The abolition of the RTE Authority had been resisted, with the state broadcaster arguing that, as a public-service broadcaster it should have its own regulator. However, this was overruled on the basis that RTE derives income from advertising and is therefore also a commercial broadcaster.

The new bill will also establish a formalised right-of-reply process for those who feel their reputation has been damaged by an incorrect or defamatory item broadcast on TV or radio.

Under the new act, however, both RTE and TG4 will be established as semi-state companies, each having its own board of directors. The new board of RTE will be responsible for ensuring that RTE as a company is commercially viable, rather than the RTE Authority's current dual regulatory and commercial roles.

Under the right-of-reply provision, a person who believes they have been defamed on air, and who feels their complaint has not be dealt with by the broadcaster, will be able to make a complaint to the BAI. The new authority, having heard from both sides, will make a ruling on the complaint. If it finds in favour of the complainant, the broadcaster can be obliged to broadcast an apology.

However, as with the government's planned defamation law, the fact that the apology is made would be held in the broadcaster's favour in the event of a subsequent libel trial. Well-placed sources said the right-to-reply provision was designed to provide "speedy resolution", without involving legal action, in cases where a person is genuinely wronged on air and wants that wrong quickly rectified.

The bill, which is expected to become law by next year's summer Dail recess, will also give new powers to the BAI to penalise broadcasters not living up to their license commitments.

Up to now, the regulator has only been able to apply the ultimate sanction of withdrawing the licence, which, for practical and legal reasons, it has been reluctant to do. However, the new BAI will have to power to levy fines and issue sanctions against a broadcaster, while also retaining the right to withdraw its licence.