FCC Likely to OK 4-0 Team Telecom Questions
An FCC draft order that would create questions for licensees seeking permission to be owned by foreign nationals is expected to change little from its draft version and to be approved unanimously at the agency’s Sept. 30 meeting, said industry experts in recent interviews. “The industry is getting a narrow set of questions,” said Vinson & Elkins' Richard Sofield. “Are they as narrow as they’d like? No, but there is certainty.” DOD, DOJ and the Department of Homeland Security make up Team Telecom, which Sofield used to chair.
Sign up for a free preview to unlock the rest of this article
Export Compliance Daily combines U.S. export control news, foreign border import regulation and policy developments into a single daily information service that reliably informs its trade professional readers about important current issues affecting their operations.
The draft order includes some concessions to industry groups such as NAB and USTelecom but largely adheres to the recommendations of the Committee for the Assessment of Foreign Participation in the U.S. Telecom Services Sector over those from trade groups. “They gave a lot of deference to the Committee,” said USTelecom Vice President-Strategic Initiatives and Partnerships Mike Saperstein. He and Sofield said this wasn’t a surprise. “The FCC has seen iterations of these questions for years,” said Sofield.
In a highly technical and largely uncontroversial proceeding based on a White House executive order and on positions that are supported by another federal entity, the FCC is considered unlikely to suddenly shift position. The questions aren’t seen as making the review more strenuous than the current system, and are expected to proceed more predictably, Sofield said. Under current rules, companies make educated guesses about what questions they're likely to be asked, but this proceeding would allow them to come to the FCC with their answers prepared, attorneys said. The previous Team Telecom order was approved unanimously last year (see 2009290063). The FCC didn’t comment Monday.
The draft adopts the committee’s view on defining an owner of an entity as having a 5% interest in a company rather than the 10% threshold NAB, USTelecom and law firm Morgan Lewis urged. The 10% would be easier to game by those seeking to avoid foreign ownership disclosures, the FCC says. The agency also took up committee recommendations on the scope of information required about those with access to submarine cables, the time frame of questions about owner criminal records, and in rejecting NAB arguments for a streamlined process for entities that had previously been approved for foreign ownership. “The Committee needs information regarding all owners to conduct its review, including updated information, just as the Commission requires a complete petition with information on all owners, not just the new investors,” the draft says.
The order would reject NAB arguments against proposed questions about the target audience, content and advertising of TV stations, and about how applicants handle subscriber data and personal identifiable information, an area that could be a point of conflict, Sofield said. NAB argued the FCC doesn’t regulate consumer data privacy and doesn’t have authority over broadcasters’ data privacy and security. That information allows the committee to assess foreign influence over a licensee, the FCC said. “We are not regulating format or content but are assessing whether the public interest would be served by not permitting foreign ownership.”
The agency conceded to industry on some points, generally in ways supported in the committee’s comments. The agency narrowed the language of questions about foreign relationships to clarify that they don’t apply to customers and changed questions about foreign parties in line with requests by NAB. “We really appreciate the FCC pulling back the scope of the review,” said Saperstein. “The goal of all this is to have more standard reviews.”