“The legal errors of the FCC’s reversal of course are manifold and manifest,” says the NAB in new comments to the Office of Management and Budget, opposing the FCC’s expansion of foreign sponsorship identification requirements.
The changes, approved 3-2 by the FCC in July, require over-the-air broadcasters to conduct multi-step diligence processes to confirm whether advertisers or lessees are foreign governmental entities. This includes obtaining written certifications or documentation of compliance and uploading these materials to online public inspection files. Portions of the NPRM took effect in August. A similar set of regulations was overturned by a federal appeals court in July 2022.
The NAB is now taking its standing challenge to the OMB that these measures, including political issue advertisements and public service announcements, violate the Administrative Procedure Act, the Paperwork Reduction Act, and the Communications Act, as well as the First Amendment.
The NAB warns that the rules impose content-based regulations on protected speech, disproportionately targeting political and public service advertising without evidence of harm or foreign influence. “The Order establishes an impermissible content-based regulation that ironically penalizes the most protected form of speech, even though the Commission never identified a single instance where a foreign governmental entity has purchased political or public service advertising on a broadcast licensee,” reads the filing.
In the statement, the association further critiques the FCC’s method of calculating compliance costs, arguing that it ignores essential variables such as the need for legal consultation, staff training, and the complexity of verifying lessee information.
The group also notes that the FCC’s original 2021 rules explicitly excluded traditional short-form advertising, citing a lack of evidence of foreign government-sponsored programming in such formats. The current proposal, the NAB argues, still fails to demonstrate any instances of covert foreign influence through political issue ads or PSAs, undermining the justification for the expansion.
The proposal has also faced opposition from within the FCC itself. FCC Chairman-designate Brendan Carr and Commissioner Nathan Simington dissented from parts of the order, citing concerns over the agency’s failure to adhere to notice-and-comment procedures. Carr criticized the expanded definition of leases, while Simington questioned the rationale for subjecting non-candidate political advertising to foreign sponsorship rules.
“The Commission has not demonstrated the need for or practical utility of the proposed information collections,” NAB stated. “By failing to provide sufficient notice of its proposed rule changes, [the FCC] eliminated the opportunity to learn about ways to minimize the burdens of its revised rules and related collections.”
The NAB closes by calling on the OMB to disapprove the proposed information collections or, at minimum, require the FCC to gather more accurate data and explore ways to mitigate the burdens on broadcasters and lessees.
