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Chapter C: Article 3 - Other Paid Circulation, Subscriptions or Copies Paid for by Other than Recipient

C 3.1 Employee, Correspondent and Agent Copies

A newspaper may include in “Average Paid Circulation” copies served (or made readily available for pick up in the normal work environment by) to employees, retired employees, correspondents and agents under the following parameters:

(a) To be classified as an employee, individuals must be, or have been, on the regular payroll during the reporting period of either the newspaper or a wholly-owned subsidiary of the newspaper that is actively engaged in the production or distribution of the newspaper. Employees of subsidiary organizations, such as radio and television stations, job printing plants and so forth, that are not actively engaged in the production or distribution of the newspaper, are not eligible.

(b) To be classified as a correspondent, individuals must contribute at least one article per month that is printed in the newspaper.

(c) To be classified as an agent, individuals must be currently involved in delivering the newspaper to subscribers.

An individual classified as an employee, correspondent or agent for more than one newspaper may be included in the “Average Paid Circulation” of only one newspaper.

(d) Adequate records must be maintained by the newspaper (employee payrolls, records of correspondent compensation, agent billings) to support its claims.

These copies will be reported separately in “Other Paid Circulation” in ABC Publisher’s Statements and Audit Reports.

C 3.2 School Subscriptions

The classification "Newspapers in Education" in Bureau reports may be shown at the option of the publisher and if shown shall include only copies (either subscriptions or single issue sales) ordered for delivery to schools. Copies may be purchased individually by the recipients or paid for by schools or out of classroom funds.

In cases where qualified copies are paid for by sponsors, it may be acceptable for payment to be made directly to the publisher from the sponsor if other supporting documentation confirming usage (i.e., affidavits from schools, verification of delivery and receipt, etc.) is available for auditor review.

This circulation shall be shown in Other Paid Circulation and in the appropriate geographic zone (e.g. City Zone, Newspaper Designated Market, etc.) or Newspapers in Education and shall qualify as paid circulation provided copies served conform to Bureau rules defining paid circulation in all other respects.

A complete explanation including the manner in which the copies are paid for shall be shown in the paragraph devoted to general explanations in Publisher's Statements and Audit Reports.

(a) From time to time daily newspapers run a series of articles on a specific subject. Copies purchased by a sponsor or group of sponsors in excess of the recurring daily school copies for the period that the articles are featured do not qualify under the category Newspapers in Education but instead should be classified as Third Party Sales in Bureau Reports.

(b) Distribution of copies outside of structured classroom settings may also qualify as paid circulation, and reported as NIE - Home Delivered for newspapers published outside of Canada, and as NIE for newspapers published in Canada in Bureau Reports provided the following conditions are met:

(1) The copies are served in conjunction with a formal program designed to encourage literacy and continuing education of the participating student by assisting the student family to improve their life and job skills.
(2) The program in question establishes minimum participation standards for the student family, and the student family achieves those minimum standards.
(3) Auditable records demonstrating the student's enrollment in school, the program in question, completion of minimum participation standards, and sufficient funding to support copies distributed are maintained.
(4) Only one copy per participating student family household may be claimed as paid.
(5) Schools and classrooms offering home delivered copies must also participate in NIE programs requiring classroom usage of the newspaper.
(6) School subscriptions (both subscriptions and single-copy sales) qualify as paid circulation, providing copies served conform to all Bureau rules defining paid circulation in all other respects.
(7) This classification of circulation shall not exceed five percent of average paid circulation.

C 3.3 Third-Party Sales

(The amount used for the purchase of newspapers must be in accord with Rule C 1.1 Paid Circulation Defined and use the NIE pricing model as described at www.accessabc.com to determine the minimum unit cost, net of all other considerations.)

(a) Third-Party (bulk) Sales are copies or subscriptions purchased in quantities of 11 or more that promote the professional or business interests of the purchaser.

All copies or subscriptions purchased in quantities of 10 or less will be designated as a “single-copy sale” or “home-delivery” in ABC Publisher’s Statements and Audit Reports, except as noted in section (b).

Eligible third-party purchasers must market their products or services directly to consumers. Organizations, such as advertising agencies, marketing companies or similar firms are not eligible third-party purchasers.

(b) All copies purchased by hotels, restaurants, airlines and rental car agencies for free distribution to their guests and by sponsors for free distribution to hospital patients and nursing home residents, regardless of the number of copies, will be reported as Third-Party Sales when at least one cent is paid, either in cash or by applicable barter. Evidence of this payment must be recorded and made available to ABC auditors.

(c) Third-Party Sales copies served in arrears will be excluded from paid circulation and included in unpaid distribution.

(d) There are two types of Third-Party Sales — direct and sponsored. The relevant category depends upon how the newspaper receives funds from these sales.

For a guide for classifying Third-Party Sales into categories, consult ABC’s website: www.accessabc.com.

(1) Direct Third-Party Sales
Direct Third-Party Sales are defined as those sales involving the solicitation of funds from a single purchaser of newspapers who controls all aspects for a specific event (e.g. fundraising event, social function) or distribution program.

(2) Sponsored Third-Party Sales
Sponsored Third-Party Sales are defined as those sales involving the solicitation of funds from more than one purchaser (sponsor) for contribution to a specific program.

(a) The total average Sponsored Third-Party Sales circulation must not exceed two percent of the average paid circulation over the Publisher’s Statement period. Copies in excess of two percent will be deducted from paid circulation and included in non-paid circulation.

(b) Each individual Sponsored Third-Party Sales program (e.g. Meals on Wheels, a sporting event, a festival) with average circulation of 250 or more copies per issue will be annotated in ABC reports with an explanatory note.

When the “Third-Party Sales” purchaser (Direct Third-Party Sales or Sponsored Third-Party Sales) is an advertiser, and the transaction provides advertising, the sales may qualify as paid circulation provided one of the following three stipulations are met.
(i) The advertising agreement and newspaper purchase agreement are shown on separate contracts, or
(ii) The advertising agreement includes specific language regarding the newspaper purchase price within the contract when the agreement includes both advertising and newspapers; or
(iii) The purchase price of the newspapers is a separate itemized line item within the contract or invoice when the agreement includes both advertiser and the newspaper.

(e) Requirements

(1) Notification
(a) Recipient
Recipients must be advised that the copies are made available by the purchaser. Here is an example of acceptable notification:
  • Sponsor name
  • Non-promotional logo
  • Address
  • City, State, ZIP
  • URL
  • Telephone/Fax/Email
Additional information will be considered advertising and must be paid for as described in paragraph (d) above. For notification language, consult ABC’s website: www.accessabc.com.

Recipients of programs extending for longer than one month must receive initial notification that furnishes all information necessary to cancel delivery. These recipients must receive monthly notification of the sponsor’s identity.

(b) ABC must be notified of any Third-Party Sales program at least two weeks (14 days) in advance of distribution if Third-Party Sales represent 4% or more of total paid circulation as reported on the most recently released Publisher's Statement, or if directed to do so by ABC. This allows real-time testing as part of the audit process. Failure to provide the required notification will disqualify the circulation as “paid.”

For Third-Party Sales copies delivered to non-subscribers, newspapers must maintain a list of recipients by address or be able to define the geographic area in which they will distribute and quantify the number of households that will receive copies. This information must be available at least two weeks before the actual distribution date and be maintained for review by an ABC auditor.

(2) Content
At a minimum, the newspapers distributed as Third-Party Sales must be the same core product (editorial, classified, inserts, etc.) delivered to all other single copy and/or rack outlets in the same zone on the same date of delivery with the exception of freestanding inserts (FSI) advertising. Unique editions may not be used for Third-Party Sales. Electronic editions may be subject to the limitations shown in paragraph (f) below.

(3) Price Qualification
A qualifying price must be paid by the sponsor for each copy sold, net of all other considerations. Associated costs must be identified separately when sold in conjunction with an advertising contract for copies to qualify as paid circulation. Newspaper members may use any of the three following methods for disclosing the cost of the newspapers:

(a) Both the advertising and newspaper purchase agreements must be shown on separate contracts.

(b) When the agreement includes both advertising and newspapers, specific language regarding the newspaper purchase price (copies, unit cost and total cost) within the contract must be included.

(c) When the agreement includes both the advertiser and the newspaper, the purchase price of the newspaper must be a line item.

The amount charged for the advertising must be the same as that charged to a similarly-situated advertiser that does not purchase newspapers.

For an example of a qualified disclosure and minimum requirements to qualify a price for third-party sales, consult ABC’s website: www.accessabc.com.


(4) Billing
The purchase transaction must be separate from any other financial agreement between the third-party purchaser and the newspaper. An independent line item for the cost of the newspapers must appear either on the contract (if sold with a package) or on the invoice to the purchaser and indicate rate, volume and total cost for the newspapers. A clear audit trail must be maintained from the invoice/contract to the circulation records.

(5) Payment
(a) At the time of distribution, a newspaper must have sufficient funds on deposit to cover the cost of distributing the newspapers claimed as Third-Party Sales. If sufficient funds are not available, the copies may not be included as "paid" circulation. Third-Party Sales are not eligible for inclusion in the four percent allowance.

(b) Payment by Barter
(i) Bartered goods and services must have a predetermined value that can be validated with supporting documentation. Goods and services are acceptable forms of currency (replaces cash in the transaction) for Third-Party Sales. In addition to the billing requirement below, the revenue and expenses with respect to the bartered goods/services must be reflected in the accounting records of both the publisher and the sponsor in accordance with Generally Accepted Accounting Principles (GAAP).

A clear audit trail supporting the value of the bartered goods/services must be shown within the publication’s accounting system.

For additional information regarding Barter Attestation Requirements, consult ABC's website.


Programs using barter must be accompanied by a written statement, dated prior to the distribution of the newspaper from the third-party purchaser's CEO, CFO or from another representative in a management position who has knowledge of the company's financial recordkeeping process and can certify that the full barter value has been/will be recorded as an expense in accord with GAAP.

For an example of an acceptable statement, consult ABC's website: www.accessabc.com.

Barter will not be considered acceptable payment unless the affidavit is dated prior to the actual distribution of the Third-Party Sale newspapers and made available to the ABC auditor upon request.

Third-Party Sales paid for by barter must be broken out in Bureau reports. Consult ABC’s website.

(6) Execution
The purchaser must direct the newspaper distribution to a specific Third-Party Sales program.

The purchaser may not contribute to a “general” third-party fund, but rather must donate to a specific program or event (e.g. Meals-on-Wheels, a sporting event, or a festival).

The number of newspapers purchased, the rate charged and the total charge must be clearly indicated to the purchaser (net of all considerations as stated in “Billing”).

Money donated to Newspapers in Education (NIE) programs cannot be transferred to Third-Party Sales and vice versa.

(7) Delivery on Date of Issue
Third-Party Sale copies must be delivered on the date of issue.

(f) Bureau Reports
The total average circulation for Third-Party Sales will not distinguish between direct and sponsored sales, but rather discloses the average circulation for the period as a whole.

Although not reported in Bureau reports, for audit purposes, the publication must be able to identify and quantify direct versus sponsored third-party sales.

U.S. publications must report circulation averages for the four largest categories of Third-Party Sales in addition to an “Other” category that will complete the section. These figures will be listed in “Other Paid Circulation” and will show the type and character of the sales in ABC Publisher’s Statements and Audit Reports.

For a guide for classifying Third-Party Sales copies into categories, consult ABC’s website: www.accessabc.com.

Duplicate home delivery circulation will be excluded from paid circulation. Newspapers delivering a “Third-Party Sunday Bulldog” edition to their regular Sunday customers, may not count the Third-Party Sale copy as paid circulation. Third-Party Sale copies must be delivered on the date of issue.

Electronic editions may qualify for use in specific Third-Party Sales Programs to businesses for their employees and to libraries. In these situations, each unique user license will constitute a subscription. The electronic edition must comply with all Bureau rules and policies relative to edition qualification and each license sale must also qualify to current paid circulation standards.

(g) Third-Party Home Delivered Allowance
A total allowance of up to 15% for random/occasional delivery errors and false "no goods" will be permitted in evaluating the results of in-field testing of Third-Party Home Delivered programs.

C 3.4 Group (Subscriptions to Businesses for Designated Employees)

(a) All copies or subscriptions purchased in quantities of 2 or more by corporations, institutions or individuals for employees, subsidiary companies or branches shall be designated in Bureau reports as "Other Paid Circulation" provided either:

(1) The newspaper has records indicating names or titles of the employees, or
(2) Subscriber records are available for Bureau verification indicating the names or titles of those receiving the newspaper.

(b) "Group (Subscriptions to Businesses for Designated Employees)" shall be reported separately in Publisher's Statements and Audit Reports in Paragraphs 1 and 2.

(c) An explanation of "Group (Subscriptions to Businesses for Designated Employees)" shall be made in the paragraph devoted to general explanations of Publisher's Statements and Audit Reports and the range of sales stated as follows: "sold in quantities of ________ to ________."

C 3.5 Gift Subscriptions

(Also see C 5.3 Combination Sales.)

(a) A Gift Subscription shall be considered one which is given as a normal expression of friendship and which does not promote the business or professional interests of the donor.

(b) To qualify, Gift Subscriptions must be paid for in accordance with C 1.1.

(c) Subscriptions which are given to promote the professional or business interests of the donor shall be judged by the rule governing term subscriptions in third-party or mail subscriptions special whichever applies.

(d) In no case where an order (or orders) from a single donor covers more than fifty subscriptions shall the subscriptions be regarded as Gift Subscriptions but shall instead be classified as term subscriptions in third-party, provided they conform to the rules governing third-party sales.

C 3.6 Gift Subscriptions Not Recognized as Paid Circulation

(a) Gift Subscriptions paid for by subscription salespersons or others who are compensated by merchandise or other rewards in lieu of cash commission.

(b) Gift Subscriptions which have been paid for by someone who has been offered a premium and the amount received is less than the full value of the premium plus one cent.