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FCC to reverse rules on TV station purchases

The Federal Communications Commission (FCC) logo is seen before the FCC Net Neutrality hearing in Washington February 26, 2015. REUTERS/Yuri Gripas

By David Shepardson

WASHINGTON (Reuters) - The U.S. Federal Communications Commission said on Thursday it will vote in April to reverse a 2016 rule adopted by the Obama administration that limits the number of television stations some companies can buy.

The FCC rewrote its rules last year that allowed companies to only partially count certain stations against the limit on ownership to those stations covering 39 percent of U.S. television households. The new rules did not require any company to sell existing stations but could bar new acquisitions.

FCC Chairman Ajit Pai said in a statement the FCC was likely to lose an ongoing lawsuit over the decision to revoke the rule in front of the U.S. Court of Appeals. Pai said he wants to revoke the rule and "launch a comprehensive review of the national ownership cap" later this year.

Sinclair Broadcast Group Inc (SBGI.O) has approached rival U.S. broadcaster Tribune Media Co (TRCO.N) to discuss a potential combination, Reuters reported earlier this month, citing sources, in a deal that would hinge on regulations being relaxed.

Both Sinclair and Tribune opposed the decision to relax the rule for certain stations last year. The FCC in September said it was time to abolish the 30-year-old so-called discount for some stations because it "restores meaning to the rule in today’s marketplace where technological change has eliminated the justification for the discount."

The discount stems from when certain "Ultra High Frequency" over-the-air stations were farther up the dial and had weaker signals than other channels.

(Editing by Leslie Adler and Jeffrey Benkoe)