In a somewhat indirect move, Congress has advanced the effort to allow television and radio stations to begin accepting cannabis ads in states where it has been approved for medical and/or adult use. More specifically, the House Appropriations Committee advanced the Financial Services and General Government appropriations bill for fiscal year 2023, which includes provisions that would eliminate the ability of the Federal Communications Commission (the "FCC") from taking administrative action against broadcasters for accepting cannabis ads in states where it has been legalized. Please note, despite this recent development, companies will still need to adhere to local cannabis marketing regulations.
What Does this Mean for the Future of Cannabis Ads?
While it is too early to say for certain, it does look like Congress has begun paving the way for approval of cannabis ads down the road. The Appropriations budget Bill still needs approval by the full House of Representatives and Senate. According to a recent news article, the spokesman for the National Association of Broadcasters, Alex Siciliano, is hopeful: "As the vast majority of states have legalized cannabis in some form, today marks a long overdue step toward finally allowing broadcasters to receive equal treatment regarding cannabis advertising that other forms of media have had for years."
Another news article reports that the proposed federal spending bill, that would seemingly allow broadcasters to accept and air cannabis ads, would prevent the FCC from penalizing broadcasters from running cannabis ads in states where it is legal. Specifically, under the budget bill, the FCC would not be allowed to use any money to deny a license renewal or a station sale application as punishment for airing cannabis ads or cannabis-related products.
What Happens Next?
This new bill, if enacted, would enable broadcasters to take advantage of an estimated $18.4 billion industry in the United States this year. Please note, however, that media outlets not governed by FCC rules and regulations are currently free to accept cannabis ads.
Various state broadcast associations have worked together to create the Safe Advertising Coalition (the "SAC"), a group that is lobbying for clear federal protection for broadcasters to air cannabis ads. The SAC has applauded the House Appropriation Committee's approval of the bill and is working toward obtaining full congressional approval. If passed, the spending bill would go into effect October 1, 2022, and would expire after one year.
There seems to be a great deal of confidence in the broadcasting industry that the bill's approval would permit cannabis ads on radio and T.V. in states that have legalized marijuana. Companies will certainly need to consult with an experienced marketing attorney to ensure that their cannabis ads are following the applicable state and federal laws and regulations.
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