The Federal Election Commission (FEC) is receiving public comments through November 14 on aspects of its Internet speech regulations. The FEC's request for comments stems from recent requests by Google and Facebook for exemptions from federal campaign speech disclaimer regulations for limited-character online text ads. Specifically, the FEC is deciding whether and how it should revise – and possibly make exceptions to – its regulations regarding disclaimers on online advertisements, such as banners, popups, and short text ads.
The short answer to the FEC is that it should, at minimum, adopt an exception for character-limited ads. If anything should qualify for "small items or impracticable" exceptions, it's online ads containing less than 160 characters. But the FEC's prospective action also provides occasion to reflect more generally on the regulation of political speech on the Internet. Do we need federal regulation of political speech on social networks, blogs, and other Web sites? The interactive and information-rich nature of the Internet as well as the fact that such disclaimer statements directly burden online speech suggests that the federal government should consider retreating from regulating Internet communications.
As explained in its Advance Notice of Proposed Rulemaking, published in the Federal Register, the Bipartisan Campaign Reform Act of 2002 ("BCRA") expanded and made more specific disclaimer requirements for certain "public communications." Disclaimers are required for public communications that: (1) are made by a political committee; (2) expressly advocate election or defeat of a clearly identified federal candidate; or (3) solicit a contribution. Under BCRA and FEC regulations, a "disclaimer" statement must appear on such communications, identifying who paid for it and whether a candidate authorized it.
The FEC "adopted its current rules governing Internet communications in 2006 in response to the decision of the U.S. District Court for the District of Columbia in Shays v. FEC  ("Shays I"). There the District Court ruled, among other things, that "[w]hile all Internet communications do not fall within [the scope of 'any other form of general public political advertising'], some clearly do." The District Court left it to the Commission to determine "what constitutes 'general public political advertising' in the world of the Internet," and thus should be treated as a "public communication."
Disagreement among FEC Commissioners resulted in the FEC not appealing the District Court's ruling regarding the FEC's prior exclusion of all Internet communications from the definition of "public communication." Instead, following Shays I, the FEC added "Internet communications placed on another person's Web site for a fee" to the regulatory definition of "public communication." This definition swept in all potential forms of Internet advertising, such as banners, streaming videos, popups, and directed search results. And by including Internet communications placed for a fee on another person's Web site in the definition of "public communication," those Internet communications became subject to BCRA's disclaimer requirement.
As mentioned earlier, Google and Facebook recently requested exemptions from FEC regulations relating to disclaimers for short-character text ads. Google asked the FEC if it could sell search engine-generated text ads of around 95 characters to candidates and political committees if those ads didn't include disclaimers. The FEC issued an Advisory Opinion, concluding such ads were not in violation of BCRA, although the Commissioners could not reach agreement on the grounds of their ruling. Facebook subsequently asked the FEC if its ads limited to 160 characters qualified for either the "small items" or "impracticable" exceptions to the disclaimer requirements. But FEC Commissioners could not reach agreement and never issued an advisory opinion in response to Facebook's request.
That the FEC could not even agree to exempt Facebook ads and that its Notice suggests imposing alternative disclaimer requirements on small online ads through the use of required hyperlinks, micro bars, or buttons, suggests the agency might favor a pro-regulatory approach for dealing with online political ads in the future. At this point, a FEC general exemption for character-limited online ads is no sure thing.
Hopefully, the FEC will recognize that disclaimer requirements are especially burdensome when it comes to online advertising along the lines of Facebook updates, Tweets, and other social networking services. Space and character length come at a premium in such cases, increasing the likelihood that disclaimer messages will interfere with ad purchaser messages. To the extent that disclaimer restrictions make innovative kinds of online advertising less attractive to ad buyers, it can also lessen the ability of online content companies to rely on ad sales to monetize their services and be able to offer them to the public for free. After all, typical online services from Google, Facebook, Twitter, and the like are ad-supported and cost nothing for regular consumers to sign up for and use.
Moreover, nothing in Shays I expressly or impliedly requires limited character ads on the Internet to be swept into the FEC's regulatory sweep. So the FEC has reason enough to grant an exemption.
Yet for those who appreciate the transformative effect of the Internet on media and speech communications, the FEC's dabbling with online ads and disclaimer requirements brings to the surface broader questions about whether the federal government should even be regulating Internet communications.
For starters, a regulatory approach to online political speech fails to appreciate the Internet's low barriers to entry. Users can offer ideas and counter other ideas without having to own a complex media empire, let alone a broadcast station, channel, or program. Blogs, streaming video such as YouTube, and social networking services have made increasingly simple and inexpensive the avenues for public participation in the marketplace of ideas, political debates, and political elections.
Federal regulation of online political speech also has a paternalistic cast to it, as if Internet users are too easily taken in by online ads advocating a particular political viewpoint or somehow insufficiently able to exercise independent judgment, seek verification, or consult contrary viewpoints. Internet users have near total control over the kinds of content they wish to access or receive. And Internet users enjoy the benefit of easy access to further sources of information concerning the contents of online ads, political or otherwise.
Much more could be said regarding regulation of political speech online – or regulation of political speech made through all other modern media platforms, for that matter. But disclaimer requirements for political speech in modern media platforms, such as the Internet, burden speakers' ability to convey their own message. In particular, this aspect of disclaimer requirements renders them more burdensome than filing periodic reports with the FEC pursuant to campaign finance disclosure requirements.
In the years since BCRA and Shays I, legislation has percolated through Congress – such as the proposed Online Freedom of Speech Act – that would exclude all Internet communications from BCRA's definition of "public communication" and hence from its disclaimer requirements. The idea of subjecting short-character Internet ads to disclaimer requirements, now before the FEC, should cause the Congress and the general public to be concerned about the whole idea of regulating Internet communications.