House of Lords - Explanatory Note
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Clause 230: Services that are not television licensable content services

513.     This clause sets out the services that are to be excluded from the definition of a television licensable content service in clause 229. A service is not a television content service licence if it is broadcast by means of a television multiplex service or to the extent that it consists of a service which is authorised by a licence to provide a television broadcasting service, the licence to provide the public teletext service or a licence to provide additional television services. Nor does it meet the description of a television licensable content service if it forms part only of a service provided by means of an electronic communications service or is one of a number of services that may be accessed through such a service where the purpose of the service provided by these means is not wholly or mainly to make available television and/or radio programmes for reception by members of the public. A service is also excluded if it is a two-way service (as defined in the previous clause). The aim of these provisions is, broadly, to maintain licensing obligations in respect of services which are or equate to broadcasting, while excluding Internet services such as web sites or web-casting, from OFCOM's regulatory powers. The effect of subsection (3) is to exclude not only any website material provided as part of another service (for example, a website which is accessed via an ISP which also provides its own in-house content) but also material provided from a stand alone site, whether it be text, web-cast or video images. Subsection (6) also excludes a service that is distributed to a single set of premises by an electronic communications network that is contained within the premises and is not connected to any external network. Subsection (8) excludes a service that is provided for the purpose only of being received by persons who have an interest in receiving the service for use in their business or employment, such as stockbrokers or bookmakers.

Clause 231: Modification of ss. 229 and 230

514.     The Secretary of State may modify clauses 229 or 230 by order, if she considers it appropriate. In making any modification, she must take into account the level of protection expected by the public as regards the content of television programmes and text services, taking into account the means of reception; the ability of the public - having been made aware of the contents of a forthcoming programme - to control what they watch; technical innovation; the financial consequences of modification; and the relative ease or difficulty of setting different levels of regulation for different services.

Clause 232: Licensing of television licensable content services

515.     A television licensable content service shall be licensable under section 13 of the Broadcasting Act 1990 according to an application procedure that is set by OFCOM. OFCOM must approve the application unless they are not satisfied that the applicant is a fit and proper person to hold a licence, or if the person is disqualified from holding a licence by virtue of Part 2 of Schedule 2 of the Broadcasting Act 1990. OFCOM is entitled to refuse an application if satisfied that the service would be unlikely to comply with OFCOM's standards code or the code on fairness issued under Part 5 of the Broadcasting Act 1996.

516.     Subsection (4) provides that a provider must seek a separate licence for every television licensable content service he proposes to offer. In other words, if a provider is intending to offer three television licensable content services he must have three licences, one for each service. Subsection (5) provides that a single licence may authorise different programmes to be broadcast simultaneously, or virtually so, for example where a service provides a choice of programmes that may be viewed at any one time.

517.     Each licence for a television licensable content service shall be valid until surrendered or revoked.

Clause 233: Direction to licensee to take remedial action

518.     If the provider has breached a condition of his television licensable content service licence then, if this will sufficiently remedy the breach, OFCOM may, after giving him a chance to comment, require the licence holder to include a correction in the licensed service or broadcast a finding by OFCOM against the licence holder. The licence holder may announce that he is making a correction or a statement of findings because OFCOM have directed him to do so. OFCOM must send a copy of any direction given to a BBC company requiring the broadcasting of a correction and/or statement of findings and any representations received from that BBC company to the Secretary of State.

519.     OFCOM may direct a television licensable content service licence holder not to include a programme in the service on a future occasion if satisfied that the previous inclusion of that programme in the service involved a contravention of a licence condition.

Clause 234: Penalties for contravention of licence condition or direction

520.     If OFCOM are satisfied that a television licensable content service licence holder has breached a condition of that licence, or has not complied with a direction given by OFCOM, they may serve a notice on that person imposing a fine. The maximum fine is the greater of £250,000 or 5 per cent of qualifying revenue within the relevant period. OFCOM may not impose a fine unless they have first given the licence holder the chance to comment. If OFCOM serves a notice on a BBC company, they must send a copy of that notice, and of any representations received from the company, to the Secretary of State.

*qualifying revenue shall be calculated in accordance with section 19(2) to (6) of the Broadcasting Act 1990 and Part 1 of Schedule 7 to that Act, with any necessary modifications

Clause 235: Revocation of television licensable content service licence

521.     If satisfied that a television licensable content service licence holder is in contravention of the terms of his licence, or is failing to comply with a direction, and that such a contravention or failure would, if not remedied, warrant revocation of the licence, OFCOM must serve a notice on the licence holder. The notice shall specify that OFCOM is satisfied that the criteria in subsection (1) are satisfied, the nature of the contravention or failure and that the licence will be revoked unless the licence holder takes specified steps within a specified period. If the licence holder does not comply within the specified period then OFCOM may, if satisfied that this is necessary in the public interest, revoke the licence. At each stage in the process, OFCOM shall first give the licence holder the chance to comment. The provisions in this clause do not apply to the revocation of a licence under clause 236 (see below).

522.     Subsections (4) and (5) provide that OFCOM may revoke a television licensable content service licence if satisfied that the licence holder is no longer providing the service, or that the licence holder provided false or misleading information in support of his licence application.

523.     If OFCOM serves a notice on a BBC company under this clause, they must send a copy of that notice, and of any representations received from the company, to the Secretary of State.

Clause 236: Action against licence holders who incite crime or disorder

524.     OFCOM must serve a notice under subsection (2) on a television licensable content service licence holder if satisfied that the service has included one or more programmes which contain material likely to encourage or to incite crime or disorder, that this has contravened a licence condition, and that the contravention warrants the revocation of that licence. A notice under subsection (2) shall state that OFCOM are satisfied as to the above, specify the nature of the contravention, state that the licence may be revoked at the end of 21 days beginning with the date of service of the notice, and inform the licence holder of his right to make representations. The effect of the notice shall be to suspend the licence until revocation, or until OFCOM decide not to revoke the licence. At the end of 21 days, and having considered any representations OFCOM may, if satisfied that this is necessary in the public interest, serve on the licence holder a notice of revocation. This may not take effect less than 28 days after being served.

Clause 237: Abolition of separate licences for certain television services

525.     This clause abolishes the two forms of licence which the television licensable content services licence replaces, that is satellite television service and licensable programme service licences. It puts in place transitional provisions so that after the television transfer date, any person holding one of the abolished licence types is to be regulated by OFCOM as if he held a television licensable content services licence, unless the service is of a kind that falls outside the new definition and so no longer requires a licence at all. To the extent that any existing licence takes effect as a licence to provide a television licensable content service, OFCOM must use their power under section 3 of the Broadcasting Act 1990 to modify that licence if they feel that it is necessary to do so in order to comply with their duty under clause 259 (see below).

Clause 238: Television multiplex services

526.     References to any television multiplex service referred to in Part 1 of the Broadcasting Act 1996 mean a service broadcast for general reception, otherwise than by satellite, so as to be available to members of the public. This service shall provide, or be capable of providing, two or more services which include at least one "relevant television service" (as defined in subsection (9)) for simultaneous broadcast on the same frequency.

527.     Subsection (3) provides that it is not an offence to provide a television multiplex service that is not licensed under the Broadcasting Act 1996. Only where a wireless telegraphy licence provides that any television multiplex services being broadcast using a station or apparatus that is authorised by this licence, must itself be licensed, shall that multiplex service require a licence. This will be assumed in cases where the multiplex service is already licensed under the Broadcasting Act 1996 and the service is broadcast using a station or apparatus that is authorised by a wireless telegraphy licence. Where this assumption applies, and a person affected by it either ceases to be licensed under Part 1 of the Broadcasting Act 1996 or ceases to exist, OFCOM may revoke the wireless telegraphy licence relating to the provision by that person of the television multiplex service in question.

Clause 239: Composition of services in television multiplexes

528.     This clause amends section 12 of the Broadcasting Act 1996. OFCOM will now be able to include conditions in any multiplex licence granted under that Act to secure that: (i) all digital programme services and digital additional services provided by the BBC may be carried on that multiplex, (ii) the digital sound programme services broadcast under the licence are either provided by the BBC or licensed under section 60 and (iii) a licensee does not show undue discrimination either against or in favour of a digital sound programme service provider, or restrict that provider's ability to share any of his spare capacity (unless it is reasonable to do so in order to ensure the technical quality of the multiplex service).

529.     The current version of section 12(1)(h) requires that at least 90 per cent of digital capacity on the frequency of the service to which the licence relates be available for broadcasting digital programmes and related services. Subsection (1)(f) amends the 90 per cent threshold to 'the required percentage'. This figure, to be set by OFCOM as they think appropriate, must be 90 per cent or higher. The Secretary of State retains the power to amend the minimum percentage, by order. Subsection (2) adds digital programme services and digital sound programme services provided by the BBC to the list of services in the current version of section 12(1)(h). Digital sound programme services provided otherwise than by the BBC must be accommodated within the remaining capacity.

530.     Subsection (3) of this clause amends the test that the Independent Television Commission currently applies where a multiplex licence holder applies for a variation of any condition imposed relating to the implementation of any proposals as to the characteristics of the digital programme services to be broadcast. When this clause comes into effect, OFCOM will be required to vary the condition unless it appears that the capacity for digital programme services and/or digital sound programme services would be unacceptably diminished. The test will also be applied to requests for variations of any condition imposed relating to the implementation of any proposals as to the characteristics of the digital sound programme services.

Clause 240: Powers where frequencies reserved for qualifying services

531.     OFCOM, in fulfilling their spectrum management role, may reserve digital capacity on particular frequencies for the provision of a television multiplex service. The Secretary of State may by order provide that OFCOM shall ensure that the holders of licences for such services on these reserved frequencies enter agreements with relevant public service broadcasters for the broadcasting of services provided by those broadcasters on the reserved digital capacity. An order under this clause may also require OFCOM to include in the licence conditions requiring any such broadcaster to pay the licence holder for use of the reserved digital capacity. The amount paid is to be agreed between the broadcaster and the television multiplex licensee or (in the absence of any agreement) determined by OFCOM.

*a relevant public service broadcaster is defined in subsection (7) as a holder of a Channel 3 service licence, the C4 Corporation, the holder of the Channel 5 licence, the Welsh Authority or the public teletext provider. This definition excludes the BBC.

*public teletext provider is defined in clause 355 as the person who holds the licence to provide that service awarded under clause 214 (or, in relation to a time before such a licence is awarded, the holder of the additional services licence under the 1990 Act which relates to the public teletext service).

Clause 241: Local digital television services

532.     The Secretary of State may, by order, extend the provisions of Part 3 of the Bill (except for this clause and any provisions relating exclusively to sound services), or any part of Part 1 of the Broadcasting Act 1990, or of Part 1 of the Broadcasting Act 1996, to local digital television services of the type further described in subsections (3) to (5). Such services should be provided with a view to including them in a television multiplex service. Such an order can be made only where the Secretary of State is satisfied that this will enhance the provision of such services. In turn, this should benefit the locality where the services are to be received, not least by broadening the range of programmes that can be received in that locality. The order may restrict advertising and programme sponsorship in the service

Chapter 3: Regulatory Structure for Independent Radio Services

Clause 242: Regulation of independent radio services

533.     This clause sets out those independent radio services whose regulation is a function of OFCOM, as specified in subsections (1) and (2). These are national, local or restricted sound broadcasting services (so long as not broadcast solely by satellite); radio licensable content services; additional radio services; radio multiplex services; digital sound programme services; and digital additional sound services. All of these must be broadcast from the United Kingdom and are not to be regulated under this section if they are broadcast by the BBC. OFCOM's regulatory function also extends to the types of service set out above provided from somewhere outside the United Kingdom by a person (other than the BBC) whose principal place of business is in the United Kingdom.

*additional radio service has the meaning given to it by section 114(1) of the Broadcasting Act 1990, namely any radio service which consists in the sending of signals for transmission by wireless telegraphy using the spare capacity within signals carrying any sound broadcasting service.

*digital additional sound service means a digital additional service as defined by section 63 of the Broadcasting Act 1996, being any service which is provided for broadcast in digital form by means of a multiplex service, for general reception within the EEA other than the United Kingdom, but which is not a digital programme service, a qualifying service, an ancillary service or a technical service.

*an ancillary service refers to services that are ancillary to a programme and directly related to its content, or which relate to the promotion or listing of such programmes. Such a service is provided by the holder of a digital programme licence or by an independent analogue broadcaster.

*a technical service is a service provided for the encryption or decryption of digital programme services or digital additional services.

* digital sound programme service, defined in section 40(5) of the Broadcasting Act 1996 (as amended by Schedule 15), means a service consisting in the provision of programmes consisting wholly of sound (together with any ancillary services), with a view to their being broadcast in digital form so as to be available for reception by members of the public (as defined in clause 355, but does not include simulcast radio services or a service where the sounds are to be received through the use of coded reference to pre-defined phonetic elements of sounds.

*radio multiplex service is defined in section 40(1) of the Broadcasting Act 1996 as a service provided by any person which consists in broadcasting, for general reception, two or more digital sound programme services, or simulcast radio services, by combining the relevant information in digital form, together with any broadcasting in digital form of digital additional services.

*radio licensable content service has the same meaning as in clause 244.

*simulcast radio service is defined in section 41(2) of the Broadcasting Act 1996 (as amended by clause 253) as a service which is provided by an independent national broadcaster provided for broadcasting in digital form, which corresponds to a national service provided in some other form.

534.     Subsections (5) and (6) specify when services will be treated as if they are provided from the United Kingdom.

Clause 243: Abolition of function of assigning radio frequencies

535.     This clause removes the Secretary of State's power to assign frequency for the purpose of regulation of radio services, or for the provision of any radio multiplex services.

Clause 244: Meaning of "radio licensable content services"

536.      Broadly, this includes all sound programmes broadcast for reception by members of the public from a satellite, or through an electronic communications network, whether in analogue or digital form.

Clause 245: Services that are not radio licensable content services

537.     Services that are not radio licensable content services include sound broadcasting services of the type regulated by OFCOM pursuant to clause 242(3), and services provided with a view to their being broadcast by means of radio multiplex services. Nor does a service meet the description of a radio licensable content service if it is a two-way service (as defined in subsection (4)); or if it forms part only of service provided by means of an electronic communications service or is one of a number of services that may be accessed through such a service where the purpose of the service provided by these means is not wholly or mainly to make available television and/or radio programmes for reception by members of the public; or if it is received only by people who have an interest in receiving the services for use in their business or employment. Finally, a service is not a radio licensable content service where it is distributed to a single set of premises by an electronic network which is contained within the premises and is not connected to any external network. These exclusions mirror those in clause 230 and serve similar purposes.

Clause 246: Modification of ss. 244 and 245

538.     The Secretary of State may modify clauses 244 or 245 by order, if she considers it appropriate. In making any modification she must take into account the level of content protection expected by the public; technical innovation; the financial consequences of modification; and the relative ease or difficulty of setting different levels of regulation for different services. The Secretary of State may also provide that a particular service should not be treated as a radio licensable content service for such provisions of this Bill as she specifies.

Clause 247: Licensing of radio licensable content services

539.     An application for this type of licence under Part 3 of the Broadcasting Act 1990 shall follow a procedure to be set by OFCOM. Subsection (3) amends sections 109 to 111A of the Broadcasting Act 1990 which apply in relation to the enforcement of licences for radio licensable content services.

Clause 248: Abolition of separate licences for certain sound services

540.     This clause abolishes the two forms of licence which the radio licensable content service licence replaces. It puts in place transitional provisions so that after the radio transfer date any persons holding one of the abolished licence types is to be regulated by OFCOM as if he held a radio licensable content service licence, unless the service is of a kind that falls outside the definition and so no longer requires a licence at all. To the extent that any existing licence takes effect as a licence to provide a radio licensable content service, OFCOM must use their power under section 86 of the Broadcasting Act 1990 to modify that licence if they feel that it is necessary to do so in order to comply with their duty under clause 259 (see below).

Clause 249: Extension of licence periods

541.     Subsection (1) amends section 86 of the Broadcasting Act 1990 by stating that licences shall continue in force until the earlier of their being surrendered or revoked, and the licences coming to the end of their terms. The exception is for radio licensable content services - they shall continue until the relevant licences are surrendered or revoked. Any licence to provide local, national or additional services must specify a maximum licence period of twelve years.

Clause 250: Extension and modification of existing licences

542.     Where, previously, a newly granted licence to provide a local, national or additional service could not continue in force for more than eight years, this has now been extended to twelve years. To compensate, the holder of a pre-transfer national or local licence can make an application for a four-year extension to that licence, and OFCOM shall make such modification to the licence as they think fit with regard to the period for which the licence is to be extended, the need to make the licence correspond with licences granted after the radio transfer date, and the sums to be paid to OFCOM under the licence. What modifications are made will depend largely on the ability of the licence holder to maintain the service and the likelihood of a contravention by that licence holder of any condition imposed through the modification of the licence or by virtue of section 106 of the Broadcasting Act 1990.

543.     The period within which an application may be made begins no sooner than three years before the date the licence would otherwise expire and ends three months before the day that OFCOM would need to publish a tender notice if they were proposing to grant a fresh licence.

*a pre-transfer licence is defined in subsection (13) as a licence granted under the Broadcasting Act 1990 prior to the radio transfer date that has not been modified under clause 250 or renewed any time on or after that date.

Clause 251: Renewal of local licences

544.     This clause amends section 104A(5) of the Broadcasting Act 1990 (conditions of renewal of local licences). When a renewal application has been made, OFCOM will be required to grant the licence provided the following criteria are met: (i) they are satisfied that the applicant would, if the licence were renewed, provide a local service with any conditions imposed to secure the character of the licensed service (ii) the nominated local digital sound programme service the applicant provides is broadcast by means of a nominated local radio multiplex services; and (iii) they are satisfied that the period and times at which the nominated local digital sound programme service will be available under the renewed licence will not be significantly different, week by week, from those for and at which the licensed local service will be broadcast.

Clause 252: Extension of special application procedure for local licences

545.     This clause amends the type of local services caught by the special application procedure for local licences under section 104B of the Broadcasting Act 1990.

Clause 253: Definition of simulcast radio services

546.     This clause amends the definition of simulcast radio services found in section 41 of the Broadcasting Act 1996. Broadly, they are services provided for broadcasting in digital form and which correspond to national services, as defined by clause 242(4)(a).

 
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