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Investigation Report No. 2472File no. ACMA2010/1633

Licensee Channel Seven Adelaide Pty Ltd

Station SAS Adelaide

Type of service Commercial television broadcasting

Name of program Channel Seven News

Date of broadcast 18 July 2010

Relevant legislation Paragraph 7(1)(a) of Schedule 2 to the Broadcasting Services Act 1992Tobacco Advertising Prohibition Act 1992

Date Finalised 30 May 2014Decision

Not satisfied there is a breach of paragraph 7(1)(a) of Schedule 2 to the Broadcasting Services Act 1992 (Cth).

ACMA Investigation Report 2472—Channel Seven News - SAS – 18 July 2010

BackgroundThe Australian Communications and Media Authority (ACMA) received a complaint that Channel Seven Adelaide Pty Ltd, the licensee of SAS Adelaide, broadcast a tobacco advertisement during the Channel Seven News program on 18 July 2010.

The complaint relates to a news segment entitled ‘Cheap Cigarette Imports’, which dealt with the importation from Germany and sale, by Coles supermarkets, of budget brands of cigarettes including those known as ‘Bayside’, ‘Harvest’, ‘Tradition’ and ‘Deal’.

Paragraph 7(1)(a) of Schedule 2 to the Broadcasting Services Act 1992 (the BSA) states that it is a condition of a commercial television broadcasting licence that the licensee will not, in contravention of the Tobacco Advertising Prohibition Act 1992 (the TAP Act), broadcast a tobacco advertisement within the meaning of that Act.

A breach finding was initially made against the licensee on 6 May 2011. Following remittal of the investigation by the Federal Court in November 2011, the licensee was given an opportunity to make fresh submissions on the matter. On 23 March 2012, a fresh breach decision was made against the licensee. The licensee subsequently sought judicial review of that decision. While a single judge of the Federal Court upheld the ACMA’s findings on 14 August 2013, a Full Court of the Federal Court overturned that judgment on 21 March 2014, and ordered that the ACMA’s decision made on 23 March 2012 be set aside. The ACMA is, therefore, now making a fresh decision on the matter in light of the judgment of the Full Court of the Federal Court in Channel Seven Adelaide Pty Ltd v ACMA [2014] FCAFC 32.

The programChannel Seven News is a half-hour news program broadcast at 6.00 pm on weeknights. The ‘Cheap Cigarette Imports’ segment (the segment) is 1 minute 20 seconds in duration. The segment reported on Coles importing cigarettes and selling them at lower prices than locally manufactured cigarettes. The segment included interviews with JT, the owner of a ‘Liberty’ petrol station, SS, a Smokefree Australia Coalition spokesman and two unidentified male smokers who participated in ‘vox-pop’ spots.

A transcript of the segment, including audio and visual elements, is included at Attachment A.

AssessmentThe assessment is based on:

the complaint

submissions from the licensee, and

a copy of the segment provided to the ACMA by the licensee.

This matter has been considered under paragraph 7(1)(a) of Schedule 2 to the BSA, and sections 8, 9(1), 9(1A), 9(7), 13 and 14 of the TAP Act. These legislative provisions are included at Attachment B.

The complaintThe complaint of 27 July 2010 stated:

I am concerned over a news report that appeared on the Channel Seven TV News program on the evening of July 18, 2010. The story reported on Coles selling imported


cigarettes at cheap prices. My objection to this story is that it contained pictures of the cigarette packets clearly showing the names of the different brands.

In my opinion this constitutes indirect advertising on behalf of both Coles and the cigarette companies involved.

Licensee’s submissionBy a letter to the ACMA dated 5 December 2011 (reproduced at Attachment C), the licensee referred to the grounds of review raised in its initial application to the Federal Court, and submitted:

1. The segment did not constitute a tobacco advertisement within the terms of subsection 9(1) of the TAP Act, or alternatively it fell within the exceptions provided for in subsection 9(1A) of the TAP Act (exception for political discourse), and/or subsection 9(7) of the TAP Act (exception for anti-smoking advertisements).

2. Alternatively, any tobacco advertisement in the segment was permitted by section 14 of the TAP Act as an incidental accompaniment to other matter.

3. Seven did not contravene the TAP Act because it had no intention to broadcast a tobacco advertisement in the segment.

FindingsThe ACMA finds that:

the segment broadcast by the licensee on 18 July 2010 included tobacco advertisements within the meaning of subsection 9(1) of the TAP Act.

the segment did not fall within the exception for political discourse in subsection 9(1A) of the TAP Act.

it was not clear from the advertisement that its sole or principal purpose was to discourage smoking or the use of tobacco products, and hence subsection 9(7) of the TAP Act did not apply.

the licensee did not broadcast the advertisement as an accidental or incidental accompaniment to the broadcasting of other matter, and hence section 14 of the TAP Act does not apply.

it is not satisfied that the licensee intended to broadcast a tobacco advertisement, according to the test of intention for a contravention of section 13 of the TAP Act stated by Tracey and Robertson JJ in Channel Seven Adelaide Pty Ltd v ACMA [2014] FCAFC 32, at paragraphs 13-14.

Accordingly, the ACMA is not satisfied that the licensee broadcast, in contravention of the TAP Act, a tobacco advertisement within the meaning of the TAP Act, and therefore is not satisfied that the licensee breached the licence condition at paragraph 7(1)(a) of Schedule 2 to the BSA.

Reasons

Section 13Tobacco advertisements not to be broadcast

Section 13 of the TAP Act provides that a person must not broadcast a tobacco advertisement in Australia on or after 1 July 1993.


There is no question that the segment was broadcast on 18 July 2010. The issue is whether the segment included a tobacco advertisement, broadcast in contravention of the TAP Act.

Whether the segment included tobacco advertisementsTobacco advertisement

The licensee submitted that the segment does not satisfy the definition of ‘tobacco advertisement’ in subsection 9(1) of the TAP Act, and further that it is not a tobacco advertisement for the purposes of that Act, by the operation of subsection 9(1A) and/or subsection 9(7).

Subsection 9(1) of the TAP Act provides:

Subject to this section, for the purposes of this Act, a tobacco advertisement is any writing, still or moving picture, sign, symbol or other visual image, or any audible message, or any combination of 2 or more of those things, that gives publicity to, or otherwise promotes or is intended to promote:

(a) smoking; or

(b) the purchase or use of a tobacco product or a range of tobacco products; or

(c) the whole or part of a trade mark that is registered under the Trade Marks Act 1955 in respect of goods that are or include tobacco products; or

(d) the whole or part of a design that is registered under the Designs Act 2003 in relation to products that are or include tobacco products; or

(e) the whole or part of the name of a person:

i. who is a manufacturer of tobacco products; and

ii. whose name appears on, or on the packaging of, some or all of those products;

(f) any other words (for example the whole or a part of a brand name) or designs, or combination of words and designs, that are closely associated with a tobacco product or a range of tobacco products (whether also closely associated with other kinds of products).

The material set out at Attachment A was broadcast in the segment. This included:

visual images of people smoking and a hand removing a cigarette from a packet in order to smoke

audible messages about, and visual images of, tobacco products available for purchase and being sold at Coles including the caption ‘cheap imports’, re-stocking of cigarette packs on a stand for sale at a petrol station, and people using tobacco products and being interviewed about their use or purchase of tobacco products

visual images of identified brands available in Australia and their prices, including the brand Benson and Hedges

audible messages about, and visual images of, German brands of cigarettes being imported by Coles from Germany for sale in Australia, including images of and verbal references to names of manufacturers of tobacco products appearing on the packaging of tobacco products.

The ACMA considers that this material included writing, stills, moving pictures, signs, symbols, other visual images, audible messages, or combinations of those things, falling within subsection 9(1) of the TAP Act.


Give publicity to, or otherwise promote?

The next question for the ACMA is whether the material gave publicity to, or otherwise promoted, any of the things listed in paragraphs (a) – (f) of subsection 9(1) of the TAP Act.

The Macquarie Dictionary (fifth edition) provides the following definitions of ‘publicity’ and ‘promote’:

Publicity

1. the state of being public, or open to general observation or knowledge.2. public notice as the result of advertising or other special measures.3. the state of being brought to public notice by mention in the mass media, or by any other means serving to effect the purpose.4. the measures, process, or business of securing public notice.5. advertisement matter, as leaflets, films, etc., intended to attract public notice.

Promote

1. to advance in rank, dignity, position, etc.2. to further the growth, development, progress, etc., of; encourage.3. to help to found; originate; organise; launch (a financial undertaking, publicity campaign, etc.).

The second and third meanings of “publicity”, and the second meaning of “promote”, are most relevant for present purposes.

The ACMA considers that the visual images of people smoking cigarettes, of cigarettes being sold at Coles and at a petrol station, of local brands and imported brands, and names of manufacturers appearing on cigarette packages, were likely to increase consumer awareness of smoking, the availability for purchase of a range of tobacco products, a trade mark (or design) registered in Australia, and the names of manufacturers of tobacco products being imported from Germany. The visual images therefore gave publicity to these things.

The ACMA considers that the audible messages identifying brands of cigarettes and their availability for discount prices at Coles, the difficulties of competition at the petrol station, references to the price of such cigarettes, and the two interviews with smokers, were also likely to increase consumer awareness of smoking, the availability for purchase of a range of tobacco products, a trade mark (or design) registered in Australia, and the names of manufacturers of tobacco products being imported from Germany. The audible messages therefore gave publicity to these things.

The ACMA also considers that the combination in the segment of the above visual images and audible messages would have brought the availability at Coles of cheap tobacco products to public notice, thereby giving publicity to the range of tobacco products referred to in the segment. The material dealing with the impact on the petrol station owner’s cigarette sales further reinforced and highlighted the segment’s messages about, and gave publicity to,the availability of cheap cigarettes at Coles.

As well as giving publicity to the products, the ACMA considers that smoking and the availability of cheap tobacco brands were advanced or encouraged through the above visual images and audible messages, or their combination, in the segment. In this sense the material also promoted smoking, the purchase or use of tobacco products, and the whole or parts of the name of a person who is a manufacturer of tobacco products.


In its submission, the licensee argued that something more than the mere appearance in visual form of, or a verbal reference to, a cigarette pack or brand name is required in order for that material to give publicity to or otherwise promote those items, and that such publicity must be positive. It argued that the segment did not contain any element of promotion or encouragement to smoking.

It also submitted that the segment runs for 80 seconds and that any references to cigarette names or images are very brief. It objected to the ACMA’s use of the detailed transcript at Attachment A on the basis that it places a disproportionate and unfair emphasis on the visual images in the news segment, including pack markings, logos and fonts which would not have been absorbed by the ordinary reasonable viewer of the evening news on a single viewing.

The ACMA is not persuaded by these submissions. The ACMA considers that the visual images and audible messages are separate and relevant matters for consideration under subsection 9(1) of the TAP Act which provides:

…a tobacco advertisement is any writing, still or moving picture, sign, symbol or other visual image, or any audible message, or any combination of 2 or more of those things, that gives…

Subsection 9(1) refers to any visual image or audible message (emphasis added). Consistent with the object of the TAP Act at subsection 3 (1), ‘to limit the exposure of the public to messages and images that may persuade them to (a) start smoking, or to continue smoking; or (b) to use, or to continue using, tobacco products,’ the ACMA considers that subsection 9(1) covers one or more visual images or audible messages, and does not set threshold measures or relative durations for such material. There is no explicit requirement in the TAP Act that the meaning conveyed by broadcast material be assessed by reference to the understanding of the ordinary, reasonable viewer, so the ‘ordinary reasonable viewer’ test used under broadcasting codes of practice to assess the meaning conveyed by broadcast material may not be applicable in this case.

In any event, the ACMA considers that the visual images and audible messages were not brief, fleeting or insignificant. Together they comprised a significant proportion of the segment. The images and messages were also quite clear and explicit and were not background material. The ACMA considers they were likely to promote awareness in ordinary reasonable viewers of the availability of less expensive brands of cigarettes at Coles. The explicit price comparisons with other brands had the tendency, and potential, to persuade some viewers to continue smoking, or to take up smoking, and the interviews with smokers gave positive messages about their enjoyment of smoking.

The licensee also submitted that the message of the segment was clear: that cheap imports are flooding the market and threaten to undermine recent progress in reducing tobacco sales. It also referred to other media reports on the issue, details of which were attached to its submission. The licensee said that to report this message effectively within the news report, it made references to cigarette brands and smoking, but these were not sufficient to provide the requisite promotion or encouragement to qualify as a ‘tobacco advertisement’ under the TAP Act.

The ACMA accepts that this was one message conveyed in the segment but considers that there were also audible messages and visual images in the segment which gave publicity to the importation of cheap cigarettes by Coles and promotional elements including the availability of cigarettes at Coles for lower prices than at other outlets, and the enjoyment of smoking by at least two smokers.


The ACMA must, of course, assess the material broadcast by the licensee, rather than the similar material that appeared in other media. However, it is noteworthy that, apart from the article in the Sunday Telegraph, the material in other media referred to by the licensee did not generally recite brand names. Although the ABC article included a picture of a man smoking, generally this material did not include such images and none referred to smokers discussing their enjoyment of smoking. Nor did it include images of people buying cigarettes, references to local trade marks associated with tobacco products, or details of comparative prices. Other media tended to include anti-smoking statements such as ‘smoking is still the major cause of cancer’ and ‘cigarettes kill one in two regular users’.

The ACMA considers that the segment broadcast by the licensee brought to public notice the availability of cheap brands of cigarettes at Coles, and this would have advanced or encouraged the purchase of tobacco products. The ACMA finds that the visual images and verbal messages from the segment that are referred to above gave publicity to, or otherwise promoted, smoking and the purchase or use of tobacco products, within the meaning of subsection 9(1) of the TAP Act.

Subsection 9 (1A) - Political discourse

The licensee submitted that the exception in subsection 9(1A) applied to the segment as it did not, and was not intended to, promote any particular tobacco product or particular range of tobacco products, or smoking, and the segment related solely to government or political matters being:

(i) the Federal government’s cigarette tax rise which prompted a rise in the availability of cheap imported products;

(ii) the recent decision by Coles to sell cheap imports which had the effect of undermining the effectiveness of the tax rise which applies only to Australian produced products;

(iii) the likely effects of cheap imports on youth smoking levels;

(iv) the likely effects of cheap imports on price competition.

The licensee also noted that these issues were the subject of comment by both the then Health Minister, Nicola Roxon, and members of the Federal Greens party, around the time of the news segment.

Under subsection 9(1A) of the TAP Act, if an advertisement does not promote, and is not intended to promote, smoking or any particular tobacco product or particular range of tobacco products, and the advertisement relates solely to government or political matters, it is not a tobacco advertisement for the purposes of the TAP Act.

Subsection 9(1A) was introduced by the Tobacco Advertising Prohibition Amendment Act 1995. According to Senator Herron’s comments on the Second Reading speech for the Bill, these amendments were introduced in order to ensure the right of ‘industry to communicate on political and government matters and to engage in many ordinary business communications’. The legislation would ‘enable companies to legitimately use their corporate logo, communicate on political and government matters, engage in many ordinary corporate communications and undertake activities such as a court imposed recall of a defective product’.

The findings above that the segment promoted smoking and particular tobacco products mean that the segment cannot satisfy paragraphs (a) and (b) of subsection 9(1A), so it is not necessary to consider the licensee’s contentions that the segment relates solely to government or political matters.


In any event, the ACMA does not accept that the segment related solely to government or political matters. The presenter’s opening line, ‘Anti-smoking campaigners say it’s a backward step in the fight against tobacco,’ continued with a reference to the fears of struggling independent retailers, and did not mention the political or government matters cited in the licensee’s submissions. The sequences which followed were about prices at Coles, the impact of the tax on sales, the interview with the petrol station owner about customers seeking the cheapest brands, and the interviews with smokers. There is a reference to the cigarette tax resulting in a drop in sales at the petrol station, and a single statement that Coles denies it is undermining the Federal Government tax rise, toward the end of the segment. There are no references in the segment to the statements by the Health Minister or the Federal Greens party, referred to in the licensee’s submission dated 5 December 2011, which might have set the segment in a government or political context.

The segment included explicit, audible messages and visual images concerning the availability for sale of cheap tobacco products at Coles, and the enjoyment by smokers of their cigarettes. While the segment may have made viewers aware of the impact of inexpensive imports on levels of smoking in the community, this message was less direct than those about the availability of cheap cigarettes for sale, and the economic impact on other retailers (which also served to highlight the bargains available at Coles). It did not directly state that the tax had prompted the rise in the importation of cheap products, nor did it expressly refer to increasing smoking levels. The messages outlined in the licensee’s submission are less explicit than the direct audible messages and visual images, or their combination, giving publicity to smoking and tobacco products in the segment.

The ACMA is not satisfied that the material in the segment does not promote tobacco products, or smoking, but even if this were so, the visual images and audible messages do not relate solely to government or political matters. For this reason also, the ACMA is not satisfied that the exception at subsection 9 (1A) of the TAP Act applies.

Subsection 9 (7) Exception - anti-smoking advertisements

The licensee submitted that the segment attracts the exception at subsection 9(7) of the TAP Act, as the sole or principal purpose of those parts which might be considered to be a tobacco advertisement were to discourage smoking or the use of tobacco products. The licensee submits that the anti-smoking tone is set in the opening words of the story, and in the references to the 30% drop in sales at the petrol station, and to the targeting of low income earners and teenagers. The licensee also referred to the interview with Stafford Sanders of Action on Smoking and Health Australia (ASH).

The exception at subsection 9(7) of the TAP Act applies if ‘it is clear from the advertisement that its sole or principal purpose is to discourage smoking or the use of tobacco products’.

The ACMA considers that the purpose of the segment was to make viewers aware of the actions of Coles in importing cheap cigarettes, the financial impact of this on Australian competitors, the undermining of the Australian Government cigarette tax, and of some smokers’ preferences. The segment did not deal with the health impact of Coles’ actions.

Although the segment contains two audible references to ‘the fight against tobacco’ and to Coles being ‘accused of targeting vulnerable and low income earners and teenagers,’ these messages are accompanied by visual images of cigarettes on display for sale, the words ‘CHEAP IMPORTS,’ a person inhaling a cigarette, the Coles retail area, a person’s hands holding a cigarette and a young person lighting a cigarette. The sequence featuring the ASH telephone interview referred to efforts to reduce smoking rates, including among teenagers


and said that Coles’ actions were not helpful, but it closed with a visual image of a hand removing a cigarette from a packet.

The ACMA considers that most of the segment was not anti-smoking in character. The segment contained no consumer health warnings and there were no words or images discouraging smoking. The segment did not contain any anti-smoking messages such as those included in the articles cited by the licensee in its submission, referring to the dangers of smoking, to death rates (‘cigarettes kill one in two regular users’), the health impact of Coles’ actions, or the diseases associated with smoking, such as cancer.

The sole or principal purpose of the segment did not appear to be to discourage smoking or the use of tobacco products.

The ACMA finds that it was not clear from either the segment as a whole, or the material in the segment which constituted a tobacco advertisement within the terms of subsection 9(1) of the TAP Act, that the sole or principal purpose was to discourage smoking or the use of tobacco products. Therefore, the exception provided for in subsection 9(7) of the TAP Act does not apply.

Whether the tobacco advertising in the segment was permitted by section 14 of the TAP ActThe licensee submitted that, if parts of the segment were considered to be a tobacco advertisement, the material was nevertheless permitted under section 14 of the TAP Act as:

a) the material was an accidental or incidental accompaniment to the broadcasting of the remainder of the news report; and

b) the licensee did not receive any direct or indirect benefit .

Under section 14 of the TAP Act, the broadcast of a tobacco advertisement is permitted if it is an ‘accidental or incidental accompaniment’ to the broadcasting of other matter, and the licensee does not receive any direct or indirect benefit for broadcasting the advertisement.

The ACMA accepts that the licensee did not receive any direct or indirect benefit for broadcasting a tobacco advertisement. However, the ACMA also considers that the broadcast of the advertisement was deliberate and not accidental.

In relation to the licensee’s contention that the tobacco advertisement was an ‘incidental’ accompaniment to the broadcasting of other matter, the ACMA notes that, in considering the meaning of the word ‘incidental’, the Full Federal Court in the Rothmans case1,and the High Court in the United Telecasters case2, referred to the definitions found in The Shorter Oxford Dictionary and The Macquarie Dictionary, as set out below.

The Shorter Oxford Dictionary defines ‘incidental’ as:

1. Occurring or liable to occur in fortuitous or subordinate conjunction with something else; casual... 2. Casually met with....

The Macquarie Dictionary definition of ‘incidental’ includes:

‘happening...in fortuitous or subordinate conjunction’ with the ‘other matter’ ...2nd ed (1987)3

In the Rothmans case, the Court stated:

1 Rothmans of Pall Mall (Australia) Ltd v Australian Broadcasting Tribunal (1985) 58 ALR 6752 Director of Public Prosecutions v United Telecasters Sydney Limited (1989) 168 CLR 5943 This definition of incidental is retained in the current on-line edition of the Macquarie Dictionary.


It is not difficult to think of circumstances under which a licensee might televise matter of an advertising character as an incidental accompaniment of televising other matter; for example a televised news item shows a street scene with advertising billboards in the background. The transmission may be accidental, in the sense that the staff of the licensee do not notice the background billboard. But it may also be deliberate. The action—which represents a genuine news item—happens to take place in front of the billboard so that if the news item is to be used the billboard must also be shown. Under such circumstances the exclusion of ‘incidental accompaniment’ would apply.4

In this case, the bulk of the segment included images of people smoking, of tobacco products available for purchase and being sold, of identified brands including local brands and German brands, and of names of manufacturers appearing on packaging. It included audible messages about the availability of the German cigarettes for sale at Coles supermarkets at discount prices, and about consumer preferences in relation to taste and price which included details of brands and price, visual images of people smoking, and interviews with consumers about their cigarette preferences.

The ACMA considers that the visual images and audible messages were of an advertising character and this constituted a substantial component of, and dominated, the segment. These images and messages did not happen in fortuitous or subordinate conjunction with other matter, and were part of the main thrust of the segment.

The licensee has submitted that, to the extent that any material within the segment is considered to be a tobacco advertisement, that material is clearly incidental to the remaining parts of the news report relating to:

a) the stance taken by anti-smoking campaigners;

b) the explanation of the Federal Government’s cigarette taxes and their effect on cigarette sales;

c) the price elasticity of cigarette demand;

d) the particular effect of cheap imports on the vulnerable and young;

e) Coles response to recent criticisms of its decisions to stock such products.

The ACMA is of the view that items (a) and (d) were present in the opening sequence, and the ASH interview but they were not the dominant feature of the segment. The main thrust of the segment concerned the availability of cheap cigarettes from Coles, and its impact on competitors, accompanied by visual images of cigarettes for sale, brand names, details about comparative prices, and people smoking, and interviews with some smokers about their enjoyment of smoking.

There was not an explanation of the Federal Tax rise. The level of the tax and its purpose was not explained, although its purpose and effects may have been inferred. Again, items (b) and (e) were covered in the context of the main thrust of the segment, rather than forming the dominant story.

The ACMA does not consider that the price elasticity of cigarette demand features in the segment, other than as a possible background theme.

The visual images and audible messages, or their combination, which fall within subsection 9(1) of the TAP Act, do not appear in subordinate conjunction to material concerning items (a) to (e). The material which constitutes a tobacco advertisement is therefore not ‘incidental’ to these items.

4 at 691


There were some spoken elements of the news story that did not give publicity to or promote smoking or tobacco products, but they were generally accompanied by visual images that did fall within subsection 9(1) of the TAP Act. The brief interview with the ASH spokesman did not constitute tobacco advertising. The images of, and words spoken by, the service station owner (with a tobacco stand in the background, but from which brands could not be identified) might not of themselves, considered separately, fall within the definition of tobacco advertisement in subsection 9(1) of the TAP Act. However, in the context of the segment as a whole, the service station owner talking about the difficulties in competing served to reinforce and highlight the segment’s dominant message about the availability of cheap cigarettes from Coles.

The ACMA does not consider that the spoken elements of the news story that did not give publicity to or promote smoking or tobacco products, the brief interview with the ASH spokesman, and the material featuring the service station owner, either separately or together formed the main thrust of the segment. While this material may have included some references to the items set out at (a) to (e) above, it did not dominate the segment. The segment, as a whole, gave publicity to or promoted the availability for purchase at Coles of cheap tobacco products, regardless of the fact that it may have contained criticisms of Coles for making those products available. When viewed in the context of the segment as a whole, the ACMA considers that items (a) to (e) were not sufficient to constitute ‘other matter’ to the broadcasting of which the rest of the material in the segment was an ‘incidental accompaniment’.

The licensee also submitted that the incidental effect of the material is to be assessed by reference to the impression created in the ordinary reasonable viewer, and not with the assistance of an overly detailed transcript. The licensee argued that the ordinary reasonable viewer would perceive references to cigarette brands and smoking as serving an illustrative purpose only for the important public health and public interest issues in the segment.

As noted above, consideration of the segment against the terms of the TAP Act requires assessment of any visual image or audible message or their combination that was broadcast. In any event, the ACMA considers that the segment did not focus on the public health issues surrounding the availability of cheap tobacco products at Coles, and the ordinary reasonable viewer would not have understood the segment to be conveying a public health message. While the segment did cover public interest issues, the material which constituted a cigarette advertisement dominated the segment and was not an incidental accompaniment to the material which covered public interest issues.

In conclusion, the ACMA finds that the cigarette advertisement was not an accidental or incidental accompaniment to the broadcast of ‘other matter’, and that section 14 of the TAP Act does not apply.

Whether Seven has contravened the TAP ActThe licensee submitted that any contravention of the TAP Act would require the ACMA to determine whether the broadcast of the news segment occurred with the requisite element of fault, and that element is the intention to broadcast. It argued that it is insufficient as a matter of statutory construction for the ACMA to demonstrate a mere failure to comply with the provisions of a statute, in order to found a ‘contravention’ of that law; the broadcast of a tobacco advertisement does not constitute ‘contravention’ of the TAP Act unless the advertisement is found, on the balance of probabilities, to have been broadcast intentionally.


The licensee also submitted that it had no intention to broadcast a tobacco advertisement in its news report, and it was its intention solely to report on a matter of public importance which had important political consequences for government policy and the efforts of third parties to reduce smoking and particularly youth smoking. This intention was evident in:

a) the introductory words of the story

b) the way in which it sought out and included in the news report the comments of ASH on the issue; and

c) the criticisms made of Coles’ actions throughout the news report.

Commonwealth offences consist of physical elements and fault elements (see subsection 3.1(1) of the Criminal Code Act 1995). The offence provided for in section 13 of the TAP Act contains a single physical element, that of broadcasting a tobacco advertisement.

Section 13 of the TAP Act does not specify a fault element for that physical element. In those circumstances, subsection 5.6(1) of the Criminal Code Act provides that intention is the fault element for that physical element. Subsection 5.2(1) of the Criminal Code Act provides that a person has intention with respect to conduct if he or she means to engage in that conduct.

The ACMA considers that the spoken words and visual images in the segment were scripted, filmed or collected, and edited and assembled, by employees or contractors of the licensee, and intentionally broadcast in the news segment on 18 July 2010.

The licensee intended to broadcast the material in the segment, and that included material which falls within the definition of a tobacco advertisement in section 9 of the TAP Act. However, that is not sufficient to satisfy the test of intention for a contravention of section 13 of the TAP Act. The majority judges (Tracey and Robertson JJ) in Channel Seven Adelaide Pty Ltd v ACMA [2014] FCAFC 32 relevantly held (at paragraphs 13-14): ‘… the person broadcasting must be proved to intend to broadcast and advertise one of the matters in s9(1)(a)-(f), that is, that the material broadcast gives publicity to, or otherwise promotes or is intended to promote, relevantly, smoking or the purchase or use of a tobacco product or a range of tobacco products. … the intention must extend to the character or nature of the material broadcast.” (emphasis added).

The segment conveyed a legitimate news story and, while the ACMA considers it was unnecessary for that story to be accompanied by so many visual images, and some spoken words, which constituted tobacco advertising within the terms of paragraphs 9(1)(a)-(f) of the TAP Act, the ACMA is not satisfied, on the balance of probabilities, that the licensee intended to give publicity to or promote smoking or the purchase or use of tobacco products.

Accordingly, the ACMA finds, for the purposes of its investigation of the complaint dated 27 July 2010, that it is not satisfied that the licensee broadcast a tobacco advertisement in contravention of section 13 of the TAP Act, and hence is not satisfied that the licensee breached the licence condition at paragraph 7(1)(a) of Schedule 2 to the BSA.


Attachment A

Transcript of ‘Cheap Cigarette Imports’, Channel Seven News segment broadcast on SAS on 18 July 2010.

AUDIO VISUAL IMAGES PRESENTER

Anti-smoking campaigners say it’s a backward step in the fight against tobacco while struggling independent retailers fear it could be the final nail in their coffin.

Foreground: Male newsreader, 7 News watermark (which remained visible throughout the story).

Background: right side of screen: city lights

Background: left side of screen: imagery associated with the story, comprised of:

Bottom left: many cigarette packets on display in several lines on a shelf, with the cigarettes being clearly available for sale. Branding unclear. Consumer warnings not apparent. Red coloured effect over the entire picture.

Middle left: caption in bold ‘CHEAP IMPORTS’. Writing in white, background in black.

Top left: four cigarette packets with three cigarette packets standing upright, and a fourth cigarette packet leaning on one of the three packets that are standing upright. The names are clearly visible on three of the packets, being ‘Harvest’, ‘Bayside’, and ‘Deal’.

Writing appears on top of the four cigarette packets being “MADE IN GERMANY’ AND “Made in ...”

There is also half of a female face visible to the right of one of the 4 cigarette packets. The face belongs to an older female smoker with a cigarette in her mouth and two of her fingers near the cigarette ready to inhale the cigarette, or having just inhaled the cigarette.

REPORTER (MM)

Bayside, Harvest, Tradition – they sound like typical Australian brands but take a closer look and you’ll see they are anything but. Coles is importing them from Germany and selling them here at discount prices, some up to $5 a packet cheaper than the Australian equivalent.

Front view of the blue and white ‘Bayside’ cigarette packet. The ‘Bayside’ trade mark, which appears to be based on a coat of arms with the letters ‘V.E’ in the middle, is clearly visible on the top left of the packet, as well as the word ‘Bayside’, which is capitalised and appears in large white print, with a blue background. The words ‘Finest Virginia’ also appear, again capitalised, and in white with a blue background. However,


Finest Virginia appears in smaller letters than the word Bayside. No consumer warnings are visible on the packet.

Front view of the blue ‘Harvest’ cigarette packet. The ‘Harvest’ trade mark which appears to be based on a coat of arms is clearly visible in the centre of the packet, as well as the word ‘Harvest, which is capitalised and appears in large white print, with a blue background. The word ‘Virginia’ also appears again capitalised, under the word ‘Harvest’. A consumer warning appears at the top of the packet. This warning is comprised of a child with a mask and the following message appears in capital letters: ‘Don’t let children breathe your smoke’.

Front view of the grey ‘Tradition’ cigarette packet, tilted to the left. The ‘Tradition’ trade mark which appears to be based on a coat of arms is clearly visible in the centre of the packet, as well as the word ‘Tradition, which is capitalised and appears in large red print, with a grey background. The number ‘25’ is visible, presumably meaning that the cigarette packet contains 25 cigarettes. A consumer warning appears at the top of the packet. This warning is comprised of two adults on telephones who appear to be speaking to each other. The following messages appears in capital letters: ‘Quitting will improve your health’, and in smaller print ‘call quitline today’.

A view of half a cigarette packet also appears. The packet is purple and appears to be a ‘Deal’ cigarette packet, but no branding is visible. A coat of arms is visible (seemingly the ‘Deal’ trade mark), and the following words appear in capital letters: ‘Virginia Blend’. A consumer warning is mostly visible at the top of the packet. The warning is comprised of the message: ‘Smoking causes mouth and throat cancer’.

A front view of the ‘Bayside’ cigarette packet appears next to a ‘Deal’ cigarette packet, with a ‘Harvest’ cigarette packet standing on both packets, in the middle, and a ‘Tradition’ cigarette packet appears to the right of the ‘Deal’ cigarette packet, tilted to the left and leaning on the ‘Deal’ cigarette packet. The camera slowly pans into this image.

A Channel Seven news caption under this image stating: “MARK MOONEY Reporting Cheap Cigarette Imports”.

Side view of Tradition cigarette packet with


clear writing ‘MADE IN GERMANY’. In smaller print, ‘Made by Joh. Wilh. von Eicken – Germany for Richland Express Pty Ltd – Australia (physical address, email address) ... Consumer Careline 1300790886. On the right side, at the top of the packet, ’25 cigarettes ... Made for Australia’ appears. On the left side, a bar code appears. Health warnings are mostly not visible.

A view of retail activity at Coles including the sale of cigarettes.

A view of a Coles cigarette stand.

Close up of cigarette packets on a stand with prices marked: Horizon in a blue packet appears – the price appears to be $11.50, Escort in 5 different coloured packets (red, blue, khaki, grey, light blue) – the price appears to be $19.20, the 7 brand in 3 different coloured packets appear (red, blue, dark green) – with a price of $21.95, an identified brand $17.60, another identified brand $11.90, and Benson and Hedges whose price is $16.50. Health warnings are mostly not visible, except on the Benson and Hedges brand. The three warnings visible on the Benson and Hedges brand are ‘Quitting will improve your health’, ‘Smoking clogs your arteries’ and ‘Smoking is addicitive’.

PETROL STATION OWNER (JT)

They are killing Australian business. I’m really surprised how things can pass the ACCC.

Live interview with petrol station owner (JT). A full cigarette stand appears in the background.

REPORTER (MM)

Since the Federal Government raised cigarette taxes in April, tobacco sales at this petrol station have dropped by more than 30%.

Close up of a man lighting a cigarette, view of a ‘Liberty’ petrol station with no customers.


Customers are asking for the cheapest now. They don’t have favourite brand (sic). They just want cheapest brands.

Live interview with petrol station owner (JT). A full cigarette stand appears in the background. This follows vision of JT who is shown restocking his cigarette stand packet by packet.

UNNAMED MALE (1)

If they taste equally the same or better, for sure.

Live interview with unnamed male (1).

UNNAMED MALE (2)

For me, personally, no. The price is irrelevant. I think you buy it cause you enjoy that type of

Live interview with unnamed male (2).


cigarette.

REPORTER (MM)

Coles is accused of targeting vulnerable low income earners and teenagers.

More vision of a Coles retail area, two female hands with cigarettes in them, and an apparently teenaged male with a baseball cap, headphones and a colourful shirt lighting a cigarette.

SS, a SMOKEFREE AUSTRALIA COALITION SPOKESMAN (SS)

At a time when we’re trying to reduce smoking rates, and particularly youth smoking rates, this is hardly helpful to be selling cut-price cigarettes.

Still picture: a man’s face (presumably the interviewee) next to an ASH insignia, a symbol of a mobile phone to the left of the photo, a caption above the photo with ‘PHONE INTERVIEW’, and a caption below the photo which has the interviewee’s name ‘STAFFORD SAND’. Below the interviewee’s name is the interviewee’s description as ‘Anti-smoking campaigner’.

Moving picture: a hand removing a cigarette from a Bayside packet with the Bayside name clearly seen on the cigarette packet. No consumer warnings are visible.

REPORTER (MM)

Coles denies it’s undermining the Federal Government’s tax rise and days the move is purely about giving customers more choice.

Journalist speaking in front of Coles.


The competition is very high between fuel, and now cigarettes and what else after that?

Live interview with petrol station owner (JT). A full cigarette stand appears in the background.

REPORTER (MM)

Mark Mooney, Seven news.Extreme close-up of a man puffing on a cigarette, seemingly in slow motion.


Attachment B

Relevant legislation – tobacco advertisements

Broadcasting Services Act 1992

Schedule 2 Standard conditionsPart 3 - Commercial television broadcasting licences

7 Standard conditions of commercial television broadcasting licences

(1) Each commercial television broadcasting licence is subject to the following conditions:

(a) the licensee will not, in contravention of the Tobacco Advertising Prohibition Act 1992, broadcast a tobacco advertisement within the meaning of that Act.

Tobacco Advertising Prohibition Act 1992 (‘TAP Act’)Part 2—Interpretation8 Defined terms

In this Act, unless the contrary intention appears:

tobacco product means:

(a) tobacco (in any form); or

(b) any product (for example a cigar or a cigarette):(i) that contains tobacco as its main or substantial ingredient;

and(ii) that is designed or intended for human consumption or use;

and(iii) that is not included in the Australian Register of

Therapeutic Goods maintained under the Therapeutic Goods Act 1989.

9 Meaning of tobacco advertisement

Basic meaning

(1) Subject to this section, for the purposes of this Act, a tobacco advertisement is any writing, still or moving picture, sign, symbol or other visual image, or any audible message, or any combination of 2 or more of those things, that gives publicity to, or otherwise promotes or is intended to promote:

(a) smoking; or

(b) the purchase or use of a tobacco product or a range of tobacco products; or


(c) the whole or a part of a trademark that is registered under the Trade Marks Act 1955 in respect of goods that are or include tobacco products; or

(d) the whole or a part of a design that is registered under the Designs Act 2003 in respect of articles that are or include tobacco products; or

(e) the whole or a part of the name of a person:

(i) who is a manufacturer of tobacco products; and(ii) whose name appears on, or on the packaging of, some or all of

those products; or(f) any other words (for example the whole or a part of a brand name) or

designs, or combination of words and designs, that are closely associated with a tobacco product or a range of tobacco products (whether also closely associated with other kinds of products).

…

Exception—political discourse

(1A) To remove any doubt, it is declared that if:

(a) something (the advertisement) does not promote, and is not intended to promote, any particular tobacco product or particular range of tobacco products; and

(b) the advertisement does not promote, and is not intended to promote, smoking; and

(c) the advertisement relates solely to government or political matters;

the advertisement is not a tobacco advertisement for the purposes of this Act.

...

Exception—anti-smoking advertisements

(7) If:

(a) apart from this subsection, something (the advertisement) would, technically, be a tobacco advertisement; and

(b) it is clear from the advertisement that its sole or principal purpose is to discourage smoking or the use of tobacco products;

then, despite subsection (1), the advertisement is not a tobacco advertisement for the purposes of this Act.

Part 3—Prohibition of tobacco advertisements

Division 1—Broadcasting of tobacco advertisements

13 Tobacco advertisements not to be broadcast


(1) A person must not broadcast a tobacco advertisement in Australia or Norfolk Island on or after 1 July 1993 otherwise than as permitted by section 14.

Penalty: 120 penalty units.

14 Accidental or incidental broadcast permitted

A person may broadcast a tobacco advertisement if:

(a) the person broadcasts the advertisement as an accidental or incidental accompaniment to the broadcasting of other matter; and

(b) the person does not receive any direct or indirect benefit (whether financial or not) for broadcasting the advertisement (in addition to any direct or indirect benefit that the person receives for broadcasting the other matter).


Attachment C

Licensee’s submission of 5 December 2011


The attachments referred to in the submission are not reproduced


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