Draft Foreign-Ownership Item Likely Unanimous Vote
A foreign ownership item circulating on the eighth floor will make it easier for broadcasters to be foreign owned and change the way the FCC assesses foreign ownership, agency and industry officials said in interviews. The item is seen as widely supported among all FCC commissioners and is expected to be unanimously approved, industry attorneys told us. "These process reforms will provide the broadcast sector with greater transparency and more predictability, while reducing regulatory burdens and costs for all sectors,” FCC Chairman Tom Wheeler said in a Sept. 8 blog post. In recent months, Frontier Media and Univision have asked the FCC to approve foreign-ownership situations above the 25 percent threshold (see 1609120072). The order is preliminarily set for commissioners' Sept. 29 meeting (see 1609080083).
Sign up for a free preview to unlock the rest of this article
If your job depends on informed compliance, you need International Trade Today. Delivered every business day and available any time online, only International Trade Today helps you stay current on the increasingly complex international trade regulatory environment.
The draft item would apply streamlined rules for foreign ownership of common carriers to broadcasters, making it easier for them to apply to the commission for permission to exceed the 25 percent foreign ownership threshold, FCC and industry officials said. The item would explicitly say broadcasters can be 100 percent foreign owned if the FCC decides it's in the public interest. The item would also allow foreign investors that have already been approved to own a stake in a broadcaster to increase their ownership to 100 percent without a new petition, the officials said. The draft will “extend to broadcast licensees the same streamlined rules and procedures that common carrier wireless licensees use to seek approval of foreign ownership, with appropriate modifications,” said Wheeler's blog post. Such matters will still be decided on a case-by-case basis, an FCC official told us. The agency didn't comment Monday.
The draft order also would change the way the commission decides whether an entity -- not just a broadcaster -- is foreign owned, the officials told us. Under the draft, a publicly owned company that has investors whose identity and country of origin can't be definitively established won't automatically have those investors counted as foreign entities by the regulator, an industry official said. The change is designed to address an issue raised during Pandora’s buy of KXMZ(FM) Box Elder, South Dakota, when rules led to some of Pandora's investors -- who were using "street names" to protect their anonymity under SEC policies -- being counted as foreign.
Several statements by commissioners and Wheeler point to the item's likely receiving bipartisan support on the eighth floor. Wheeler credited Commissioner Mike O'Rielly with pushing for the rule changes to happen, in the blog post introducing the item. "Commissioner O’Rielly deserves special recognition for his leadership in highlighting this issue,” Wheeler said. Commissioner Ajit Pai has been vocal in criticizing the way the current rules affected the Pandora matter, which he has called “absurd” (see 1510220052).