This file contains archived live captions of the open meeting of the Federal Election Commission held on March 14, 2018. This file is not a transcript of the meeting, and it has not been reviewed for accuracy or approved by the Federal Election Commission. >> CHAIRMAN HUNTER: Good afternoon, the open meeting for the Federal Election Commission for Wednesday, March 14th is in order. Welcome everybody. We're delighted to be here. It's a special meeting because we have one special matter on the agenda and it's also the last meeting at 999 EStreet. We are excited about the move. More on that later. But for us we're delighted to be able to adopt a notice of proposed rule making on internet disclaimers. We'll start off with general council comments. >> Thank you. I believe we have a late submitted document on this. >> I move that we suspend the rules so we can consider the late submission. I don't know why they think it's late. It's still warm off the printer. >> Thank you, all those in favor. >> Aye. >> Motion passes unanimously. >> Agenda document 1218-specifically for internet communications. The commission first started looking at the issue of internet disclaimers in 2011. It has published several advanced notices of proposed rule making in the years since then. And the commission first considered changing the word website in the definition of public communication to include things like apps in a rulemaking concerning technological modernization. The draft before you poses two alternative approaches to how communications on internet communications must include disclaimers. Both of the proposals would allow for the use of an adapted disclaimer by which a communication may provide a full disclaimer utilizing a technological mechanism. The proposal also proposes so amend the definition of public communication to apply to not just communications on another person's website. But also to include as previously proposed with the same exact language in the technological modernization rule making to include communications placed for a fee on another person's internet-enabled device or application. We're available for any additional questions or comments you may have. >> Thank you very much. That was an excellent presentation, especially considering you had to do it on the fly. So thank you. And thank you to the Office of General Council who have done an excellent job of getting us to where we are today. They have been working on this for a while and they have been extremely throughout the process. Lisa, Nevin, and Jessica. You have worked particularly hard on this in the last week. We thank you. And thank you to the E.A.s in many of our offices. The lion share of this was done by Amy, who is hiding in the back, from my office. And Tom from Ellen's office. Everybody else helped, as well. But I think it's fair they probably put the most work into this. And thank you Dana for getting this meeting together last minute. We appreciate it. And to Laura for helping you. As was said, this rule making covers a topic that has come up a number of times in the past. I think Commissioner Petersen put it out for comment a couple of years ago. We got more comments this time. (Chuckling) So we're happy, as I said, to be putting this proposal out. It's a very, it's a fairly narrow rule making. We're only talking about internet. We're talking about putting disclaimers on public communications on the internet that contain express advocacy or are made by political committees. It's a narrow subset of the kinds of ads that you see on the internet right now. Both proposals start off with requiring the full disclaimer, and both of them also allow an adapted disclaimer under certain circumstances. One of the major differences between the rules, between proposal A and proposal B is what gets you to that adapted disclaimer. Proposal Asays if it doesn't fit, you go to the second disclaimer. Proposal B does something more objective and has a measure in there. We proposed 10% of the ad. If the disclaimer takes up more than 10% of the ad, then you can move to the adapted disclaimer. And we asked questions of how do you measure that. Is 10% the right thing. We're really looking for advice from the technological community on how to measure it. Maybe that metric isn't a good one. We look forward to any comments on that. Under alternative B, there is a possibility if that adapted disclaimer doesn't fit, just a notice on the indicator on the ad. We're talking about very small ads, as long as the indicator is obvious, you'll be brought to the full disclaimer on the web page. We are working on trying to come up with a list of examples and we're going to do our best to do that and there is a mention of it in the document. And the examples will try to illustrate how both alternative A and alternative B would apply to real-world examples that we see out there today. So thank you again to everybody for your work on this. It was nice working with the vice chair. And I think she and I can agree that our sort of bouncing back proposals to one another actually improved the document over time. And we'll see where the comments take us. Madam Vice Chair? >> COMMISSIONER WEINTRAUB: Thank you, Madam Chair. I would like to start by saying happy pi day. I'm sorry, I didn't bring in pie. Had I thought of it in advance, I would have liked to have brought pie. Secondly, and most importantly, I would like to express some gratitude to some important people. To the 150,000 Americans who weighed in with us when we said should we move forward with this overwhelmingly yes. The answer was overwhelmingly that we should strengthen our disclaimer requirements. We hear you and we're here today to start that process formally. And I look forward to moving forward with that and I welcome comments from all those people again on the specific proposals that we're putting forward today. We really want to hear your ideas. We appreciate your energy and your interest. Closer to home, there are a lot of people who worked very hard burning the midnight oil literally to get this document in shape so that we could vote it out today. There were many, many hours, much quality time for the chair and me sitting in the conference room across the hall with a very dedicated group of people. Tom Anderson, John Burman, Eric Brown from commissioner staff, from the Office of Legal Council, who are really indispensable. Evan, and Lisa. I want to thank everybody on my staff who all helped. But there were a couple of standouts. There are three people without whom this document would not have been produced. They are Amy Rothstein from the chair's office. The endifatigable Amy. Tom Moore from my office who not only helped me get the document done, but kept my spirits up when I thought this document was going to be the death of me. And the incomparable Jessica Selinkoff who spent so many hours working on this. I know the Chair feels the same way. There is no way we could ever thank you for all of the effort you put into this document. And I suppose I should say that any inadequacies in the document are all on the Chair and me because what Jessica gave us was always perfect. We're all a little bit tired. (Chuckling) I'm really, really happy to be able to put these proposals out and start this formal process. There are a couple of different proposals in there. But it says in the document, but I want to reiterate that people not look at them as silos. Okay? We've got proposal A and proposal B and they're going to duke it out and only one can win. I think it's possible to combine elements of them. There is overlap between them. There are significant differences between them. But there's also some significant similarities. And we welcome and encourage people to look at every element and say well we like this the part of proposal A. We like that part of proposal B. And in fact, we have this brand new idea that we think would be useful that none of you thought of. And we want to hear that. As the Chair said, it's both proposals. And in fact the document itself as a whole affirm that there is a requirement for disclaimers on these ads and yes this is a narrow proposal. I would have preferred to do have done something broader than this. But I am delighted that we could at least get unanimous support to get this narrow proposal moved forward. I think it will be an improvement and it will bring greater transparency to political ads. It's not going to solve all of the problems that we saw in the last election, but it will be a step in the right direction. As I said, I think it's clear that the types of ads that are discussed in this document require disclaimers and we have different ways of providing that information in the two different proposals. There is a difference in at what point you can move to an adapted disclaimer where you could hover over a link or somehow use technology to get to the full disclaimer. My own preference is to try to fashion a rule that will have the most information on the face of the ad. Because we all know that not everybody is going to click through to find the information. So I think bringing the information before the American public is the most important criterion for me. Another difference between the two proposals is there is a new exemption proposed in alternative B. When I looked at the 150,000 comments that we got, I didn't see a big call for more exemptions in the rules. So I'm not personally leaning toward that aspect of that proposal. But again, we welcome all comments. And as the Chair said, I think the process of creating the NPRM made both proposals stronger. We learned a lot from each other as we hashed out the document. We, I think, both proposals evolved in the course of the writing of it. And I think that that process will put us in a good place to start as we collect the comments to start thinking about what a final rule might look like and where we might find some common ground, which I sincerely hope that we would have been able to find. I would have liked to have gotten this done sooner. We are going to have a hearing, as noted in this document, on June 27th. There's going to be a 60-day comment period and then a hearing on June 27th. Again, I would have liked to have done that sooner. But that's, that was the agreement. So that's what we're going to do. And I think that's it. We really look forward to getting robust comments and continuing the process and I'm looking forward to working with all of my colleagues to try to come up with a final rule. >> CHAIRMAN HUNTER: Likewise. I just want to say one thing in response. On the exemption in alternative B, and that's what the Vice Chair is talking about. In alternative B., there is an exemption. But I want to make clear that you don't get there until you jump through a lot of other hoops. You start with the full disclaimer, and if that is bigger than the 10%, then you go to the adapted disclaimer. The adapted disclaimer, just to use a realistic hypo since we're here in the room. John, can I use Republican National Committee? Okay, thank you very much. In alternative B., it would say paid for by the Republican National Committee, 310 1st St. Northeast. And it would say not authorized or paid for by the candidate. It's a fairly long disclaimer. If that disclaimer on the internet ad, we're talking about things you're looking at on your phone, and if that is larger than 10%, and again we're asking if that's the right metric, but if that full thing I just recited is bigger than 10%, then under proposal B, you go to the adapted disclaimer. In our case in alternative B., you can use a recognizable abbreviation. In this case it would read paid for by the RNC. And then you would have some kind of indication, some kind of technology that would link you to the RNC's web page. And on the RNC's web page, you would have the full disclaimer there. So again, on the face of the ad for the adapted disclaimer, it would say paid for by the RNC and then the technology is open. It can be a link, it can be a hover over, which wouldn't take you to the page. It would just give you all the information if you hovered over. So whatever the technology people can do to get the reader the full disclaimer very readily, that's the adapted disclaimer. And if the adapted disclaimer is more than 10% of that small ad that we're talking about, then alternative B. allows you to go to another step which is called an indicator. And that is, from what I can tell in my lifted research, that's fairly common on certain ads on the internet. And the one that we plan to use in our example is an eye with a circle around it, which designates information. So in a very small ad, you might not be able to fit the adapted disclaimer or it might be more than 10%, so you have that eye there. And that eye you can hover over to get to the full disclaimer. And the full disclaimer is one click away. Now if there is some circumstance whereby none of that works and you have to jump through all of those hoops first, then there is an exemption in the rule. Frankly I can't think of a time where that exemption would apply because you certainly, I think you could fit the eye on just about anything, even the smallest of ads. But in the event that there is some kind of technology that we're not thinking of, you know, something that might be developed down the road, or that sort of thing, the exemption is there. Because we don't want to freeze technology. We want to keep that open. But I don't think that that's something where people are going to be able to go to that right away. As I say, they're going to have to filter their way down to get to the exemption in alternative B. It's not widely available. With respect to alternative A., I believe that alternative A. keeps the small items and impracticability exemption in the regulation. I don't want to speak for alternative A., but that's my understanding. So it's conceivable that the ad may meet the small items and impracticability exemptions, which have been in the regulations for a while. Alternative B. gets rid of that for internet ads. Our proposal says they're still in the regulations, but not for internet ads because they're really hard to apply to internet ads and we've had some difficulty in the past trying to apply them to internet ads. We sort of throw those away with respect to internet ads. Madam Vice Chair? >> COMMISSIONER WEINTRAUB: To respond to that, alternative A. doesn't do anything with respect to the small items and the impracticability exemption, which the commission has never applied on the internet. So we could ask the question if it ever would. I'm open to that. >> CHAIRMAN HUNTER: Just to clarify. It's not that we've applied it. We've never found four votes. We've run the analysis through it. >> COMMISSIONER WEINTRAUB: There has never been a consensus that it applies in any circumstance involving internet ads. See, this is why it took so long to get the document done. (Laughing) >> CHAIRMAN HUNTER: Commissioner Petersen? >> COMMISSIONER PETERSEN: Thank you. I'm glad to support this document today. I commend the Chair and Vice Chair for all of their efforts to bring this to this point along with their staff. There have been countless hours put into this. And I think they deserve a great deal of credit for getting us to the point to where we are now. I thank John from my staff for his work to help facilitate hopefully what will be a successful conclusion. As the Chair pointed out, I've pointed out moving forward on this topic for a few years now. I think since the commission grappled with the internet rule making back in the mid 2000s, I believe it was 2006 was when it was finally promulgated, the commission, to its credit has sought to facilitate the continuing development of the internet and of apps and of all sorts of different technology as a means for consuming and disseminating political information. As we now know, traditional media, radio, television, newspaper, mail is becoming less and less relevant for purposes of receiving and consuming political news, making contributions, organizing political movements, even getting get out the vote activities. Increasingly is being done in an online environment. And as we know, radio and television is relatively a static medium in the sense that whether you're reviewing a television ad on a 55-inch HDTV or on a 10-inch tube television, you're getting the same ad. It may be bigger or smaller, but it's the same ad. Whereas in an online environment, whether or not you're viewing an ad on a desktop or on a tablet or a cell phone can make a difference in terms of the content that you receive. Whether or not you have an iPhone or whether it's a Samsung Galaxy or whether you have a newer iPhone or an older one. You have a more expensive and advanced model or more of a primitive one and depending on what operating system you may have. All of these different factors can change the way in which a political communication is received by you. So the commission is in a position where we have a strong interest in ensuring that we are not impeding the further development of the internet and of technology as a means for allowing and facilitating a political communication, but at the same time ensuring that the disclaimer requirements that are in the act that are required by the act are also being met. So threading this needle is what this rulemaking exercise is all about. And comments are always valuable in a rule-making situation. I think even more so in this particular case because we're not dealing with purely questions of law that might be right within our wheelhouse of expertise. But these issues regarding the state of technology, which is rapidly evolving is something where I think we all really can use and will be well served by comments and testimony so that we can be better educated about what the current state of play is in the technology world so that we can develop rules that are relevant and that they will be meaningful in this rapidly developing field. We also want to make sure that we're drafting rules that can be meaningful. We want to make sure that we don't draft rules and a means that will be obsolete in a very short period of time. So I think that the comments that we will receive will be especially valuable. And I certainly join my colleagues in inviting as much response to this NPRM as possible. And I very much look forward to hearing those comments, hearing the testimony that we'll have in the hearing. Because I think that we stand a need of being educated further as to how technology is evolving in this field. Again, I very much look forward to going forward with this rule making. I'm happy to support it. Again, thank all of the efforts. I didn't mention the office of general council when I was distributing my thanks. But thank you to everyone who put in so much time in order to get us to the point where we are now. So Madam Chair, when the time is appropriate, I'll be happy to support this document. >> CHAIRMAN HUNTER: Thank you. Mr. Walther? >> COMMISSIONER WALTHER: Thank you, Madam Chair. I join the rest of the commissioners in supporting this. It's been a long time coming. There's been a comment lately about how long some of these things have been on the commission. This has been almost my full time that we've been dealing with these issues. We'll be getting started and find that we're in disagreement in some areas and we have unclear guidance from what the public wants in the past. And then we're confronted with new ways for people to spend money and new ways for people to use it and not, and in ways that are new to us. And obviously we are confronted with new technology. And I use as an example whenever we talk about the wristwatch. I have a 5-year-old granddaughter who has this wristwatch and she can talk to her mom and get information. And it's pretty neat. So if we get, if we all have these fairly soon, we can say whatever we want to say on there and we can convey information. And so I use that as a way to think about how we can take information that comes to us and then at the same time provide the promise that we have to public to give them information on who's paying for it. So I think it's taken probably another event like we have had in Watergate to make everybody realize that we have to work in a bipartisan way to make sure everybody knows where the money is. And I think the last few years has taught us that there are new pressures to find out where the money is coming from. And this is one way that will improve our ability to do that. I think it's a nice step forward. It's a small step. But it's a positive one. It's great to see the Chair and Vice Chair working together so chummily, if that's a word, but really positively. But saying we're going to get this done. They sat down and went through a lot of iterations. And Matt and I stepped back and said "Let 'em go." And they did it. And without the I.T. department and ITT, it couldn't have been done. And how to meld technology with law and people's prejudices and viewpoints, stuff like that is tough. But I'm really pleased to see us do this. It's kind of a, I would like to say it's kind of a breakthrough for us in a way. Maybe we can tackle some other issues that are coming at us in the same vein. And hopefully we can use this and come up with a rule that we then can adopt. And that will be our test. We are doing a great job so far. But until we actually have a rule that's finalized, it will be a disappointing, but still a productive event. And I would like to just turn the two of them loose and see if they can't give us a final rule. In any event, this is the last time that we'll be in this building. It's been great being here. One of the people in the elevator said, one of the workmen said how do you feel about leaving. He said this has been kind of a family elevator. In a way it has. We've had nine floors, but now we'll only have three or four. But this has been a wonderful building and it has been a comfortable spot. I hate to see us move. But on the other hand it's going to be a great spot. And I think change is something we can all look forward to and maybe this will propel us to agree more. >> CHAIRMAN HUNTER: Thank you. Is there a motion? >> COMMISSIONER WEINTRAUB: I've got one. >> CHAIRMAN HUNTER: Okay! >> COMMISSIONER WEINTRAUB: Madam Chair. I move that the commission approve 18-128-A, a notice of proposed rule making on internet communication disclaimers and definition of public communication and authorize the office of general council to submit it for publication in the general register so we can get lots and lots of comments. >> CHAIRMAN HUNTER: Thank you. All those in favor? Aye. >> Aye. >> CHAIRMAN HUNTER: The motion passes unanimously. Thank you very much. All righty. Since that is the only matter on the agenda today, are there any administrative matters the commission needs to discuss today? >> There are none. >> CHAIRMAN HUNTER: Okay. Thank you. This meeting is adjourned. Thank you.