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US Places Weak Limits on Messaging by Foreign Governments

FILE - An entrance to the offices of EDI and G&E is pictured in West Covina, California, July 31, 2014.

Under the First Amendment, the U.S. Constitution generally prevents the federal government from censoring any media. And while the Federal Communications Commission and the Justice Department regulate radio station ownership and messaging by foreign governments, it's easy for other nations to legally reach American audiences.

A law administered by the FCC, the Communications Act, bans foreign governments or their representatives from owning a radio license for a U.S. broadcast station. The law, first enacted in 1934, does not apply to cable or satellite outlets, such as Russia's RT or Qatar's Al-Jazeera, or to Internet sites, according to FCC officials.

The law permits foreign individuals, governments and corporations to hold up to 20 percent ownership directly in stations and up to 25 percent in U.S. parent corporations of stations.

Liberal interpretation

FCC commissioners have liberally interpreted the foreign broadcast ownership cap, stressing the law allows exceptions to the 20 and 25 percent rules if it will "serve the public interest." FCC commissioners have also said that allowing foreigners to lease time on airwaves owned by American companies — a process known as "time brokering" — can be a good way to promote diversity of views.

James Su, a naturalized U.S. citizen and Los Angeles-area businessman, owns and co-owns several stations and uses time brokering to lease virtually all the time on others.

Su also owns 40 percent of a network called G&E Studio Inc., which is 60 percent owned by a Chinese state-owned subsidiary.

G&E leases almost all the broadcast time on two stations — in Washington and Philadelphia — to air China-friendly programming.

G&E also distributes CRI content made in Beijing, as well as G&E content produced in California, to more than a dozen stations inside the United States.

According to FCC records, these include several stations in which Su's companies hold a stake of approximately 80 percent — for example, stations in Atlanta, Salt Lake City and Las Vegas.

The records show that the remaining roughly 20 percent is held by AIM Broadcasting, a company in Palo Alto, California, which specializes in programming aimed at immigrants. Su's various companies also partner with AIM on some time-broker ventures, records show.

Each of these arrangements complies with U.S. law, said Su and Greg Douglas, chief operating officer of AIM Broadcasting.

Fuzzy lines

Douglas said many U.S. stations commonly air content produced overseas. He said he did not know that G&E was 60 percent owned by a subsidiary of the Chinese state until contacted by Reuters.

Douglas said he believes that G&E content produced in the United States is made independently, and not directed by the Beijing government.

FCC officials declined to comment.

The Justice Department, meanwhile, regulates agents of foreign governments or foreign groups engaging in political activity — defined as people or entities seeking to influence U.S. policy or public opinion. They are required to register with the department under the Foreign Agents Registration Act, or FARA. These people must publicly disclose financial arrangements with foreign governments and affix warning labels to any promotional material distributed inside the United States.

Foreign Agents Registration Act

Su nor two of his primary companies — G&E Studio and EDI Media Inc. — are registered as foreign agents, public records show. Su said he and his companies aren't acting as agents of a foreign government and his lawyers have told him his actions are legal.

Ronald Meltzer, who wrote the FARA chapter in the American Bar Association's official lobbying manual, said media outlets are not exempt from the law.

"You can't hide behind a rubric of journalism by producing a newspaper or putting content on the U.S. radio airwaves if the content is provided, financed or directed by a foreign government for the purpose of influencing American public opinion or policy," Meltzer said.

Willful violation of FARA carries a maximum penalty of five years in prison. Justice Department officials spend "a considerable amount of time combing through public source information" looking for unregistered foreign agents, said a senior Justice Department official.

But there have been only four prosecutions in the last decade. Most cases are resolved administratively, outside of public view, the official said, adding that "proving foreign-agency direction and control is nuanced."

As a result, said U.S. officials and lawyers who follow the issue closely, the primary goal of FARA is to force foreign governments to be transparent in their attempts to lobby the American government and public.

There are currently about 350 registrants representing some 500 foreign entities in the United States, officials said.

Current Chinese registrants include Beijing's official trade and tourist offices, as well as its China Daily, which produces a U.S. edition and regular, multi-page advertorial inserts that appear in The Washington Post. Past registrants include a U.S. public relations firm that helped promote CCTV, the Chinese state broadcaster, to influential people inside the United States in 2012.