Australia's digital-only radio stations won't be obligated to spin home-grown tunes for the next three years after the broadcast authority granted controversial exemption from the country's domestic content quota system.

Despite the objections of many in the local music industry, the Australian Communications and Media Authority has agreed to register a new broadcast code that effectively excuses digital-only radio from meeting the quotas.

On the request of trade body Commercial Radio Australia, the ACMA has inserted a new clause into Code 4 of the Commercial Radio Codes of Practice, the section which imposes a requirement on commercial free-to-air radio stations to devote up to 25% of its airtime to Australian music.

Australia's DAB+ digital radio platform is still very much in its infancy, having launched less than a year ago.

CRA approached the ACMA earlier this year with the argument that the development of digital radio would be stifled if stations were constrained by content quotas.

Also, the trade body noted, the ACMA had already exempted new digital-only TV channels from quota requirements until 2013. The same exemption has now been granted to the digital radio sector, and CRA has been bestowed its wish.

"In these early days of digital radio, licensees should be afforded the opportunity to experiment with programming formats, including the programming of niche services such as 'event channels' like Pink Radio and Radio GaGa," says ACMA Chairman Chris Chapman in a statement.

The exemption comes after IFPI-affiliated labels group the Australian Recording Industry Assn., indie labels organization AIR, the Australian Performing Right Assn., the Assn. of Artist Managers and umbrella lobbying group the Music Council of Australia all wrote to CRA opposing its plan.

Labels body ARIA is far from pleased with the situation. "Given the level of concern expressed across the music industry about this proposal, we would have thought that consultation between the radio sector and the industry would have been an appropriate next step," ARIA CEO Stephen Peach tells Billboard.biz. "This is particularly so given that the code was originally the result of industry-to-industry negotiation and any changes should similarly have been the subject of further negotiation."

Peach adds, "CRA did not make out any compelling case for such an exemption and a desire to play back-to-back overseas artists hardly seems like a good reason to grant one, even if it is only temporary."

CRA did not respond for a request for comment by deadline.

The new code won't be reviewed until the next general review of the codes, which will take place in three years from now. But that won't stop the music industry forcing the issue. "We'll obviously take a good look at the options that may be available to us," Peach says, "including speaking to government."