An Advisory from the law firm of Pillsbury Winthrop Shaw Pittman

by Lauren Lynch Flick and Scott R. Flick

The FCC’s Media Bureau has announced that a new version of the Biennial Ownership Report Form for commercial broadcast stations, FCC Form 323, will be available on its website as of April 9, 2010. All commercial broadcast station owners must file their biennial ownership reports using the new form by July 8, 2010. However, the data used to complete the form must be accurate as of November 1, 2009.

The FCC originally announced its intent to implement a new version of the Form 323 in an Order released in May 2009 as part of its Promoting Diversification in the Broadcasting Services proceeding. The revision required, among other things, that each holder of a direct or indirect attributable interest in a licensee secure an FCC-issued Federal Registration Number (“FRN”). The revision also mandated that information regarding attributable interest holders and their other broadcast interests be reported repeatedly and in a precisely structured manner. As a result, the number of reports and the time to complete each report increased dramatically for many broadcasters with the ultimate result that the FCC’s electronic filing system ground to a near halt and did not reliably save information entered into it. Based on these technical difficulties, the FCC stayed the filing obligation until it could improve the functioning of the form to account for these difficulties.

The FCC sent its revisions to the form to the Office of Management and Budget (“OMB”) for approval on March 25, and OMB approved the modified form on March 26. The revised form uses a new XML Spreadsheet template that will allow information to be entered into the spreadsheet and then uploaded to the form, thereby reducing the time and effort needed to enter the data. The spreadsheet must be downloaded from the FCC form and comes with detailed instructions regarding the proper use of the XML Spreadsheet. Of particular note are the following:

The XML Spreadsheet comes with 25 empty rows for data entry that contain embedded validation codes necessary for the proper functioning of the form. Any licensee needing more than 25 lines must copy and paste the original 25 lines as many times as necessary and not create new lines.

The XML Spreadsheet must be saved with an .xml extension, not the .xls or .xlsx extensions that the Excel program will assign by default. Licensees must not change or delete any data in Cell B1. Information must be entered in all capital letters. The new version of the form also retains the requirement that each attributable interest holder secure an FRN. The instructions state that where, after a good faith effort, a licensee is unable to secure an interest holder’s social security number, which is needed to  complete the FRN registration process, a button on the form will allow the licensee to secure a Special Use FRN. The instructions to the form state that the Special Use FRN can only be used for the Biennial Ownership Report filing, and not for any other filing, such as a post-consummation Ownership Report filing.

The Commission’s May 2009 Order also adopted November 1 as a new uniform reporting date for all commercial stations nationwide, regardless of the station’s license renewal filing anniversary (the deadline previously used by the FCC). Because the original November 1, 2009 filing requirement was stayed while the form was revised, the reports filed by the new July 8, 2010 deadline must still reflect the ownership data as it existed November 1, 2009.

The substantial difference in time between the new filing deadline and the time for which ownership information is being reported leads to some interesting questions. For example, where a station has been sold since November 2009, should the report be filed under the name of the new licensee or the prior licensee? If it is to be filed by the new licensee, how will the FCC deal with the fact that the new licensee may not have any personal knowledge of the prior licensee’s November 2009 ownership structure? These questions may be answered by a follow up public notice from the FCC, but if not, we will be pursuing them with the FCC’s staff.

The FCC released an Order announcing that, due to technical difficulties, it was temporarily suspending the use of the new FCC Form 323 and, as a consequence, was postponing the January 11, 2010 deadline for the filing of Biennial Ownership Reports for commercial broadcast licensees.  The Commission stated that it would announce the reactivation of the new form and the new filing deadline in a subsequent Public Notice.  The Order states that the Commission “will temporarily suspend the ability to start a new biennial Form 323 during this interim suspension period but will allow filers to complete and file forms that they have already started should they wish to do so.”  The Order also states that the new filing deadline will be at least  90 days from the date that the new form is made available for new biennial filings.

As previously reported, on December 9, 2009, the Commission released the electronic version of the new FCC Form 323 in CDBS.  Over the last two weeks, the Commission has fielded numerous inquiries prompted by complaints of technical problems with the new FCC Form 323.  As a consequence, the Commission has decided to suspend use of the new FCC Form 323 in an effort to resolve such technical issues.   

One of the technical problems that has been encountered by many practitioners is the inexplicable loss of enormous amounts of data that had been uploaded onto the form, notwithstanding the fact that such data had been “saved” during the uploading process.  Accordingly, it is hoped that this type of problem will be remedied before the form goes “live” again. 

We will provide updates regarding the status of the new FCC Form 323 as developments occur.

In a Public Notice released by the FCC yesterday, the Media Bureau has announced that it has extended to January 11, 2010, the prior December 15, 2009 deadline for commercial radio and television broadcast station licensees to file their Biennial Ownership Reports on revised FCC Form 323.

This announcement comes as a great relief to licensees of commercial broadcast stations given that the electronic version of revised FCC Form 323 is not yet available on the FCC’s CDBS system for uploading of data. In the meantime, every licensee should continue their preparations by compiling an accurate (as of November 1, 2009) and complete list of all individuals and legal entities which have a direct or indirect attributable interest in their station licenses. All such individuals and legal entities will have to obtain Federal Registration Numbers (“FRNs”) by registering with the FCC. The following link may be used for that purpose: https://svartifoss2.fcc.gov/coresWeb/regEntityType.do

With those tasks completed, licensees will be in better position to expeditiously upload all of the data required in the newly revised FCC Form 323 when it becomes available. Licensees are encouraged to file well before the new deadline to avoid the expected onslaught of FCC Form 323 filings. We will issue an update of this Alert as soon as the FCC issues another Public Notice announcing when the electronic version of FCC Form 323 is available on CDBS. Further information about the FCC’s requirements may be obtained at http://.www.fcc.gov/form323.

The FCC urges members of the public to continue to submit questions regarding the new form and filing procedures to Form323@fcc.gov.

As we wrote in an earlier Advisory, the FCC adopted an order in April 2009 revising FCC Form 323, its Ownership Report form for commercial stations. It also expanded the types of entities and licensees required to file Form 323, announcing that owners of all commercial AM, FM, TV, LPTV and Class A TV stations would need to file the new form by November 1, 2009. The FCC later suspended its existing biennial Ownership Report filing requirement for stations that were to have filed in June, August, or October of 2009, since those stations would have to file the new Form 323 by November 1, 2009 in any event. At this time, the Office of Management and Budget (OMB) has not yet approved the new Form 323 for use by the FCC. In response to numerous calls from station counsel and industry representatives, the FCC today announced that it is suspending the requirement that stations file the revised Form 323 by November 1, 2009. Instead, stations will be required to file the new Form 323 by a date to be later announced by the FCC that is at least thirty days after the release of a public notice of OMB approval of the new form. In the meantime, the FCC announced that it will continue to suspend the filing of biennial ownership reports on existing Form 323 until the new form is available. While the FCC originally required that the ownership information submitted in the new Form 323 be current as of October 1, 2009, today’s Order announced that when the revised Form 323 is available for filing, stations should include ownership information that is current as of November 1, 2009. The FCC also announced that this delay does not affect future filing dates of the biennial Ownership Report, which will fall on November 1 of all odd-numbered years going forward. The FCC’s full order is below: Before the Federal Communications Commission Washington, D.C. 20554 In the matter of Promoting Diversification in the Broadcasting Services 2006 Quadrennial Regulatory Review – Review of the Commission’s Broadcast Ownership Rules and Other Rules Adopted Pursuant to Section 202 of the Telecommunications Act of 1996 2002 Biennial Regulatory Review – Review of the Commission’s Broadcast Ownership Rules and Other Rules Adopted Pursuant to Section 202 of the Telecommunications Act of 1996 Cross-Ownership of Broadcast Stations and Newspapers Rules and Policies Concerning Multiple Ownership of Radio Broadcast Stations in Local Markets Definition of Radio Markets Ways to Further Section 257 Mandate and to Build on Earlier Studies MB Docket No. 07-294 MB Docket No. 06-121 MB Docket No. 02-277 MM Docket No. 01-235 MM Docket No. 01-317 MM Docket 00-244 MB Docket No. 04-228 ORDER Adopted: October 2, 2009 Released: October 2, 2009 By the Chief, Media Bureau: 1. On April 8, 2009, the Commission adopted a Report and Order and Fourth Further Notice of Proposed Rulemaking in the above-captioned proceeding. In pertinent part, the Report and Order revised certain requirements for filing FCC Form 323, which provides ownership information about broadcast facilities. The Report and Order enlarged the class of broadcast licensees required to file FCC Form 323 biennially, and it substituted a uniform biennial filing deadline for the current system of rolling filing deadlines that are tied to a station’s renewal anniversary. Pursuant to these new requirements, all commercial full-power AM, FM, TV, LPTV and Class A stations, as well as entities with attributable or reportable interests in them, are required to file the revised FCC Form 323 on or before November 1, 2009, with information current as of October 1, 2009, and to file biennially thereafter. 2. On May 29, 2009, the Media Bureau suspended the filing requirement for the existing Form 323 for licensees who would otherwise be required to file biennially between the date of the Order and November 1, 2009. The Bureau considered it in the public interest to relieve filers from the burden of biennially filing the existing Form 323 within the six months prior to the new November 1 biennial filing requirement. In addition, the Bureau stated that if the Commission has not received OMB approval for the new Form 323 by the November 1, 2009 filing deadline, all filers who would have been required to file Form 323 biennially between the date of the Bureau Order and November 1, 2009, but whose filing obligation was suspended by the Bureau’s May 29th Order, would be required to file the existing Form 323 by November 1, 2009. 3. On our own motion, we are extending the initial November 1 biennial filing date for the new Form 323. Accordingly, licensees and other filing entities are not required to biennially file revised Form 323 on November 1. When the Commission receives approval from the Office of Management and Budget (“OMB”) for the revised Form 323 (Control Number 3060-0010), the Media Bureau will issue a Public Notice establishing a filing date for the revised Form 323 that will be no earlier than 30 days after the date of public notice of OMB approval. We will also extend the date as of which information submitted on the revised Form 323 must be accurate from October 1, 2009, to November 1, 2009. We believe these deferrals are necessary in order to provide licensees and other entities with sufficient time to review the new form and gather the information needed to complete it. The filing deadline extension and the November 1 cut-off date for ownership data will apply only to the initial biennial filings. Beginning with the 2011 filing, the form must be filed no later than November 1 with data current as of October 1 of the filing year. 4. We will also not require licensees excused from filing by the Media Bureau’s May 29th Order to file the existing Form 323 on November 1, 2009. We believe that it would be an undue burden on licensees and other entities required to file Form 323 to prepare the existing form on November 1 and then prepare and file the revised form soon thereafter. 5. Accordingly, IT IS ORDERED, that pursuant to authority under Sections 4(i) and 303(r) of the Communications Act of 1934, as amended, 47 U.S.C. §§ 154 and 303(r) and pursuant to authority delegated to the Media Bureau pursuant to Sections 0.204 and 0.283 of the Commission’s rules, 47 C.F.R. §§ 0.204, 0.283, the filing requirements as described above ARE EXTENDED, sua sponte. 6. For additional information, please contact Mania Baghdadi or Amy Brett, Industry Analysis Division, Media Bureau, at (202) 418-2330. FEDERAL COMMUNICATIONS COMMISSION William T. Lake Chief, Media Bureau