An appeal court judge in the United States says that the Federal Communications Commission is out of line in mandating compliance with the copy protection flag for digital broadcasts.

The FCC has mandated the “broadcast flag” in digital terrestrial television signals to support copy protection of high-definition material in response to pressure from the entertainment industry to combat piracy.

Under the FCC compliance requirements, flagged content must be output either using copy protection or downscaled to standard resolution. From the beginning of July 2005 it will be illegal in the U.S. to sell a high-definition receiver that does not support the broadcast flag in this way.

The FCC argues that its ancillary powers authorise it to regulate the reception of broadcasts as well as their transmission.

Critics, including consumer groups and the Electronic Frontier Foundation, say that the FCC does not have the right to rule on receivers, including high-definition tuner cards in personal computers, digital video recorders and other consumer devices.

In an appeal court hearing a judge said that the FCC should not dictate how devices work. “You crossed the line,” he said. “Selling televisions is not what the FCC is in the business of.”

The appeals panel now has to decide whether consumer groups have the right to contest the FCC mandate. The decision is expected within months.