Public Interest Obligations/Localism

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Last week, as we noted in our monthly look ahead at the regulatory dates of importance to broadcasters in August, the reinstatement of the rule prohibiting the duplication of programming on FM stations went into effect.  The FCC Order reinstating the rule is interesting both for its substance, and for the parties pushing for that reinstatement – principally representatives of the music industry.  As we note below, even though the rule is now back in effect, the NAB has asked for reconsideration of that action.

First, let’s look at what the rule provides.  The reinstated rule prohibits any commonly owned or operated (e.g., through a time brokerage agreement) commercial FM station from duplicating more than 25% of its weekly programming on another FM station if there is overlap of the 3.16 mv/m (70 dbu) contours of the two stations, and that area of overlap constitutes 50% of the 3.16 mv/m predicted coverage area of either of the overlapping stations.  Program duplication is not limited to simultaneous transmission of the same programming – the rule by its terms defines “duplication” to include the broadcast of the same programming any time within a 24-hour period. 

Continue Reading FM Programming Nonduplication Rule Goes Back into Effect – A Win for the Music Industry While the NAB Objects

The FCC last week issued a Declaratory Ruling approving the acquisition by a company owned by a Canadian citizen of 100% of the ownership interest in a company that owns an AM radio stations in Seattle.  Until about a decade ago, a 25% limit in the parent company of an FCC broadcast licensee would have been the limit allowed by the FCC under Section imposed on foreign ownership of a US broadcast station by Section 310(b)(4) of the Communications Act.  Section 310(b) limits non-US citizens from holding more than 20% of a broadcast licensee, and foreign owners cannot hold more than 25% of a parent company “if the Commission finds that the public interest will be served by the refusal or revocation of such license.” About a decade ago, as we wrote here, the FCC decided to permit, on a case by case basis, greater foreign ownership of US broadcast station owners. This has resulted in past cases where 100% foreign ownership of US broadcast stations have been permitted (see our articles here and here) and even many large US broadcast companies have been permitted to have foreign ownership in excess of the 25% allowed by Section 310(b)(4).  The processing of these applications is, of course, not as straightforward as the normal acquisition of a station by US citizens.

Any foreign owner seeking to acquire a substantial stake in a US broadcast station must be reviewed by various Executive Branch agencies to ensure that there are no perceived security risks raised by the proposed acquisition. The FCC has to do its own review as well.  The approval process for the first acquisition by a foreign owner often takes a full year or more (the deal approved last week was filed with the FCC almost exactly a year ago), so don’t expect to complete an acquisition by a foreign owner on the same timeline as that for the completion of a deal by US citizens.  But, once a foreign owner is approved by the FCC, as long as the ownership of that acquiring company stays the same, it can in most cases acquire additional US stations without going through this extended review process. 

Continue Reading FCC Allows 100% Ownership of US Radio Station by Canadian Owner – Once Again Demonstrating Openness to Foreign Investment in the US Broadcast Industry
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Update, 7/26/2024 – We understand that the FCC has decided that the requirement for verification of the buyers of issues ads and paid PSAs will not go into effect on August 15, as this article stated. Instead, as we report in this article, the new requirement will require approval of the Office of Management and Budget, thus delaying its implementation for some time. As the FCC has not released any document specifically confirming the delay in the implementation of this verification requirement, we suggest that you confirm this understanding with your own counsel.

The FCC this week issued a Public Notice announcing the effective date of certain portions of the FCC Order released in June adopting changes to its requirements that broadcasters obtain certifications from buyers of program time on their stations that the sponsors are not foreign governments or agents of those governments.  As we wrote when the Order was released, the order had some good parts and some that could add additional burdens on broadcasters.  It is the latter that become effective on August 15, with most of the rest awaiting approval for the information collection requirements from the Office of Management and Budget under the Paperwork Reduction Act.

What is the “bad part” that will become effective on August 15?  It is the portion of the Order that requires broadcasters to get certifications not only from the buyers of program time (certifications that have been required since March 2022 – see our article here), but that they also get these certifications from buyers of spot advertising time unless the ad is for a commercial product or service.  That means that broadcasters, when they are selling political issue ads and paid PSAs, will need to go through the same process as they do when they sell blocks of program time.  They will need to get the sponsor of these ads to provide a certification consistent with the  the certification requirements for all leased programming time, to demonstrate that the buyer is not a foreign government or the agent of a foreign government.  As we will be entering the peak of political advertising time just about the time that this Order becomes effective, and as so much money is not spent by candidates but instead by PACs and other non-candidate political organizations, this will immediately impose new information gathering requirements from these political buyers – right in the heat of a campaign. 

Continue Reading August 15 Is the Effective Date of Requirements for Foreign Government Certifications for Political Issue Advertising and Paid PSAs
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  • The National Religious Broadcasters, American Family Association, and the Texas Association of Broadcasters jointly requested that the FCC stay the
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  • The U.S. Supreme Court overturned the longstanding Chevron doctrine, which required Courts to defer to expert regulatory agencies, like the
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The lazy days of summer continue to provide little respite from the regulatory actions of importance to broadcasters.  This month brings quarterly requirements, including most importantly, the obligation to upload Quarterly Issues Programs Lists to a station’s online public file, and a number of comment deadlines in important FCC proceedings, as well as the opening of political windows in this major election year.  So, even if the beach chair is calling, remember to keep an eye on dates that can affect your stations. 

The regulatory date that all full-power broadcasters should have circled on their calendars is July 10, the deadline by which all full-power radio and TV stations (as well as Class A television stations), both commercial and noncommercial, must upload to their online public inspection files their Quarterly Issues/Program lists for the second quarter of 2024.  The lists should identify the issues of importance to the station’s community and the programs that the station aired between April 1 and June 30, 2024 that addressed those issues.  It is important that these be timely uploaded to your public file, as the untimely uploads of these documents probably have resulted in more fines in the last decade than for any other violation of the FCC’s rules.  As you finalize your lists, do so carefully and accurately, as they are the only official records of how your station is serving the public and addressing the needs and interests of its community.  See our article here for more on the importance of the Quarterly Issues/Programs list obligation.

Continue Reading July Regulatory Dates for Broadcasters – Quarterly Issues/Programs Lists, Comment Deadlines in Multiple Proceedings, Political Windows, and More

Last week, the FCC released its long-expected decision on foreign government sponsored programming.  As you will recall, in 2022, the FCC adopted rules that required enhanced sponsorship identifications when program time bought (or, in the FCC’s words, “leased”) on broadcast stations was sponsored by a foreign government or an agent of a foreign government.  In addition, it required broadcasters to verify whether program buyers were agents of foreign governments, both by getting certifications from program buyers as to whether they represented foreign governments and by checking a Department of Justice database (compiled under the Foreign Agents Registration Act) to see if the buyer was registered as a foreign agent (see our articles here and here).  When a court threw out the requirement that broadcasters check those databases (see our article here), the FCC responded with a Second Notice of Proposed Rulemaking proposing that, instead of the FARA research, broadcasters needed to obtain a 13-paragraph certification as to whether any program buyer was a foreign government entity, and to include in the public file all such certifications, regardless of the response (as opposed to the existing requirement only obligating the broadcaster to put certifications in the public file when they indicated that the buyer was in fact an agent of a foreign government) (see our articles here and here on that proposal).  In the order released last week, the FCC decided not to require that enhanced certification (or the requirement to put negative responses into the public file), but instead came up with an unexpected addition to the requirement – that certifications must be obtained not just from buyers of program time, but also from buyers of advertising spot time, if the advertisers are not promoting commercial products and services. 

The order simplifies the certification requirement from the detailed multi-page certification in complex legalese that had been proposed in the Second Notice.  Instead, the FCC offers a relatively short certification (contained in Appendix D of the order) for program buyers to sign, with two basic questions – whether any foreign government entity ( a foreign government, a foreign political party, or an agent of one of those groups) is the purchaser of the programming; and whether the purchaser or any producer of the programming is being paid by a foreign government entity.  In the vast majority of cases, we expect that the answer to both questions will be “no.”  In the event that a programmer or program producer is an agent of a foreign government, then an additional question applies, requiring that the programmer provide the licensee appropriate sponsorship identification information for the enhanced on-air sponsorship identifications and for the required public file disclosure obligations.  Even using this FCC form questionnaire is not necessary, if the licensee can obtain that information using different words.  So, in at least some instances, broadcasters may be able to continue to use their existing certification language. Consult your attorney to see if the language you are using will comply with what the FCC will require when this order becomes effective. 

Continue Reading FCC Releases Decision on Broadcaster’s Obligations to Identify Foreign Government Sponsored Programming – There is Some Good News, and Some Bad News Affecting Issue Ads