Fox TV violated federal law but may merit waiver, FCC finds
05/16/95
WASHINGTON, D.C.–The Federal Communications Commission ruled in early May that Fox Television Stations Inc. is in violation of foreign-ownership laws, but the commissioners also began the process to grant the company a waiver.
In a 5-0 vote, the commissioners decided Fox was in technical violation of the rules but added that News Corp. could win a waiver under the Communications Act by proving the exemption would be in the public interest. Three of the five commissioners remarked during the meeting that they already believe the Fox network has benefited the public by bringing new competition to NBC, ABC and CBS, the New York Times reported.
The FCC began investigating Fox in November 1993 after the New York Chapter of the National Association for the Advancement of Colored People charged that Fox illegally acquired its original six television stations in 1985 by using funds from its Australian parent company, News Corp.
Foreign-based companies are prohibited by law from owning more than 25 percent of a United States broadcast station. In 1985, Rupert Murdoch, a naturalized U.S. citizen, told the FCC the he would control 76 percent of the voting stock and that News Corp. would own the rest. What was not discussed at the time was that News Corp. provided 99 percent of the equity for the Fox station group, according to the FCC findings. The NAACP claimed Fox was masking its true corporate identity when seeking FCC approval ten years ago.
A decision against Fox could have cost the company its broadcasting licenses, but the FCC rejected NAACP’s charges that Murdoch deceived the agency in 1985 by not disclosing the full extent of News Corp.’s ownership. “We cannot fault anybody for failing to comply with policies that were not clear,” Commissioner Susan Ness said.
Murdoch has until mid-June to file for a waiver with the FCC. “We will have absolutely no difficulty whatsoever in preparing a compelling public interest showing that will satisfy the statute,” Murdoch told Broadcasting & Cable. (In re Application of Fox Television Stations Inc.)
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