Internet final rules

The Commission has approved regulations that narrowly expand the definition of “public communication” to include certain types of paid Internet content. This change complies with the district court’s determination in Shays v. FEC that the Commission could not exclude all Internet communications from its “public communication” definition.

As detailed below and in the accompanying 800-line article, the revised rules also modify the Commission’s disclaimer requirements, add an exception for uncompensated individual Internet activities, revise the “media exemption” to make clear that it covers qualified online publications and add new language regarding individuals’ use of corporate and labor organization computers and other equipment for campaign-related Internet activities.

Background

The Bipartisan Campaign Reform Act of 2002 (BCRA) requires that state, district and local political party committees and state and local candidates use federal funds to pay for any “public communication” that promotes, attacks, supports or opposes (PASOs) a clearly identified federal candidate. Congress defined “public communication” as a communication by means of any broadcast, cable or satellite communication, newspaper, magazine, outdoor advertising facility, mass mailing, or telephone bank to the general public, or any other form of general public political advertising.” 2 U.S.C. §421(22). Based on that definition, the Commission expressly excluded all Internet communications from its regulatory definition of the term.

In its other BCRA rulemakings, the Commission incorporated the term “public communication” into provisions on generic campaign activity, coordinated communications and disclaimer requirement. By excluding Internet content from the definition of public communication, the Commission effectively exempted most Internet activity from those regulations. The term was also used in the definition of an “agent” of a state or local candidate and in certain allocation rules governing spending by SSFs and nonconnected committees. 11 CFR 300.2(b) and 106.6(f)

On October 21, 2005, the U.S. District Court for the District of Columbia in Shays rejected the Commission’s decision to exclude all Internet communications from the definition of “public communication.” 337 F.Supp. 28 (D.D.C. 2004), aff’d, 414 F.3d 76 (D.C. Cir. 2005). The court concluded that some Internet communications do fall with in the scope of “any other form of general public political advertising” and, therefore, required the Commission to determine which Internet communications were encompassed by that term.

The Commission issued a Notice of Proposed Rulemaking (NPRM) on March 24, 2005, seeking comment on possible rule changes and held public hearings on June 28 and 29, 2005. For more information, see the May 2005 Record, page 1 and August 2005 Record, page 2.

Final rules

Public communication

While the new regulations continue to exempt most Internet communications, those placed on another person’s web site for a fee are now considered “general public political advertising” and, therefore, qualify as “public communications.” By contrast, unpaid Internet communications, including blogs, e-mail and a person’s web site, are not.

Coordination

Content that a person places on one’s own web site is not included in the definition of “public communication,” even if it includes republished campaign material. Therefore, their republication of a candidate’s campaign materials on their own web site, blog or e-mail does not constitute a “coordinated communication.” However, when a person pays a fee to republish campaign materials on another person’s web site, the republication would qualify as a “public communication.”

Disclaimer requirements

Under the new rules, political committees must include disclaimers on their web sites and their widely distributed e-mail, i.e., more than 500 substantially similar messages, regardless of whether the e-mail messages are solicited or unsolicited. Others are not required to include a disclaimer on their own web site or e-mail messages. Persons other than political committees need only include disclaimers on paid Internet advertising that qualifies as a “public communication” and then only if the communication includes certain content such as a message expressly advocating the election or defeat of a clearly identified federal candidate. 11 CFR 110.11.

Uncompensated individual internet activities

Online campaign activity by uncompensated individuals or groups of individuals is exempt from the definitions of contribution and expenditure. 11 CFR 100.94. This exemption applies whether the individual acts independently or in coordination with a candidate, authorized committee or political party committee. Exempt Internet activities include:

• Sending or forwarding election-related e-mail messages;
• Providing a hyperlink to a campaign or committee’s website;
• Engaging in campaign-related blogging;
• Creating, maintaining or hosting an election-related website; and
• Paying a nominal fee for a website or other forms of communication distributed over the Internet.

Media exemption

In general, a media entity’s costs for carrying bona fide news stories, commentary and editorials are not considered “contributions” or “expenditures,” unless the media facility is owned or controlled by a federal candidate, political party or federally registered political committee. See 2 U.S.C. §431(9)(B)(i) and 11 CFR 100.73 and 100.132. The new regulations clarify that the exemption, commonly known as the “news story exemption” or the “media exemption,” extends to media entities that cover or carry news stories, commentary and editorials on the Internet, including web sites or any other Internet or electronic publication. See also AOs 2005-16, 2004-7 and 2000-13.

The media exemption applies to the same extent to entities with only an online presence as those media outlets that maintain both an offline and an online presence. See the E&J for revised regulations. 11 CFR 100.73 and 100.32.

Corporate and labor internet activities

Commission regulations have long permitted stockholders and employees of a corporation and members of a union to make occasional, isolated or incidental use of the organization’s facilities for voluntary political activity. The new regulations clarify that employees may use their work computers at the workplace and elsewhere to engage in political Internet activity, as long as that use does not prevent them from completing their normal work or increase the overhead or operate expenses for the corporation or labor organization. The organization may not condition the availability of its space or computers on their being used for political activity or to support or oppose any candidate or political party. 11 CFR 114.9.¹

State and local party activities

If a party committee pays to produce content that would qualify as federal election activity (FEA)—e.g., a video that PASOs a federal candidate—and pays to post that content on another person’s web site, then the entire costs of production and publication of the content must be paid for with federal funds. 11 CFR 100.24. The costs of placing content on the party committee’s own web site, however, are not restricted to federal funds. See the E&J for revised 11 CFR 100.26.

The final rules were published in the April 12, 2006 Federal Register (71 FR 18589 ) and will go into effect on May 12, 2006.

The final rules are available on the FEC website and from the FEC Faxline 202/501-3413.

¹ The new regulations do not affect the existing regulations concerning communications by such organizations to the restricted class or to the general public. 11 CFR 114.9(e).