Melbourne City Council v Telstra Corporation Limited [2020] FCAFC 200
On 20 November 2020 the Full Court of the Federal Court determined that Telstra’s new “Smart City” payphone cabinets, which include a large digital LED screen on the rear elevation, did not constitute “low-impact facilities”.
Schedule 3 of the Telecommunications Act 1997 (Cth) allows telecommunication carriers such as Telstra to install a facility without the need to obtain development consent from local councils, if the facility is a “low-impact” facility for the purposes connected with the supply of a carriage service.
Part 6 of the Schedule to the Telecommunications (Low Impact Facilities) Determination 2018 specifies the following requirements for public payphone facilities that comprise low-impact facilities:
a) used solely for carriage and content services; and
b) not designed for other uses (for example, as a vending machine); and
c) not fitted with devices or facilities for other uses; and
d) not used to display commercial advertising other than advertising related to the supply of standard telephone services.
After Melbourne City Council rejected Telstra’s development applications seeking consent to utilise LED screens on the back of 81 new payphone cabinets to display commercial advertising in May last year, the carrier launched proceedings in the Federal Court to clarify the meaning of low-impact facilities under the Telecommunications Act 1997 (Cth).
On 10 March 2020 Justice O’Callaghan of the Federal Court agreed with Telstra that the new payphone cabinets were a “low-impact facility” in circumstances where they would not display commercial advertising at the time that they were installed, and separate development consent would be sought to display any commercial advertising.
Melbourne City Council, joined by Brisbane City Council and the City of Sydney Council appealed the March decision, arguing that the new payphone cabinets were clearly designed to display advertising to maximum effect and were a means for Telstra to bypass local planning schemes.
On appeal, the Full Court of the Federal Court overturned the decision of Justice O’Callaghan and held by a majority that a central function of the new payphone cabinets was to display commercial advertising.
Justice O’Bryan described Telstra’s argument as an “apparent paradox”, pointing out at [139]:
“It is passing strange that Telstra has applied to the Melbourne City Council for planning permission to display commercial advertisements on its proposed New Payphone Cabinets while asserting that the New Payphone Cabinets are low-impact facilities which, relevantly, are required to be facilities that will not be used for commercial advertising.”
The Full Court of the Federal Court found that the design intent of the new payphone cabinets was to display commercial advertising and as such the payphone cabinets did not satisfy condition (d) of the requirements of a “low impact facility” in Part 6 of the Schedule to the Telecommunications (Low Impact Facilities) Determination 2018.
In reaching this conclusion, regard was had to the agreement with AdBooth (a subsidiary of the global advertising agency JCDecaux) who had partnered with Telstra in the roll out of the new payphone cabinets throughout Australia. Based on this agreement, the Court was satisfied that use of the payphone cabinets for commercial advertising was not “remote or speculative” but rather a central function that the new cabinets were designed to serve.
The effect of the ruling is that Telstra will now be required to seek planning approval to install the new payphone cabinets, rather than relying on the Telecommunications Act 1997 (Cth).
We understand that an application for special leave to appeal the decision to the High Court of Australia has been made and will be heard early next year.
A copy of the judgment the Full Federal Court of Australia can be accessed in the following link:
https://www.judgments.fedcourt.gov.au/judgments/Judgments/fca/full/2020/2020fcafc0200
The contents of this publication are for reference purposes only. This publication does not constitute legal advice and should not be relied upon as legal advice. Specific legal advice should always be sought separately before taking any action based on this publication.
