“Enforcement Advisory” wags threatening finger at broadcasters, but still leaves questions unanswered. After three years, that’s par for the course.
The FCC has unleashed a new “Enforcement Advisory” announcing its intention (in the Chairman’s words) to “vigorously enforce its rules against discrimination in advertising sales contracts”. The Advisory also “alerts” broadcasters about their “new” obligations concerning nondiscriminatory advertising contracts. Unfortunately, the Advisory (and its accompanying news release) leave something to be desired.
Which is par for the course with respect to the nondiscrimination-in-advertising policy (NIAP).
Three years ago, the FCC released what has come to be known as the Diversity Order, a sprawling piece of work by which the Commission sought to increase, um, “diversity” in the broadcast industry. The order included new and amended rules, a sprinkling of new and revised policies, some expressions of good intentions, and a bunch of proposals.
In two paragraphs buried in the middle of the Diversity Order (those would be Paragraphs 49 and 50, if you’re looking), the Commission announced that it would henceforth “require broadcasters renewing their licenses to certify that their advertising sales contracts contain nondiscrimination clauses that prohibit all forms of discrimination, as outlined below.” The phrase “as outlined below” suggested that further details about what this meant for affected broadcasters might be found elsewhere in the Diversity Order.
But no such details were to be found.
To the contrary, citing the First Amendment, the Commission explicitly declined to tell broadcasters precisely what language their advertising contracts should or should not contain. Instead, the Commission simply reiterated that it would “require broadcasters renewing their licenses to certify that their advertising contracts do not discriminate on the basis of race or gender and that such contracts contain nondiscrimination clauses.”
Overall, the Diversity Order’s terse treatment of the NIAP was less than thorough – a fact underscored two years later when the Commission issued an “erratum” revising the phrase “race or gender” to read “race or ethnicity”. Oops. No explanation was offered. Nor did the erratum address the fact that, by deleting “gender”, the Commission was at least implicitly condoning discrimination based on gender.
Importantly, the NIAP was not incorporated in any rule proscribing discrimination in advertising. (By contrast, the Commission did adopt a specific rule – Section 73.2090 – prohibiting discrimination in the sale of broadcast stations.) All the NIAP did was to impose a new certification requirement in the broadcast renewal application. Since the NIAP was announced in 2008, and the next cycle of broadcast renewals wasn’t due to start until 2011, little was heard of the NIAP in the meantime.
Time moved on, the years passed, and lookee here – it’s 2011! Already! Which means that thousands of broadcasters will soon be required to sign off on the certification in their renewal applications.
But since the Commission hasn’t bothered to shed any meaningful light on the underlying conduct that broadcasters are expected to be certifying about, many broadcasters have been hoping that maybe, just maybe, the Commission would provide some guidance: Do I need to re-write all of my advertising sales orders to include some magic language (and if so, what might that language be)? What if the advertiser uses a standard form contract for everyone – am I expected to forego a sale if they refuse to incorporate this language? How can a broadcaster confidently certify anything about the intent of the advertiser? If the Commission’s trying to stop discrimination against urban and Spanish format, what happens if an advertiser chooses ONLY Spanish stations or ONLY urban stations – isn’t that race/ethnicity-based discrimination too? If an advertiser sells cowboy hats, is it wrong that he advertises on my country music station but chooses not to buy time on my R&B station? (We could go on, but you get the point.)
So when the Enforcement Advisory appeared, there was at least some hope that the Commission was finally ready to let the industry in on the secret.
No such luck.
Instead of guidance, the Advisory offers not-so-veiled threats about enforcement of the policy without any particular indication of what will constitute a violation. Indeed, in the public notice the Chairman, apparently unaware that the policy is just that – merely a policy – refers incorrectly to the policy as “rules” or a “rule”. If it were a rule, it would show up somewhere in 47 C.F.R. It doesn’t. If it were a rule, the Commission would be able to impose a fine for its violation. It can’t.
[Of course, there’s always a chance that we’re missing something here. Nobody’s perfect. So if anyone can point us to a section of the FCC’s rules that contains any provision that codifies the NIAP, we would appreciate it if you would let us know by any means that you feel comfortable with – email, phone, comment below, whatever. We’ll happily post a correction, with full credit to you.]
Now let’s be clear. Inappropriate discrimination – on the basis of race, ethnicity, gender, religious belief or other similar factors – is wrong and should not be tolerated. But while there are some areas in which the Commission can effectively police improper conduct, it’s not clear that private contractual arrangements are among those areas. After all, even in the Diversity Order the Commission referred to “nondiscrimination laws”, acknowledging that there are legal mechanisms other than FCC regulation with which the government can address such problems. And the misconduct which appears to be the FCC’s primary concern is not misconduct by broadcasters, but rather by advertisers and/or their agents. Rattling the enforcement saber at broadcasters seems a curiously misdirected effort, especially when there are other Federal agencies (the FTC comes to mind as one example) which should already be enforcing the “nondiscrimination laws” to which the FCC itself referred.
We have addressed the question of how one might deal with the NIAP in previous posts (for example, here), long before the Advisory. The Advisory provides little reason to alter what we have said there. But the problem with the situation the Commission has created is that it is difficult, if not impossible, to know for certain what the Commission expects here. Indeed, even the Enforcement Bureau can’t seem to figure it out. The public notice accompanying the Advisory says that the Bureau “will work in close collaboration with the Media Bureau to give this new requirement meaning.” How could the “new” requirement (that is, the policy that was adopted more than three years ago) still need to be given “meaning”?
Unfortunately until the Commission sheds more light, broadcasters will have to tread carefully to certify according to their reasonable beliefs and due diligence efforts – whatever that means.