Broadcasting Bill [H.L.]

HL Deb 18 July 1996 vol 574 cc1004-77

3.49 p.m.

The Parliamentary Under-Secretary of State, Department of National Heritage (Lord Inglewood)

My Lords, I beg to move that the Commons amendments be now considered.

Moved, That the Commons amendments be now considered.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENTS AND MOTIONS AND AMENDMENTS TO BE MOVED ON CONSIDERATION OF COMMONS AMENDMENTS

[The page and line refer to Bill (88) as first printed by the Commons]

COMMONS AMENDMENT

1 Clause 1, page 2, line 5, after 'programmes' insert '(together with any ancillary services, as defined by section 21(2))'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 1. In moving this Motion, I shall speak also to Amendments Nos. 2, 3, 22, 23, 25, 37 to 41, 52, 56 to 60, 78, 86 to 88, 97 and 98. I ask that the House agree with the Commons in their Amendment No. 1 and the group of amendments connected with it which adjust the provisions of the Bill with regard to additional and ancillary services. The amendments achieve three things. First, they ensure that the whole of the 10 per cent. of the capacity on each multiplex which can be devoted to additional services is available for services which are not connected to television or radio programmes. Ancillary services, electronic programme guides and conditional access data, in so far as they relate to television or radio programmes rather than additional services, will not count towards that 10 per cent. limit.

Secondly, the amendments make adjustments to the definitions of digital programme services and digital sound programme services and therefore to the boundary between programme and additional services.

Thirdly, though we have done the best we can in the Bill, and through these amendments, to cater for all foreseeable eventualities, technological developments are not always foreseeable. Amendments Nos. 3 and 60 allow the Government, by affirmative order, to amend the definitions of programme services and, therefore, what is counted as an additional service, in order to take account of such developments. Together with the order-making power already in the Bill allowing revision of the 10 per cent. limit on additional services, this gives a flexibility which may well prove necessary in dealing with this new technology.

In speaking to the amendments this afternoon, I propose to be as brief as I can be. In so doing, I hope that I will not be thought to be discourteous but rather that I shall enable the business to proceed appropriately and expeditiously. Needless to say, it is possible that some noble Lords may need to question what I say because I have been a trifle too speedy in my approach.

Moved, That the House do agree with the Commons in their Amendment No. 1.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENTS

2 Clause 1, page 2, line 8, leave out from 'service' to end of line 12 and insert—

'(b) a teletext service, or

(c) any service in the case of which the visual images to be broadcast do not consist wholly or mainly of images capable of being seen as moving pictures,

except, in the case of a service falling within paragraph (b) or (c), to the extent that it is an ancillary service.'.

3 Page 2, line 12, at end insert—

'(4A) The Secretary of State may, if having regard to developments in broadcasting technology he considers it appropriate to do so, by order amend the definition of "digital programme service" in subsection (4).

(4B) No order under subsection (4A) shall be made unless a draft of the order has been laid before and approved by a resolution of each House of Parliament.'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 2 and 3 en bloc. I spoke to these amendments when moving Amendment No. 1.

Moved, That the House do agree with the Commons in their Amendments Nos. 2 and 3.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

4 Clause 1, page 2, line 14, leave out 'by satellite' and insert—

1. '(a) by satellite, or
2. (b) in the provision of a local delivery service (as defined by section 72(1) of the 1990 Act)'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 4. In speaking to this amendment, I should like to speak also to Commons Amendments Nos. 5 to 10, 24, 48, 49, 54, 55 and 61.

Amendments Nos. 4 and 61 are technical. They are intended to ensure that the Bill does not inadvertently require local delivery service licencees to obtain a multiplex licence. The other amendments fulfil the commitment made to the public service teletext licence holder, Teletext Ltd, that there should be no requirement to simulcast its existing analogue service on the capacity on the Channel 3/Channel 4 multiplex reserved for it. That would deny Teletext the opportunity to use the new technology to its fullest potential.

Instead, Teletext will be able to propose to the ITC a new service to be broadcast on the reserved capacity. It must meet the same general quality threshold required of the existing analogue service and be approved by the ITC.

Moved, That the House do agree with the Commons in their Amendment No. 4.—(Lord Inglewood.)

Lord Donoghue

My Lords, I thought long and hard about whether to speak on each of the amendments on the Marshalled List. However, after long consideration, I decided that that would not necessarily be the best and most optimum use of the time of the House. Therefore, perhaps I may just say a few words in general, as I believe that there are several blocs of amendments that will be taken very quickly.

We on this side feel that whilst the Bill came first to this House and was very thoroughly considered, it has been thoroughly thrashed in the other place; indeed, it has been much changed and improved. The Government have been most helpful in a number of areas in promising changes which they have delivered. Broadly speaking, although we are not satisfied with everything—indeed, we are unhappy that there is not enough provision on quality; and we shall raise a number of points later in that respect—we would like to see the Bill go through expeditiously. We are happy to accept the will of the other place on the matter. I shall not, therefore, be speaking critically of every amendment placed before the House.

Lord Thomson of Monifieth

My Lords, I should like to associate myself with the words of the noble Lord, Lord Donoghue, on the first group of amendments and, indeed, as regards the approach to subsequent groups. However, I should like to raise one point with the Minister. Perhaps the noble Lord can clarify what will happen once the Bill has become enacted in terms of pursuing the aim of trying to ensure that, when digital terrestrial television is being developed, we as consumers will be able to enjoy the benefits of it with a single set top box.

In the autumn, after the Bill has become law, the DTI will produce, after consultation and much work, a statutory instrument in regard to such matters. That will be a vital statutory instrument. However, if it is not effective, there is a very real danger that digital terrestrial television will simply be dead before it gets off the ground and that its future will be handed over to the satellite operators.

Lord Renton

My Lords, I must apologise to my noble friend the Minister because I have a point to raise that I have not as yet mentioned to him. It is something that has just occurred to me. Some of us were given a most interesting and illuminating demonstration recently at the Queen Elizabeth II Conference Centre of the BBC's technical achievements by which the corporation is able to forecast a tremendous increase in the use of digital television and indeed radio.

Nevertheless, it seems to me that it will be a very long time before we are able to enjoy such services in our homes, simply because the receiving instruments are not being manufactured in this country. I understand that Germany has started to manufacture them. There is, perhaps, a lack of liaison between those adventurous scientists who advise the BBC and those equally adventurous people in our own industry about the timing of this wonderful new development. Although we are now enacting the introduction of such technology, we must bear in mind the fact that such developments may not come into operation for quite a long time so far as concerns the viewers and listeners of this country.

If there is anything that the Government can do to expedite the production of receivers—I do not say subsidies, or anything like that—perhaps by simply telling those who might be able to help in our great manufacturing industry that here is a great opportunity for them, they will then be performing a public service.

Lord Inglewood

My Lords, two most important points were raised by the noble Lord, Lord Thomson, and my noble friend Lord Renton. Perhaps I may deal with them in turn. The noble Lord, Lord Thomson, is slightly ahead of the game in that I shall be dealing in the next group of amendments with conditional access systems. I should like to assure the noble Lord that I shall be slightly less brief than I have been hitherto. The crucial point is that the statutory instrument from the Department of Trade and Industry is due to be finalised in the autumn.

As regards the point raised by my noble friend Lord Renton, I should say at once that it is a good one. As of last week, I understand that BBC television has been broadcasting digitally both in London and Newcastle. Two transmitters were broadcasting and I believe that there are two receivers which are able to pick up the information being distributed—you have to start somewhere. However, frivolity aside, when looking at the criteria under the Bill by which multiplex licences will be awarded, it is important to note that the ITC takes into consideration the steps that are being taken by potential licensees to promote the take-up of digital. That is within the structure of what is being legislated for and that is where my noble friend's point comes in.

Of course it is important that the receiver manufacturers, and the other suppliers of hardware, produce the necessary equipment to enable people to take advantage of this technology. Indeed, I have been encouraging manufacturers to embark upon that course of action. Some of the issues that we will be discussing in the next group of amendments dealing with single set top boxes will obviously have an important bearing on that matter.

On Question, Motion agreed to.

COMMONS AMENDMENTS

5 Clause 2, page 2, line 21, leave out lines 21 to 23 and insert—

'(d) the public teletext provider,'.

6 Page 2, line 24, leave out 'subsection (4)' and insert 'subsections (4) and (4A)'.

7 Page 2, line 27, leave out '(c) or (d)' and insert 'or (c)'.

8 Page 2, line 36, at end insert 'and'.

9 Page 2, line 37, leave out from '5' to end of line 38.

10 Page 2, line 42, at end insert—

'(4A) If—

1. (a) the public teletext provider notifies the Commission, within the period of one month beginning with the commencement of this section, of his intention to provide a teletext service for broadcasting in digital form, and
2. (b) the Commission consent under section (The qualifying teletext service) to his provision of that service,

that service (in this Part referred to as "the qualifying teletext service") shall be a qualifying service for the purposes of this Part.

(4B) In this Part "public teletext provider" means the person who holds the additional services licence (within the meaning of Part I of the 1990 Act) which relates to the teletext service referred to in section 49(2) of that Act.'.

4 p.m.

Lord Inglewood: My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 5 to 10 en bloc. I have already spoken to these amendments with Amendment No. 4.

Moved, That the House do agree with the Commons in their Amendments Nos. 5 to 10.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

11 Clause 7, page 8, line 3, leave out 'the service' and insert 'all the multiplex services available in that area'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 11. With the leave of the House, I should like to speak at the same time to Amendments Nos. 12 and 151.

As I have already intimated, these amendments address an important issue and with the leave of the House I would like to speak to them at a little more length.

These three amendments are all intended to help to ensure that the consumer will have the opportunity to receive the greatest possible choice of broadcast services by buying a single piece of equipment.

As your Lordships will be aware, during Committee stage in another place, the Government issued a consultation paper on co-operation between digital terrestrial multiplex providers, and the single set top box. Conditional access is a major factor here. All terrestrial boxes must, under the terms of the European Directive on Advanced Television standards, be able to receive all terrestrial services transmitted in clear. However, without interoperability between different systems, it is possible that some boxes might be unable to receive all digital terrestrial pay-TV services.

To help to prevent this problem, and in the light of responses to our consultation document, two complementary measures have been taken. First, the Government have published a draft statutory instrument and draft Telecommunications Act licences implementing the conditional access provisions in the directive. The proposals will ensure that any broadcaster may obtain conditional access services from every provider of such services, and can thus make his programmes available through every digital terrestrial set top box, if necessary by transmitting them with more than one set of conditional access control information. This process, known as simulcrypt, does not involve mandating a common interface, which as Ministers explained in the Commons, would require seeking clearance from the European Union and, even if that were granted, would lead to substantial delay. The Government continue to believe that a mandatory common interface would discourage investment by allowing latecomers to free-ride on investment by those who have developed and subsidised set-top boxes.

The second measure is contained in Commons Amendments Nos. 11 and 12, which the Government believe are an ingenious response to some of the competition law difficulties identified with proposals requiring collusion between multiplex providers. The amendments require the ITC to take into account, in awarding multiplex licences, not only applicants' plans to promote and assist the acquisition of digital terrestrial receiving equipment, but specifically their plans to encourage the roll out of equipment capable of receiving all digital terrestrial services. Applicants may choose to do this, for example, by coming to arrangements involving the voluntary incorporation of a common interface or through simulcrypt.

Finally, I should like briefly to explain Commons Amendment No. 151, which implements Article 2(c) of the directive, dealing with transmission standards. This goes beyond digital terrestrial and seeks to facilitate interoperability across all three delivery mechanisms—terrestrial, satellite and cable. The effect of that will be to allow manufacturers, should they so choose, to produce set top boxes, and later integrated receivers, capable of receiving all digital television services. It will also facilitate interconnectivity between boxes so that viewers with separate boxes for different means of transmission will be able quickly and easily to switch between, say, terrestrial and satellite services, using the same television set.

The directive mandates particular standards, but allows member states to select from various options within them. The amendment gives the ITC the power, if necessary and after consultation with all the relevant bodies, to select a particular set of options for use in broadcasts in the UK. I hope that that slightly longer explanation will have been helpful. I commend the amendments to the House.

Moved, That the House do agree with the Commons in their Amendment No. 11.—(Lord Inglewood.)

Lord Donoughue

My Lords, this, I feel, is the single most important policy issue in the Bill. It was quite properly mentioned by the noble Lord, Lord Thomson, at the beginning of our deliberations because the interconnectivity of set-top boxes and the whole question of universal access are crucial. It is important to ensure that from the beginning consumers do not have to buy a range of different set-top boxes to gain access. One box should be sufficient to gain access to different digital systems, otherwise there is a danger that whoever springs first and pre-empts the field may block out the others. One agent may, for example, produce a heavily subsidised box which gives access only to that system.

Much progress has been made on this since we first raised it at Second Reading in your Lordships' House. In particular, Amendment No. 151 is very helpful, but we still have to wait until we have the final DTI regulations. We on this side will scrutinise those regulations closely to make sure that the maximum interconnectivity is achieved.

Lord Renton

My Lords, I promise your Lordships that I shall not speak to every group of amendments. I am quite surprised at myself for doing so on the first two.

Amendment No. 151 is really very interesting. It states: The Independent Television Commission … shall do all that they can to secure that every licensed service uses a transmission system complying with", the Council directive. I wonder whether my noble friend can tell me whether that means that there will be a standard transmission system to be used by each licensed service. I can see the advantage of that. It would mean that the best system would be chosen and that there would not be varied performance by different licensed services. Does it mean that each licensed service shall use a transmission system complying with the Council directive? There is a slight distinction. If my noble friend is able to say which of the two things it means, it might be of help as guidance for the future.

Lord Thomson of Monifieth

My Lords, I am grateful to the Minister for the full explanation that he has now given. I apologise for the fact that I had confused Amendment No. 4 with the fourth group of amendments.

Lord Inglewood

My Lords, I am most grateful to noble Lords who have expressed the view that this has been a step in the right direction. In response to the important question from my noble friend Lord Renton, I think that the strict reply is that both of the options that he described are valid.

We are moving into a world where the technology will be more or less entirely new. The precise form that that technology may take is not yet certain. Within the parameters of European legislation, various options are technically possible which may contain a degree of mutual exclusivity.

There are two problems that we want to avoid. One is clearly the problem that in some way or other, by adopting a particular technology, one broadcaster may effectively block out and exclude another broadcaster. The other—this state of affairs is very well illustrated in the video market—is that it is possible to mandate a standard which, given the benefit of hindsight, is perhaps not the best standard that could have been adopted because of the state of knowledge when the decision had to be taken.

We have endeavoured to provide an environment where the technology can lead in the marketplace. At the same time we have also endeavoured to provide what might be described as a safety net so that if it looks, for example, as if one player in the game may be using exclusive control of a particular form of technology to exclude all the others, he will not, in fact, be able to do that.

On Question, Motion agreed to.

COMMONS AMENDMENT

12 Clause 8, page 9, line 8, leave out 'the service' and insert 'all the multiplex services available in that area'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 12. I have already spoken to this amendment.

Moved, That the House do agree with the Commons in their Amendment No. 12.—(Lord Inglewood.).

On Question, Motion agreed to.

COMMONS AMENDMENT

13 Clause 9, page 9, line 29, leave out 'and 8(2)(c) and (e)'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 13. I wish to speak also to Amendments Nos. 14, 15, 16 and 28. These amendments were made in response to a request by the ITC to clarify the way in which the ITC shall consider the award of multiplex licences that have been "bundled". Amendment No. 28, again requested by the ITC, makes clear that all programme services must consist of at least 10 per cent. independent productions and a proper proportion of European programming.

Moved, That the House do agree with the Commons in their Amendment No. 13.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENTS

14 Clause 9, page 9, line 32, leave out 'and'.

15 Page 9, line 33, leave out from beginning to 'to' and insert in section 8(2), the reference in paragraph (d)'.

16 Page 9, line 35, at end insert 'and other references to the proposed service shall have effect as references either to each of the proposed services or to all of them considered together, as the Commission consider appropriate'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 14 to 16 en bloc. I have already spoken to these amendments.

Moved, That the House do agree with the Commons in their Amendments Nos. 14 to 16.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

17 After Clause 9, insert the following new clause—

AWARD OF MULTIPLEX LICENCE SUBJECT TO CONDITIONS

'.—(1) The Commission may, when awarding a multiplex licence to any person, make the grant of the licence to him conditional on his compliance before the grant with such specified requirements relating to the financing of the service as appear to them to be appropriate, having regard to—

1. (a) any duties which are or may be imposed on them, or on the licence holder, by or under the 1990 Act or this Act, and
2. (b) any information provided to them under section 7(4)(g) by the person to whom the licence is awarded as to his projected financial position during the period for which the licence would be in force.

(2) Where the Commission determine that any condition imposed by them in relation to a multiplex licence in pursuance of subsection (1) has not been satisfied, section 8 shall (subject to subsection (3)) have effect as if the person to whom the licence was awarded had not made an application for it.

(3) Section 8 shall not so have effect if the Commission decide that it would be desirable to publish a fresh notice under section 7(1) in respect of the grant of the licence.'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 17. I wish to speak also to Amendment No. 131. These amendments will enable the ITC to set financial conditions on the granting of the licence at the time the licence is awarded. If the potential licensee fails to meet these conditions, the commission can then cancel the award of the licence and simply proceed to the next applicant. This will give the commission greater flexibility in the licensing process for both analogue and digital services and will prevent needless rerunning of licence competitions if the potential licensee fails to deliver what he promised in his application before the licence is even granted.

Moved, That the House do agree with the Commons in their Amendment No. 17.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

18 Clause 10, page 10, line 19, leave out 'financial penalty' and insert 'specified financial penalty not exceeding whichever is the greater'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 18. I wish to speak also to Amendments Nos. 36, 42, 72, 73, 74, 85, 94 and 96. These amendments fulfil a commitment made during Commons Committee. Amendment No. 18 allows the ITC discretion to levy a fine of less than £50,000 or the specified percentage of qualifying revenue, whichever is the greater, when it revokes a multiplex licence because the multiplex provider has failed to begin providing the service. Amendments Nos. 72 to 74 make the same arrangements with regard to radio multiplexes.

Amendments Nos. 36, 42, 85 and 94 allow the regulators, when determining a fine, to estimate the share of multiplex revenue which should be attributable to a particular service which has not been broadcasting for very long.

Amendment No. 96 corrects an earlier drafting error which omitted the fine for breach of local radio multiplex licence conditions from the list of fines which could be amended by order.

Moved, That the House do agree with the Commons in their Amendment No. 18.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

19 Clause 11, page 10, line 41, after 'timetable' insert 'and other proposals'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 19. I wish to speak also to Amendments Nos. 27, 75 and 80.

Amendment No. 19 has been made at the behest of the ITC. It allows it to include whatever aspects of a multiplex provider's technical plan it sees fit in the multiplex licence. Amendment No. 75 makes the same adjustment to the provisions covering radio multiplexes.

Clause 15(11) as presently drafted refers, incorrectly, to supplementary proposals submitted under subsection (4)(b). The correct reference is to subsection (4)(a). Amendment No. 27 corrects the error, and Amendment No. 80 does the same for radio.

Moved, That the House do agree with the Commons in their Amendment No. 19.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

20 Clause 11, page 11, line 4, after 'services' insert 'or digital additional services'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No.20. I wish to speak also to Amendments Nos. 21, 43, 44 to 46, 53, 71, 76, 77, 267, 273, 276, 277, 279, 281, 283 to 287, and 296.

These amendments make a number of technical adjustments to the arrangements for digital broadcasting, together with some consequential amendments to do with the creation of the Broadcasting Standards Commission. Rather than go into detail about each, I should be pleased to clarify any points which noble Lords might wish to raise with me.

Moved, That the House do agree with the Commons in their Amendment No. 20.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENTS

21 Clause 11, page 11, line 15, after 'broadcasts' insert 'or for the purpose of securing compliance with any other condition of the licence'.

22 Page 11, line 23, leave out 'or qualifying services' and insert 'qualifying services, programme-related services or relevant technical services'.

23 Page 11, line 34, after '(1)(j)'insert—

'(a)".

24 Page 11, line 34, leave out from 'the' to end of line 35 and insert 'qualifying teletext service'.

25 Page 11, line 35, at end insert—

'(b) "programme-related service" means any digital additional service consisting in the provision of services (apart from advertising) which—

1. (i) are ancillary to the programmes included in one or more television programme services (within the meaning of Part I of the 1990 Act) and are directly related to the contents of those programmes, or
2. (ii) relate to the promotion or listing of such programmes, and

(c) "relevant technical service" means any technical service which relates to one or more digital programme services.'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 21 to 25 en bloc. I spoke to these with Amendments Nos. 1, 4 and 20.

Moved, That the House do agree with the Commons in their Amendments Nos. 21 to 25.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

26 Clause 15, page 16, line 21, at end insert 'and in deciding whether to give his consent the Secretary of State shall have regard to any report made to him under subsection (1)(b) of section (Review of digital television broadcasting) and to any representations received by him on consultation under subsection (4) of that section.'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 26. I wish to speak also to Amendments Nos. 51, 79 and 95.

These amendments fulfil a commitment I made in this House to place, on the face of the Bill, the arrangements for reviewing the prospects for analogue switch-off.

The effect is that the Secretary of State is under a duty to keep under review the progress of digital television broadcasting and so the prospects for switching off the analogue services. This hinges crucially on whether the existing terrestrial services—BBC1, BBC2, Channel 3, Channel 4, S4C and, soon, Channel 5—are available to viewers throughout the United Kingdom. We cannot switch off analogue services if the vast majority of people have not already switched to digital reception and similar arrangements are put in place for radio.

Moved, That the House do agree with the Commons in their Amendment No. 26.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENTS

27 Clause 15, page 17, line 13, leave out from 'plan' to end of line 14 and insert 'and supplementary proposals submitted under subsection (4)(a)'.

28 Clause 18, page 19, line 1, at end insert 'in relation to each service provided under the licence'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 27 and 28. I spoke to these with Amendments Nos. 13 and 19.

Moved, That the House do agree with the Commons in their Amendments Nos. 27 and 28.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

29 Clause 19, page 20, line 14, after 'services' insert 'and qualifying services'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 29. I wish to speak also to Amendments Nos. 30 to 35 inclusive. I intend, with your Lordships' permission, to speak at slightly greater length than I have done on the amendments immediately preceding this one because the issue gave rise to much debate during our deliberations in this House.

When the Bill left this House, it provided that the ITC, after consultation with bodies representing those with sensory impairments, would set out requirements for assistance in a code. However, following debates in another place, we have been persuaded of the case for putting targets on the face of the Bill to act, from the outset, as a strong signal to broadcasters. The aim of the Government's amendments is therefore to establish targets on the face of the Bill, set at a realistic level and applied to programme rather than multiplex providers.

Amendment No. 30 provides that by the tenth anniversary of the introduction of any digital programme service: not less than 50 per cent. of non-excluded programme hours broadcast in any programme service should be subtitled to such technical standards as are specified by the ITC; and not less than 10 per cent. of non-excluded programme hours broadcast should be presented with audio-description.

These target percentages will be amendable by order. They will be incorporated into the ITC's code, conformity with which will be a licence condition for all digital programme service licence holders. The ITC will monitor broadcasters' progress towards meeting these requirements during the lead period to ensure an ongoing commitment to their achievement.

In the light of the strength of argument, the Government reconsidered the position regarding sign language provision. The Secretary of State announced in another place during Report stage that she intends to introduce by order a 5 per cent. target for sign language at the earliest possible opportunity.

The ITC will identify, in consultation with broadcasters and bodies representing the interests of those with sensory impairments, any types of programming for which it would not be practicable to require the levels of subtitling, audio-description or sign language interpretation set out in the Bill. It will do this only after consulting bodies representing people with sensory impairments and broadcasters. It will then be able to set lower, achievable targets for such programmes. These exclusions will be the exception—I emphasise that—rather than the rule: the majority of programmes should be subject to the targets set out on the face of the Bill.

The Government also recognise that there are currently no requirements on Channels 3, 4 or 5 regarding sign language or audio-description. They therefore intend to apply the new code and targets to their digital simulcast qualifying services. This is given effect by subsection (1J) of Amendment No. 30.

I believe that these proposals represent real gains for viewers with sensory disabilities. Our proposals also recognise that many different types of programme service are likely to be broadcast on digital television, and provision of subtitling, signing or audio-description at the same level will be extremely difficult for some of these programme types. This is an important point. We must allow the necessary flexibility for a range of new services to develop on digital, otherwise the successful launch of digital terrestrial television will be jeopardised, with the loss of services to all viewers.

Moved, That the House do agree with the Commons in their Amendment No. 29.—(Lord Inglewood.)

Lord Donoughue

My Lords, the Government's amendment represents a slight slippage in the optimum achievements that were at one point in the Bill. However, I should like to take a positive rather than a negative approach. The progress made, represented by the amendment, is considerable and is much appreciated by the people concerned. I know that my noble friend Lord Ashley, who worked so hard and did so much to achieve what is in the Bill, accepts the practicality of the compromise.

Lord Thomson of Monifieth

My Lords, we are in the not totally unusual position of agreeing with the Minister and the noble Lord, Lord Donoughue.

On Question, Motion agreed to.

COMMONS AMENDMENTS

30 Clause 19, page 20, line 20, at end insert—

'(1A) In this section "assistance" means assistance of any of the following three kinds, namely—

1. (a) subtitling for the deaf,
2. (b) audio-description for the blind, and
3. (c) presentation in, or translation into, sign language.

(1B) The code must require that, as from the tenth anniversary of the date of the commencement of the provision of any digital programme service, in each week—

1. (a) at least 50 per cent of so much of the service as consists of programmes which are not excluded programmes in relation to subtitling for the deaf is to be accompanied by such subtitling, and
2. (b) at least 10 per cent of so much of the service as consists of programmes which are not excluded programmes in relation to audio-description for the blind is to be accompanied by such audio-description.

(1C) The code must specify—

1. (a) in relation to subtitling for the deaf, those classes of programmes in relation to which the Commission consider that it would be inappropriate for the requirement in paragraph (a) of subsection (1B) to apply, and
2. (b) in relation to audio-description for the blind, those classes of programmes in relation to which the Commission consider that it would be inappropriate for the requirement in paragraph (b) of that subsection to apply.

(1D) If an order under section (Powers of Secretary of State in relation to code about provision for deaf and visually impaired)(1)(b) is in force, the code must also specify, in relation to presentation in, or translation into, sign language, those classes of programmes in relation to which the Commission consider that it would be inappropriate for the requirements specified in the order to apply.

(1E) In determining under subsection (1C) or (1D) whether it is appropriate for a particular requirement to apply to any class of programmes, the Commission shall have regard, in particular, to the benefit which the assistance would be likely to confer on the persons for whom it is intended and to the technical difficulty of providing it.

(1F) In this section "excluded programme", in relation to assistance of a particular kind, means a programme falling within a class specified under subsection (1C) or (1D) in relation to assistance of that kind.

(1G) Without prejudice to the generality of subsection (1), the code may—

1. (a) require persons providing digital programme services, at any time or times before the anniversary referred to in subsection (1B), to meet specified targets in relation to subtitling for the deaf or audio-description for the blind,
1017
2. (b) require a specified percentage of so much of any digital programme service as consists of programmes which are not excluded programmes in relation to presentation in, or translation into, sign language, to be so presented or translated, and
3. (c) require, in relation to assistance of any kind, a specified percentage of so much of any digital programme service as consists of excluded programmes falling within a specified class to be accompanied by assistance of that kind.

(1H) In subsection (1G) "specified" means specified in, or determined by the Commission under, the code.

(1J) Subsections (1B) and (1G), so far as relating to audio-description for the blind or presentation in, or translation into, sign language, shall have effect as if any reference to a digital programme service included a reference to a qualifying service.

(1K) The Commission may determine that, for the purposes of any provision included in the code in pursuance of subsection (1B), a digital programme service provided by any person is to be treated as a continuation of a digital programme service previously provided by him.'.

31 Page 20, line 21, leave out 'subsection (1)' and insert 'this section'.

32 Page 20, leave out lines 25 and 26.

33 Page 20, line 31, at end insert—

'(4A) In this section—

"programme" does not include an advertisement;

"qualifying service" does not include the qualifying teletext service.'.

34 After Clause 19, insert the following new clause—

POWERS OF SECRETARY OF STATE IN RELATION TO CODE ABOUT PROVISION FOR DEAF AND VISUALLY IMPAIRED

'.—(1) The Secretary of State may by order—

1. (a) amend subsection (1B) of section 19 by substituting for any percentage specified there a percentage specified in the order, and
2. (b) require the Commission to include in the code maintained under that section the requirement that in each week, at least a percentage specified in the order of so much of any digital programme service or qualifying service as consists of programmes which are not excluded programmes for the purposes of that section in relation to presentation in, or translation into, sign language is to be so presented or translated.

(2) In subsection (1) "qualifying service" does not include the qualifying teletext service.

(3) Before making an order under subsection (1), the Secretary of State shall consult the Commission.

(4) No order under subsection (1) shall be made unless a draft of the order has been laid before and approved by a resolution of each House of Parliament.'.

35 Insert the following new clause—

COMPLIANCE WITH CODE ABOUT PROVISION FOR DEAF AND VISUALLY IMPAIRED

'.—(1) The Commission shall do all that they can to secure that the provisions of the code maintained by them under section 19 are observed in the provision of digital programme services and qualifying services.

(2) Without prejudice to the generality of subsection (1), a digital programme licence shall include such conditions as appear to the Commission to be appropriate for requiring the holder of the licence, on entering into any such agreement as is mentioned in section 18(3)(a), to submit to the Commission proposals for ensuring that the code is complied with in relation to the provision of the digital programme service.

(3) Where the holder of a digital programme licence has submitted proposals to the Commission in accordance with a condition included in the licence by virtue of subsection (2) or has failed to comply with such a condition, the Commission shall, after consulting him, vary the licence so as to include in the licence such further conditions as they consider appropriate for the purpose of securing compliance with the code in the provision of the digital programme service in question.'.

36 Clause 20, page 21, line 14, at end insert—

'(4A) Where, in the case of any multiplex service, the first accounting period of the holder of the multiplex licence throughout which the holder of the digital programme licence provides a digital programme service for broadcasting by means of the multiplex service ("the first period") has not yet ended, then for the purposes of subsection (3) the share of multiplex revenue attributable to the holder of the digital programme licence in relation to that multiplex service for the relevant accounting period shall be taken to be the amount which the Commission estimate to be the share of multiplex revenue attributable to him for the first period.'.

37 Clause 21, page 22, line 1, leave out 'or an ancillary service' and insert 'an ancillary service or a technical service'.

38 Page 22, line 3, leave out 'subsection (1)' and insert 'this Part'.

39 Page 22, line 6, leave out 'provided by means of a teletext service'.

40 Page 22, line 9, leave out from 'which' to end of line 10 and insert—

1. '(i) are ancillary to such programmes and directly related to their contents, or
2. (ii) relate to the promotion or listing of such programmes.'.

41 Page 22, line 10, at end insert—

'(3) In this Part "technical service" means a service which—

1. (a) is provided for technical purposes connected with the encryption or decryption of one or more digital programme services or digital additional services, and
2. (b) is of a description specified in an order made by the Secretary of State.

(4) An order under subsection (3) shall be subject to annulment in pursuance of a resolution of either House of Parliament.'.

42 Clause 24, page 23, line 40, at end insert—

'(4A) Where, in the case of any multiplex service, the first accounting period of the holder of the multiplex licence throughout which the holder of the digital additional services licence provides a digital additional service for broadcasting by means of the multiplex service ("the first period") has not yet ended, then for the purposes of subsection (3) the share of multiplex revenue attributable to the holder of the digital additional services licence in relation to that multiplex service for the relevant accounting period shall be taken to be the amount which the Commission estimate to be the share of multiplex revenue attributable to him for the first period.'.

43 Clause 25, page 24, leave out lines 44 to 46 and insert—

'(a) provide, in relation to any frequency to which this section applies—

1. (i) that any or all of the provisions of sections 7 to 15 and sections 17 and 18 are not to apply, or are to apply with specified modifications, and
2. (ii) that provisions of the order are to have effect in place of any or all of those provisions,'.

44 Page 25, line 6, leave out 'qualifying service' and insert 'service specified in section 2(3) corresponding to the qualifying service ("the corresponding analogue service")'.

45 Page 25, line 7, leave out 'that service in digital form' and insert 'the qualifying service'.

46 Page 25, line 10, leave out 'qualifying' and insert 'corresponding analogue'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 30 to 46 en bloc. I spoke to these amendments with various other amendments.

Moved, That the House do agree with the Commons in their Amendments Nos. 30 to 46.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

47 Clause 26, page 25, line 46 at end insert—

'(2A) No payment shall be required by the BBC in respect of the broadcasting pursuant to subsection (1)(b) of programmes provided by them under section 58(1) of the 1990 Act.'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 47. In moving the amendment I should like to speak also to Amendments Nos. 124 to 130 inclusive, 139 and 140, 180, 266, 268 and 269, 278, 280, 282 and 293.

The group of amendments headed by Amendment No. 47 deals with matters relating to S4C and Channel 4. Amendment No. 47 is a technical amendment. S4C is required by Clause 26(1)(b) to simulcast those Welsh language programmes provided to it free of charge by the BBC under the terms of Section 58 of the 1990 Act. For the avoidance of doubt, the amendment provides that the BBC may not require payment in respect of those simulcasts.

The rest of the amendments fulfil promises I made during discussion in this House of the parts of the Bill relating to S4C and Channel 4. They are designed to empower the Welsh authority to establish or participate in companies involved in television or radio broadcasting so that they can realise the full benefits of the digital revolution.

Finally, Amendment No. 127 makes it clear that Channel 4 is able to broadcast its digital simulcast service throughout the United Kingdom, including Wales. On analogue, the Welsh Fourth Channel is of course the responsibility of S4C.

Moved, That the House do agree with the Commons in their Amendment No. 47.—(Lord Inglewood.)

Lord Prys-Davies

My Lords, I wish to express our appreciation for the amendments relating to S4C. We raised these issues in the House. Our concerns have been met on almost every point. I should like the department and the Minister to know that that is appreciated.

On Question, Motion agreed to.

COMMONS AMENDMENTS

48 After Clause 26, insert the following new clause—

THE QUALIFYING TELETEXT SERVICE

'.—(1) If the public teletext provider has notified the Commission under section 2(4A) of his intention to provide a teletext service for broadcasting in digital form as a qualifying service, he shall submit to the Commission his proposals for providing that service in compliance with the requirements specified in subsection (3).

(2) The Commission shall give their consent to the provision of the service unless it appears to them that the proposed service would not comply with the requirements specified in subsection (3).

(3) The requirements referred to in subsections (1) and (2) are—

1. (a) that the service includes a sufficient amount of news items which are of high quality and deal with both national and international matters,
2. (b) that the service includes a sufficient amount of information which is of particular interest to persons living within different areas for which the service is provided, and
3. (c) that (taken as whole) the service includes a sufficient amount of information (other than news) which is calculated to appeal to a wide variety of tastes and interests.

(4) Where the Commission have given their consent under subsection (2), they shall vary the relevant licence held by the public teletext provider so as to include such conditions as appear to them to be appropriate—

1. (a) for imposing on the public teletext provider, in specified circumstances, an obligation to provide the qualifying teletext service, and
2. (b) for securing that the qualifying teletext service, if provided, accords with the proposals submitted under subsection (1);

and they may include those conditions in an) other licence under which the analogue service is subsequently provided.

(5) Sections 6 to 12 of the 1990 Act (general provisions relating to services licensed under Part I of that Act) shall apply in relation to the qualifying teletext service as they apply in relation to the analogue service, but as if the reference in section 12(1)(b) of the 1990 Act to the Commission's functions under Chapter II of Part I of that Act included a reference to their functions under this Part.

(6) In this section—

"the analogue service" means the service referred to in section 49(2) of the 1990 Act,

"the relevant licence" means the additional services licence (within the meaning of Part I of the 1990 Act) under which the analogue service is provided.'.

49 Clause 27, page 26, line 3, after 'Authority' insert 'or the public teletext provider'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 48 and 49 en bloc. I spoke to these amendments with Amendment No. 4.

Moved, That the House do agree with the Commons in their Amendments Nos. 48 and 49.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

50 Before Clause 28, insert the following new clause—

DIGITAL BROADCASTING OF GAELIC PROGRAMMES

'.—(1) The Secretary of State may by order provide for the Commission to include in any multiplex licence granted in respect of one frequency to which section 25 applies such conditions relating to the broadcasting of programmes in Gaelic for reception wholly or mainly in Scotland as may be specified in, or determined by them under, the order.

(2) The Secretary of State may by order require the holder of a multiplex licence ("the holder"), in complying with any such conditions, to broadcast programmes in Gaelic supplied by each of the persons mentioned in subsection (4) ("the suppliers") amounting to such minimum number of hours (if any) of transmission time per year as may be specified in the order in relation to that supplier.

(3) For the purpose of enabling the holder to comply with any such conditions and any obligation imposed by virtue of subsection (2), it shall be the duty of each supplier to provide the holder, free of charge, with such programmes in Gaelic which have been broadcast by the supplier as the holder may request.

(4) The suppliers are—

1. (a) the BBC,
2. (b) the Channel Four Television Corporation,
3. (c) any holder of a Channel 3 licence to provide a regional Channel 3 service (within the meaning of Part I of the 1990 Act) for reception wholly in Scotland, and
4. (d) such other persons providing television broadcasting services as may be specified by order by the Secretary of State.

(5) Subsection (3) shall not apply in relation to any programme first broadcast by the supplier concerned—

1. (a) before 1 January 1993, or
2. (b) in the period beginning on 1 January 1993 and ending on 31 March 1997, if the supplier has no right to broadcast it again or has such a right but is not entitled to transfer it to the holder.

(6) The holder may broadcast any programme supplied by virtue of subsection (3) on one occasion only.

(7) The holder shall consult Comataidh Craolaidh Gaidhlig and the suppliers about—

1. (a) the quantity of programmes likely to be requested by the holder from each supplier by virtue of subsection (3), and
2. (b) the schedules proposed for the broadcast by the holder of programmes supplied by virtue of that subsection,

and shall have regard to any comments made as a result of such consultation.

(8) Any order under this section shall be subject to annulment in pursuance of a resolution of either House of Parliament.

(9) In this section "Gaelic" means the Gaelic language as spoken in Scotland.'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 50. The amendment will increase the amount of Gaelic television programmes broadcast in peak time in Scotland. It places an obligation on the ITC to ensure that the operator of the third digital multiplex service carrying S4C and Channel 5 includes in Scotland a minimum of half-an-hour in peak time of Gaelic programmes every day as part of the overall service. The amendment also places an obligation on the existing broadcasters of Gaelic programmes to make available, free of charge, Gaelic programmes which they have previously broadcast for retransmission as part of the digital multiplex service.

The new measures will significantly increase the amount of Gaelic programming available in peak time in Scotland and I am sure that they will be warmly welcomed by the Gaelic speaking community.

Moved, That the House do agree with the Commons in their Amendment No. 50.—(Lord Inglewood.)

Lord Thomson of Monifieth

My Lords, the Minister will be pleased to know that I received a letter from the Gaelic Television Committee which asks me to convey our appreciation for the progress made. Overall it is a considerable step in the right direction. It would be untrue to say that we are totally satisfied; we will have demands in the future. But it is such a rare occasion to be able to read such a letter to the Minister that I felt I should do so.

On Question, Motion agreed to.

COMMONS AMENDMENTS

51 Before Clause 28, insert the following new clause—

REVIEW OF DIGITAL TELEVISION BROADCASTING

'.—(1) For the purpose of considering for how long it would be appropriate for television broadcasting services to continue to be provided in analogue form, the Secretary of State—

1. (a) shall keep under review the extent of—
1. (i) the provision in the United Kingdom of multiplex services,
2. (ii) the availability in the United Kingdom in digital form of the services specified in section 2(3), S4C Digital, the qualifying teletext service, and the television broadcasting services of the BBC, and
3. (iii) the ownership or possession in the United Kingdom of equipment capable of receiving the services referred to in sub-paragraph (ii) when broadcast or transmitted in digital form,

and the likely future extent of such provision, such availability and such ownership or possession, and

(b) shall, on or before the fourth anniversary of the day on which the first multiplex licence is granted under section 8, and at such time or times thereafter as he thinks fit, require the Commission and the BBC to report to him on the matters referred to in paragraph (a).

(2) If the Commission or the BBC are required to submit a report under subsection (1)(b), they shall submit the report within twelve months of the date of the requirement.

(3) Before making any report under subsection (1)(b), the Commission shall consult—

1. (a) the holders of all multiplex licences.
2. (b) the holders of digital programme licences who are providing digital programme services which are being broadcast,
3. (c) such other persons providing services licensed by the Commission under this Part or Part I or II of the 1990 Act as the Commission think fit, and
4. (d) the Welsh Authority;

and the Commission shall include in their report a summary of representations made to them by the persons consulted.

(4) For the purpose mentioned in subsection (1), the Secretary of State shall, on requiring reports under subsection (1)(b), consult—

1. (a) such persons appearing to him to represent viewers as he thinks fit, and
2. (b) such other persons as he thinks fit,

in connection with the matters referred to in subsection (1)(a) and also, if the Secretary of State thinks fit, as to the likely effects on viewers of any television broadcasting service ceasing to be broadcast in analogue form.

(5) In this section "television broadcasting service" has the same meaning as in Part I of the 1990 Act.'.

52 Clause 33, page 27, line 39, at end insert—

"ancillary service' has the meaning given by section 21(2);'.

53 Page 27, leave out lines 40 and 41 and insert—

"a Channel 3 licence' has the same meaning as in Part I of the 1990 Act and 'a Channel 3 service' means a regional or national Channel 3 service (within the meaning of that Part);'.

54 Page 28, line 9, at end insert—

"public teletext provider' has the meaning given by section 2(4B);'.

55 Page 28, line 10, at end insert—

"qualifying teletext service' means the public teletext service provided by the public teletext provider for broadcasting in digital form as a qualifying service;'.

56 Page 28, line 14, at end insert—

"technical service' has the meaning given by section 21(3)'.

57 Clause 34, page 28, line 45, after 'sound' insert '(together with any ancillary services, as defined by section 57(2))'.

58 Page 29, line 1, after 'include' insert—

'(a)".

59 Page 29, line 2, at end insert 'or

(b) a service where the sounds are to be received through the use of coded reference to pre-defined phonetic elements of sounds'.

60 Page 29, line 2, at end insert—

'(5A) The Secretary of State may, if having regard to developments in broadcasting technology he considers it appropriate to do so, by order amend the definition of "digital sound programme service" in subsection (5).

(5B) No order under subsection (5A) shall be made unless a draft of the order has been laid before and approved by a resolution of each House of Parliament.'.

61 Page 29, line 4, leave out 'by satellite' and insert—

1. '(a) by satellite, or
2. (b) in the provision of a local delivery service (as defined by section 72(1) of the 1990 Act)'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 51 to 61 en bloc. I have already spoken to these amendments.

Moved, That the House do agree with the Commons in their Amendments Nos. 51 to 61.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

62 Clause 35, page 29, line 29, at end insert—

'(4A) Before making an order under subsection (4) the Secretary of State shall consult such persons appearing to him to represent listeners as he thinks fit'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 62. In moving this amendment I should like to speak also to Amendments Nos. 63 to 70 inclusive, 81 to 84 inclusive and 89 to 93 inclusive and Amendments Nos. 135, 137, 275 and 291.

This group of amendments makes various largely technical adjustments to the provisions in the Bill covering digital radio. Again, with your Lordships' permission, rather than go into detail about each, I will be happy to provide any clarification in response to questions.

Moved, That the House do agree with the Commons in their Amendment No. 62.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENTS

63 Clause 39, page 34, line 2, at end insert—

'(4A) References in subsection (4) to digital sound programme services of a particular character include references to digital sound programme services catering for the tastes and interests of persons living within a specified area or locality'.

64 Clause 42, page 37, line 4, leave out 'digital capacity of 256 kilobits per second' and insert 'an amount of digital capacity specified in the direction'.

65 Page 37, line 6, at end insert—

'(1A) Before giving a direction under subsection (1) in relation to any simulcast radio service, the Secretary of State shall consult the Authority as to the amount of digital capacity which the Authority consider appropriate in all the circumstances for the broadcasting of that service'.

66 Page 37, line 7, leave out 'this section' and insert 'subsection (1)'.

67 Page 37, line 16, leave out '256 kilobits per second' and insert 'the amount reserved under subsection (1)'.

68 Page 37, line 34, after 'service' insert 'and in broadcasting the simulcast radio service in question'.

69 Clause 43, page 37, line 41, after 'and' insert 'every'.

70 Page 37, leave out lines 45 and 46 and insert—

'(2) The circumstances to which the Authority may have regard in performing their duty under subsection (1) include the likely demand for digital capacity by persons providing or proposing to provide local digital sound programme services'.

71 Clause 45, page 40, line 32, after 'services' insert 'or digital additional services'.

72 Clause 47, page 41, line 39, at end insert 'a specified financial penalty not exceeding'.

73 Page 41, line 40, leave out 'a financial penalty of'.

74 Page 41, line 42, leave out 'a financial penalty of'.

75 Clause 48, page 42, line 20, after 'timetable' insert 'and other proposals'.

76 Page 42, line 36, after 'services' insert or 'digital additional services'.

77 Page 42, line 47, after 'broadcasts' insert 'or for the purpose of securing compliance with any other condition of the licence'.

78 Page 43, line 8, leave out 'or simulcast radio services' and insert,' simulcast radio services, programme-related services or relevant technical services.

(1A) In paragraph (1)(h)—

1. (a) "programme-related service" means any digital additional service consisting in the provision of services (apart from advertising) which—
1. (i) are ancillary to the programmes included in one or more digital sound programme services, simulcast radio services or local or national services (within the meaning of Part I of the 1990 Act) and are directly related to the contents of those programmes, or
1025
2. (ii) relate to the promotion or listing of such programmes, and
2. (b) "relevant technical service" means any technical service which relates to one or more digital sound programme services.'.

79 Clause 52, page 48, line 18, at end insert 'and in deciding whether to give his consent the Secretary of State shall have regard to any report made to him under subsection (1)(b) of section (Review of digital radio broadcasting) and to any representations received by him on consultation under subsection (4) of that section.'.

80 Page 49, line 11, leave out from 'plan' to end of line 12 and insert 'and supplementary proposals submitted under subsection (4)(a)'.

81 Clause 53, page 50, line 13, leave out subsection (7).

82 Clause 54, page 51, line 19, after '90' insert 'of the 1990 Act'.

83 Page 51, line 20, leave out 'subsection (3)' and insert 'subsections (3) and (4)'.

84 Page 51, line 28, at end insert—

'(4) In applying subsection (3)(a) to a national digital sound programme service a series of programmes may be considered as a whole; and in applying subsection (3)(b) to a local digital sound programme service the programmes included in that service shall be taken as a whole.'.

85 Clause 56, page 53, line 9, at end insert—

'(4A) Where, in the case of any national radio multiplex service, the first accounting period of the holder of the national radio multiplex licence throughout which the holder of the digital sound programme licence provides a digital sound programme service for broadcasting by means of the radio multiplex service ("the first period") has not yet ended, then for the purposes of subsection (3) the share of multiplex revenue attributable to the holder of the digital sound programme licence in relation to that radio multiplex service for the relevant accounting period shall be taken to be the amount which the Authority estimate to be the share of multiplex revenue attributable to him for the first period.'.

86 Clause 57, page 54, leave out line 6 and insert 'an ancillary service or a technical service'.

87 Page 54, leave out lines 7 to 13 and insert—

'(2) In this Part "ancillary service" means any service which is provided by the holder of a digital sound programme licence or by an independent national broadcaster and consists in the provision of any service (other than advertising) which—

1. (a) is ancillary to programmes included in a digital sound programme service or simulcast radio service provided by him and is directly related to their contents, or
2. (b) relates to the promotion or listing of such programmes.'.

88 Page 54, line 13, at end insert—

'(3) In this Part "technical service" means a service which—

1. (a) is provided for technical purposes connected with the encryption or decryption of one or more digital sound programme services or digital additional services, and
2. (b) is of a description specified in an order made by the Secretary of State.

(4) An order under subsection (3) shall be subject to annulment in pursuance of a resolution of either House of Parliament.'.

89 Clause 59, page 54, line 39, leave out 'and'.

90 Page 54, line 40, at end insert 'and

(iii) where under the agreement the holder of the digital additional services licence will be entitled to the use of a specified amount of digital capacity, of that amount,'.

91 Page 54, line 41, leave out 'either' and insert 'any'.

92 Page 54, line 42, leave out 'or (ii)' and insert ', (ii) or (iii)'.

93 Clause 60, page 55, line 16, leave out 'on any person'.

94 Page 55, line 36, at end insert—

'(5A) Where, in the case of any national radio multiplex service, the first accounting period of the holder of the national radio multiplex licence throughout which the holder of the digital additional services licence provides a digital additional service for broadcasting by means of the radio multiplex service ("the first period") has not yet ended, then for the purposes of subsection (3) the share of multiplex revenue attributable to the holder of the digital additional services licence in relation to that radio multiplex service for the relevant accounting period shall be taken to be the amount which the Authority estimate to be the share of multiplex revenue attributable to him for the first period.'.

95 Before Clause 61, insert the following new clause—

REVIEW OF DIGITAL RADIO BROADCASTING

'.—(1) For the purpose of considering for how long it would be appropriate for sound broadcasting services to continue to be provided in analogue form, the Secretary of State—

1. (a) shall keep under review the extent of—
1. (i) the provision in the United Kingdom of radio multiplex services,
2. (ii) the availability in the United Kingdom of digital sound programme services and the availability there in digital form of national services (within the meaning of Part III of the 1990 Act) and the sound broadcasting services of the BBC, and
3. (iii) the ownership or possession in the United Kingdom of equipment capable of receiving the services referred to in sub-paragraph (ii) when broadcast or transmitted in digital form,

and the likely future extent of such provision, such availability and such ownership or possession, and

(b) shall, on or before the fourth anniversary of the day on which the first national radio multiplex licence is granted under section 41, and at such time or times thereafter as he thinks fit, require the Authority and the BBC to report to him on the matters referred to in paragraph (a).

(2) If the Authority or the BBC are required to submit a report under subsection (1)(b), they shall submit the report within twelve months of the date of the requirement.

(3) Before making any report under this subsection (1)(b), the Authority shall consult—

1. (a) the holders of all radio multiplex licences,
2. (b) the holders of digital sound programme licences who are providing digital sound programme services which are being broadcast, and
3. (c) such other persons providing services licensed by the Authority under this Part or Part III of the 1990 Act as the Authority think fit,

and the Authority shall include in their report a summary of representations made to them by the persons consulted.

(4) For the purpose mentioned in subsection (1), the Secretary of State shall, on requiring reports under subsection (1)(b), consult—

1. (a) such persons appearing to him to represent listeners as he thinks fit, and
1027
2. (b) such other persons as he thinks fit,

in connection with the matters referred to in subsection (1)(a) and also, if the Secretary of State thinks tit, as to the likely effects on listeners of any sound broadcasting service ceasing to he broadcast in analogue form.

(5) In this section "sound broadcasting service', has the same meaning as in Part III of the 1990 Act.'.

96 Clause 62, page 56, line 38, at end insert 'and (4)'.

97 Clause 65, page 57, line 40, at end insert—

"ancillary service' has the meaning given by section 57(2)'.

98 Page 58, line 17, at end insert—

"technical service' has the meaning given by section 57(3)'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 63 to 98 en bloc. I spoke to these amendments with various earlier amendments.

Moved, That the House do agree with the Commons in their Amendments Nos. 63 to 98.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

171 Schedule 2, page 91, line 10, at end insert—

'( ) for paragraph (a) of the definition of "associate" there is substituted—

"(a) in relation to a body corporate, shall be construed in accordance with paragraph (1A), and"'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 171. In moving this amendment I shall speak also to Amendments Nos. 172 to 178 and Amendment No. 292. In addition, there is a manuscript amendment which I have just tabled. I apologise to the House for that, but a problem arose at the last minute and we hope that that amendment will resolve it.

Amendments Nos. 171 and 173 are concerned with the definition of an "associate". Our amendment will ensure that the associates of a body corporate will now be defined by reference to the Bill's definition of "control" which casts the net wider than the Companies Act's definition of a "group" on which the current definition is based.

Amendments Nos. 172, 174, 175 and 176 amend the definition and interpretation of "control" to catch a number of devices which have been employed to evade the ownership restrictions under the 1990 Act. Amendment No. 177 modifies the definition of a "participant", and Amendment No. 292 repeals provisions in Schedule 2 to the 1990 Act which will become redundant as a result of Amendment No. 173 once this schedule in enacted.

The regulators' greatest concern, which we share, is about arrangements made by corporate bodies which involve "warehousing", joint control or "deadlocked" companies. Amendments Nos. 176A to 176K, which have been inspired by the Independent Television Commission, seek to bolster the provisions inserted in the Bill in Committee dealing with this area.

As it currently stands, the Bill will, without doubt, catch cases where two companies each have a 50 per cent. stake in the deadlocked company. However, concern has been expressed about the case where, for example, company A and company B each hold a 49 per cent. interest while 1 per cent. is held by a company which can be relied upon to follow the wishes of company A and 1 per cent. by a company which can be relied upon to follow the wishes of company B. The ITC continues to maintain that such a scenario will not be caught. Our advice is that it will be covered by the formulation which has already been introduced by the Government.

Much would, of course, depend on the exact circumstances behind such a corporate structure, but it could be covered in two ways. Such a case could be caught by the substituted paragraph 1(3)(c) introduced by Amendment No. 176, if the I per cent. shareholders could each be regarded as nominees within the meaning of paragraph 2(1) of Part I of the 1990 Act. Such a situation could also be caught by paragraph 1(3)(b) if it was thought likely (in the sense of a reasonable expectation) that A and B would be acting in accordance with each other's wishes. This is because if A and B are acting together, it would be reasonable to expect that they would be able to secure that the company's affairs would be conducted in accordance with their joint wishes. Likewise, it may be reasonable to expect, depending on the circumstances, that B would always act in accordance with A's wishes. The 2 per cent. part-shareholding would be completely irrelevant in company law terms unless allied with A or B.

The amendments tabled by the noble Lord, Lord Donoughue, and the noble Baroness, Lady Dean, would treat each of the parties to the arrangement as controlling the company. That could produce some unwelcome, and possibly even absurd, results. That is particularly the case when one considers that, under these amendments, the word "arrangement" would be defined to include any agreement, arrangement, expectation or understanding, whether or not it is legally enforceable.

The crux of the problem with these amendments lies in the scope of the expression "any specified matter" to which an arrangement could relate. Shareholders or joint venture partners enter into all sorts of arrangements, and indeed have myriad expectations which, in our view, it would not be proper to catch.

Perhaps I may illustrate the problems by means of the following examples. If a large number of small shareholders together holding 50 per cent. of the shares have an informal understanding that they will seek to ensure that no director earns more than £500,000, the amendments would treat each of them as controlling the company.

A funding shareholder who retained a right of consent to any change in the name of the company could be deemed to control that company even though its name would make no difference at all to the way in which its affairs were conducted and would be immaterial in terms of our Schedule 2 concerns.

I have just given two examples and, if noble Lords wish, I can give others but I shall wait until I am asked. I hope that what I have said will serve to demonstrate that the amendments would give the regulators unnecessarily wide powers. As I have explained, the Government have already introduced amendments which should cover the specific abuses of deadlocking and joint control which lie at the heart of the regulators' concerns. Those are the reasons why the Government do not therefore support Amendments Nos. 176A to 176K.

I now turn to Amendments Nos. 174A, 176L, 177A and 177B which have been tabled by the noble Lord, Lord Donoughue, and the noble Baroness, Lady Dean. The amendments have also been inspired by the ITC and are designed to exclude bare and custodian trustees from the provisions for participation and control. The Government accept the case for excluding such trustees from the media ownership provisions, but we have been advised that although the amendments include a reference to custodian trustees, they omit a number of other categories of trustee which should also be exempted from the media ownership rules.

I also understand that the expression "exempt custodian interest" may not work in relation to the shares in companies incorporated elsewhere in the European Economic Area or in Northern Ireland. It would apply only to shares in English, Scottish or Welsh companies. Clearly, the policy should be capable of applying to the shares in any company incorporated anywhere in the EEA. I also understand that, for the purposes of the Companies Act, an exempt custodian interest is disregarded for the purposes of the statutory notification obligations only if the person concerned is not entitled to exercise, or control the exercise of, voting rights in respect of the shares in question. The amendments would disregard these interests even if the voting power attaching to them was exerciseable, thus creating a loophole.

In view of those defects, the Government have therefore tabled an alternative amendment, Amendment No. 177C, which is couched in broader terms and which will ensure that the policy is carried through. Still further consultation with the ITC's legal advisers has, however, revealed that even this amendment is defective in being unclear in its application to non-voting shares. It is for those reasons that I have tabled a manuscript amendment this afternoon, to which I have referred, to put the situation right. I apologise that it has been necessary to table the amendments at such a late stage, but I hope that in the light of the explanation that I have endeavoured to give as clearly as I can to your Lordships, the noble Lord, Lord Donoughue, and the noble Baroness, Lady Dean, will agree to withdraw their amendments in favour of the Government's Amendment No. 177C, as amended. I can assure them that I have been advised that the ITC's legal advisers are now content with the substance.

I have spoken at some length about a complicated and convoluted state of affairs. I hope that the conclusion I have reached is clear and satisfactory to your Lordships. I beg to move.

Moved, That the House do agree with the Commons in their Amendment No. 171.—(Lord Inglewood.)

4.30 p.m.

Lord Donoughue

My Lords, we wish to thank the Minister for the attention and work that he has given to the matter. I shall now speak to our amendments, the purpose of which was to make the Act work. We saw in one case of deadlocking, devices to evade and in another case, that of the bare trustees, unnecessary bureaucracy. The problem with all those is that the law is often imperfect in being comprehensive, so we have difficulty in keeping up with the problem, just as I have difficulty with keeping up with the pace of the Government's amendments.

Both sides are working towards the same objective and we are quite happy to accept what the Government said and what they propose in order better to achieve what we imperfectly sought. We shall therefore be happy not to move our amendments.

Lord Inglewood

My Lords, I am grateful to the noble Lord, Lord Donoughue, for those remarks.

On Question, Motion agreed to.

COMMONS AMENDMENTS

172 Schedule 2, page 91, line 10, at end insert—

'( ) in paragraph (b) of the definition of "control" for "by virtue of the rules regulating that or any other body" there is substituted "by whatever means and whether directly or indirectly",'.

173 Page 91, line 25, at end insert—

'( ) After sub-paragraph (1) there is inserted—

"(1A) For the purpose of determining the persons who are the associates of a body corporate for the purposes of this Schedule—

1. (a) an individual shall be regarded as an associate of a body corporate if he is a director of that body corporate and
2. (b) a body corporate and another body corporate shall be regarded as associates of each other if one controls the other or if the same person controls both."'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 172 and 173. I have already spoken to them with Amendment No. 171.

Moved, That the House do agree with the Commons in their Amendments Nos. 172 and 173.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

174 Schedule 2, page 91, leave out line 26 and insert—

'(3) For sub-paragraph (3) there is substituted—

"(3) For the purposes of this Schedule a person controls a body corporate if—

(a) he holds, or is beneficially entitled to, more than 50 per cent. of the equity share capital in the body, or possesses more than 50 per cent. of the voting power in it, or'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 174.

Moved, That the House do agree with the Commons in their Amendment No. 174.—(Lord Inglewood.)

[Amendment No. 174A, as an amendment to Commons Amendment No. 174, not moved.]

On Question, Motion agreed to.

COMMONS AMENDMENT

175 Schedule 2, page 91, line 30, leave out 'secure' and insert 'achieve the result'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 175.

Moved, That the House do agree with the Commons in their Amendment No. 175.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

176 Schedule 2, page 91, line 31, at end insert 'or

(c) he holds, or is beneficially entitled to, 50 per cent of the equity share capital in that body, or possesses 50 per cent of the voting power in it, and an arrangement exists between him and any other participant in the body as to the manner in which any voting power in the body possessed by either of them is to be exercised, or as to the omission by either of them to exercise such voting power.

(3A) For the purposes of sub-paragraph (3)(c)—

1. (a) "arrangement" includes any agreement or arrangement, whether or not it is, or is intended to be, legally enforceable, and
2. (b) a person shall be treated—
1. (i) as holding, or being beneficially entitled to, any equity share capital which is held by a body corporate which he controls or to which such a body corporate is beneficially entitled, and
2. (ii) as possessing any voting power possessed by such a body corporate."'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 176. I spoke to this amendment with Amendment No. 171.

Moved, That the House do agree with the Commons in their Amendment No. 176.—(Lord Inglewood.)

[Amendments Nos. 176A to 176L, as amendments to Commons Amendment No. 176, not moved.]

On Question, Motion agreed to.

COMMONS AMENDMENT

177 Schedule 2, page 91, line 32, at end insert—

'( ) For sub-paragraph (6) there is substituted—

"(6) In this Schedule any reference to a participant with more than a 20 per cent. interest in a body corporate is a reference to a person who—

1. (a) holds or is beneficially entitled to more than 20 per cent. of the shares in that body, or
2. (b) possesses more than 20 per cent. of the voting power in that body.

(7) Sub-paragraph (6) shall have effect subject to the necessary modifications in relation to other references in this Schedule—

1. (a) to an interest of more than a specified percentage in a body corporate, or
2. (b) to an interest of a specified percentage or more in a body corporate.

(8) Any reference in this Schedule to a person who is over a particular age is a reference to a person who has attained that age'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 177.

Moved, That the House do agree with the Commons in their Amendment No. 177.—(Lord Inglewood.)

[Amendments Nos. 177A and 177B, as amendments to Commons Amendment No. 177, not moved.]

As an amendment to Commons Amendment No. 177.

177C Line 18, at end insert—

(".—(1) Paragraph 2 of Part I of Schedule 2 is amended as follows.

(2) At the beginning of sub-paragraph (1) there is inserted "Subject to sub-paragraph (1A)".

(3) After sub-paragraph (1) there is inserted—

"(1A) For the purposes of this Schedule, a person's holding of shares, or possession of voting power, in a body corporate shall be disregarded if, or to the extent that—

1. (a) he holds the shares—
1. (i) as a nominee,
2. (ii) as a custodian (whether under a trust or by a contract), or
3. (iii) under an arrangement pursuant to which he has issued, or is to issue, depositary receipts, as defined by section 220(1) of the Companies Act 1985, in respect of the shares concerned, and
2. (b) he is bound (whether by contract or otherwise) not to exercise the voting rights in respect of the shares or not to exercise them otherwise than in accordance with the instructions of another.

(1B) For the purposes of sub-paragraph (1A)(b), voting rights which a person is entitled to exercise or of which he is entitled to control the exercise only in certain circumstances shall be taken into account only when those circumstances have arisen and for long as they continue to obtain."").

MANUSCRIPT AMENDMENTS TO AMENDMENT No. 177C

177D Line 9, at end insert ("concerned")

177E Line 17, leave out from ("is") to end of line 20 and insert ("not entitled to exercise or control the exercise of voting rights in respect of the shares concerned")

177F Line 21, after ("(1A(b)") insert—

("(a) a person is not entitled to exercise or control the exercise of voting rights in respect of shares if he is bound (whether by contract or otherwise) not to exercise the voting rights, or not to exercise them otherwise than in accordance with the instructions of another, and

(b)")

Lord Inglewood

My Lords, before moving Amendment No. 177C as an amendment to Commons Amendment No. 177, I beg to move manuscript Amendments Nos. 177D to 177F.

I think I owe the House an apology for causing a lot of this complication. I commend the manuscript amendments.

On Question, manuscript Amendments Nos. 177D to 177F, as amendments to Amendment No. 177C, agreed to.

Lord Inglewood

My Lords, I beg to move, as an amendment to Commons Amendment No. 177, Amendment No. 177C.

On Question, Amendment No. 177C, as amended, as an amendment to Commons Amendment No. 177, agreed to.

On Question, Commons Amendment No. 177, as amended, agreed to.

COMMONS AMENDMENT

178 Page 91, line 32, at end insert—

'1A. For paragraph 3 of Part I of Schedule 2 there is substituted—

"3. For the purposes of this Schedule the following persons shall he treated as connected with a particular person—

1. (a) a person who controls that person,
2. (b) an associate of that person or of a person falling within paragraph (a), and
3. (c) a body which is controlled by that person or by an associate of that person."'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 178. I have already spoken to this amendment with Commons Amendment No. 171. I commend the amendment.

Moved, That the House do agree with the Commons in their Amendment No. 178.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

179 Page 93, line 13, at end insert—

'(i) a licence to provide digital programme services, or

(j) a licence to provide national or local digital sound programme services.'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 179. Following a debate on this matter in another place, we concluded that it would be wrong to prevent foreign ownership of digital television programme services. That is because there are already a number of programme channels offered through cable and satellite which are provided by organisations whose ultimate parent is a non-EEA company. These channels, which include the Family Channel, the History Channel, the Discovery Channel, the Disney Channel and even the Parliamentary Channel, have established their popularity. We felt that we could not ultimately justify a position whereby such channels could be provided by cable or satellite but not by way of a digital programme service. In addition, their availability through digital terrestrial television may well contribute to the success of digital terrestrial broadcasting.

Similarly, allowing foreign control of digital sound programme services may contribute to the success of digital radio. Indeed, the development of commercial radio in this country owes much to the early input of overseas companies which had experience in the commercial market.

The Government consulted both the ITC and the Radio Authority about these amendments, and both were content with this liberalisation. I commend the amendment.

Moved, That the House do agree with the Commons in their Amendment No. 179.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

180 Page 93, line 13, at end insert—

'4A. In paragraph 3 of Part II of Schedule 2 (disqualification of publicly-funded bodies for radio service licences), in sub-paragraph (1)(a) for "(other than a local authority)" there is substituted "(other than a local authority, the Welsh Authority or the BBC)".

4B. In paragraph 5 of Part II of Schedule 2 (general disqualification of broadcasting bodies), paragraphs (c) and (d) are omitted.

4C. After paragraph 5 of Part II of Schedule 2 there is inserted—

"Disqualification of certain companies for certain licences

5A.—(1) A BBC company, a Channel 4 company or an S4C company is a disqualified person in relation to—

1. (a) any licence granted by the Commission to provide regional or national Channel 3 services or Channel 5, and
2. (b) any licence granted by the Commission to provide a local delivery service.

(2) A BBC company is also a disqualified person in relation to any licence granted by the Authority to provide a national, local or restricted service within the meaning of Part III of this Act.

(3) The Secretary of State may by order provide that sub-paragraph (1)(b) shall not have effect in relation to any local delivery service of a description specified in the order." '.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 180.

Subsections (4A) and (4B) in this amendment are consequential to the provisions allowing S4C and Channel 4 to create companies, to which I spoke earlier. Subsection (4C) was brought forward by my honourable friend the Minister of State following discussion in the Standing Committee in another place about the potential impact on the commercial radio market of competition from BBC companies.

Some of the concerns expressed were somewhat exaggerated. But there are special factors in the domestic radio market relating to strong competition and spectrum scarcity which will not be changed by digital broadcasting. Nor is this a sector in which the BBC had plans to establish companies. We therefore thought it would be a good thing to provide assurances to the commercial radio market by clarifying the position. This amendment makes it clear that BBC companies are disqualified from holding a Radio Authority licence to provide a national, local or restricted radio service. I commend the amendment.

Moved, That the House do agree with the Commons in their Amendment No. 180.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

181 Page 93, line 22, leave out 'paragraphs 8 and 15' and insert 'paragraph 8'.

4.45 p.m.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 181. In moving this amendment I shall also refer to Commons Amendments Nos. 182 to 184 inclusive and Commons Amendments Nos. 216 to 221.

This group of amendments concerns the categories of broadcasting licence which fall within the system of media ownership controls. They largely relate to more substantive changes to which we shall come shortly.

Amendment No. 181 is consequential on the revised system of controlling licence-holders' shares and other licences, which is now to rely not on maximum holdings but on attributing half the audience share of the licence concerned where the shareholdings are over 20 per cent.

Amendment No. 182 takes account of Amendment No. 183, which provides for the addition of the new category of restricted television services to the audience, subject to the overall 15 per cent. television share limit.

Amendment No. 184 provides for the omission of restricted radio services from the system of controls. I shall have more to say about this later.

Amendments Nos. 216 to 219 make minor and consequential changes to the order-making power to vary the specific ownership controls.

Amendments Nos. 220 and 221 are minor drafting amendments consequential on the removal of the power to specify a maximum number of local radio service licences that may be held by one person. I commend the amendment.

Moved, That the House do agree with the Commons in their Amendment No. 181.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENTS

182 Schedule 2, page 93, line 23, leave out 'eighteen' and insert 'seventeen'.

183 Page 93, line 26, at end insert—

'(aa) restricted services (within the meaning of Part I of this Act);'.

184 Page 93, leave out line 38.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 182 to 184. I have already spoken to these amendments. I commend them to the House.

Moved, That the House do agree with the Commons in their Amendments Nos. 182 to 184.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

185 Schedule 2, page 94, leave out lines 4 to 50 and insert—

'General limit on the holding of licences to provide television services or interests in bodies corporate holding such licences

2.—(1) If any person's audience time, in respect of a period of twelve months ending with the last day of any calendar month, exceeds 15 per cent. of total audience time, he shall not, subject to sub-paragraph (4), at any time in the following month—

1. (a) hold two or more licences to provide relevant services falling within one or more of the categories specified in paragraph 1(2)(a), (b), (c), (d) or (g),
2. (b) be a participant with a qualifying interest in two or more bodies corporate each of which holds a licence, or two or more licences, to provide services falling within one or more of those categories,
3. (c) hold any licence to provide a relevant service falling within any of those categories and be a participant with a qualifying interest in any body corporate which holds such a licence or two or more such licences,
4. (d) provide a foreign satellite service and either hold any licence to provide a relevant service falling within any of those categories or be a participant with a qualifying interest in a body corporate which holds such a licence or two or more such licences, or
5. (e) hold a licence to provide relevant services falling within the category specified in paragraph 1(2)(g) and provide two or more such services.

(2) For the purposes of sub-paragraph (1), and subject to sub- paragraph (3), a person's audience time in respect of any period is the aggregate of—

1. (a) the audience time attributable in respect of that period to each relevant service falling within any of the categories specified in paragraph 1(2)(a), (b), (c), (d) or (g) provided under a licence held by him,
2. (b) one half of the audience time attributable in respect of that period to any relevant service falling within any of the categories specified in paragraph 1(2)(a), (b), (c), (d) or (g) provided under a licence held by a body corporate which he does not control, but in which he is a participant with a qualifying interest, and
3. (c) the audience time attributable in respect of that period to any foreign satellite service provided by him.

(3) For the purposes of calculating a person's audience time in respect of any period in accordance with sub-paragraph (2)—

1. (a) there shall be included the audience time attributable in respect of that period to each service referred to in that sub-paragraph in respect of which, on the date upon which the calculation of his audience time for the purposes of sub-paragraph (1) is made, he holds the licence, is 1037 a participant in the body corporate which holds the licence, or which he provides (as the case may be), irrespective of whether he held the licence, or was a participant in the body corporate which holds the licence or provided the service at any time during the period; and
2. (b) there shall (for the avoidance of doubt) be excluded the audience time attributable in respect of that period to each service referred to in sub-paragraph (2) in respect of which, prior to the date upon which the calculation of his audience time for the purposes of sub-paragraph (1) is made, he has ceased to hold the licence, or to be a participant in the holder of the licence, or to provide the service (as the case may be).

(4) Sub-paragraph (1) shall not prevent a person from continuing to hold any licence, or to be a participant in a body corporate which holds any licence, or from continuing to provide any service (as the case may be) if and to the extent that arrangements made by him after the end of the period in respect of which his audience time exceeds 15 per cent. of total audience time would cause his audience time, calculated so as to take into account the effect of those arrangements, not to exceed 15 per cent. of total audience time.

(5) In this paragraph "foreign satellite service" means any service (other than a non-domestic satellite service) which consists in the transmission of television programmes by satellite, is provided on a frequency other than one allocated to the United Kingdom for broadcasting by satellite and either—

1. (a) appears to the Commission to be intended for general reception in the United Kingdom (whether or not it appears to them to be also intended for general reception elsewhere), or
2. (b) is (to any extent) relayed by a local delivery service.

(6) References in this paragraph—

1. (a) to the audience time attributable to any service in respect of any period, or
2. (b) to total audience time in respect of any period,

shall be construed in accordance with paragraph 3.

(7) In this paragraph "qualifying interest" means an interest of more than 20 per cent.

(8) The Secretary of State may by order amend sub-paragraph (7)—

1. (a) by substituting a different percentage for any percentage for the time being specified there, and
2. (b) so as to specify different percentages in relation to licences to provide different services.

(9) The Secretary of State may by order amend sub-paragraphs (1)(a), (2)(a) and (b) by adding a reference to relevant services falling within the category specified in paragraph 1(2)(aa)'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 185. In speaking to this amendment I shall also refer to Amendments Nos. 186 and 187, 215, 157 and 158.

Amendment No. 185 retains the general scheme whereby holdings in television are limited to no more than 15 per cent. of the total television audience time. However, it provides that those who have an interest in more than 20 per cent. but less than the control of the television service shall be attributed half the audience time attributable to that service.

The amendment to Amendment No. 185 before the House will ensure that when calculating audience time audience share is attributed immediately in respect of licences that a person controls or in which he has a qualifying interest at the time the calculation is made.

Amendment No. 185 also provides order-making powers whereby the Secretary of State may amend the percentage of qualifying interests to which half the audience time is attributed and bring restricted television services within the scope of the 15 per cent. audience time limit.

Amendment No. 186 provides that the Secretary of State can amend paragraph 3 of Part III to reflect any significant change in the manner in which the television industry calculates audience time.

Amendment No. 187 is simple and straightforward. It changes an order-making power into a general rule to prevent the holder of one regional Channel 3 licence from also holding another licence to provide a regional Channel 3 service for that region.

Amendments Nos. 157 and 158 are minor amendments to Clause 115 which pave the way for a repeal of the Broadcasting (Restrictions on the Holding of Licences) Orders. The replacement provisions are now contained on the face of this Bill, so the orders will become redundant when Schedule 2 of the Bill becomes law.

Amendment No. 215 amends the earlier provisions whereby the holders of one type of licence were restricted to a 20 per cent. interest in licences of a different category, replacing them with provisions which prevent common control of those licences but which do not restrict the extent of participation below the level of control. It will, however, still prevent any one person from having more than one national analogue broadcasting licence; and anyone holding a local radio licence and a Channel 3 licence where services are provided for areas which are significantly the same. I commend the amendment.

Moved, That the House do agree with the Commons in their Amendment No. 185.—(Lord Inglewood.)

AMENDMENTS TO COMMONS AMENDMENT No. 185

185A Leave out lines 4 to 7 and insert ("No one person may, at any time when his audience time in respect of the period of twelve months ending with the last day of the preceding calendar month exceeds 15 per cent of total audience time in respect of that period—").

185B Line 27, leave out (", and subject to sub-paragraph (3)").

185C Line 28, after ("time") insert ("at any time ("the relevant time")").

185D Line 33, at end insert ("at the relevant time").

185E Line 38, after ("is") insert ("at the relevant time").

185F Line 41, at end insert ("at the relevant time").

185G Line 42, leave out sub-paragraphs (3) and (4).

Lord Inglewood

My Lords, I have already spoken to Amendments Nos. 185A to 185G. I beg to move them en bloc.

Moved, That Amendments Nos. 185A to 185G, as amendments to Commons Amendment No. 185, be agreed to.—(Lord Inglewood.)

On Question, amendments agreed to.

On Question, Commons Amendment No. 185, as amended, agreed to.

COMMONS AMENDMENTS

186 Schedule 2, page 95, line 37, at end insert—

'(7) If it appears to the Secretary of State that there has been a significant change in the audience measurement practices prevailing in the television industry, the Secretary of State may, after consulting the Commission, make such amendments of sub-paragraphs (1), (3) and (6) as he considers appropriate for the purpose of taking account of that change'.

187 Page 95, line 42, leave out from beginning to first 'a'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 186 and 187. I spoke to these amendments in speaking to Amendment No. 185.

Moved, That the House do agree with the Commons in their Amendments Nos. 186 and 187.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

188 Schedule 2, page 95, line 48, at beginning insert—

'(1A) For the purposes of sub-paragraph (1), a person who is a participant with more than a 20 per cent. interest in a body corporate which holds a licence to provide a television multiplex service but does not control that body shall be treated as holding the licence held by that body.

(1B) No one person may at any time, in relation to each of five or more licences to provide television multiplex services, be either the holder of the licence or a participant with more than a 10 per cent. interest in a body corporate which holds the licence.

(2) In relation to'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 188. In speaking to this amendment I should like also to speak to Amendments Nos. 189, 190 to 195, 210, 211, 213 and 214. This group of amendments deals with the aggregation of interests in licences to provide digital terrestrial services. Amendments Nos. 188 and 189 provide limits of participation to prevent the accumulation of interests in licences to provide digital multiplex services for television. A person who controls or has an interest in more than 20 per cent. of three such licences is restricted to a 20 per cent. interest in another such licence and to interests of 10 per cent. in any such licences thereafter. Amendment No. 190 provides for these arrangements to be amended by order. It also provides that the Secretary of State may designate a television multiplex service as a regional television multiplex service if it covers less than half the population of the United Kingdom.

Amendments Nos. 210 and 211 provide similar restrictions to prevent the accumulation of interests in digital radio multiplex licences. Amendment No. 191 provides that the Secretary of State may impose limits on those providing digital programme services by means of a designated regional multiplex and the control of Channel 3 services and local analogue and digital radio provided for areas which are to a significant extent the same. This is prevent the development of local media monopolies.

Amendment No. 192 allows a digital programme service provider to provide any number of services on a single digital television multiplex without limitation under the television points system. But as soon as the licence holder provides services on two multiplexes, the points system would apply to him.

Amendment No. 193 makes a drafting correction to Part III of the schedule. Amendment No. 194 provides that only one point is attributable to those digital programme services provided by means of a designated regional multiplex. Amendment No. 195 clarifies the restriction in sub-paragraph (8) by providing that it applies to a participant with more than 20 per cent. interest who does not control that licence. Amendments Nos. 213 and 214 change the arrangements restricting the number of services which the holder of a local digital sound programme service licence may provide on a local radio multiplex.

Moved, That the House do agree with the Commons in their Amendment No. 188.—(Lord Inglewood.)

Lord Renton

My Lords, this is something which one could have said at any stage in the consideration of these Commons amendments, but I give an undertaking to say it only once. We have here, as we have already had—and we shall have many more—a mass of somewhat technical amendments which mostly have not arisen from views expressed in your Lordships' House when the Bill was before us; nor do they arise for the most part from views expressed in another place. They are necessary amendments, but they are mostly very technical and they are amendments which I think could well have been brought into the Bill as originally published if, instead of taking about one year over the preparation of the Bill, two years or even three years had been allowed in order to do so.

The Prime Minister recently made a speech about the working of the constitution generally in which he talked of ideas on the improving of the handling of legislation in the years to come. One of those suggestions was that we should have an arrangement, when we have massive Bills and especially technical Bills, for having much longer time for their consideration. The suggestion was that draft Bills should be issued to all those who might be affected by them: public bodies and others. I mention this because here is an example which illustrates the need for the change which the Prime Minister has proposed. I hope that it may be regarded as a good example of what needs to be done in the years to come.

Lord Inglewood

My Lords, the point that my noble friend has made is a very good one. As he says, this is almost a textbook case of very technical legislation. If I may, I should like to make what one might describe as a couple of points in mitigation. The first is that many of the points we are considering arose out of commitments given by me in this House at an earlier stage. In addition, the vast majority of the others arise from commitments given and changes introduced in another place.

The point made by my noble friend about the general technicality of the Bill is well taken, but there is one point which I have already mentioned on a number of occasions and perhaps in this context it is appropriate to repeat it. We accept that this was a difficult Bill and it was brought in in a hurry. There was one very good reason for that: it is a Bill asked for by the industry in order to enable digital terrestrial broadcasting to take place in this country. Digital satellite broadcasting and digital cable broadcasting can be done without any legislative change.

The industry requested the Government to bring in the necessary legal framework to give the possibility of digital terrestrial broadcasting a chance. It is the view of the industry—and one which we ought to take very seriously—that unless we got that legislative framework in place quickly, the economic consequences would be that there was every likelihood that digital terrestrial broadcasting would not take place in Britain at all. Because the points made by my noble friend are entirely well taken, I thought it important to explain why, in the particular circumstances of this Bill, the Government brought forward proposals which in ordinary circumstances they probably would not have done. There was, I believe, a very good underlying reason for so doing.

Lord Renton

My Lords, before my noble friend sits down, may I thank him for that explanation? However, I should like to say that I would still suggest that this indicates a need for plenty of time to be given in such cases.

Lord Inglewood

My Lords, my noble friend is absolutely right, but one of the extraordinary things which are happening in the world is that the technology in this area is moving forward fast. Indeed, what one might describe as the broadcasting landscape is very different now from what it was in November when the Bill was introduced. In economic terms it is almost a different world from what it was six months ago.

Lord Donoghue

My Lords, I agree entirely with what the noble Lord said and I sympathise with him. I am sure he will sympathise with us on this side if he considers that we, on this side, unpaid, and with no research back-up at all, have had to handle the technicalities of the Bill from day one. The people responsible might think about the necessity from the public interest point of view to provide a proper support structure for Her Majesty's Opposition in this House.

On Question, Motion agreed to.

COMMONS AMENDMENTS

189 Schedule 2, page 95, line 50, leave out from 'Act)' to end of line 51 and insert—

1. '(a) sub-paragraph (1) shall have effect as if the reference to three licences were a reference to two licences, and
2. (b) sub-paragraph (1B) shall have effect as if the reference to five licences were a reference to four licences.'.

190 Page 96, line 1, leave out from 'order' to end of line 3 and insert—

1. '(a) amend sub-paragraphs (1) to (2) by substituting a different numerical limit or percentage for any numerical limit or percentage for the time being specified there,
2. (b) designate any television multiplex service as a regional multiplex service for the purposes of this sub-paragraph,
3. (c) prescribe restrictions on the holding by any one person of two or more licences to provide regional multiplex services whose coverage areas are to a significant extent the same.

(4) The Secretary of State shall not designate any television multiplex service as a regional television multiplex service for the purposes of sub-paragraph (3) unless less than half of the population of the United Kingdom is resident within the proposed coverage area of the service.'.

191 Page 96, line 3, at end insert—

'Limits on the holding, by persons providing digital programme services, of licences to provide other categories of service

5A.—(1) The Secretary of State may by order prescribe restrictions on the holding, by a person who is providing a digital programme service by means of a television multiplex service designated by order under paragraph 5(3)(b) as a regional multiplex service, of a licence to provide any service specified in sub-paragraph (2) whose coverage area is to a significant extent the same as that of the digital programme service.

(2) The services referred to in sub-paragraph (1) are—

1. (a) a regional Channel 3 service,
2. (b) a local radio service, and
3. (c) a local radio multiplex service.

(3) The Secretary of State may also by order prescribe restrictions on the provision by any one person at any time of both—

1. (a) a digital programme service by means of a television multiplex service which is designated by order under paragraph 5(3)(b) as a regional multiplex service, and
2. (b) a digital sound programme service whose coverage area is to a significant extent the same as that of the digital programme service.

192 Page 96, line 8, leave out from first 'services' to second 'services' and insert 'by means of two or more television multiplex services if the number of points attributable to those digital programme'.

193 Page 96, line 16, leave out 'broadcast' and insert 'provided'.

194 Page 96, line 16, at end insert—

'(aa) a digital programme service is provided by means of a television multiplex service designated by the Secretary of State by order under paragraph 5(3)(b) as a regional multiplex service, or'.

195 Page 97, line 7, leave out from 'licence' to 'to' in line 10 and insert 'but who does not control that body, shall be taken'.

Lord Inglewood

My Lords, I have already spoken to these amendments. I beg to move them en bloc.

Moved, That this House do agree with the Commons in their Amendments Nos. 189 to 195.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

196 Schedule 2, page 97, leave out lines 11 to 13 and insert—

'(9) The Secretary of State may by order amend this paragraph—

1. (a) by altering the number of points for the time being attributable to digital programme services falling within sub-paragraph (2), (3) or (4),
2. (b) by substituting a different number of hours for the number for the time being specified in sub-paragraph (3), (4) or (5),
3. (c) by substituting different numbers for any numbers for the time being specified in sub-paragraph (7), and
4. (d) by substituting a different percentage for the percentage for the time being specified in sub-paragraph (8).'.

5 p.m.

Lord Inglewood

My Lords, in speaking to Amendment No. 196 I should like also to speak to Amendments No. 197 and 209 inclusive. Amendment No. 196 gives the Secretary of State the power to vary elements in the digital points system set out in paragraph 6 of Part III to Schedule 2, so that the ownership regime can respond to developments within digital television broadcasting.

Amendments Nos. 198 and 201 make it clear that, for the purposes of the 15 per cent. radio ownership points limit, points will be allocated to the company concerned at the time the licence is awarded. The Radio Authority will not have to wait until the company is actually broadcasting under a licence which is in force before allocating points. That brings the Bill into line with the approach currently adopted by the authority. The other amendments in this group are designed to remove the category of restricted radio licences from regulation under the radio points scheme. Restricted service licences are issued by the Radio Authority to permit broadcasting which is provided for a particular establishment or other defined location, or a particular event. Licences are issued on demand, and are normally valid for 28 days.

Following representations from the Radio Authority, the Government decided that there were good reasons for removing that category of licence from the points system. The inclusion of restricted radio licences in the points system unhelpfully distorts the market. However, we do not know what the future might hold. Amendment No. 209 empowers the Secretary of State to reinstate such licences, or any category of them, in the calculation and to specify a number of points to be assigned to them should concentrations of ownership threaten to cause a problem.

Moved, That the House do agree with the Commons in their Amendment No. 196.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENTS

197 Schedule 2, page 97, line 21, leave out '(b) or (c)' and insert 'or (b)'.

198 Page 97, line 24, at end insert 'or have been awarded'.

199 Page 97, line 27, leave out ',(c)'.

200 Page 97, line 31, leave out ', local or restricted' and insert 'or local'.

201 Page 97, line 32, after 'force' insert 'or have been awarded'.

202 Page 97, line 35, leave out 'two or more'.

203 Page 97, line 45, leave out ', local or restricted' and insert 'or local'.

204 Page 98, leave out lines 13 and 14.

205 Page 98, line 24, at end insert—

'(2A) No points shall be attributed to a national or local digital sound programme service unless the service is being provided.'.

206 Page 98, line 25, leave out ', local or restricted' and insert 'or local'.

207 Page 98, line 34, leave out ', local or restricted' and insert 'or local'.

208 Page 98, line 37, leave out ', local or restricted' and insert 'or local'.

209 Page 98, line 46, at beginning insert—

'(1) The Secretary of State may by order make such amendments of paragraphs 7 and 8 as he thinks fit for the purposes of including restricted radio services among the services referred to in any provision of paragraph 7 and of providing for the calculation of the points to be attributed to any such service, or any category of such service.

(2) '.

210 Page 99, line 24, at end insert —

'(2A) For the purposes of sub-paragraph (2)(a) a person who is a participant with more than a 20 per cent. interest in a body corporate which holds a licence to provide a radio multiplex service but does not control that body shall be treated as holding the licence held by that body.

(2B) No one person may at any time—

1. (a) hold a licence to provide a radio multiplex service and be a participant with more than a 10 per cent. interest in more than one body corporate which holds any other such licence, or
2. (b) be a participant with more than a 10 per cent. interest in each of three or more bodies corporate which hold such licences.'.

211 Page 99, line 25, leave out from 'order' to end of line 26 and insert—

1. '(a) amend sub-paragraph (1), (2) or (2B) by substituting a different numerical limit for any numerical limit for the time being specified there, and
2. (b) amend sub-paragraph (2A) or (2B) by substituting a different percentage for any percentage for the time being specified there.'.

Lord Inglewood

My Lords, I beg to move that this House do agree with the Commons in their Amendments Nos. 197 to 211. I have already spoken to these amendments.

Moved, That the House do agree with the Commons in their Amendments Nos. 197 to 211.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

212 Schedule 2, Page 99, line 26, at end insert—

'Limits in relation to licences to provide local radio services in overlapping areas

10A.—(1) No one person may at any time hold any two licences to provide local radio services which share a potential audience unless either—

1. (a) one of the licences is an AM licence and the other is an FM licence, or
1045
2. (b) the Authority have determined that in all the circumstances, having regard to the matters specified in sub-paragraph (4), the holding by that person of the licences in question could not be expected to operate against the public interest within the area concerned.

(2) No one person may at any time hold any three licences to provide local radio services any of which shares a potential audience with each of the other two services unless—

1. (a) the licences include both an AM licence and an FM licence, and
2. (b) the Authority have determined that in all the circumstances, having regard to the matters specified in sub-paragraph (4), the holding by that person of the licences in question could not be expected to operate against the public interest within the area concerned.

(3) No one person may at any time hold any four or more licences to provide local radio services any of which shares a potential audience with each of the other services.

(4) The matters referred to in sub-paragraphs (1) and (2) are—

1. (a) any reduction in plurality of ownership of local radio services within the area concerned that would result from a decision to allow the licences to be held together, and
2. (b) the likely effect of such a decision on—
1. (i) the range of programmes available by way of independent radio services to persons living in the area concerned, and
2. (ii) diversity in the sources of information available to the public in the area concerned and in the opinions expressed on local radio services received in that area.

(5) For the purposes of this paragraph two local radio services share a potential audience if, but only if, the potential audience of one service includes more than half of the potential audience of the other service.

(6) This paragraph has effect subject to paragraph 10B.

(7) In this paragraph—

"AM licence" means a licence to provide a local radio service on an amplitude modulated frequency,

"FM licence" means a licence to provide such a service on a frequency modulated frequency, and

"potential audience", in relation to a local radio service, means the persons over the age referred to in paragraph 8(2)(a) who reside in the coverage area of that service.

Power by order to impose different restrictions in place of paragraph 10A

10B. The Secretary of State may by order provide that, where a digital sound programme service is provided in any area, the holding by any one person of two or more licences to provide in that area local radio services which for the purposes of paragraph 10A share a potential audience with each other or with each of the others shall, instead of being subject to the restrictions specified in paragraph 10A, be subject to other restrictions specified in the order.'.

Lord Inglewood

My Lords, I beg to move that this House do agree with the Commons in their Amendment No. 212. I should also like to speak to Commons Amendments Nos. 222 to 229 and Commons Amendment No. 136.

There has been considerable debate about the current restriction which limits companies to one radio licence on the AM waveband and one licence on the FM waveband in areas which overlap. The Government listened carefully to this debate and held discussions with the Radio Authority and the Commercial Radio Companies Association. We concluded that both the industry and the listener would benefit from a measured relaxation of the existing ownership regime. Amendment No. 212 therefore allows companies to own three licences in areas which share a potential audience; that is to say, either two FM licences and one AM licence, or two AM licences and one FM licence.

The acquisition of a second licence on the same waveband will be subject to a radio specific public interest test, to protect plurality and diversity in the local radio market. When considering applications from radio companies wishing to operate a second licence on the same waveband in the same area, the Radio Authority will have to consider three factors in relation to that area. These are whether any reduction in plurality of ownership might result from a decision to allow the licences to be held together; the likely effect on the range of independent radio services available to listeners; and the likely effect on diversity in sources of information available and opinions expressed on local radio services in the area.

In the larger city areas where there are already several other radio stations, it is not obvious that plurality dictates that a company should be restricted to owning two licences. Under the test that we propose, the authority will be able to allow the acquisition if it concludes that a reduction in plurality is not so material as to be against the public interest.

However, in shire areas, where typically the only AM licence and the only FM licence are owned by the same company, the test will allow the Radio Authority to conclude that the acquisition of a third licence for that area does not operate against the public interest if such an acquisition will actually lead to an increase in the number of services which would be provided. That may be the only way that a further service would be viable; that is to say, through the exploitation by the dominant company of economies of scale. It will be for the Radio Authority to judge whether the benefits of diversity outweigh the interests of plurality.

In allowing a company to acquire a second FM (or AM) licence in a particular area, we do not propose to remove the existing licence conditions applying to programme formats and promises of performance. If a company acquires an existing licence, it will remain bound by these conditions, and will not simply be able to supplant an existing service with one that is radically different from the one to which listeners have grown accustomed. And in issuing any new licences, the Radio Authority will continue to seek to extend diversity for listeners in the area.

However, in our discussions with the Radio Authority about this issue, the authority expressed concern that many of the existing promises of performance had been drafted in general terms when there were tighter limits on the ownership of more than one station in any one local area. Amendment No. 136 accordingly enables the Radio Authority to revise local licences upon a change of control in order to write tighter promises of performance which accurately reflect the character of the station's output immediately prior to the change of control.

The intention behind Amendments Nos. 222 to 227 is simple. The connected persons provisions in Part III of Schedule 2, would mean that the Radio Authority would have to apply the new public interest test if a person is a director of any three radio stations which share a potential audience. That was never the intention, and these amendments change the connected persons provisions to ensure that such a situation does not arise.

Finally, Amendments Nos. 228 and 229 remove the limits on participation by holders of certain licences to provide services of a different category. Those arrangements have been superseded by Amendment No. 215.

Moved, That the House do agree with the Commons in their Amendment No. 212.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENTS

213 Schedule 2, page 99, line 30, leave out 'such' and insert 'non-simulcast'.

214 Page 99, leave out lines 31 to 51 and insert—

'(2) Where—

1. (a) the coverage area of the local radio multiplex service is to a significant extent the same as that of another local radio multiplex service, and
2. (b) the person concerned is not providing any non-simulcast service by means of that other local radio multiplex service,

sub-paragraph (1) shall have effect as if the reference to one non-simulcast service were a reference to two such services.

(3) In this paragraph "non-simulcast service" means any local digital sound programme service other than one which—

1. (a) is provided by a person who holds a licence to provide a local radio service, and
2. (b) corresponds to that local radio service.

(4) For the purposes of sub-paragraph (3)(b) a local digital sound programme service corresponds to a local radio service if, and only if, in every calendar month—

1. (a) at least 80 per cent. of so much of the local radio service as consists of programmes, consists of programmes which are also included in the local digital sound programme service in that month, and
2. (b) at least 50 per cent. of so much of the local radio service as consists of such programmes is broadcast at the same time on both services.

(5) The Secretary of State may by order—

1. (a) amend sub-paragraphs (1) and (2) by substituting a different numerical limit for any numerical limit for the time being specified there, and
2. (b) amend sub-paragraph (4)(a) or (b) by substituting a different percentage for any percentage for the time being specified there.

(6) In subsection (4) "programme" does not include an advertisement.'.

215 Page 99, line 51, at end insert—

'Further restrictions on holding of licences of different descriptions

11A.—(1) No one person may at any time hold—

1. (a) a licence to provide a national Channel 3 service or Channel 5, and
2. (b) a licence to provide a national radio service.

(2) No one person may at any time hold—

1. (a) a licence to provide a local radio service or local digital sound programme services, and
2. (b) a licence to provide a regional Channel 3 service whose coverage area is to a significant extent the same as that of the local radio service or of any local digital sound programme service provided by him.'.

216 Page 100, line 4, leave out '1(2)(b)' and insert '1(2)(aa),(b)'.

217 Page 100, line 12, leave out '(g)'and insert '(aa)'.

218 Page 100, line 12, leave out from '1(3)(a)' to the second 'or' in line 13 and insert ',(b) or (g)'.

219 Page 100, line 15, leave out '11' and insert '11A'.

220 Page 100, leave out lines 31 to 35.

221 Page 100, line 46, leave out 'sub-paragraphs (4) and (5)' and insert 'subparagraph (5)'.

222 Page 101, line 8, at beginning insert 'Subject to sub-paragraph (1A)'.

223 Page 101, line 9, leave out '11' and insert '11A'.

224 Page 101, line 10, after 'paragraph' insert '10B or'.

225 Page 101, line 13, leave out 'who is'.

226 Page 101, line 13, leave out from 'him' to end of line 14.

227 Page 101, line 14, at end insert—

'(1A) For the purposes of paragraph 10A and any order under paragraph 10B, a person shall not be treated as holding a licence to provide a local radio service merely because he is a director of a body corporate which holds the licence.

(1B) Any provision of paragraphs 2 to 11 which refers to a person's participation in a body corporate shall have effect as if he and every person connected with him were one person.'.

228 Page 101, line 15, leave out from beginning to end of line 37 on page 102.

229 Page 102, leave out lines 38 to 43.

Lord Inglewood

My Lords, I beg to move that this House do agree with the Commons in their Amendments Nos. 213 to 229 en bloc. I have already spoken to these amendments.

Moved, That the House do agree with the Commons in their Amendments Nos. 213 to 229.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

230 Schedule 2, page 104, leave out lines 1 to 10.

Lord Inglewood

My Lords, I beg to move that this House do agree with the Commons in their Amendment No. 230. I should also like to speak to Commons Amendments Nos. 231 to 240 and Commons Amendment No. 254. These amendments all relate to rules relating to the relationship between newspapers and broadcast licences.

Amendments Nos. 230 and 231 are minor modifications of the drafting of paragraph 3 of Part IV to Schedule 2.

Amendments Nos. 232 to 237 and Amendment No. 240 effect the Government's revised policy for limiting participation in broadcasters by newspaper companies, which relies on the attribution of half the audience share of a service to minority participants having more than a 20 per cent. interest in a licence.

Amendment No. 240 allows local newspaper groups with 50 per cent. or more of local newspaper circulation to apply to control a local radio licence, provided there is at least one other commercial local radio licence serving the same area and subject to the public interest test.

Amendments Nos. 238 and 239 relax media ownership restrictions in the light of the new regulatory system introduced by the Bill as amended, by removing the prohibition on national newspaper companies with a market share of 20 per cent. or more controlling digital programme service licences for radio.

Amendment No. 254 empowers the Secretary of State to make an order restricting cross-ownership of restricted service television licences and newspaper companies.

Moved, That the House do agree with the Commons in their Amendment No. 230.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENTS

231 Schedule 2, page 104, line 10, at end insert—

'( ) For the purposes of this Part of this Schedule a person runs a national or local newspaper if—

1. (a) he is the proprietor of the newspaper, or
2. (b) he controls a body which is the proprietor of the newspaper.'.

232 Page 104, line 12, at end insert—

'Restrictions on common control etc.

3A.—(1) No person who runs a national newspaper which for the time being has, or national newspapers which for the time being together have, a national market share of 20 per cent. or more may hold a licence to provide—

1. (a) a regional or national Channel 3 service or Channel 5, or
2. (b) a national or local radio service.

(2) A licence to provide a regional Channel 3 service may not be held by a person who runs a local newspaper which for the time being has, or local newspapers which for the time being together have, a local market share of 20 per cent. or more in the coverage area of the service.

(3) A licence to provide digital programme services may not be held by a person who runs a local newspaper which for the time being has, or local newspapers which for the time being together have, a local market-share of 20 per cent. or more in the coverage area of any digital programme service provided under the licence.

(4) For the purposes of this paragraph a person shall be treated as holding a licence if the licence is held by a person connected with him.'.

233 Page 104, line 13, leave out from beginning to 'No' in line 14 on page 105 and insert—

'Restrictions on participation

'5.—(1) No proprietor of a national newspaper which for the time being has, or of national newspapers which for the time being together have, a national market share of 20 per cent. or more shall be a participant with more than a 20 per cent. interest in a body corporate which is the holder of a licence to provide any of the services specified in sub-paragraph (4).

(1A) '.

234 Page 105, leave out lines 15 to 17 and insert 'any of the services specified in sub-paragraph (4)'.

235 Page 105, leave out lines 28 to 39.

236 Page 105, line 40, leave out '(2) and (3)(b)' and insert '(1), (1A) and (2)'.

237 Page 105, line 41, after 'a' insert 'regional or national'.

238 Page 105, line 41, at end insert 'and'.

239 Page 105, line 42, leave out from 'services' to end of line 43.

240 Page 105, line 44, leave out from beginning to end of line 5 on page 108 and insert—

'(4A) The Secretary of State may by order amend sub-paragraph (1), (1A) or (2) by substituting a different percentage interest in a body corporate for the percentage for the time being specified there.

(4B) Any restriction imposed by this paragraph on participation in a body corporate which is the holder of a particular kind of licence shall apply equally to participation in a body corporate which controls the holder of such a licence.

(4C) Any restriction on participation imposed by this paragraph—

1. (a) on the proprietor of any newspaper, or
2. (b) on the holder of any licence,

shall apply as if he and every person connected with him were one person.

Holding of local radio licence by person running local newspapers with at least 50 per cent local market share

5A.—(1) A licence to provide a local radio service may not be held by a person who runs a local newspaper which has, or local newspapers which for the time being together have, a local market share of 50 per cent. or more in the coverage area of the service unless—

1. (a) the service in question shares a potential audience with another local radio service, but
2. (b) he does not hold any other licence to provide a local radio service whose coverage area is to any extent the same as the coverage area of the service in question.

(2) The reference in sub-paragraph (1) to sharing a potential audience shall be construed in accordance with paragraph 10A(5) in Part III of this Schedule.

(3) For the purposes of this paragraph a person shall be treated as holding a licence if the licence is held by a person connected with him.'.

Lord Inglewood

My Lords, I beg to move that this House do agree with the Commons in their Amendments Nos. 231 to 240. I have already spoken to these amendments.

Moved, That the House do agree with the Commons in their Amendments Nos. 231 to 240.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

241 Schedule 2, page 108, line 5, at end insert—

'Further restrictions on holding of local radio licences by a person who runs a local newspaper

5B.—(1) No person who runs a local newspaper which for the time being has, or local newspapers which for the time being together have, a local market share of 20 per cent. or more in each of the relevant areas may hold any three licences to provide local radio services any of which shares a potential audience with each of the other services.

(2) No person who runs a local newspaper which for the time being has, or local newspapers which for the time being together have, a local market share of 20 per cent. or more in both the relevant areas may hold any two licences to provide local radio services which share a potential audience, unless one of the licences is an AM licence and the other is an FM licence.

(3) In sub-paragraphs (1) and (2)—

1. (a) "the relevant areas" means the coverage areas of the local radio services in question,
2. (b) references to sharing a potential audience shall be construed in accordance with sub-paragraph (5) of paragraph 10A in Part III of this Schedule, and
3. (c) "AM licence" and "FM licence" have the same meaning as in that paragraph.

(4) For the purposes of this paragraph a person shall be treated as holding a licence if the licence is held by a person connected with him.

(5) This paragraph has effect subject to paragraph 5C.

Power by order to impose different restrictions in place of paragraph 5B

5C.—(1) The Secretary of State may by order provide that, where a digital sound programme service is provided in any area, the holding, by a person who runs a local newspaper or local newspapers as mentioned in paragraph 5B(1), of two or more licences to provide in that area local radio services which for the purposes of paragraph 5B share a potential audience with each other or with each of the others shall, instead of being subject to the restrictions specified in paragraph 5B, be subject to other restrictions specified in the order.

(2) For the purposes of any order under sub-paragraph (1), a person shall be treated as holding a licence if the licence is held by a person connected with him.'.

Lord Inglewood

My Lords, I beg to move that this House do agree with the Commons in their Amendment No. 241. I should also like to speak to Amendments Nos. 242 through to 253 and to Amendments Nos. 255 and 256.

These amendments relate to the public interest test for the newspaper acquisition of broadcasting licences. Amendment No. 241 allows, subject to the public interest test, local newspapers with less than 20 per cent. of circulation in an area to own up to three local radio services on the same basis as any other company, and local newspapers with between 20 per cent. and 50 per cent. of circulation in an area to own one AM and one FM service.

Amendment No. 242 clarifies the operation of the public interest test for cross-ownership of newspapers and broadcasters, ensuring that it will not represent a continuing sanction against a newspaper once it has acquired a particular broadcasting licence; that it will not apply retrospectively and that it will not apply if a newspaper acquires further titles; and that it will not apply to the acquisition of licences by local newspapers outside their circulation area. But that will apply each time a newspaper proprietor acquires further broadcasting licences, and it will apply if a national newspaper acquires a local broadcasting licence and subsequently becomes a local newspaper proprietor in the area concerned.

Amendment No. 242 also permits the ITC and Radio Authority, having consulted licence-holders, to extend the three-month period within which they are required to make a public interest determination.

Amendment No. 242 also ensures that a newspaper proprietor wishing to become a digital programme provider is able to obtain an advance indication that, in principle, his being a digital programme provider is unlikely to be against the public interest test.

Amendments Nos. 252 to 256 make a series of consequential amendments, following Amendment No. 242, while Amendments Nos. 255 and 256 prevent the regulators revoking a licence solely on the basis of a change of circumstances, which if those circumstances had obtained prior to its grant, would have led them to conclude that the grant was against the public interest.

Taken together, these amendments ensure that the regulators can protect plurality and diversity without imposing unduly on the media industry.

Moved, That the House do agree with the Commons in their Amendment No. 241.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENTS

242 Schedule 2, page 108, leave out lines 8 to 22 and insert—

'9.—(1) A licence to provide any of the services specified in sub-paragraph (4) may not be granted to a body corporate which is, or is connected with, the proprietor of a national or local newspaper if the relevant authority determine that in all the circumstances the holding of the licence by that body corporate could be expected to operate against the public interest.

(2) Subject to sub-paragraph (3), a body corporate which holds a licence to provide any of the services specified in sub-paragraph (4) shall not become, or become connected with, the proprietor of a national or local newspaper and continue to hold the licence if the relevant authority determine within the permitted period that in all the circumstances the continued holding of the licence by that body corporate operates, or could be expected to operate, against the public interest.

(3) Sub-paragraph (2) does not apply in any case where the body corporate holding the licence—

1. (a) is already the proprietor of some other national or local newspaper, or is already connected with such a proprietor, and
2. (b) does not become connected with any other person who holds a licence to provide any of the services specified in sub-paragraph (4).

(4) The services referred to in sub-paragraphs (1) to (3) are—

1. (a) a national Channel 3 service or Channel 5,
2. (b) a national radio service, and
3. (c) national digital sound programme services.

(5) Subject to sub-paragraph (6), in this paragraph "the permitted period" means a period beginning with the day on which the licence holder becomes, or becomes connected with, the proprietor of the national or local newspaper ("the relevant day") and ending—

1. (a) in a case where the licence holder has, before the relevant day, notified the relevant authority that he will become, or become connected with the proprietor of that national or local newspaper on that day, at the end of the period of three months beginning with the relevant day, or
2. (b) in any other case, at the end of the period of three months beginning with the day on which the licence holder notifies the relevant authority that he has become, or has become connected with, the proprietor of that national or local newspaper.

(6) The relevant authority may in a particular case, after consultation with the licence holder, notify him before the time when the permitted period would (apart from this sub-paragraph) have ended that the permitted period in that case is to be calculated as if the references in sub-paragraph (5) to three months were references to such longer period specified in the notification as the relevant authority reasonably consider necessary in the circumstances.

(7) Nothing in any of the preceding provisions of this Schedule shall be construed as affecting the operation of this paragraph or paragraph 9A or 9B.

9A.—(1) A licence to provide a regional Channel 3 service or a local radio service may not be granted to a body corporate which is, or is connected with, the proprietor of a national newspaper or a relevant local newspaper if the relevant authority determine that in all the circumstances the holding of the licence by that body corporate could be expected to operate against the public interest.

(2) Subject to sub-paragraph (3), a body corporate which holds a licence to provide a regional Channel 3 service or a local radio service shall not become, or become connected with, the proprietor of a national newspaper and continue to hold the licence if the relevant authority determine within the permitted period that in all the circumstances the continued holding of the licence by that body corporate operates, or could be expected to operate, against the public interest.

(3) Sub-paragraph (2) does not apply in any case where the body corporate holding the licence—

1. (a) is already the proprietor of some other national newspaper or is already connected with such a proprietor, and
2. (b) does not become connected with—
1. (i) any other person who holds a licence to provide a regional Channel 3 service or a local radio service, or
2. (ii) any person who holds a licence to provide digital programme services and is providing a service under that licence.

(4) Subject to sub-paragraph (5), a body corporate which holds a licence to provide a regional Channel 3 service or a local radio service shall not become, or become connected with, the proprietor of a relevant local newspaper and continue to hold the licence if the relevant authority determine, within the permitted period that in all the circumstances the continued holding of the licence by that body corporate operates, or could be expected to operate, against the public interest.

(5) Sub-paragraph (4) does not apply in any case where the body corporate which holds the licence—

1. (a) is already the proprietor of some other local newspaper which is a relevant local newspaper in relation to the service referred to in that sub-paragraph, or is already connected with such a proprietor, and
2. (b) does not become connected with—
1. (i) any other person who holds a licence to provide a regional Channel 3 service or local radio service in relation to which that other local newspaper is also a relevant local newspaper, or
1054
2. (ii) any person who holds a licence to provide digital programme services and is providing a service under that licence in relation to which that other local newspaper is also a relevant local newspaper.

(6) For the purposes of this paragraph a local newspaper is a "relevant local newspaper", in relation to any service, if it serves an area which is to a significant extent the same as the coverage area of the service.

(7) In this paragraph "the permitted period" has the meaning given by paragraph 9(5) and (6).

9B.—(1) A body corporate which holds a licence to provide digital programme services and is, or is connected with, the proprietor of a national newspaper or a relevant local newspaper, shall not begin to provide a digital programme service if the Commission determine before the end of the period specified in sub-paragraph (2) that in all the circumstances the provision of that service by that body corporate could be expected to operate against the public interest.

(2) The period referred to in sub-paragraph (1) is the period of three months beginning with the day on which the Commission are notified pursuant to section 18(3) of the 1996 Act of an agreement to provide the digital programme service, or such longer period beginning with that day as the Commission may in a particular case, after consultation with the licence holder, notify him during those three months as being the period which they reasonably consider necessary in the circumstances.

(3) Subject to sub-paragraph (4), a body corporate which is providing a digital programme service shall not become, or become connected with, the proprietor of a national newspaper and continue to provide the service if the Commission determine within the permitted period that in all the circumstances the continued provision of the service by that body corporate operates, or could be expected to operate, against the public interest.

(4) Sub-paragraph (3) does not apply in any case where the body corporate which is providing the digital programme service—

1. (a) is already the proprietor of some other national newspaper or is already connected with such a proprietor, and
2. (b) does not become connected with—
1. (i) the holder of a licence to provide a regional Channel 3 service or a local radio service, or
2. (ii) the holder of another licence to provide digital programme services who is providing a service under that licence.

(5) Subject to sub-paragraph (6), a body corporate which is providing a digital programme service shall not become, or become connected with, the proprietor of a relevant local newspaper and continue to provide the service if the Commission determine within the permitted period that in all the circumstances the continued provision of the service by that body corporate operates, or could be expected to operate, against the public interest.

(6) Sub-paragraph (5) does not apply in any case where the body corporate which is providing the digital programme service—

1. (a) is already the proprietor of some other local newspaper which is a relevant local newspaper in relation to the service referred to in that sub-paragraph, or is already connected with such a proprietor, and
2. (b) does not become connected with—
1. (i) the holder of a licence to provide a regional Channel 3 service or local radio service in relation to which that other local newspaper is also a relevant local newspaper, or
1055
2. (ii) the holder of another licence to provide digital programme services who is providing a service under that licence in relation to which that other local newspaper is also a relevant local newspaper.

(7) In this paragraph—

1. (a) references to a relevant local newspaper shall be construed in accordance with paragraph 9A(6), and
2. (b) "the permitted period" has the meaning given by paragraph 9(5) and (6).'.

243 Page 108, line 24, leave out from 'result' to end of line 27 and insert—

1. '(a) in the application of paragraph 9(2) to a body corporate which holds a licence to provide any of the services specified in paragraph 9(4),
2. (b) in the application of paragraph 9A(2) or (4) to a body corporate which holds a licence to provide a regional Channel 3 service or a local radio service, or
3. (c) in the application of paragraph 9B(1), (3) or (5) to a body corporate which holds a licence to provide digital programme services.'.

244 Page 108, line 39, leave out from first 'the' to 'could' in line 40 and insert 'continued holding of the licence by the body corporate'.

245 Page 108, line 48, leave out '9(1)' and insert '9(2), 9A(2) or (4) or 9B(1), (3) or (5)'.

246 Page 109, line 1, leave out '9(1)' and insert '9(2), 9A(2) or (4) or 9B(1),(3) or (5)'.

247 Page 109, line 4, leave out 'and' and insert 'or'.

248 Page 109, line 7, after first 'the' insert 'relevant'.

249 Page 109, line 13, after '9' insert ', 9A, 9B'.

250 Page 109, line 14, leave out from 'corporate' to 'operates' in line 15 and insert 'which is, or is connected with, the proprietor of a newspaper'.

251 Page 109, line 27, leave out from 'corporate' to 'and' in line 28 and insert 'which was not, and was not connected with, the proprietor of a newspaper'.

252 Page 109, line 32, after '9' insert 9A, 9B'.

253 Page 109, line 33, at end insert—

'12. In relation to any determination under paragraph 9B(1), (3) or (5), references in paragraphs 10 and 11 to the holding of the licence shall have effect as references to the provision of the service.'.

254 Page 109, line 33, at end insert—

'Restricted television services

.—(1) The Secretary of State may by order—

1. (a) prescribe restrictions on the holding of one or more licences to provide restricted television services by a person who runs a national or local newspaper, and
2. (b) apply any of the provisions of paragraphs 9 to 11, with such modifications as may be specified in the order, in relation to the holding of a licence to provide a restricted television service.

(2) Any order under sub-paragraph (1) may provide that, for the purposes of any provision of the order, a person is to be treated as holding a licence if the licence is held by a person connected with him.

(3) In this paragraph "restricted television service" means a restricted service within the meaning of Part I of this Act.'.

255 Page 110, line 11, at end insert—

'(6B) Where a licence has been granted in a case where the Commission could have made a determination under paragraph 9(1) or 9A(1) of Part IV of Schedule 2 (if satisfied that the fact mentioned in that provision could have been expected to operate against the public interest), subsection (5) does not enable the licence to be revoked merely because a change is such that the Commission would have made such a determination in the new circumstances of the case."'.

256 Page 110, line 43, at end insert—

'(6B) Where a licence has been granted in a case where the Authority could have made a determination under paragraph 9(1) or 9A(1) of Part IV of Schedule 2 (if satisfied that the fact mentioned in that provision could have been expected to operate against the public interest), subsection (5) does not enable the licence to be revoked merely because a change is such that the Authority would have made such a determination in the new circumstances of the case."'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 242 to 256 en bloc. I have already spoken to these amendments.

Moved, That the House do agree with the Commons in their Amendments Nos. 242 to 256.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

99 After Clause 66, insert the following new clause—

PROVISION OF NEWS PROGRAMMES BY HOLDERS OF REGIONAL CHANNEL 3 LICENCES

'.—(1) With respect to the broadcasting of news programmes on and after 1st January 1998, section 31 of the 1990 Act (provision of news on Channels 3 and 5) is amended as follows.

(2) In subsection (2)—

(a) at the beginning there is inserted—

"For the purpose of securing the nationwide broadcast, by holders of regional Channel 3 licences (taken together), of news programmes which are able to compete effectively with other news programmes broadcast nationwide in the United Kingdom,"

(b) for "a nominated news provider" there is substituted "the appointed news provider", and

(c) in paragraph (b), for "the same nominated" there is substituted "the appointed".

(3) For subsection (3) there is substituted—

"(3) In subsection (2) "appointed news provider" means, subject to subsection (4), the body corporate for the time being appointed for the purposes of that subsection, from among the bodies corporate nominated by the Commission under section 32, in accordance with conditions included by virtue of section 31A in regional Channel 3 licences.

(4) A body corporate ceases by virtue of this subsection to be the appointed news provider if its nomination is terminated by the Commission under any provision of section 32."'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 99. I shall speak also to Amendments Nos. 100 to 102, 160 and 289.

This group of amendments gives effect to the commitment I gave the noble Lord, Lord Barnett, at Report stage on 7th March. As I made clear in that debate, we believe there are significant benefits to restricting the provision of news on Channel 3 to one provider able to compete effectively with other national news services provided by the BBC and, increasingly, by cable and satellite channels.

The amendments therefore place a requirement on the regional Channel 3 companies to appoint a single news provider; selected by them, from a list of those who have been nominated by the ITC as being of the necessary standard to provide high quality national and international news.

Moved, That the House do agree with the Commons in their Amendment No.99.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

100 After Clause 66, insert the following new clause—

APPOINTMENT OF NEWS PROVIDER BY HOLDERS OF REGIONAL CHANNEL 3 LICENCES

'.—(1) After section 31 of the 1990 Act there is inserted—

"Appointment of news provider by holders of regional Channel 3 licences.

31A. A regional Channel 3 licence shall include conditions requiring the holder of the licence to do all that he can to ensure—

1. (a) that arrangements are made between all holders of regional Channel 3 licences ("the relevant licence holders") for the appointment by them, from among the bodies corporate nominated by the Commission under section 32, and on such terms as the relevant licence holders may agree, of a single body corporate to be the appointed news provider for the purposes of section 31(2), and
2. (b) that, so long as he provides his licensed service, an appointment for the purposes of section 31(2) is in force."

(2) The Independent Television Commission may not include in pursuance of section 31A of the 1990 Act any condition in a regional Channel 3 licence (within the meaning of Part I of the 1990 Act) which would require an appointment for the purposes of section 31(2) (as amended by this Act) to take effect before 1st January 1998.'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 100. I have already spoken to this amendment.

Moved, That the House do agree with the Commons in their Amendment No. 100.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

101 After Clause 66, insert the following new clause—

NOMINATION BY COMMISSION FOR PURPOSES OF SECTION 31(2) OF BROADCASTING ACT 1990

'.—(1) Section 32 of the 1990 Act (nomination of bodies to provide news for regional Channel 3 services) is amended in accordance with subsections (2) to (5).

(2) For subsections (1) to (6) there is substituted—

"(1) With a view to enabling them to nominate bodies corporate as eligible for appointment for the purposes of section 31(2), the Commission shall invite bodies appearing to them to be qualified for nomination to make applications to be so nominated.

(2) Where a body corporate—

1. (a) applies to the Commission (whether in pursuance of any such invitation or not) to be nominated under this section as a nominated news provider, and
2. (b) appears to the Commission to be qualified for nomination,

the Commission shall so nominate that body.

(3) Subject to subsection (5), any nomination made by the Commission under this section shall remain in force for a period of ten years, and at the end of that period may be renewed by the Commission for a further period of ten years.

(4) Where the Commission are notified by the holders of licences to provide regional Channel 3 services that the appointment of the appointed news provider is due to expire, or to be renewed or terminated in accordance with the terms of the appointment, the Commission shall review the qualification for nomination of all nominated news providers (including the appointed news provider).

(5) If on any such review it appears to the Commission that a body is no longer qualified for nomination they shall (subject to subsection (6)) by notice terminate that body's nomination.

(6) The Commission shall not terminate a body's nomination under subsection (5) unless they have given the body a reasonable opportunity of making representations to them about the proposed termination."

(3) In subsection (9), paragraph (b) is omitted.

(4) In subsection (12), for the words from "appearing" onwards there is substituted "which—

1. (a) in their opinion is or, if appointed, would be effectively equipped and adequately financed to provide high quality news programmes for broadcasting in regional Channel 3 services; and
2. (b) appears to them not to be disqualified for being nominated under this section by virtue of this subsection."

(5) In subsection (13)—

(a) in paragraph (b), after "section", where second occurring, there is inserted "as eligible for appointment", and

(b) after paragraph (b) there is inserted—

"and

(c) references to the appointed news provider are references to the person for the time being appointed for the purposes of section 31(2) under the arrangements referred to in section 31A(a)."

(6) Subsections (2), (4) and (5) do not affect the application of section 32 of the 1990 Act before 1st January 1998 in relation to nomination for the purposes of section 31(2) as originally enacted.'

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 101. I have already spoken to this amendment with Amendment No. 99.

Moved, That the House do agree with the Commons in their Amendment No. 101.—(Lord Inglewood.)

AMENDMENT TO COMMONS AMENDMENT No. 101

101A Line 34, after (""appearing"") insert (", where second occurring,")

Lord Inglewood

My Lords, I beg to move Amendment No. 101A as an amendment to Commons Amendment No. 101.

Moved, That Amendment No. 101A, as an amendment to Commons Amendment No. 101, be agreed to.—(Lord Inglewood.)

On Question, amendment agreed to.

On Question, Commons Amendment No. 101, as amended, agreed to.

COMMONS AMENDMENT

102 After Clause 66 insert the following new clause—

MODIFICATION OF RESTRICTIVE TRADE PRACTICES ACT 1976 IN ITS APPLICATION TO AGREEMENTS RELATING TO CHANNEL 3 NEWS PROVISION

'.—(1) After section 194 of the 1990 Act there is inserted—

"Modification of Restrictive Trade Practices Act 1976 in its application to agreements relating to Channel 3 news provision.

194A.—(1) In this section a "relevant agreement" means an agreement—

1. (a) which is made between all holders of regional Channel 3 licences for securing the appointment by them, in accordance with conditions included in their licences by virtue of section 31A(a), of a single body corporate to be the appointed news provider for the purposes of section 31(2), or
2. (b) which is made between them and the body corporate appointed to be the appointed news provider for the purposes of section 31(2) for purposes connected with the appointment.

(2) If a relevant agreement is registered under the Restrictive Trade Practices Act 1976 ("the 1976 Act"), the Director General of Fair Trading shall report to the Secretary of State as to whether it appears to the Director that the agreement falls within subsection (4).

(3) If, on receiving a report under subsection (2), it appears to the Secretary of State that the agreement falls within subsection (4), he may give a direction to the Director requiring him not to make an application to the Restrictive Practices Court under Part I of the 1976 Act in respect of the relevant agreement.

(4) A relevant agreement falls within this subsection if—

1. (a) those provisions of the agreement by virtue of which the 1976 Act applies to the agreement do not have, and are not intended or likely to have, to any significant extent the effect of restricting, distorting or preventing competition, or
2. (b) all or any of those provisions have, or are intended or likely to have, that effect to a significant extent, but that the effect is not greater than is necessary—
1. (i) in the case of a relevant agreement falling within subsection (1)(a), for securing the appointment by holders of regional Channel 3 licences of a single body corporate to be the appointed news provider for the purposes of section 31(2), or
2. (ii) in the case of a relevant agreement falling within subsection (1)(b), for compliance by them with conditions included in their licences by virtue of section 31(1) and (2).

(5) The Secretary of State may vary or revoke any direction given under subsection (3) above if he satisfied that there has been a material change of circumstances such that—

1. (a) the grounds for the direction have ceased to exist, or
2. (b) there are grounds for giving a different direction;

and where the Secretary of State so varies or revokes any direction, he shall give notice of the variation or revocation to the Director.

(6) In this section—

1. (a) "agreement" and "Director" have the same meaning as in the 1976 Act, and
2. (b) "regional Channel 3 licence" has the same meaning as in Part I."

(2) Subsection (1) shall not apply in relation to any agreement (within the meaning of the Restrictive Trade Practices Act 1976) made for the purposes of the provision of news programmes by a nominated news provider under section 31(2) of the 1990 Act as originally enacted.'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 102.—(Lord Inglewood.)

Moved, That the House do agree with the Commons in their Amendment No. 102.—(Lord Inglewood.)

On Question, Motion agreed to.

5.15 p.m.

COMMONS AMENDMENT

103 Clause 67, page 58, line 40, after 'include' insert '(a)'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 103. In moving this amendment, I shall speak also to Amendments Nos. 104, 108, 112 to 114, 116, and 119 to 123.

Amendment No. 123 introduces a related new clause, which results from commitments given in this House. They reflect our full and helpful discussion of regional programming, and I trust noble Lords will accept them as fulfilling the wishes of this House.

Amendment No. 106 deals with a problem raised in another place. It was suggested that a licence holder who was the object of a hostile takeover might pre-notify the commission, but be unable to provide information about the predator to provide the basis of new licence conditions. Amendment No. 106, therefore, allows the commission in such a case to wait until a takeover occurs. At this point the predator company becomes the licence holder and so is bound by the licence to supply information to the commission.

Amendments Nos. 107 and 109 to 111 clarify the ways in which the ITC must take into account the different aspects of regionality identified in Clause 67.

The remaining amendments are simply corrections or simplifications of drafting.

Moved, That the House do agree with the Commons in their Amendment No. 103.—(Lord Inglewood.)

The Earl of Arran

My Lords, the alterations to the Bill, since we first encountered it, show what a very long time in politics six months can prove to be. So I pay warm tribute to my noble friend for having stayed the course. It is no mean feat for a man who once admitted that watching TV was not his favourite pastime! Your Lordships may recall my cri de Coeur at Second Reading that everything that could be done to protect quality regional ITV should be done.

I proposed an amendment to stop the moguls of ITV draining the financial lifeblood from small, regional companies. I sought to prevent interference with the discount price arrangement for network programmes. My noble friend promised to take a look at the problem. It turned into—if he will forgive me—a frustratingly long look. But the results of slow gestation are now embodied in the Bill. I am delighted that the spirit is close to my original intention. I am also encouraged by the comments of his ministerial colleague in another place. His words will add strength to the arm of the regulator in enforcing what will soon be law.

However, there are some puzzling anomalies and potential lacunas. Indeed, the late arrival of some government amendments allowed no time for proper consultation and precious little time for parliamentary consideration. For example, I wonder whether it is fair for a regional newspaper group to own a local radio station, while a regional ITV company cannot make such investments. And what powers were at work when, as late as Report stage in another place, the Government introduced amendments to stop ITV companies profiting from the use of Teletext?

Your Lordships will recall the reaction. ITV united in public opposition. The amendments vanished as mysteriously as they had come. This Bill may wreak discomfiting change in the ownership of ITV, but at least the small regional companies can face the future knowing that our public lobbying has secured additional safeguards for quality. At least, the small companies can now face the future without both hands being tied behind their backs, for which I am indeed grateful.

Lord Thomson of Monifieth

My Lords, I join with the noble Earl, Lord Arran, in expressing thanks to the Minister for following up this matter in the way that he has. It was a matter of concern in your Lordships' House that the regional companies and ITV are a distinctive aspect of ITV. We are all grateful for the safeguards that have been inserted.

On Question, Motion agreed to.

COMMONS AMENDMENTS

104 Clause 67, page 58, line 42, at end insert 'and

(b) a condition requiring the licence holder to provide the Commission, in such manner and at such times as they may reasonably require, with such information as they may require for the purposes of exercising their functions under this section.'.

105 Page 58, line 44, leave out 'imposed under subsection (1) or section 5(2)(d)' and insert 'in a regional Channel 3 licence'.

106 Page 59, line 5, leave out 'without that change having' and insert 'whether or not that change has'.

107 Page 59, line 8, at end insert 'one or more of the following matters, namely'.

108 Page 59, line 14, leave out 'included' and insert 'made available by the licence holder for the purposes of inclusion'.

109 Page 59, line 17, at beginning insert 'then, with a view to ensuring that the relevant change of control is not prejudicial to any of those matters'.

110 Page 59, line 19, leave out from 'of' to 'as' in line 20 and insert 'those matters'.

111 Page 59, line 21, leave out from 'that' to end of line 24 and insert ', having regard to the effect, or likely effect, of the relevant change of control on-'.

112 Page 59, line 32, leave out 'or'.

113 Page 59, line 39, at end insert 'or

(d) the extent to which managerial or editorial decisions relating to programmes to be included in the service are taken by persons so employed within that area,

the relevant change of control is or would be prejudicial to the regional character of the service,'.

114 Page 59, line 43, leave out 'and (c)' and insert ',(c) and (d)'.

115 Page 59, line 46, leave out 'the' and insert 'any'.

116 Page 60, line 5, leave out from 'holder' to end of line 6 and insert—

1. '(a) during the three months immediately before the relevant date, or
2. (b) if the Commission consider that the performance of the licence holder during that period is not typical of its performance during the twelve months before the relevant date, during such other period of three months during those twelve months as they may notify in writing to the licence holder;

and for the purposes of this subsection "the relevant date" is the date of the relevant change of control or, if earlier, the date on which the Commission exercise their powers under subsection (3) or (4).'.

117 Page 60, leave out lines 11 to 14 and insert—

'(8) Where, in a case falling within subsection (2)(a), a notice under subsection (3) or (4) varying a licence is served before the change to which it relates takes place, the variation shall not take effect until the change takes place.'.

118 Page 60, leave out lines 15 and 16.

119 Page 60, line 21, after 'interest' insert '(a)'.

120 Page 60, line 22, at end insert—

'(b) to persons living within any part of that area, or

(c) to particular communities living within that area;'.

121 Page 60, line 33, leave out 'condition' and insert 'conditions'.

122 Page 60, line 34, leave out '21A(1)' and insert '21A(1)(a) and (b)'.

123 After Clause 67, insert the following new clause—

POWERS OF COMMISSION IN RELATION TO MODIFICATION OR REPLACEMENT OF NETWORKING ARRANGEMENTS

'.—(1) Section 39 of the 1990 Act (networking arrangements between holders of regional Channel 3 licences) is amended as follows.

(2) After subsection (9) there is inserted—

"(9A) The matters to which the Commission shall have regard in deciding whether to approve any arrangements or modification under subsection (4) or (8) include the likely effect of the arrangements in question, or (as the case may be) those arrangements as proposed to be modified, on the ability of the holders of regional Channel 3 licences to maintain the quality and range—

1. (a) of the regional programmes (as defined in section 21 A(9)) included in each regional Channel 3 service, and
2. (b) of the other programmes included in each service which contribute to the regional character of the service."

(3) For subsection (10) there is substituted—

"(10) Without prejudice to the generality of their power to refuse to approve any arrangements or modification under subsection (4) or (8), the Commission shall refuse to do so if—

1. (a) they are not satisfied that the arrangements in question, or (as the case may be) those arrangements as proposed to be modified, would be appropriate for the purpose mentioned in subsection (1), or
1063
2. (b) it appears to them that the arrangements in question, or (as the case may be) those arrangements as proposed to be modified, would be likely to prejudice the ability of the holder of any regional Channel 3 licence to comply with—
1. (i) any condition imposed in pursuance of section 33(1), for the purpose of securing the implementation of proposals relating to the matters specified in section 16(2)(c), or
2. (ii) any condition imposed in pursuance of subsection (3) of section 21A in relation to the matters specified in paragraph (a) of that subsection."'.

124 Clause 68, page 61, line 4, leave out '57(1A)' and insert '57(1A)(a)'.

125 After Clause 68, insert the following new clause—

PUBLIC SERVICE FUND OF SIANEL PEDWAR CYMRU

'.—(1) After section 61 of the 1990 Act there is inserted—

"Welsh Authority public service fund

61A.—(1) The Welsh Authority shall not exercise their powers under section 57(1A)(b) before such date (in this section referred to as "the notified date") as they may notify to the Secretary of State for the purposes of this section.

(2) All amounts received by the Welsh Authority under section 61 on or after the notified date shall be kept by the Authority in a separate fund (in this section referred to as "the public service fund") which may be applied only for the purposes of their functions under section 57(1) or (1A)(a).

(3) No S4C company shall receive any direct or indirect subsidy from the public service fund.

(4) The Welsh Authority shall secure that no television programme which has been wholly or partly financed out of the public service fund is included in a television programme service provided by an S4C company before it is first broadcast on S4C or in the service referred to in section 57(1A)(a).

(5) On the notified date—

1. (a) all the assets then held by the Welsh Authority other than cash, together with the appropriate proportion of any cash then held by them, shall be taken to be comprised in the public service fund, and
2. (b) the remainder of any cash then held by the Authority shall be taken to be comprised in a general fund.

(6) In subsection (5)(a) "the appropriate proportion" means the proportion which, in the last financial year in respect of which a statement of accounts has been prepared under paragraph 12(1) of Schedule 6 before the notified date, the total amount received by the Welsh Authority under section 61 bears to the total amount of its income from all sources."

(2) In paragraph 12 of Schedule 6 of the 1990 Act (accounts and audit) after sub-paragraph (1) there is inserted—

"(1A) The statement of accounts must deal separately with the public service fund referred to in section 61A of this Act and with the general fund referred to in subsection (5)(b) of that section.".'.

126 Clause 71, page 62, line 32, after 'power' insert—

'(a)".

127 Page 62, line 34, after 'form' insert 'in any part of the United Kingdom'.

128 Page 62, line 35, at end insert 'and

(b) to establish qualifying companies, to purchase or otherwise acquire shares, stocks or other securities of qualifying companies and to assist any qualifying company.

(6) In subsection (5)(b) "qualifying company" means any company (whether incorporated under the law of the United Kingdom or of any other country) which is or will be wholly or mainly engaged in one or more of the following activities—

1. (a) the provision of one or more services which are licensed by the Commission or by the Radio Authority or which, if provided in the United Kingdom, would be required to be so licensed,
2. (b) activities incidental to such provision, and
3. (c) the holding of shares in any other company which is wholly or mainly engaged in such provision or in activities incidental to such provision."

(1A) In paragraph 1 of Schedule 3 to the 1990 Act (status and capacity of Channel Four Television Corporation) after sub-paragraph (3) there is inserted—

"(4) Section 24(5)(b) of this Act shall not be taken to limit the Corporation's power by virtue of sub-paragraph (3) to do such things and enter into such transactions as are incidental or conducive to the discharge of their functions under section 24(1) or (5)(a)." '.

129 Page 62, line 38, after 'power' insert—

'(a)".

130 Page 62, line 41, at end insert 'and

(b) to establish qualifying companies, to purchase or otherwise acquire shares, stocks or other securities of qualifying companies and to assist any qualifying company.

(1B) In subsection (1A)(b) "qualifying company" means any company (whether incorporated under the law of the United Kingdom or of any other country) which is or will be wholly or mainly engaged in one or more of the following activities—

1. (a) the provision of one or more services which are licensed by the Commission or by the Radio Authority or which, if provided in the United Kingdom, would be required to be so licensed,
2. (b) activities incidental to such provision, and
3. (c) the holding of shares in any other company which is wholly or mainly engaged in such provision or in activities incidental to such provision.

(3) In paragraph 1 of Schedule 6 to the 1990 Act (status and capacity of Welsh Authority) after sub-paragraph (2) there is inserted—

"(3) Section 57(1A)(b) of this Act shall not be taken to limit the Authority's power by virtue of sub-paragraph (2) to do such things and enter into such transactions as are incidental or conducive to the discharge of their functions under section 57(1) or (1A)(a)."'.

131 After Clause 72, insert the following new clause—

AWARD OF CERTAIN LICENCES SUBJECT TO CONDITIONS

'.—(1) After section 17 of the 1990 Act there is inserted—

"Award of Channel 3 licence subject to conditions.

17A.—(1) The Commission may, when awarding a Channel 3 licence to any person, make the grant of the licence to him conditional on his compliance before the grant with such specified requirements relating to the financing of the service as appear to them to be appropriate, having regard to—

1. (a) any duties which are or may be imposed on them, or on the licence holder, by or under this Act, and
2. (b) any information provided to them under section 15(3)(g) by the person to whom the licence is awarded as to his projected financial position during the period for which the licence would he in force.

(2) Where the Commission determine that any condition imposed by them in relation to a Channel 3 licence in pursuance of subsection (1) has not been satisfied, section 17 shall (subject to subsection (3)) have effect as if the person to whom the licence was awarded had not made an application for it.

(3) Section 17 shall not so have effect if the Commission decide that it would be desirable to publish a fresh notice under section 15(1) in respect of the grant of the licence."

(2) In section 51 of the 1990 Act (procedure to be followed by Commission in connection with consideration of applications for, and awarding of, licences to provide additional services), in subsection (3)—

1. (a) for "section 17" there is substituted "sections 17 and 17A", and
2. (b) for "it applies" there is substituted "they apply".

(3) After section 76 of the 1990 Act there is inserted—

"Award of local delivery licence subject to conditions.

76A.—(1) The Commission may, when awarding a local delivery licence to any person, make the grant of the licence to him conditional on his compliance before the grant with such specified requirements relating to the financing of the service as appear to them to be appropriate, having regard to—

1. (a) any duties which are or may be imposed on them, or on the licence holder, by or under this Act, and
2. (b) any information provided to them under section 74(3)(d) by the person to whom the licence is awarded as to his projected financial position during the period for which the licence would be in force.

(2) Where the Commission determine that any condition imposed by them in relation to a local delivery licence in pursuance of subsection (1) has not been satisfied, section 76 shall (subject to subsection (3)) have effect as if the person to whom the licence was awarded had not made an application for it.

(3) Section 76 shall not so have effect if the Commission decide that it would be desirable to publish a fresh notice under section 74(1) in respect of the grant of the licence."'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 104 to 131. I have already spoken to these amendments.

Moved, That the House do agree with the Commons in their Amendments Nos. 104 to 131.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

132 After Clause 72, insert the following new clause—

ANCILLARY SERVICES

'. Section 48 of the 1990 Act (Additional services) is amended in paragraph (c) of subsection (3) by the addition after the words "their contents" of the words "or relate to the promotion or listing of such programmes"'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 132. This amendment was tabled by the Opposition in another place and the Government were happy to accept the amendment as drafted, which expands the definition of ancillary services in Section 48(3) of the 1990 Act. This amendment will enable fuller listings by Channels 3, 4 and 5 of their forthcoming programmes on their Teletext pages currently broadcast as ancillary services. Amendment No. 132 will also enable the principal terrestrial broadcasters to develop further systems of programme delivery control and give more information to the viewer about their services.

Moved, That the House do agree with the Commons in their Amendment No. 132.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

133 After Clause 73, insert the following new clause—

POWER OF INDEPENDENT TELEVISION COMMISSION TO SUSPEND LICENCE TO PROVIDE NON-DOMESTIC SATELLITE SERVICE

'.After section 45 of the 1990 Act there is inserted—

"Special power of revocation and suspension on certain grounds in case of licence to provide non-domestic satellite service.

45A.—(1) If the Commission are satisfied—

1. (a) that the holder of a licence to provide a non-domestic satellite service has included in the service one or more programmes containing material likely to encourage or incite to crime or to lead to disorder,
2. (b) that he has thereby failed to comply with a condition included in the licence in pursuance of section 6(1)(a), and
3. (c) that the failure is such as to justify the revocation of the licence,

they shall serve on the holder of the licence a notice under subsection (2).

(2) A notice under this subsection is a notice—

1. (a) stating that the Commission are satisfied as mentioned in subsection (1),
2. (b) specifying the respects in which, in their opinion, the licence holder has failed to comply with the condition mentioned in paragraph (b) of that subsection,
3. (c) stating that the Commission may revoke his licence after the end of the period of twenty-one days beginning with the date on which the notice is served on the licence holder,
4. (d) informing the licence holder of his right to make representations to the Commission within that period about the matters complained of, and
5. (e) suspending the licence as from the time when the notice is served on the licence holder until the revocation takes effect or the Commission decide not to revoke the licence.

(3) If the Commission, having considered any representations about the matters complained of made to them within the period referred to in subsection (2)(c) by the licence holder, are satisfied that it is necessary in the public interest to revoke the licence in question, they shall serve on the licence holder a notice revoking the licence.

(4) A notice under subsection (3) shall not take effect until the end of the period of twenty-eight days beginning with the day on which that notice was served on the licence holder.

(5) Section 42 (as applied by section 45(5)) shall not have effect in relation to the revocation of a licence in pursuance of a notice under subsection (1)."'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 133. In speaking to this amendment, I should like to speak also to Amendments Nos. 138, 152 and 156. Your Lordships will know that in this country we have a liberal and deregulated broadcasting regime. We must, however, be vigilant against the exploitation of that framework particularly by those who see the opportunity to take advantage of our liberal regime in the way in which they direct broadcasts to other countries where they profoundly disagree with the government of the receiving country. While the Government are always conscious of the right of free speech in this country and of our obligations in that regard under international conventions, equally strongly they believe that the maintenance of good and proper relations between the UK and other countries requires that this matter be dealt with in legislation. Each of these amendments is directed in different ways to that consideration.

Amendment No. 133 gives a special power to the Independent Television Commission, if it thinks fit, to suspend and revoke a non-domestic television broadcasting satellite licence where there has been a serious breach of that licence by the inclusion of material likely to encourage or incite to crime or to lead to disorder. Amendment No. 138 provides parallel powers to the Radio Authority in respect of satellite radio licences.

The Government do not consider it necessary to extend the scope of the existing rules in respect of political disqualification contained in the 1990 Act because they are already comprehensive. However, the Government wish to place beyond any shadow of a doubt the obligations of the commission and authority in respect of investigation and judgment with regard to disqualification on political grounds when they are considering an application for a licence or taking a view on a current licence. Amendment No. 152 has this effect. What concerns the Government is that those who are disqualified under the existing legislation by virtue of their political objectives, might, if they are sufficiently motivated or reckless, provide false information or withhold information. The Government therefore believe that it is necessary to create a new offence. This is the effect of Amendment No. 153. Amendment No. 154 gives the court a discretion to order an offender convicted under the provisions of Amendment No. 153 to be disqualified from holding a broadcasting licence for a period of up to five years as the court thinks fit. Amendment No. 155 provides for an appeal. Amendment No. 156 is consequential to these amendments.

Moved, That the House do agree with the Commons in their Amendment No. 133.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

134 After Clause 74, insert the following new clause—

CERTAIN DELIVERY SERVICES TO CARRY CERTAIN BROADCASTS

'.—(1) After section 78 of the 1990 Act there is inserted—

'Inclusion of certain services in local delivery service provided by digital means.

78A.—(1) Where the Commission are satisfied, in the case of a local delivery service by means of which one or more of the services specified in section 72(2) is delivered in digital form, that it would be appropriate, having regard to the extent of the use and proposed use of digital technology in the provision of the service, for the service to be treated as a digital local delivery service for the purposes of this section, they shall serve a notice to that effect on the holder of the licence to provide the service.

(2) The Commission shall do all that they can to secure that, subject to subsection (3) and to any exceptions for which the Secretary of State, after consultation with the Commission, the BBC and the Welsh Authority, may by order provide, every digital local delivery service provided by any person in any area includes, by the reception and immediate re-transmission of the broadcasts—

1. (a) the programmes included in each relevant service, and
2. (b) if the area for which the local delivery service is provided falls wholly or partly in Wales, the programmes included in the appropriate Welsh service.

(3) The Commission may exempt any digital local delivery service from the requirement to include any service ("the broadcast service") if it appears to the Commission that, at the place where the holder of the licence to provide the local delivery service receives or would receive the broadcast service, the broadcast service is not capable of being received at a level satisfying such technical standards as the Commission may from time to time determine.

(4) Where a relevant service provided for reception in an area for which a digital local delivery service is provided consists in the broadcasting for simultaneous reception of programmes contained in two or more programme schedules, then, so far as relating to that relevant service, the duty in subsection (2) shall be subject to the limitation in whichever of subsections (5) and (6) is appropriate.

(5) Where the programmes contained in one of the programme schedules are broadcast for reception in a greater part of the area than the programmes contained in the other schedule or any of the other schedules, the duty in subsection (2) so far as so relating shall extend only to the programmes contained in the first-mentioned schedule.

(6) Where subsection (5) does not apply, the duty in subsection (2) so far as so relating shall extend only to the programmes contained in such one of the programme schedules as the relevant broadcasting body may determine.

(7) For the purposes of this section Channel 3 shall be taken to be a single service consisting in the broadcasting for simultaneous reception of programmes contained in several programme schedules.

(8) Each broadcaster shall provide any person providing a digital local delivery service with such assistance as he may reasonably require in relation to the technical arrangements for the re-transmission in pursuance of this section of the broadcasts of that broadcaster.

(9) In this section—

"the appropriate Welsh service" means the service referred to in section 57(1A)(a) or, if no such service is being broadcast, S4C;

"broadcaster" means the Welsh Authority or any person providing a relevant service;

"digital local delivery service" means any local delivery service in respect of which the Commission have given a notice under subsection (1);

"the relevant broadcasting body" means—

1. (a) in relation to any service provided by the BBC, the BBC, and
2. (b) in relation to any service licensed by the Commission, the Commission;

"relevant service" means any of the following services—

1. (a) Channel 3, Channel 4 and Channel 5,
2. (b) the teletext service referred to in section 49(2), and
1069
3. (c) the television broadcasting services and teletext service provided by the BBC.

(10) Expressions used in subsections (7) and (9) and in Part I of this Act have the same meaning in those provisions as in that Part.

(11) An order under subsection (2) shall be subject to annulment in pursuance of a resolution of either House of Parliament."

(2) In Part III of Schedule 12 to the 1990 Act (transitional provisions relating to existing cable services), for paragraph 4 there is substituted—

"4.—(1) The Commission shall do all that they can to secure that, subject to sub-paragraph (2) and to any exceptions for which the Secretary of State, after consultation with the Commission, the BBC and the Welsh Authority, may by order provide, every diffusion service provided by any person in any area under a relevant licence includes, by the reception and immediate re-transmission of the broadcasts, the programmes included in each relevant service provided for reception in that area.

(2) The Commission may exempt any diffusion service from the requirement to include any relevant service if it appears to the Commission that, at the place where the holder of the licence to provide the diffusion service receives or would receive the relevant service, the relevant service is not capable of being received at a level satisfying such technical standards as the Commission may from time to time determine.

(3) Where a relevant service provided for reception in an area for which a diffusion service is provided consists in the broadcasting for simultaneous reception of programmes contained in two or more programme schedules, then, so far as relating to that relevant service, the duty in sub-paragraph (1) shall be subject to the limitation in whichever of sub-paragraphs (4) and (5) is appropriate.

(4) Where the programmes contained in one of the programme schedules are broadcast for reception in a greater part of the area than the programmes contained in the other schedule or any of the other schedules, the duty in sub-paragraph (1) so far as so relating shall extend only to the programmes contained in the first-mentioned schedule.

(5) Where sub-paragraph (4) does not apply, the duty in sub-paragraph (1) so far as so relating shall extend only to the programmes contained in such one of the programme schedules as the relevant broadcasting body may determine.

(6) For the purposes of this paragraph Channel 3 shall be taken to be a single service consisting in the broadcasting for simultaneous reception of programmes contained in several programme schedules.

(7) Each person providing a relevant service ("the broadcaster") shall provide any person providing a diffusion service with such assistance as he may reasonably require in relation to the technical arrangements for the re-transmission in pursuance of this paragraph of the broadcasts of that broadcaster.

(8) In this paragraph—

"the relevant broadcasting body" means—

1. (a) in relation to any service provided by the BBC, the BBC, and
2. (b) in relation to any service licensed by the Commission, the Commission;

"relevant service" means any of the following services—

1. (a) Channel 3, Channel 4 and S4C,
2. (b) the teletext service referred to in section 49(2) of this Act, and
3. (c) the two television broadcasting services provided by the BBC on the passing of the Broadcasting Act 1996 and the teletext service provided by the BBC at that time.

(9) Expressions used in sub-paragraphs (6) and (8) and in Part I of this Act have the same meaning in those sub-paragraphs as in that Part.

(10) An order under sub-paragraph (1) shall be subject to annulment in pursuance of a resolution of either House of Parliament.

4A.—(1) Where the Commission are satisfied, in the case of any diffusion service which is provided under a relevant licence and by means of which one or more of the services specified in section 72(2) of this Act is delivered in digital form, that it would be appropriate, having regard to the extent of the use and proposed use of digital technology in the provision of the service, for the service to be treated as a digital diffusion service for the purposes of this paragraph, they shall serve a notice to that effect on the holder of the licence to provide the service; and in this paragraph "digital diffusion service" means a diffusion service in respect of which such a notice has been served.

(2) Subsections (2) to (8) of section 78A of this Act shall have effect in relation to a digital diffusion service as they have effect in relation to a digital local delivery service (within the meaning of that section); and nothing in paragraph 4 shall have effect in relation to a digital diffusion service."'.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 134. In speaking to this amendment I should like to speak also to Amendments Nos. 147 and 270. In commending this group of amendments to your Lordships I should like to pay tribute to the part played by my noble friend Lady O'Cathain in putting the case for a must-carry requirement upon digital cable operators. We listened to that case and accepted it.

Amendment No. 134 requires digital cable operators to carry the public service channels. It also tidies up the existing must-carry provisions applying to analogue cable operators holding diffusion service licences. Amendments Nos. 147 and 270 adjust the Copyright, Design and Patents Act 1988 to take account of the new must-carry provisions and other developments. I very much hope that all sides of the House will be able to welcome these amendments.

Moved, That the House do agree with the Commons in their Amendment No. 134.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENTS

135 Clause 75, page 65, line 35, leave out '35(2)(b)' and insert '35(2)(a)'.

136 After Clause 75, insert the following new clause—

VARIATION OF LOCAL RADIO LICENCE FOLLOWING CHANGE OF CONTROL

'. After section 106 of the 1990 Act there is inserted—

"Variation of local licence following change of control.

106A.—(1) Any local licence granted to a body corporate before the commencement of this section shall be taken to include—

1. (a) a condition requiring the body to give the Authority advance notice of any proposals known to the body that may give rise to a relevant change of control, and
2. (b) a condition requiring the body to provide the Authority, in such manner and at such times as they may reasonably require, with such information as they may require for the purposes of exercising their functions under subsection (3).

(2) Subsection (3) applies in relation to any local licence which—

1. (a) was granted before the commencement of this section,
2. (b) is held by a body corporate, and
3. (c) has not previously been varied under that subsection.

(3) Where, in relation to any local licence to which this subsection applies—

1. (a) the Authority receive notice, in pursuance of a condition imposed under subsection (1) or section 88(2)(d), of any proposals that may give rise to a relevant change of control, or
2. (b) a relevant change of control takes place (whether or not that change has been previously notified to the Authority),

the Authority may vary the licence, by a notice served on the licence holder, so as to include in the licence such conditions as they consider appropriate for the purpose of ensuring that the character of the local service is maintained after the relevant change of control.

(4) Subject to subsection (5), any new or varied condition imposed under subsection (3) in relation to any matter may be more onerous than any existing condition imposed under section 106(1) in relation to that matter; and in this subsection "existing condition" means a condition of the licence as it has effect, or had effect, before the relevant change of control.

(5) The Authority may not under subsection (3) include any new or varied condition in a licence unless the new condition or the condition as varied is one which (with any necessary modifications) would have been satisfied by the licence holder—

1. (a) during the three months immediately before the relevant date, or
2. (b) if the Authority consider that the performance of the licence holder during that period is not typical of its performance during the twelve months before the relevant date, during such other period of three months during those twelve months as they may notify in writing to the licence holder;

and for the purposes of this subsection "the relevant date" is the date of the relevant change of control or, if earlier, the date on which the Authority exercise their powers under subsection (3).

(6) The Authority shall not serve a notice on any body under subsection (3) unless they have given it a reasonable opportunity of making representations to them about the variation.

(7) Where, in any case falling within paragraph (a) of subsection (3), a notice under that subsection is served before the change to which it relates takes place, the variation shall not take effect until the change to which it relates takes place.

(8) The power in subsection (1) of section 106 to vary conditions imposed under that subsection includes power to vary conditions imposed under subsection (3).

(9) In this section "relevant change of control" means a change in the persons having control over the body holding the licence." '.

137 Insert the following new clause—

RENEWAL OF LICENCES TO PROVIDE LOCAL RADIO SERVICES

'.— (1) After section 104 of the 1990 Act there is inserted—

"Renewal of local licences.

104A.—(1) A local licence may (subject to the following provisions of this section) be renewed on one occasion for a period of eight years beginning with the date of renewal.

(2) No application for the renewal of a local licence under subsection (1) may be made before the Authority first publish a notice pursuant to section 44(2) of the Broadcasting Act 1996 inviting applications for a licence to provide a relevant local radio multiplex service.

(3) Subject to subsection (2), an application for the renewal of a local licence under subsection (1) may be made by the licence holder not earlier than three years before the date on which it would otherwise cease to be in force and not later than the relevant date.

(4) The applicant must, in his application or at any time before the consideration of his application, nominate—

1. (a) a local digital sound programme service provided or to be provided by him, and
2. (b) a relevant local radio multiplex service.

but may not nominate together a local digital sound programme service and a local radio multiplex service if another local licence held by him includes a condition in pursuance of subsection (12) relating to the broadcasting of that local digital sound programme service by that local radio multiplex service.

(5) Where an application for the renewal of a local licence has been duly made to the Authority, they shall grant the application if—

1. (a) they are satisfied that the applicant would, if his licence were renewed, provide a local service which complied with the conditions included in the licence in pursuance of section 106 (whether as originally imposed or as varied under that section), and
2. (b) the nominated local digital sound programme service provided by the applicant is being broadcast by means of the nominated local radio multiplex service.

(6) Where the condition specified in subsection (5)(a) is satisfied, the Authority may grant the application even though the condition specified in subsection (5)(b) is not satisfied if—

1. (a) the applicant holds a licence to provide local digital sound programme services,
2. (b) a licence to provide the nominated local radio multiplex service has been awarded, and
3. (c) it appears to the Authority that, under a contract between the applicant and the person to whom that licence has been awarded, the applicant is obliged to provide the nominated local digital sound programme service for broadcasting by means of the nominated local radio multiplex service.

(7) The Authority may in any case postpone consideration of the application until the relevant date.

(8) If, at the relevant date, the condition specified in subsection (5)(b) is not satisfied, and any of the conditions specified in subsection (6) is not satisfied, the Authority may postpone consideration of the application for such period not exceeding twelve months as they think appropriate.

(9) Where the Authority postpone consideration of an application under this section for any period beyond the relevant date (the "postponement period"), they shall extend the period for which the licence is in force by a period equal to the postponement period; and section 86(3) shall not limit the powers of the Authority under this subsection.

(10) On the grant of any application under this section the Authority shall—

1. (a) where the nominated local digital sound programme service provided by the applicant is not being broadcast by means of the nominated local radio multiplex service, determine a date by which that service must have begun to be so broadcast; and
2. (b) specify a fee payable to the Authority in respect of the renewal.

(11) Where the Authority have granted a person's application under this section they shall formally renew his licence as soon afterwards as is reasonably practicable; and they shall not so renew his licence unless they have notified him of—

1. (a) any date determined by them under subsection (10)(a), and
2. (b) the renewal fee specified by them under subsection (10)(b),

and he has, within such period as is specified in that notification, notified them that he consents to the licence being renewed on those terms.

(12) Where the Authority renew a licence under this section they shall include in the licence as renewed a condition requiring the licence holder to do all that he can to ensure that the nominated local digital sound programme service is broadcast by means of the nominated local radio multiplex service throughout the period beginning with whichever is the later of—

1. (a) the date on which the licence would expire if not renewed, and
2. (b) any date determined by them under subsection (10)(a),

and ending with the date on which the licence (as renewed) is to expire.

(13) In this section—

1. (a) "local digital sound programme service" has the same meaning as in Part II of the Broadcasting Act 1996;
2. (b) "nominated" means nominated by the applicant under subsection (4);
3. (c) "relevant date", in relation to a local licence, means the date which the Authority determine to be that by which they would need to publish a notice under section 104(1) if they were to grant, as from the date on which that licence would expire if not renewed, a fresh licence to provide the local service formerly provided under that licence; and
4. (d) "relevant local radio multiplex service", in relation to a local licence, means a local radio multiplex service (within the meaning of Part II of the Broadcasting Act 1996) with a coverage area which to a significant extent includes the coverage area of the local service provided under the local licence; and for this purpose "coverage area", in relation to a service, has the meaning given by in paragraph 3A of Part I of Schedule 2.

Special application procedure for local licences.

104B.—(1) Where—

1. (a) a local licence is due to expire (otherwise than by virtue of section 110),
2. (b) the local service provided under the licence falls within category B, C or D of the Table in paragraph 8 of Part III of Schedule 2, and
3. (c) the Authority propose to grant a further licence to provide the service in question,

the Authority may if they think fit publish a notice under subsection (2) instead of a notice under section 104(1).

(2) A notice under this subsection is a notice—

1. (a) stating that the Authority propose to grant a further licence to provide a specified local service,
2. (b) specifying the area or locality in the United Kingdom for which the service is to be provided,
3. (c) inviting declarations of intent to apply for a licence to provide the service,
4. (d) specifying the closing date for such declarations, and
1074
5. (e) specifying—
1. (i) the application fee payable on any declaration made in pursuance of the notice, and
2. (ii) a deposit of such amount as the Authority may think fit.

(3) A declaration of intent made in pursuance of a notice under subsection (2) must be in writing and accompanied by the application fee and deposit specified under subsection (2)(e)(i) and (ii).

(4) Where the Authority receive a declaration of intent in accordance with the provisions of this section from a person other than the licence holder in relation to the service in question, they shall—

1. (a) publish a notice under section 104(1),
2. (b) specify—
1. (i) in relation to persons who have made a declaration of intent in accordance with the provisions of this section, no further application fee, and
2. (ii) in relation to all other applicants, an application fee of the same amount as the fee referred to in subsection (2)(e)(i), and
3. (c) repay the deposit referred to in subsection (2)(e)(ii) to every person—
1. (i) who has made a declaration of intent in accordance with the provisions of this section, and
2. (ii) who duly submits an application in pursuance of the notice referred to in paragraph (a).

(5) Where the Authority receive a declaration of intent in accordance with the provisions of this section from the licence holder in relation to the service in question, and no such declaration from any other person, they shall—

1. (a) invite the licence holder to apply for the licence in such manner as they may determine (but without requiring any further application fee), and
2. (b) on receiving an application duly made by him, repay to him the deposit referred to in subsection (2)(e)(ii).

(6) The Secretary of State may by order amend subsection (1) by removing any of the categories of local service for the time being specified in that subsection, or by substituting for any of such categories any one or more categories of local service set out in the Table in paragraph 8 of Part III of Schedule 2.

(7) Any order under subsection (6) shall be subject to annulment in pursuance of a resolution of either House of Parliament."

(2) In section 104 of the 1990 Act (applications for licences other than national licences), subsections (5) and (6)(a) shall cease to have effect.'.

138 After Clause 76, insert the following new clause—

POWER OF RADIO AUTHORITY TO SUSPEND LICENCE TO PROVIDE SATELLITE SERVICE

'. After section 111A of the 1990 Act there is inserted—

"Power to suspend licence to provide satellite service.

111B.—(1) If the Authority are satisfied—

1. (a) that the holder of a licence to provide a satellite service has included in the service one or more programmes containing material likely to encourage or incite to crime or to lead to disorder,
2. (b) that he has thereby failed to comply with the condition included in the licence in pursuance of section 90(1)(a), and
3. (c) that the failure is such as to justify the revocation of the licence,

they shall serve on the holder of the licence a notice under subsection (2).

(2) A notice under this subsection is a notice—

1. (a) stating that the Authority are satisfied as mentioned in subsection (1),
2. (b) specifying the respects in which, in their opinion, the licence holder has failed to comply with the condition mentioned in paragraph (b) of that subsection,
3. (c) stating that the Authority may revoke his licence after the end of the period of twenty-one days beginning with the date on which the notice is served on the licence holder,
4. (d) informing the licence holder of his right to make representations to the Authority within that period about the matters complained of, and
5. (e) suspending the licence as from the time when the notice is served on the licence holder until the revocation takes effect or the Authority decide not to revoke the licence.

(3) If the Authority, having considered any representations about the matters complained of made to them within the period referred to in subsection (2)(c) by the licence holder, are satisfied that it is necessary in the public interest to revoke the licence in question, they shall serve on the licence holder a notice revoking the licence.

(4) A notice under subsection (3) shall not take effect until the end of the period of twenty-eight days beginning with the day on which that notice was served on the licence holder.

(5) Section 111 shall not have effect in relation to the revocation of a licence in pursuance of a notice under subsection (1)."'.

139 Clause 87, page 73, line 23, leave out '57(1A)' and insert '57(1A)(a)'.

140 Clause 88, page 74, line 2, leave out '57(1A)' and insert '57(1 A)(a)'

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendments Nos. 135 to 140. I have already spoken to these amendments.

Moved, That the House do agree with the Commons in their Amendments Nos. 135 to 140.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

141 Clause 99, page 81, leave out lines 21 to 23.

Lord Inglewood

My Lords, I beg to move that the House do agree with the Commons in their Amendment No. 141. In speaking to this amendment, I should like to speak also to Amendment No. 142. Your Lordships may recall the debate at Report stage during the previous passage of this Bill through this House, at which time my noble friend Lord Astor moved amendments designed to replace the provision of absolute privilege for the BSC with one of qualified privilege. I said at that time that the Government proposed to remove the existing reference to privilege in its entirety. On further reflection, however, we did not feel that this alone was entirely satisfactory. Thus, while Amendment No. 141 deletes the existing provision, Amendment No. 142 attaches privilege to statements, directions and reports issued by the commission in so far as they relate to fairness complaints, provided that it cannot be shown that the commission has acted with malice. We would not wish to imply that this provision in any way limited privilege for any other element of the commission's work where it would normally apply, and subsection (2) of the new clause makes this clear.

Moved, That the House do agree with the Commons in their Amendments Nos. 141 and 142.—(Lord Inglewood.)

Lord Renton

My Lords, I wish that subsection (1) would make the matter clear. The original subsection (11), which it is proposed to omit, was perfectly clear from the legal point of view. Your Lordships are aware that there are two kinds of privilege: absolute privilege and qualified privilege. Qualified privilege arises in various circumstances. It is not merely a question of whether there is malice; it is a question of whether a person has either a duty or right to communicate. In Amendment No. 142 subsection (1) of the new clause merely refers to privilege. It does not say whether it is absolute or qualified privilege. But it provides that, whether the privilege is absolute or qualified, if malice arises privilege does not exist.

One wonders what the courts will make of that. They will try to interpret the will of Parliament as best they can, and I hope that they do not find it too difficult. I am a little worried about it. Although this change may be desirable in view of what my noble friend Lord Astor said at an earlier stage of the Bill, I wonder whether the solution of the Government is the right way to do it. Frankly, I would have preferred to leave the Bill as it was.

Lord Inglewood

My Lords, I am most grateful to my noble friend for giving the House the benefit of his very considerable experience in these matters. As those involved in the history of this matter know only too well, this has proved to be a difficult issue. We believe that the effect of what we have done will be appropriately to circumscribe the circumstances in which the commission could be attacked. I accept that the state of affairs to which the noble Lord has referred could give rise to problems. One of the difficulties that we faced in this area, bearing in mind recent history, was that the position had become very unclear. We felt that this was probably the best way forward in all the circumstances.

Lord Simon of Glaisdale

My Lords, I should like to ask the noble Lord whether the concluding words of subsection (1) provide the usual formula; in other words, whether it may be simpler to say that there is qualified privilege.

Lord Inglewood

My Lords, I am advised that this is the usual formula in these kinds of circumstance.

On Question, Motion agreed to.

Amendment No. 142 omitted.

COMMONS AMENDMENT

143 Clause 112, page 87, line 12, at end insert 'or the issue of shares or securities'.

5.30 p.m.

Lord Inglewood

My Lords, I beg to move that this House do agree with the Commons in their Amendment No. 143. I shall speak also to Amendments Nos. 144, 144A, 145, 259, 261–265, 264A, 265 and 265A. I shall refer to a number of amendments which were introduced in another place which relate to the sale by the BBC of its transmission services. The bulk of the amendments is of a technical nature and relates to various accounting and taxation matters which arise when an entity moves from the public to the private sector.

In selling its transmission assets, the BBC is likely to proceed either by a trade sale of the assets direct, or through the creation of a wholly owned subsidiary and then sale of that subsidiary. A flotation is unlikely but not impossible. The provisions now incorporated in the Bill are designed to ensure that that process can take place without accounting and taxation distortions or unnecessary constraints. I hope that that comprehensively describes the thinking behind the amendments.

Moved, That the House do agree with the Commons in their Amendment No. 143.—(Lord Inglewood.)

On Question, Motion agreed to.

COMMONS AMENDMENT

144 After Clause 112, insert the following new clause—

TRANSFER SCHEMES: SUCCESSOR COMPANIES

'. Schedule (Transfer schemes relating to the BBC transmission network: successor companies) (which makes provision about the accounts etc. of wholly-owned subsidiaries of the BBC to which any property, rights or liabilities are transferred in accordance with a transfer scheme) shall have effect.'.