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218 Financial terms of licence renewed under s. 217 | |
(1) The determination under section 217(4)(b) must comprise— | |
(a) a determination of the amount which the holder of the renewed licence | |
will be required by the conditions of that licence to pay to OFCOM in | |
respect of the first complete calendar year falling within the renewal | 5 |
period; | |
(b) a determination of the percentage of qualifying revenue for each | |
accounting period of the licence holder falling within the renewal | |
period which he will be required by those conditions to pay to OFCOM. | |
(2) The amount determined under subsection (1)(a) must be equal to the amount | 10 |
which, in OFCOM’s opinion, would have been the cash bid of the licence | |
holder were the licence (instead of being renewed) to be granted for the period | |
of the renewal on an application made in accordance with Part 1 of Schedule | |
10. | |
(3) For the purposes of subsection (1)(b)— | 15 |
(a) different percentages may be determined for different accounting | |
periods; and | |
(b) the percentages that may be determined for an accounting period | |
include a nil percentage. | |
(4) In this section “renewal period”, in relation to a licence, means the period for | 20 |
which the licence is in force by reason of its renewal. | |
(5) Part 3 of Schedule 10 applies for construing this section as it applies for | |
construing that Schedule. | |
Meaning of initial expiry date | |
219 Meaning of “initial expiry date” | 25 |
(1) Subject to any postponement under this section, the date which is the initial | |
expiry date for the purposes of this Part is 31st December 2014. | |
(2) The Secretary of State may (on one or more occasions) by order postpone the | |
initial expiry date. | |
(3) The Secretary of State’s power to postpone the initial expiry date— | 30 |
(a) is to be exercisable before 30th June 2013 only if he has fixed a date after | |
30th June 2013 as the date for digital switchover; and | |
(b) is not to be exercisable on or after 30th June 2013 if he has fixed 30th | |
June 2013 or an earlier date as the date for digital switchover. | |
(4) Where the Secretary of State makes an order under this section at a time after | 35 |
he has fixed a date for digital switchover, the date to which the initial expiry | |
date is postponed must be a date not less than eighteen months after the date | |
for digital switchover. | |
(5) The Secretary of State must exercise his power to postpone the initial expiry | |
date if it at any time appears to him that that date would otherwise fall within | 40 |
the period of eighteen months immediately following the date fixed for digital | |
switchover. | |
(6) Where an order under this section extends a licensing period for which a | |
licence has been granted in accordance with section 209 or 214, the 1990 Act | |
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(6) and this Part shall have effect (subject to subsection (7)) as if the licence had | |
originally been granted for the extended period. | |
(7) Where an order under this section extends the period for which a licence is to | |
continue in force— | |
(a) that order shall not affect the earliest time at which an application for | 5 |
the renewal of that licence may be made in accordance with section | |
211(2)(a) or 217(2)(a); | |
(b) as soon as reasonably practicable after making the order, OFCOM must | |
make such modification of any determination made by them in the case | |
of that licence for the purposes of section 211(2)(b) or 217(2)(b) as they | 10 |
consider appropriate in consequence of the extension; and | |
(c) neither section 211(3)(a) nor section 217(3)(a) applies to the making of | |
that modification. | |
(8) In this section a reference to the date for digital switchover is a reference to the | |
date fixed by the Secretary of State for the purposes of this section as the date | 15 |
which appears to him, in consequence of directions given by him for the | |
purposes of the conditions of the licences for the relevant public broadcasting | |
services, to be the date after which none of those services will be broadcast to | |
any significant extent in analogue form. | |
(9) In this section “the relevant public broadcasting service” means any of the | 20 |
following— | |
(a) the services comprised in Channel 3; and | |
(b) Channel 5. | |
Reviews relating to licensing of Channels 3 & 5 and teletext | |
220 Application for review of financial terms of replacement licences | 25 |
(1) The holder of a replacement licence granted under section 210 or 216 may | |
apply to OFCOM, at any time in the first or any subsequent review period, for | |
a review of the financial terms on which that licence is held. | |
(2) For the purposes of this section the first review period is the period which— | |
(a) begins four years before the first notional expiry date; and | 30 |
(b) ends with the day before the day that OFCOM have determined to be | |
the one by which they would need to publish a tender notice if they | |
were proposing to grant a fresh licence to take effect from the first | |
notional expiry date. | |
(3) For the purposes of this section a subsequent review period in the case of a | 35 |
replacement licence is so much (if any) of the following period as falls before | |
the end of the initial expiry date, namely, the period which— | |
(a) begins four years before a subsequent notional expiry date; and | |
(b) ends with the day before the day that OFCOM have determined to be | |
the one by which they would need to publish a tender notice if they | 40 |
were proposing to grant a fresh licence to take effect from that notional | |
expiry date. | |
(4) A determination for the purposes of subsection (2)(b) or (3)(b) in respect of a | |
replacement licence— | |
(a) must be made at least one year before the day determined; and | 45 |
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(b) must be notified by OFCOM to the person who, at the time of the | |
determination, holds the licence in question. | |
(5) No application under this section for a review of the financial terms on which | |
a replacement licence is held is to be made— | |
(a) at any time when an application under section 221 for a review of those | 5 |
terms is pending; or | |
(b) at any time in the period of twelve months following the day on which | |
a determination by OFCOM on such an application is notified to the | |
licence holder. | |
(6) For the purposes of this section an application for a review under section 221 | 10 |
is pending from the time when the application is made until the end of the day | |
on which OFCOM’s determination on the review is notified to the licence | |
holder. | |
(7) In this section— | |
“the first notional expiry date”, in relation to a replacement licence, means | 15 |
the date with which (apart from this Act) the existing licence would | |
have expired if not renewed; | |
“subsequent notional expiry date”, in relation to a replacement licence, | |
means— | |
(a) in a case in which an application by the licence holder for a | 20 |
review under this section was made during the review period | |
beginning four years before the last notional expiry date, the | |
tenth anniversary of the date on which OFCOM’s | |
determination on that review was notified to the licence holder; | |
and | 25 |
(b) in any other case, the tenth anniversary of the last notional | |
expiry date; | |
“tender notice” means a notice under section 15(1) of the 1990 Act or (as | |
the case may be) paragraph 1 of Schedule 10. | |
(8) In subsection (7) “existing licence” has the same meaning as in section 210 or | 30 |
(as the case may be) 216. | |
221 Application for review of financial terms in consequence of new obligations | |
(1) This section applies where an order is made under section 399 that brings | |
section 265, 266 or 267 (or any two or more of them) into force for the purpose | |
of including conditions in the regulatory regime for— | 35 |
(a) a Channel 3 service; | |
(b) Channel 5; or | |
(c) the public teletext service. | |
(2) The holder of a licence in which conditions mentioned in section 265, 266 or 267 | |
will fall to be included when the order comes into force may apply to OFCOM, | 40 |
at any time in the review period, for a review of the financial terms on which | |
the licence is held. | |
(3) For the purposes of this section the review period in the case of an order under | |
section 399 is the period which— | |
(a) begins with the day on which the order is made; and | 45 |
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(b) ends with the time at which, by virtue of the order, one or more of | |
sections 265, 266 and 267 come into force in the case of the licence in | |
question. | |
(4) If in the case of the same order there is more than one time falling within | |
subsection (3)(b), the review period ends with the later or latest of them. | 5 |
222 Reviews under ss. 220 and 221 | |
(1) This section applies where an application is made under section 220 or 221 for | |
a review of the financial terms on which a licence is held. | |
(2) As soon as reasonably practicable after receiving the application, OFCOM | |
must— | 10 |
(a) determine the amount to be paid to them under the conditions of the | |
licence for the first calendar year falling wholly or partly within the | |
period under review to begin after the application date; and | |
(b) determine the percentage to be used for computing the payments to be | |
made to them under those conditions in respect of each accounting | 15 |
period falling within the period under review to begin after that date. | |
(3) The amount determined under subsection (2)(a) must be equal to the amount | |
which, in OFCOM’s opinion, would have been the cash bid of the licence | |
holder were the licence being granted afresh on an application made in | |
accordance with— | 20 |
(a) section 15 of the 1990 Act (licences for Channel 3 service or Channel 5); | |
or | |
(b) paragraph 3 of Schedule 10 to this Act. | |
(4) The determination required by subsection (2)(b) is a determination of the | |
percentage of qualifying revenue for each accounting period that is to be paid | 25 |
to OFCOM. | |
(5) For the purposes of subsection (2)(b)— | |
(a) different percentages may be determined for different accounting | |
periods; and | |
(b) the percentages that may be determined for an accounting period | 30 |
include a nil percentage. | |
(6) In making their determinations on an application under section 221 OFCOM | |
are to have regard, in particular, to any additional costs that are likely to be | |
incurred by the licence holder in consequence of the commencement of so | |
much of section 265, 266 or 267 (or any two or more of them) as is brought into | 35 |
force by the commencement order in question. | |
(7) References in this section to qualifying revenue for an accounting period are to | |
be construed— | |
(a) in the case of the holder of a licence to provide a Channel 3 service or | |
Channel 5, in accordance with section 19 of and Part 1 of Schedule 7 to | 40 |
the 1990 Act; and | |
(b) in the case of the holder of the licence to provide the public teletext | |
service, in accordance with Part 3 of Schedule 10 to this Act. | |
(8) In this section— | |
“the application date”, in relation to a review, means the date of the | 45 |
making under section 220 or 221 of the application for the review; and | |
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“the period under review”, in relation to a review of the financial terms of | |
a licence, means so much of the period for which the licence will (if not | |
renewed) continue in force after the application date. | |
223 Giving effect to reviews under ss. 220 and 221 | |
(1) As soon as reasonably practicable after making a determination under section | 5 |
222 on an application under section 220 or 221, OFCOM must give a | |
notification of their determination to the applicant. | |
(2) The notification must set out— | |
(a) the determination made by OFCOM; | |
(b) the modifications of the applicant’s licence that are required to give | 10 |
effect to the determination; | |
(c) a date by which the applicant must notify OFCOM whether or not he | |
accepts the determination and modifications; and | |
(d) a subsequent date by which the applicant’s licence will cease to have | |
effect if he does not. | 15 |
(3) The modifications set out in accordance with subsection (2)(b) must secure that | |
the amount falling to be paid under the conditions of the applicant’s licence for | |
each calendar year subsequent to that for which an amount has been | |
determined in accordance with section 222(2)(a) is the amount so determined | |
as increased by the appropriate percentage. | 20 |
(4) In the case of a determination on an application under section 220, the date | |
specified in accordance with subsection (2)(d) must not fall before whichever | |
is the earlier of — | |
(a) the next notional expiry date after the application for the review; and | |
(b) the end of the licensing period in which that application was made. | 25 |
(5) Where the applicant notifies OFCOM that he accepts the determination— | |
(a) his licence is to have effect with the modifications set out in OFCOM’s | |
notification; and | |
(b) all such adjustments by way of payment or repayment as may be | |
necessary for giving effect to the modifications are to be made in | 30 |
respect of any payments already made for years or periods affected by | |
the modifications. | |
(6) Where the applicant does not, before the date specified in accordance with | |
paragraph (c) of subsection (2), notify OFCOM that he accepts the | |
determination, his licence shall have effect as if the period for which it is to | 35 |
continue in force ended with the time specified in accordance with paragraph | |
(d) of that subsection. | |
(7) Where the time at which a licence would cease to have effect in accordance | |
with subsection (6) is the end of a licensing period, that subsection does not | |
affect any rights of the licence holder with respect to the renewal of his licence | 40 |
from the end of that period. | |
(8) In this section— | |
“the appropriate percentage” has the same meaning as in section 19 of the | |
1990 Act; | |
“licensing period” means— | 45 |
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(a) the period beginning with the commencement of this section | |
and ending with the initial expiry date; or | |
(b) any subsequent period of ten years beginning with the end of | |
the previous licensing period; | |
“notional expiry date” means a first or subsequent notional expiry date | 5 |
within the meaning of section 220. | |
224 Report in anticipation of new licensing round | |
(1) OFCOM must, in anticipation of the end of each licensing period— | |
(a) prepare a report under this section; and | |
(b) submit it to the Secretary of State no later than thirty months before the | 10 |
end of that period. | |
(2) A report under this section must set out OFCOM’s opinion on the effect of each | |
of the matters mentioned in subsection (3) on the capacity of the holders of | |
relevant licences to contribute, in the next licensing period, to the fulfilment of | |
the purposes of public service television broadcasting in the United Kingdom | 15 |
at a cost to the licence holders that is commercially sustainable. | |
(3) Those matters are— | |
(a) the arrangements that (but for an order under section 225) would allow | |
for the renewal of relevant licences from the end of the current licensing | |
period; and | 20 |
(b) the conditions included in the regulatory regimes for the services | |
provided under relevant licences. | |
(4) A report under this section must also include the recommendations (if any) | |
which OFCOM consider, in the light of the opinion set out in the report, should | |
be made to the Secretary of State for the exercise by him of— | 25 |
(a) his power under section 225; or | |
(b) any of the powers to make statutory instruments that are conferred on | |
him by Chapter 4 of this Part. | |
(5) Where the Secretary of State makes an order under section 219 after receiving | |
a report under this section in anticipation of the end of the licensing period that | 30 |
is extended by the order— | |
(a) he may require OFCOM to prepare a supplementary report in the light | |
of the postponement of the beginning of the next licensing period; and | |
(b) it shall be the duty of OFCOM, within such period as may be specified | |
by the Secretary of State, to prepare the required supplementary report | 35 |
and to submit it to him. | |
(6) References in this section to the purposes of public service television | |
broadcasting in the United Kingdom are to be construed in accordance with | |
subsection (4) of section 257; and subsection (5) of that section shall have effect | |
for the purposes of a report under this section as it applies for the purposes of | 40 |
a report under that section. | |
(7) In this section— | |
“licensing period” means— | |
(a) the period beginning with the commencement of this section | |
and ending with the initial expiry date; or | 45 |
(b) any subsequent period of ten years beginning with the end of | |
the previous licensing period; | |
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“relevant licence” means— | |
(a) a licence to provide a Channel 3 service; | |
(b) a licence to provide Channel 5; or | |
(c) the licence to provide the public teletext service. | |
225 Orders suspending rights of renewal | 5 |
(1) This section applies where the Secretary of State has received and considered | |
a report submitted to him by OFCOM under section 224. | |
(2) If— | |
(a) the report contains a recommendation by OFCOM for the making of an | |
order under this section, or | 10 |
(b) the Secretary of State considers, notwithstanding the absence of such a | |
recommendation, that it would be appropriate to do so, | |
he may by order provide that licences for the time being in force that are of the | |
description specified in the order are not to be renewable under section 211 or | |
217 from the end of the licensing period in which he received the report. | 15 |
(3) An order under this section preventing the renewal of licences from the end of | |
a licensing period must be made at least eighteen months before the end of that | |
period. | |
(4) The Secretary of State is not to make an order under this section preventing the | |
renewal of licences from the end of the initial licensing period unless he has | 20 |
fixed a date before the end of that period as the date for digital switchover. | |
(5) Where the Secretary of State postpones the date for digital switchover after | |
making an order under this section preventing the renewal of licences from the | |
end of the initial licensing period, the order shall have effect only if the date to | |
which digital switchover is postponed falls before the end of that period. | 25 |
(6) Subsection (5) does not affect the power of the Secretary of State to make | |
another order under this section after postponing the date for digital | |
switchover. | |
(7) An order under this section with respect to Channel 3 licences must be an order | |
of one of the following descriptions— | 30 |
(a) an order applying to every licence to provide a Channel 3 service; | |
(b) an order applying to every licence to provide a national Channel 3 | |
service; or | |
(c) an order applying to every licence to provide a regional Channel 3 | |
service. | 35 |
(8) An order under this section does not affect— | |
(a) the person to whom a licence may be granted on an application made | |
under section 15 of the 1990 Act or under paragraph 3 of Schedule 10 to | |
this Act; or | |
(b) rights of renewal in respect of licences first granted so as to take effect | 40 |
from the beginning of a licensing period beginning after the making of | |
the order, or from a subsequent time. | |
(9) No order is to be made containing provision authorised by this section unless | |
a draft of the order has been laid before Parliament and approved by a | |
resolution of each House. | 45 |
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