one with another, the policies which may be formulated under par (a) or notified under par (b) and the directions which may be given under par (c) must be consistent with the objects of the Act and with par (d). So construed, there could be no conflict between the constraint created by the objects of the Act or by par (d) and any of the other constraints imposed by s 160. If there were any conflict between "the objects of this Act" and s 160(d) the former would prevail but no such conflict appears in the present case. Section 160(d) therefore prescribes a manner in which the ABA must perform its statutory functions. It has effect according to its tenor.
Of course, the ascertainment of Australia's obligations under "any convention to which Australia is a party or any agreement between Australia and a foreign country" may be difficult to ascertain, especially if those obligations are mutually inconsistent. Counsel for the interveners pointed to a number of international instruments which indicate that the conventions and international agreements to which Australia is a party create obligations which, if not mutually inconsistent, at least throw doubt on the proposition that Arts 4 and 5(1) of the Protocol entitle Australian and New Zealand makers of programs to share the market between them and equally. Clearly Parliament did not contemplate that the constraints imposed by s 160(d) could be mutually inconsistent for the entirety of Australia's obligations had to be observed by the ABA in the performance of its functions.
Here, Arts 4 and 5(1) express unequivocally Australia's obligations under an agreement "between Australia and a foreign country". Whether or not Australia's obligations under other agreements or conventions restrict the proportion of a market available to Australian and New Zealand service providers, Arts 4 and 5(1) of the Protocol impose an obligation on Australia to extend to New Zealand service providers market access and treatment no less favourable to New Zealand service providers than the market access and treatment available to Australian service providers. As there is nothing to show that Arts 4 and 5(1) do not truly impose obligations on Australia, s 160(d) has the effect of requiring the ABA to perform its functions in a manner consistent with Arts 4 and 5(1).
On the hypothesis that the prescription of a transmission quota for programs having an Australian provenance could be supported by an exercise of power conferred by s 122, s 160(d) directs the ABA not to exercise its power so as to breach Australia's international obligations. On that hypothesis, a majority of this Court, reading s 122 with s 160, holds that [11] :
the legal meaning of s 122 is that the ABA must determine standards relating to the Australian content of programs but only to the extent that those standards are consistent with the directions in s 160. Given the hypothesis, I would respectfully agree. And, as Australian program makers are given an advantage over the New Zealand program makers by cll 7 and 9 of the Australian Content Standard, I would hold those clauses to be inconsistent with s 160(d). 1. Project Blue Sky Inc v Australian Broadcasting Authority (1998) 194 CLR 355 at 385.
Although I apprehend that, on the hypothesis stated, the majority and I would hold cll 7 and 9 to be inconsistent with s 160(d) of the Act, my analysis of the consequences is radically different. I must explain the basis on which I proceed.
The supposed conflict between s 122 and s 160(d) which a majority of the Federal Court held to exist was not textual; it was operational. There is no textual inconsistency between s 122 and s 160. And an operational conflict could arise only if s 122 conferred a power which required the ABA to determine a standard inconsistent with Australia's obligations under an agreement with another country. Were that the situation, s 122 would prevail because, on that construction of s 122, it would express the Parliament's direction to the ABA to exercise the power it confers in a particular way while s 160 expresses a direction as to the way in which the ABA's functions generally were to be exercised. One of the "objects of this Act" would be expressed by s 122. The special direction contained in s 122 would prevail over the general direction contained in s 160(d) [12] . However, as it is not possible to construe s 122 as containing a direction to the ABA to determine a standard inconsistent with Australia's obligations under an agreement with another country, there is no textual inconsistency between the two provisions. Nor is there any operational inconsistency as it is open to the ABA so to formulate a determination as to afford the same protection to the makers of New Zealand programs as that afforded to the makers of Australian programs. Therefore this question arises: what is the effect of an obligation owed by Australia under an agreement with a foreign country on the ambit of the power conferred on the ABA by s 122?
A provision conferring a general power and a provision prescribing the manner in which the repository of that power must exercise it have to be read together. In Colquhoun v Brooks [13] , Lord Herschell said:
It is beyond dispute, too, that we are entitled and indeed bound when construing the terms of any provision found in a statute to consider any other parts of the Act which throw light upon the intention of the legislature and which may serve to shew that the particular provision ought not to be construed as it would be if considered alone and apart from the rest of the Act. When the Parliament confers a power and statutorily directs the manner of its exercise, "[t]he ambit of the power must be ascertained by the character of the statute and the nature of the provisions it contains" [14] . Therefore a provision conferring the power must be so construed as to conform with a provision governing the manner of its exercise. The authority conferred on the repository of a general power cannot be exercised in conflict with a provision which governs the manner of its exercise [15] ; the constraint on the exercise of the power defines the ambit of the power granted. A purported exercise of a power in breach of the provision which governs the manner of its exercise is invalid, since there is no power to support it. 1. (1889) 14 App Cas 493 at 506. 2. Morton v Union Steamship Co of New Zealand Ltd (1951) 83 CLR 402 at 410. 3. Shanahan v Scott (1957) 96 CLR 245 at 250; Clyne v Deputy Commissioner of Taxation (1984) 154 CLR 589 at 597-598; Shop Distributive and Allied Employees Association v Minister for Industrial Affairs (SA) (1995) 183 CLR 552 at 561; Harrington v Lowe (1996) 190 CLR 311 at 324-325; Utah Construction & Engineering Pty Ltd v Pataky [1966] AC 629 at 640; Willocks v Anderson (1971) 124 CLR 293 at 298-299.
If a statutory instrument is invalid by reason of conflict between the terms of the instrument and a statutory direction as to the manner in which the power to make the instrument may be exercised, the source of the invalidity is the restricted ambit of the power, not the absence of some act or occurrence extrinsic to the statute. A statutory direction as to the manner in which a power may be exercised is not a condition upon the existence of the power or a mere direction as to the doing of some preliminary or collateral act. It is a delimitation of the power itself.
If the power exercised by a repository is within the ambit of the power reposed, there can be no unlawfulness on the part of the repository in exercising it. Either there is power available for exercise in the manner in which the repository has exercised it and the exercise is lawful or there is no power available for exercise in the manner in which the repository has purported to exercise it and the purported exercise is invalid.
A provision which directs the manner of the exercise of a power is quite different from a provision which prescribes an act or the occurrence of an event as a condition on the power - that is, a provision which denies the availability of the power unless the prescribed act is done or the prescribed event occurs. In one case, power is available for exercise by the repository but the power available is no wider than the direction as to the manner of its exercise permits; in the other case, no power is available for exercise by the repository unless the condition is satisfied [16] . A provision which prescribes such a condition has traditionally been described as mandatory because non-compliance is attended with invalidity. A purported exercise of a power when a condition has not been satisfied is not a valid exercise of the power.
A third kind of provision must be distinguished from provisions which restrict the ambit of the power and provisions which prescribe conditions on its availability for exercise. A provision may require the repository or some other person to do or to refrain from doing something (sometimes within a period prescribed by the statute) before the power is exercised but non-compliance with the provision does not invalidate a purported exercise of the power [17] : the provision does not condition the existence of the power [18] . Such a provision has often been called directory, in contradistinction to mandatory, because it simply directs the doing of a particular act (sometimes within a prescribed period) without invalidating an exercise of power when the act is not done or not done within the prescribed period. The description of provisions as either mandatory or directory provides no test by which the consequences of non-compliance can be determined; rather, the consequences must be determined before a provision can be described as either mandatory or directory.
(j) to develop program standards relating to broadcasting in Australia; and
(d) to ensure that Australians have effective control of the more influential broadcasting services; and
(e) to promote the role of broadcasting services in developing and reflecting a sense of Australian identity, character and cultural diversity; and
(g) to encourage providers of commercial and community broadcasting services to be responsive to the need for a fair and accurate coverage of matters of public interest and for an appropriate coverage of matters of local significance.
The ABA is to perform its functions in a manner consistent with:
(a) the objects of this Act and the regulatory policy described in section 4; and
(b) any general policies of the Government notified by the Minister under section 161; and
(c) any directions given by the Minister in accordance with this Act; and
(d) Australia's obligations under any convention to which Australia is a party or any agreement between Australia and a foreign country. [25]
The appellants contend that par (d) of s 160 required the ABA in determining program standards to comply with the Trade Agreement and the Protocol. They contend that, because the Protocol requires equality of treatment and access to markets, the Australian Content Standard is invalid because it gives television programs made by Australians preferential treatment over programs made by New Zealand nationals.
The Act imposes a specific obligation on the ABA to determine program standards to be observed by commercial television broadcasting licensees in respect of the Australian content of television programs. Section 122 states:
(a) determine standards that are to be observed by commercial television broadcasting licensees; and
(b) determine standards that are to be observed by community television broadcasting licensees.
(2) Standards under subsection (1) for commercial television broadcasting licensees are to relate to:
(3) Standards under subsection (1) for community television broadcasting licensees are to relate to programs for children.
(4) Standards must not be inconsistent with this Act or the regulations.
Section 6 defines "program" in relation to a broadcasting service to mean:
(a) matter the primary purpose of which is to entertain, to educate or to inform an audience; or
(b) advertising or sponsorship matter, whether or not of a commercial kind.
Before determining, varying or revoking a standard, the ABA must "seek public comment on the proposed standard or the variation or revocation" (s 126). Decisions by the ABA with respect to standards are not decisions under the Act which may be reviewed under s 204 by the Administrative Appeals Tribunal. Instead, the Act gives the Houses of Parliament authority to alter a standard. Section 128(1) provides that, upon either of the Houses of Parliament agreeing to an amendment of a standard which has been determined, the standard has effect as amended from the twenty-eighth day after the date on which the other House agrees to the amendment.
The Act also provides for the allocation of commercial television broadcasting licences and the conditions of such licences [26] include [27] a requirement that the licensee comply with program standards determined by the ABA. Breaches of licence conditions are offences (s 139(1)) and may lead to cancellation of a licence by the ABA (s 143).
The object of this Standard is to promote the role of commercial television in developing and reflecting a sense of Australian identity, character and cultural diversity by supporting the community's continued access to television programs produced under Australian creative control.
(a) sets minimum levels of Australian programming to be broadcast on commercial television; and
(b) requires minimum amounts of first release Australian drama, documentary and children's programs to be broadcast on commercial television; and
(c) requires preschool programs broadcast on commercial television to be Australian programs.
(1) Subject to subclause (3), until the end of 1997, Australian programs must be at least 50% of all programming broadcast between 6.00am and midnight in a year that was made without financial assistance from the television production fund.
(2) Subject to subclause (3), from the beginning of 1998, Australian programs must be at least 55% of all programming broadcast between 6.00am and midnight in a year that was made without financial assistance from the television production fund.
(b) begins before midnight and ends on the next day;
the part of the program broadcast between midnight and 2.00am is taken to have been broadcast between 6.00am and midnight.
Each Member State shall grant to persons of the other Member State and services provided by them access rights in its market no less favourable than those allowed to its own persons and services provided by them.
Each Member State shall accord to persons of the other Member State and services provided by them treatment no less favourable than that accorded in like circumstances to its persons and services provided by them.
Conflicting statutory provisions should be reconciled so far as is possible
The Australian Content Standard was authorised by the literal meaning of s 122
(b) recognise the diversity of cultural backgrounds represented in the Australian community;
Not less that 35% of the time occupied by programs broadcast by a licensee between the hours of 6.00am and midnight, averaged over the calendar year commencing 1 January 1990, shall be devoted to the broadcasting of Australian programs, including repeats. The percentage requirement shall increase to:
(a) 40% for the calendar year commencing 1 January 1991;
(b) 45% for the calendar year commencing 1 January 1992;
(c) 50% for the calendar year commencing 1 January 1993 and for each calendar year thereafter.
Other clauses in TPS 14 spelt out the criteria for determining whether programs qualified for the transmission quota referred to in cl 21. Thus, cl 23 relevantly provided:
(a) Programs other than drama will qualify in full for the transmission quota if they are:
(i) designed for and relevant to Australian society;
(A) are shot in Australia and all elements of the program have been designed and produced by Australians for an Australian audience; or
(B) are produced in Australia for an Australian audience but some elements of the program have been made by non-Australians (eg news, current affairs and today programs); or
(C) are shot overseas but with substantial Australian production involvement (eg Australian travel documentaries and sporting events covered on site by Australian interviewers and commentators).
It is unnecessary to set out the criteria for other programs to qualify as Australian programs for the purpose of cl 21 of TPS 14. It is enough to say that to qualify they had to be identifiably Australian either in their content or in their creation or production.
Against the background of TPS 14 and its continuation into force by the Transitional Provisions Act, it is clear that the Australian Content Standard was authorised by the literal meaning of s 122(2)(b).
However, the duty of a court is to give the words of a statutory provision the meaning that the legislature is taken to have intended them to have. Ordinarily, that meaning (the legal meaning) will correspond with the grammatical meaning of the provision. But not always. The context of the words, the consequences of a literal or grammatical construction, the purpose of the statute or the canons of construction [46] may require the words of a legislative provision to be read in a way that does not correspond with the literal or grammatical meaning. In Statutory Interpretation [47] , Mr Francis Bennion points out:
The distinction between literal and legal meaning lies at the heart of the problem of statutory interpretation. An enactment consists of a verbal formula. Unless defectively worded, this has a grammatical meaning in itself. The unwary reader of this formula (particularly if not a lawyer) may mistakenly conclude that the grammatical meaning is all that is of concern. If that were right, there would be little need for books on statutory interpretation. Indeed, so far as concerns law embodied in statute, there would scarcely be a need for law books of any kind. Unhappily this state of being able to rely on grammatical meaning does not prevail in the realm of statute law; nor is it likely to. In some cases the grammatical meaning, when applied to the facts of the instant case, is ambiguous. Furthermore there needs to be brought to the grammatical meaning of an enactment due consideration of the relevant matters drawn from the context (using that term in its widest sense). Consideration of the enactment in its context may raise factors that pull in different ways. For example the desirability of applying the clear literal meaning may conflict with the fact that this does not remedy the mischief that Parliament intended to deal with. (footnotes omitted) 1. For example, the presumption that, in the absence of unmistakable and unambiguous language, the legislature has not intended to interfere with basic rights, freedoms or immunities: Coco v The Queen (1994) 179 CLR 427 at 437. 2. 3rd ed (1997), pp 343-344.
The express words of s 160 require the ABA to carry out its functions in accordance with the directions given by that section. Section 160 therefore provides the conceptual framework in which the functions conferred by s 158 are to be carried out. The function specified in s 158(j) encompasses the direction in s 122 to "determine standards" to be observed by commercial and community television broadcasting licensees. The carrying out of the directions in s 122 is therefore one of the functions of the ABA.
If s 122(1) and (2) were given their grammatical meaning, without regard to the provisions of s 160, they would authorise the making of standards which were inconsistent with Australia's obligations under international conventions or under its agreements with foreign countries. However, the express words of s 122(4) and the mandatory direction in s 160 show that the grammatical meaning of s 122(1) and (2) is not the legal meaning of those sub-sections. When s 122 is read with s 160, the legal meaning of s 122 is that the ABA must determine standards relating to the Australian content of programs but only to the extent that those standards are consistent with the directions in s 160. If, by reason of an obligation under a convention or agreement with a foreign country, it is impossible to make an Australian content standard that is consistent with that obligation, the ABA is precluded by s 160 from making the standard, notwithstanding the literal command of s 122(1) and (2). Accordingly, in making the Australian Content Standard in December 1995, the ABA was under an obligation to ensure that the Standard was not inconsistent with the Trade Agreement or the Protocol.
The majority judges in the Full Court in the present case were therefore in error in holding that the relationship of s 160 and s 122 is that of a general and a special provision. They are interlocking provisions, with s 160 - the dominant provision - directing how the function conferred by s 122 is to be carried out. The power conferred by s 122 must therefore be exercised within the framework imposed by s 160.
An Australian content standard must be consistent with the Trade Agreement and the Protocol
The Trade Agreement and the Protocol are agreements "between Australia and a foreign country" within the meaning of s 160(d). They fall within the ordinary grammatical meaning of that paragraph. Moreover, the Explanatory Memorandum that accompanied the Bill that became the Act stated that cl 160 [48] :
Requires the ABA to perform its functions in a manner consistent with various matters, including Australia's international obligations or agreements such as Closer Economic Relations with New Zealand. Accordingly, s 122 prohibits the ABA from making a standard that is inconsistent with the Trade Agreement or the Protocol. 1. Australian Broadcasting Authority v Project Blue Sky Inc (1996) 71 FCR 465 at 483.
No doubt it is a curious feature of the 1992 legislation that, despite the enactment of s 160(d) of the Act, s 21 of the Transitional Provisions Act maintained TPS 14 in force notwithstanding that its provisions were inconsistent with the Protocol and that, for present purposes, its provisions are substantially the same as the Australian Content Standard. However, the continuation in force of TPS 14 provides no ground for holding that s 122 authorises standards that are in conflict with Australia's obligations under the Trade Agreement or the Protocol. The continuation of TPS 14 was probably a stop-gap measure, designed to protect Australian interests, until the ABA promulgated a new standard that was consistent with Australia's international obligations including those under the Trade Agreement and the Protocol. Certainly, the Minister for Transport and Communications was aware that the provisions of TPS 14 might be in conflict with Australia's obligations under the Protocol. In a letter dated 2 December 1992 to the Chairperson of the ABA, the Minister, after referring to s 160 and the Trade Agreement, said:
Having consulted with the Minister for Trade and Overseas Development, I am aware that Australia's present treatment of New Zealand produced programming in Australian content Standard TPS14 may be in breach of Australia's Services Protocol obligations. I would hope that the ABA can quickly reconsider the Australian content standard.
Clause 9 of the Australian Content Standard published in December 1995 is plainly in breach of Australia's obligations under Arts 4 and 5 of the Protocol. That is because cl 9 requires Australian programs to constitute 50 per cent (rising to 55 per cent) of programming broadcasts made between 6 am and midnight. Consequently, Australian programs have an assured market of at least 50 per cent of broadcasting time while New Zealand programs have to compete with all other programs including Australian programs for the balance of broadcasting time. New Zealand programs therefore have less favourable access rights to the market for television programs than Australian programs have. As a result, cl 9 of the Australian Content Standard is in breach of Art 4 (access rights of persons and services to a market to be no less favourable) and Art 5 (treatment of persons and services to be no less favourable) of the Protocol and was therefore made in contravention of s 122(4).
It would seem to follow from the conclusion that cl 9 is in breach of the Act that other provisions of the Standard such as cll 10-16, which have a similar effect to cl 9, were also made in breach of s 122(4). However, the Court heard no detailed submissions on the validity of cll 10-16. For the purpose of the present case, it is unnecessary to come to any fixed view about the validity of these clauses. It is sufficient to hold that cl 9 was made in breach of the Act.
However, it does not follow that cl 9 of the Standard is void and of no force or effect. A group of Australian companies and persons who were given leave to appear in the proceedings as amici curiae, submitted to the Court that, on its proper construction, s 160(d) did not impose any duty on the ABA that would result in the invalidity of any act done in breach of that paragraph. Before turning to this submission, however, it is necessary to discuss the conclusion of the majority judges in the Full Court that, because of the Trade Agreement and the Protocol, in enacting ss 122 and 160 [49] :
Parliament has given the ABA two mutually inconsistent instructions. It has said, first, that the ABA is to provide for preferential treatment of Australian programs, but, second, that it is to do so even-handedly as between Australia and New Zealand. 1. Australian Broadcasting Authority v Project Blue Sky Inc (1996) 71 FCR 465 at 483.
With great respect to their Honours, the Parliament has done no such thing. The Parliament has not said that the ABA must give preferential treatment to Australian programs. It has said that the ABA must determine standards that "relate to the Australian content of programs" (s 122(2)(b)). The words "relate to" are "extremely wide" [50] . They require the existence of a connection or association [51] between the content of the Standard and the Australian content of programs. What constitutes a sufficient connection or association to form the required relationship is a matter for judgment depending on the facts of the case. No doubt the association or connection must be a relevant one in the sense that it cannot be accidental or so remote that the Standard has no real effect or bearing on the Australian content of programs. But, without attempting to provide an exhaustive definition, once the Standard appears to prohibit, regulate, promote or protect the Australian content of television broadcasts the required relationship will exist. Furthermore, the fact that the Standard also deals with matters other than the Australian content of programs will not necessarily negate the existence of a relevant relationship. A standard can relate to the Australian content of programs although it also regulates other matters [52] . Section 158(j) gives the ABA power to develop program standards relating to broadcasting including those standards referred to in s 122. There is nothing in the Act to prevent the ABA from utilising the power conferred by s 158(j) to determine program standards in a general way and at the same time carry out its obligation to determine the Australian content of programs.
Does the failure to comply with s 160 mean that cl 9 of the Australian Content Standard is invalid?
The appeal be allowed and the orders made by Davies J set aside.
The Court Declares That cl 9 of the Australian Content Standard (the Standard) determined by the Appellant on 15 December 1995 was unlawfully made.
The Appellant pay the costs of the appeal and of the proceedings before Davies J.
Each party has liberty to apply further, as it may be advised.
Without limiting the generality of Order 4, the respondents have liberty to apply for such further or other orders as they may be entitled to arising from the alleged failure of a clause of the Standard to comply with Australia's obligations under the Australia New Zealand Closer Economic Relations Trade Agreement and the Trade in Services Protocol to that agreement.
There be no order in relation to the costs of the interveners.
Project Blue Sky Inc
Australian Broadcasting Authority
(1996) 71 FCR 465
(1998) 194 CLR 355
(1994) 181 CLR 338
(1980) 44 FLR 455
(1951) 83 CLR 402
(1957) 96 CLR 245
(1984) 154 CLR 589
(1995) 183 CLR 552
(1996) 190 CLR 311
(1971) 124 CLR 293
(1911) 12 CLR 321
(1913) 16 CLR 315
(1960) 105 CLR 214
(1973) 133 CLR 242
(1975) 134 CLR 81
(1985) 8 FCR 93
(1996) 68 FCR 455
(1958) 98 CLR 606
(1968) 119 CLR 222
(1991) 173 CLR 349
(1976) 137 CLR 208
(1981) 147 CLR 297
(1955) 92 CLR 390
(1917) 23 CLR 322
(1985) 157 CLR 309
(1979) 141 CLR 432
(1993) 43 FCR 565
(1905) 2 CLR 405
(1992) 176 CLR 1
(1994) 179 CLR 427
(1961) 105 CLR 602
(1984) 155 CLR 474
(1979) 141 CLR 504
(1984) 156 CLR 185
(1990) 169 CLR 356
(1966) 115 CLR 418
(1976) 136 CLR 1
(1983) 158 CLR 1
(1938) 59 CLR 369
(1949) 77 CLR 387
(1970) 123 CLR 657
(1991) 32 FCR 476
(1904) 1 CLR 77
(1989) 89 ALR 213
(1989) 166 CLR 454
(1988) 164 CLR 234
(1989) 86 ALR 119
(1986) 7 NSWLR 644
(1990) 25 FCR 1
(1987) 16 FCR 296
(1997) 190 CLR 225
(1995) 183 CLR 273
Appeal allowed. Orders of the Full Court of the Federal Court set aside and in lieu thereof appeal to that Court allowed, orders of Davies J set aside, declaration that cl 9 of the Australian Content Standard was unlawfully made, costs orders against the ABA, liberty to apply including in relation to other clauses and Australia's obligations under the Protocol.