In a recent case between the Commissioner of Taxation and the Seven Network, the Federal Court has confirmed that the Copyright Act does not protect the digital transmission of sounds and images unless what is being transmitted is itself the subject of copyright protection.
The case revolved around whether the fee paid by the Seven Network to the International Olympic Committee for exclusive broadcasting rights was a royalty (and thus subject to withholding tax).
Central to the case was a question around whether there was copyright in the international audio visual signal (ITVR) or whether the signal merely transmits data which is used to create the sounds and images.
The Court upheld an earlier decision that the ITVR was a data stream and therefore not a cinematograph film, meaning the Copyright Act does not cover it. In this case the copyright first existed in Channel 7’s broadcast.
The Australian Tax Office has sought leave to appeal to the High Court.