Ownership Report Relief: In the Nick of Time

November Reporting Suspended

On Friday, the FCC released a much-awaited order suspending the filing date for the new biennial ownership report. Reports would have been due Monday, November 2nd. Broadcasters and broadcast attorneys were getting nervous about this requirement, since the new form has not been approved by the Office of Management and Budget (OMB) and because the FCC had added a considerable new information requirement that would take time to gather for all but the smallest broadcasters.

In addition, the new requirement calls for a simultaneous filing for all broadcasters throughout the U.S., unlike the staggered reporting regimen of the past. Therefore, without this delay, a massive last-minute reporting program would have had to have been started without being able to even start filling in forms and with no knowledge of what information will actually be required.

Among other things, the new report was to require every attributable interest holder to obtain a Federal Registration Number (FRN), which requires submitting to the FCC your Tax Identification Number (TIN). For individuals, that would be your social security number. Naturally, this created great concern over privacy issues.

The Commission suspended the filing requirement until OMB grants its approval and the issues of privacy and other matters have been resolved. The NAB had objected to the new reporting form and issued a report detailing the decision and issued a report hailing the postponement. All regular biennial ownership report filing requirements were previously suspended by the Commission in May of this year.

The FCC stated that broadcasters will be required to submit new reports by a date no earlier than 30 days after public notice of OMB approval of a revised Form 323 ownership report. The reports will be required to reflect current ownership data as of November 1st, 2009. Future reports will then be required every two years on the November 1st anniversary (reflecting current ownership data as of October 1st).

WhatTthe New Ownership Report Is Intended To Accomplish

The new ownership report is a piece in the Commission's commitment to the Congressional mandate that it promote business opportunities in broadcasting for women and minorities. Although it has been collecting gender and racial ownership data since 1998, due to the suspension of the old FCC 395B report and a general lack of reliable data, the FCC is seeking new information upon which to base diversity initiatives that will withstand judicial challenge.

The new FCC Form 323 ownership report for broadcasters sought to obtain this data through the following changes:

Uniform Filing Date - All commercial broadcasters were to file their ownership reports by November 1st and then on each odd-numbered year, thereafter. With data to be current as of October 1st, the Commission would obtain every two years a "snapshot" of ownership that will permit a meaningful nationwide comparison.

Entities Required to File - Exemptions for low-power TV and Class A TV stations, sole proprietorships and partnerships composed only of natural persons were eliminated.

Reportable Interests - Certain reporting exemptions for those previously sheltered by the single majority shareholder rule and the exemptions from the "Equity/Debt Plus" rule for "eligible" entities were eliminated for all interests that exceed the 33% EDP threshold.

Electronic submission - To facilitate electronic retrieval and evaluation, all data must be submitted in the body of the online form itself. No attachments are to be permitted.

The Media Bureau will conduct random audits and has committed itself to penalizing those who submit inaccurate reports.

The Commission had also requested comment on a proposal for expanded ownership reporting for noncommercial licensees, under which it would require gender, race and ethnic information.

REMEMBER:

This is only a temporary suspension. As soon as the outstanding issues are resolved, broadcasters can expect reporting to resume and there will again be a very limited time for gathering the required data and submitting the FCC forms online. It would be smart to start gathering all the data now!

This column is provided for general information purposes only and should not be relied upon as legal advice pertaining to any specific factual situation. Legal decisions should be made only after proper consultation with a legal professional of your choosing.