The Federal Trade Commission wants non-compete clauses to be a thing of the past at radio stations across the country. The National Association of Broadcasters is pushing back. The group sent a letter to Congress this week opposing the FTC’s proposal.
“The FTC lacks the constitutional or statutory authority to issue such a rule and, in attempting to do so, the agency is improperly usurping the role of Congress,” the letter reads.
The NAB makes a case for what it calls “reasonable non-compete clauses”. The group’s letter notes that the clauses are necessary because companies make “substantial investments” in promoting on-air talent.
Non-compete clauses have been found by “courts, scholars, and economists” to be an effective means of protecting intellectual property, according to the letter. The NAB also adds that when reasonable and promoting of competition, non-competes work. When those conditions are not met, they fail. That makes a total ban unnecessary.
“The FTC has not attempted to promulgate a competition rule for decades, across administrations of both parties,” the letter states. “In the past, Congress curbed FTC’s excesses with appropriations riders, and we encourage Congress to revisit such tools today.”
