FEC Votes to Explore Disclosure Rules for Online Ads

By Kenneth P. Doyle

The Federal Election Commission voted unanimously to jump-start a rulemaking process focused on disclosure requirements for online ads, following the revelation of Russian-linked political ads on Facebook.

The vote, at the end of a lengthy commission meeting Sept. 14, was a possible breakthrough for the FEC. In the months following the first reports that Russia intervened in the 2016 election to support President Donald Trump, Republican and Democratic commissioners have been deeply divided over whether new rules may be needed to protect U.S. campaigns from foreign influence.

Foreign money has long been outlawed in U.S. elections. The FEC and others have struggled, however, to determine whether Russian actions in the last presidential campaign violated existing rules and whether new rules should be considered.

Ellen Weintraub, a Democratic FEC commissioner, has pushed the commission to consider new rules to protect future elections. She called the FEC’s latest vote to reopen a long-dormant rulemaking, which could beef up disclaimer requirements for online political ads, a “baby step in the right direction.”

New Deadlock on Twitter Disclaimers

The FEC voted at the meeting to reopen for 30 days a public comment period on a rulemaking notice originally published by the FEC in 2011 (REG 2011-02) regarding online ad disclaimers.

The 5-0 vote was unusual because the commissioners have been divided for years, along party and ideological lines, regarding whether disclosure rules for spending on all types of campaign messages should strengthened. In earlier action at the same meeting, for example, the commissioners deadlocked along party lines regarding an advisory opinion request from a pro-Trump political action committees. The committees asked whether they could send messages on Twitter without having a disclaimer on their Twitter profile pages.

The FEC’s three Republicans voted to grant the request (AO 2017-05) from the Great America PAC and Committee to Defend the President, while the two commissioners holding Democratic seats voted to deny the PACs’ request. The votes of at least four commissioners are required for any ruling by the six-member FEC. One Democratic seat on the FEC is vacant.

In other action at the meeting, the FEC commissioners approved an advisory opinion (AO 2017-06) allowing a pair of entrepreneurs, Eli Stein and Jeremy Gottlieb, to market a new app that would let users round up the change from purchases and contribute that amount to certain Democratic congressional candidates.

The watchdog group Campaign Legal Center had said approving the opinion could could grant too much power to a private company to steer contributions to favored candidates.

Past Facebook, Google AOs

The original rulemaking on political ad disclaimers was initiated after the FEC considered advisory opinions requested by Google Inc. in 2010 and Facebook Inc. in 2011. The requests were aimed at exempting online ads from some or all of the requirements applied to political ads broadcast on television or radio or published in print. The companies argued their online ads were too small or otherwise unsuitable to carry disclosure messages stating who paid for them.

In looking again at possible new rules in this area, the FEC commissioners indicated they want to assess the current state of technology regarding how political ad sponsors can be disclosed, as well as look at whether and how disclosure is being accomplished in the real world.

Republican FEC Commissioner Matthew Petersen said during the Sept. 14 meeting that the FEC adopted a regulation in 2006 that provided broad waivers from campaign finance rules for political activity on the internet. This provided “regulatory space” for the development of online political activity, he said, while the internet over the last decade has “overtaken everything” as a medium for fund raising and political messaging.

Weintraub said she wants the FEC to hold a public hearing after the new comment period to examine these issues. She said she hoped representatives of Facebook, Twitter, Google and others involved in social media and internet operations would come in to the FEC explore possible new rules to inform the public about sponsors of online political ads.

Facebook Fought Disclaimer Rules

Facebook opposed new disclaimer requirements in 2011, saying in a comment letter that its ads shouldn’t be required to have links to a landing page that would disclose an ad’s sponsor.

In its advisory opinion requested that year, Facebook asked the FEC to apply the “small items” and “impracticability” exceptions to its ads. The company was referring to long-standing disclaimer exemptions in campaign finance law for such items as pins, bumper stickers, and skywriting.

Facebook hasn’t said whether its position on disclaimer requirements for online ads has changed since 2011.

The company said in a recent blog post that an internal probe found the company had sold thousands political ads in 2016 linked to Russia. Facebook has refused to publicly release the ads, making it difficult to know whether they contained any disclaimers stating who paid for the messages.

In addition to responding to the FEC, Facebook and Twitter are facing demands from Congress for more information about Russian use of social media during the 2016 election, Bloomberg News has reported.

The top two members of Senate Intelligence Committee, Chairman Richard Burr (R-N.C.) and ranking Democrat Sen. Mark Warner (Va.) told reporters Facebook was likely to be called in for a public hearing before the committee.

To contact the reporter on this story: Kenneth P. Doyle in Washington at kdoyle@bna.com

To contact the editor responsible for this story: Paul Hendrie at pHendrie@bna.com

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