Explanatory note

Schedule 2 to the Broadcasting Act 1990 contains restrictions on theholding of licences which may be awarded by the Independent TelevisionCommission and the Radio Authority. Various provisions of that Scheduleprovide for those restrictions to be supplemented by Order. This Ordercontains supplementary restrictions. It is divided into five parts; PartI is concerned with general matters.

Part II relates to television. The limit contained in Schedule 2 tothe Act that no person may hold more than two licences for regionalChannel 3 services is supplemented so that a person may not holdlicences for two specified large areas or, until such licences have beengranted, for two specified contiguous areas. In addition the holder of aregional Channel 3 licence who has a non-controlling interest in asecond Channel 3 licensee company may not have more than a 20% interestin a third such company, nor more than a 5% interest in a fourth.

The holder of a national Channel 3 licence may not have more than a20% interest in a second national Channel 3 licensee company, nor morethan a 5% interest in a third. Similar limits are applied to Channel 5.The holder of a licence for national or regional Channel 3 or Channel 5may not have more than a 20% interest in a company which holds a licenceto provide a service falling into another of those categories, nor morethan a 5% interest in a third such company. Those who invest in, but donot control, Channel 3 and Channel 5 licensee companies are limited to a20% interest in a third regional Channel 3 company and a 20% interest ina second Channel 3 or Channel 5 company if one company provides anational Channel 3 service or Channel 5. Further investment in Channel 3and Channel 5 is limited to 5%; and those with more than a 5% interestin three Channel 3 or Channel 5 companies are limited to a 5% investmentin any other such companies.

Part III concerns radio. It provides for a points scheme by virtueof which various categories of radio licence are allocated pointsaccording to the size of the population in the areas for which they areprovided. Subject to minor exceptions, no person may hold radio licencessuch that the number of points attributable to them exceeds 15% of thepoints allocated to the radio system as a whole. In addition one personis limited to two licences for the largest type of local radio servicesand six licences for the next size down (four if a national radiolicence is also held). Subject to limited exceptions, a local radiolicensee may not hold, nor have more than a 20% interest in a companywhich holds, a licence to provide a local radio service which overlapssubstantially with his service.

Part IV contains supplementary limits for newspapers. Theproprietor of a national newspaper may not have more than a 20% interestin a company which holds a licence to provide a local radio service andvice versa . The proprietor of a national or local newspaper may nothave more than a 20% interest in a company licensed to provide adomestic satellite service, nor more than a 5% interest in a second suchcompany and vice versa .

Part V concerns national public telecommunications operators. Itprovides that a national public telecommunications operator with anannual turnover of more than £2 billion, his associate, aperson who controls either of them or a body controlled by such anoperator or his associate may not hold a licence to provide a Channel 3or 5 service, a domestic satellite service or a national radio service.Subject to a limited exception, a national public telecommunicationsoperator may not hold a licence to provide a local delivery service. Butafter 1st April 1994 such an operator may bid for such a licence if itis for an area not at that time covered by a licence authorising theprovision of a local delivery service or a prescribed diffusionservice.