A small decision with big implications has sent a cold shudder down the spines of Section 40 off-band commercial radio licencees today, as the ABA sets a precedent about its approach to how broadcasters in this sector conduct their business affairs.
The Australian Broadcasting Authority has determined that Western Australian company Cybervale Pty Ltd “is not a suitable commercial radio licensee” and will not renew Cybervale’s off-band commercial radio licence with expires this week.
The ABA’s decision “was made following an assessment of Cybervale’s business record, and record in situations requiring trust and candour.” It related to unsatisfactory reporting in the company’s 2002 audited annual returns.
Cybervale currently holds a Section 40 off-band commercial radio licence on AM 1611 in Wagin, Western Australia. The service has been off air since early June due to a transmitter problem. As a result of this decision Cybervale will no longer be able to provide a commercial radio service on that frequency, but once the technical problem is fixed “Cybervale will be able, if it wishes, to use the frequency to provide a different type of radio service,” such as a narrowcast service.
Cybervale currently also operates a narrowcasting service called Radio 6GS on AM 1422 in Wagin, which is not affected by the decision.
ABA Chairman David Flint said: “This is the first time the ABA has found a licensee not suitable to hold a commercial radio licence. The ABA takes very seriously the manner in which every licensee complies with its obligations under the Act.”
The town of Wagin is 228 kms south-east of Perth and has a population of 18,000 people. It is currently served by four commercial radio services, Cybervale’s narrowcasting service, and two ABC radio services.
The action the ABA has taken falls under Schedule 2 clause 8(2)(b) of the Broadcasting Services Act 1992, which requires the ABA to ensure that licencees are suitable operates of broadcasting services and will not breach the Act.
The ABA suspended the company from broadcasting for two weeks in June this year following a finding that Cybervale breached a condition of its licence in relation to audited annual returns for the financial year ended 30 June 2002.
In reaching its decision, the ABA took into account: the business record of Cybervale; Cybervale’s record in situations requiring trust and candour; the business record of each person who is in a position to control the licence; the record in situations requiring trust and candour of each such person; and whether Cybervale, or its principles had been convicted of an offence against the Act or the regulations.
As the AM 1611 frequency is not in the broadcasting services bands the ABA only has a say over the type of service Cybervale can provide on that frequency, the Australian Communications Authority has control over access to the frequency.