4-0 Vote Expected for FCC Foreign-Ownership Update
An FCC draft NPRM on a host of minor updates to the agency’s foreign-ownership rules for broadcasters and common carriers is expected to enjoy unanimous approval during the agency's open meeting Monday, FCC and industry officials told us.
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According to an FCC fact sheet on the NPRM, the FCC has many practices and requirements around foreign ownership that haven’t been codified and the item seeks comment on updating the rules to fix that. Not including requirements and practices in the rules “only makes it harder for entities to understand and navigate our rules, risks inconsistent outcomes, and can needlessly raise costs,” the agency said.
The final item is expected to be little changed from its draft version, FCC officials told us. It's widely seen as uncontroversial, and FCC officials said there has been little back-and-forth about it on the 10th floor. Likewise, the draft item’s docket -- 25-149 -- has drawn scant ex-parte traffic since its creation. The draft NPRM is a good example of the type of unobjectionable item that can easily be approved by all four commissioners while there is no FCC majority, an agency official said.
The draft NPRM seeks comment on “updates to set clear expectations” about the FCC’s review process for foreign investment in broadcasters and common carriers. Chairman Brendan Carr wrote earlier this month that during the agency's existence, foreign-ownership regulations have increased, “but in many cases, the FCC never codified those foreign ownership regulations in our rules. Not very efficient!”
The item asks for input on codifying the agency’s policy on deemed voting interests and the FCC’s existing definition of a controlling U.S. parent company. The lack of a consistent definition in the rules “often results in considerable additional processing time” to “asses a licensee’s vertical chain of control,” the draft NPRM says. It also proposes changing the rules to specify what information companies must submit about trusts and trustees, codifying the requirements for filing an amendment to a petition for declaratory ruling, and clarifying that there's no FCC requirement that foreign investors must reside in the U.S.
For broadcast licensees only, the item seeks comment on foreign-ownership considerations connected with noncommercial educational and low-power FM stations and on processing applications from broadcasters filed while a remedial petition for declaratory ruling is pending.
In addition, the draft item seeks comment on allowing privately held companies to use the same methods as U.S. public companies for determining the level of foreign ownership when an entity’s interest holders are equity funds or other public companies. Since it last updated the foreign-ownership rules in 2016, the FCC “has observed increasingly complex ownership structures” in its licensees.
The FCC also seeks comment on general improvements to the foreign-ownership review process. “Consistent with the Delete, Delete, Delete Proceeding, we also seek comment on opportunities to alleviate unnecessary regulatory burdens in the context of our rules or our foreign ownership review,” the draft says (see 2503140049).