The General Accountability Office (“GAO”) has issued a report regarding the disclosure requirements that apply to, and broadcaster practices concerning, content that affects broadcasters’ interests and may be intended to influence Congress.  The GAO report responds to a request of Rep. Darrell Issa (R-CA), who has supported legislation requiring radio stations to pay performance royalties to copyright holders, performers, and musicians, and who has criticized broadcasters for refusing to air ads advocating adoption of a radio performance royalty law.  In its report, GAO recognizes that broadcasters have no obligation to air ads that are adverse to their own interests, and expressly states that it is not making any recommendation that the Federal Communications Commission (“FCC”) take any action with respect to this issue. 

In the report, GAO examines the extent to which broadcasters aired ads related to performance royalties, as well as spectrum allocation, radio-enabled mobile phones, and retransmission consent issues, between 2007 and 2012.  Of these issues, GAO finds that broadcasters aired ads on the performance royalty and spectrum allocation issues.  GAO notes, however, that the information available for its analysis is limited because broadcast stations need only keep information about issue ads in their public files for two years and reliable information about the cost of ads, particularly those aired on radio stations, is lacking.

The GAO report notes that “FCC regulations require licensed broadcasters operating television and radio stations to publicly disclose certain information on air when broadcasting content has been provided without charge or sponsored by another party in exchange for payment or other valuable consideration.”  GAO goes on to explain that these “sponsorship identification requirements generally apply to any program material for which the sponsor is not readily apparent, including advertising or other programming related to political or controversial issues.”  With respect to political “issue” advertising – advertising related to a controversial issue of public importance or a political matter – broadcasters must make an on-air announcement indicating who furnished the material, regardless of whether the furnishing party provides consideration.  And broadcasters must maintain records of information regarding political advertising in the “political file” portion of their public inspection files, as GAO notes and as we have explained before.

At the same time, the report confirms that broadcasters enjoy broad editorial discretion as to which issue ads to accept.  In particular, GAO explains that “broadcasters have no legal obligation to air advertisements or programming that present opposing views, including views that do not align with their interests.  As GAO notes, the FCC eliminated the so-called “Fairness Doctrine” – which had “required broadcasters to afford a reasonable opportunity for the presentation of contrasting viewpoints” – in 1987, based on First Amendment concerns about the “chilling effect” the doctrine had on broadcaster speech.  And since that time, the FCC has repeatedly “reiterated that the Fairness Doctrine is no longer in effect.”

Accordingly, the GAO report tempers the fire of those who claim that broadcasters should be subject to requirements that they air advertisements advancing positions that conflict with their own interests, such as those advocating adoption of legislation to require the payment of performance royalties by broadcast stations or reformation of the retransmission consent regime in a manner that benefits cable operators.  When in doubt, however, stations should seek the advice of FCC counsel to ensure that their decision-making with respect to a particular ad complies with the FCC’s sponsorship identification and political advertising requirements.

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