Is Maori TV rugby bid a breach of WTO obligations?

New Zealand is bound by the General Agreement on Trade in Services to have no limitations on market access in the audio-visual services sector and no limitations on national treatment. This was a commitment signed up in 1994 under the previous National Government. It has effectively stopped local content quotas being introduced on television and radio.

Whilst there remain no limitations on market access, it is the commitment to no limitations on national treatment that is at issue here.

National treatment means that you treat foreign owned suppliers on an equivalent basis to domestically owned suppliers. In practice this means NZ On Air cannot discriminate between broadcasters on the basis of ownership, and it does not. However, it becomes a little more complicated when we talk about Maori broadcasting.

New Zealand limited national treatment for Maori broadcasting as follows:

"The Broadcasting Commission is 3)directed by the Government, pursuant to the Broadcasting Act 1989, to allocate a minimum of 6 per cent of its budget to Maori programming. From 1995 all public funding for Maori broadcasting will be controlled by Te Reo Whakapuaki Irirangi (Maori Broadcasting Funding Agency)."

However, Te Puni Kokiri is responsible for the money being given to the Maori Television Service to bid for the broadcasting of the Rugby World Cup free to air. Not Te Reo Whakapuaki Irirangi (commonly known as Te Mangai Paho). Indeed you might ask whether bidding for broadcasting a rugby match is "Maori broadcasting" but it is moot.

That limitation does not apply as the money has not gone through the right agency. So the exception doesn't work.

Is there a potential breach of New Zealand's WTO commitments?

The state granting funding to a broadcaster that would not be available to a foreign owned broadcaster, for the same purpose, would appear to be so. Subsidies, you see, are meant to have national treatment.

TV3 and Prime should be entitled to national treatment, and be eligible for the same funding for a similar purpose, but are not. Indeed, one could not even begin to argue that there was a process to allow them to apply for such funding.

The foreign owners of both broadcasters could, theoretically, get their national governments to formally complain to the New Zealand government of this breach. Indeed, they could go to a WTO Disputes Panel and thoroughly embarrass the government as a result.

Wouldn't this have been picked up? Well no. You see Te Puni Kokiri is hardly versed in trade agreements. The Ministry of Culture and Heritage, which is responsible, was not actually responsible for broadcasting policy and GATS at the time it was signed. It was the then Ministry of Commerce (now Ministry of Economic Development). The institutional knowledge about this is not located in the Ministry of Culture and Heritage nor TPK.

I also doubt whether anybody thought it was necessary to get Ministry of Foreign Affairs sign off on this funding.

So the Parliamentary Question is:

"Has the Trade Minister received any advice as to whether the Te Puni Kokiri funding of the Maori Television Service to bid for free to air Rugby World Cup broadcasting rights is in compliance with New Zealand's international trade obligations? If not, why not?"

Supplementary:

"How does the Trade Minister reconcile New Zealand's commitments to national treatment in audio-visual services with the granting of a subsidy to a New Zealand owned broadcaster to acquire broadcasting rights that could not and would not ever be available to a foreign owned broadcaster?"

UPDATE: This also applies to CER. New Zealand is bound to offer national treatment to Australian broadcasters. So there could be a breach of CER as well.