Advertising Discrimination and License Renewal

Posted on August 28th, 2013 by

The FCC has issued what appears to be its first written decision addressing an admitted violation of its policy requiring broadcasters to include non-discrimination clauses in advertising agreements. At license renewal, commercial broadcasters must certify that their advertising agreements do not discriminate on the basis of race or ethnicity and that all such agreements contain non-discrimination clauses. 

In the FCC’s decision, the licensee of a Class A television station disclosed in its renewal application that it had not come into compliance with the rule requiring advertising agreements to contain non-discrimination clauses until “several months” after the rule went into effect.  The FCC’s reaction to this disclosure was in a footnote, where it declared that “we will excuse this delay in compliance as a de minimis violation on this one occasion but caution the licensee of the importance of continued full implementation of this requirement.”

 The FCC always has discretion in deciding whether to fine a broadcaster for a rule or policy violation.  There might have been a few factors at work in its decision not to do so here.  First, the station did not air commercial “spots” but only sponsored text crawls.  Second, the FCC simultaneously issued a $9,000 fine to the station for Children’s TV reporting, public file, and incorrect material factual information violations.  We surmise that a third reason might be that the FCC’s nondiscrimination policy, adopted in 2008, was modified in 2010 to change the originally adopted “race and gender” language to “race and ethnicity,” leaving at least some question as to the effective date for compliance.

Now is a good time to check your station’s advertising agreements to ensure that they contain appropriate non-discrimination clauses.  We doubt the FCC will be so generous in the future.