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FCC Preserves Retrans 'Good Faith' Provision

The FCC has amended its rules to extend the good faith
requirement in retransmission consent negotiations until March 1 or longer
if Congress moves a related sunset date. But the FCC had to work fast.

That provision [325(b)(3)(C)(ii) of the Communications
Act for those keeping track] prevents broadcasters "from
engaging in exclusive contracts for carriage or failing to negotiate in good
faith." It is not exactly clear what the FCC defines as good
faith, but the issue has been heating up of late due to retrans fights between
Fox and Time Warner and Sinclair and Mediacom, respectively.

The good faith/nonexclusive bargaining rule had been
expected to be extended, along with the satellite copyright license to import
distant network TV station signals, as part of the reauthorization of the
Satellite Home Viewer Extension and Reauthorization Act (SHVERA).

But a revised satellite bill got hung up and Congress
extended the SHVERA bill until March 1 as a stop-gap measure. That came as
an amendment to the Defense Appropriations Act, which only passed Dec. 19. The
FCC then needed to move the retrans bargaining sunset date to March 1 or it,
too, would have expired.

Without that extension the requirement that TV stations not
enter into exclusive contracts for carriage (say cutting out satellite
operators in favor of cable) or that they negotiate in good faith would have
expired on Dec. 31.

That, in turn, could have had major implications for future
retrans fights.  Mediacom, for example,
has argued that Sinclair is not bargaining in good faith, and Time Warner has
taken aim at Fox.

If a new satellite bill has not been agreed to by that March
1 date and Congress again extends the SHVERA sunset date, the FCC sunset of the
good faith/nonexclusive bargaining rule will automatically move right along
with it.

The FCC said it was not providing time for comment on
amending the sunset date because it didn't have the time.

"We are amending these rules without providing prior
public notice and comment because prior notice and comment would be
impracticable in this case," the FCC said in an order released Tuesday.  "Section 1003(b) of the Department of
Defense Appropriations Act, 2010 was enacted on December 19, 2009, less than two weeks before
the sunset date of January
1, 2010. This provides the Commission with an insufficient amount
of time to publish a Notice of Proposed Rulemaking in the Federal Register, to
allow time for meaningful comment, and to consider those comments before taking
the necessary actions..."