Court Overturns Part of New FCC Foreign Sponsorship ID Rules

Earlier this year, the FCC adopted new Foreign Sponsorship Identification rules that were challenged in court but went into effect on March 15, 2022.  On July 12th, the DC Circuit Court of Appeals vacated a small portion of the FCC’s new rules requiring federal database verification of foreign sponsorship information obtained by broadcasters.  You can read the short decision here.  The rest of the new rule requiring stations to ask sponsors of programming content aired pursuant to a “lease of time” if the sponsor qualifies as a “foreign governmental entity” was not overturned and remains in place.

Interestingly, neither the FCC or any of the Commissioners (all of whom voted in favor of the new rule) issued a public notice or statement about the decision.  Perhaps they will in the future.  While they can certainly seek further judicial review of the decision to the entire DC Circuit or to the U.S. Supreme Court, we would be surprised if they did.  The Court’s decision essentially tells the FCC to “stay in its lane” when it comes to implementing laws adopted by Congress – i.e., don’t “imagine” certain obligations into existence when there is no basis for doing so given the legislative language. If the FCC challenges the decision, it might be inviting a ruling that puts even further guardrails on Commission or administrative agency decision making.

For leased time program agreements that were in effect on March 15, 2022 and still are, stations are to complete due diligence to determine foreign entity status no later than September 15, 2022.  For any new agreements, actions should be taken at the time they are signed up to determine foreign entity status.  On air and public file requirements only kick in if a programmer has foreign entity status or receives support from a foreign entity.