FCC Wants To Streamline Foreign Ownership

The FCC on Thursday proposed to extend the same streamlined procedures and rules used to review foreign ownership in common carriers licensees to broadcast licensees, with what it calls “certain tailored modifications.” 

The Communications Act sets out a 25% limit for foreign ownership in the controlling U.S. parents of broadcast and common carrier licensees. A licensee seeking foreign ownership above 25% undergoes an individual, case-by-case public interest review. As part of that review, the commission coordinates with the relevant Executive Branch agencies on matters related to national security, law enforcement, foreign policy, and trade policy.

In 2013, the FCC streamlined the policies and procedures that apply to foreign ownership of common carrier licensees to reduce costs and provide greater transparency.  At that time, the commission did not extend the policies to broadcast licensees.

Today’s proposals modernize the filing and review procedures and would adopt a standardized process for broadcast licensees’ requests to exceed the 25% percent cap. The proposals do not modify or change the statutory foreign ownership limits or the public interest standard of review.

The FCC said its proposals would, among other things:

• “Affirm and codify in the rules our current policy of allowing a broadcast licensee to request commission approval for its controlling U.S. parent to have up to and including 100% foreign ownership, subject to the commission’s public interest review.

• “Allow the licensee to request that a proposed controlling foreign investor, once approved by the commission, be permitted to increase its ownership to 100% in the future without filing a new petition.

• “Extend to broadcast licensees our current practice of allowing the licensee to request that any non-controlling named foreign investor, once approved by the commission, be permitted to increase its interest in the U.S. parent up to and including a non-controlling interest of 49.99% in the future without filing a new petition.

• “Lessen regulatory burdens on broadcast licensees by not requiring the licensee to request approval of a non-controlling foreign investor with an interest of 5% or less (or 10% in certain circumstances).

• “Allow broadcast licensees to continue to use the broadcast attribution rules to disclose their principal U.S. and foreign owners and to rely on broadcast insulation rules.”

The FCC said the proposed process changes “could facilitate investment from new sources of capital at a time of growing need for investment in this important sector of our nation’s economy. The proposals will also provide the broadcast sector with greater transparency and predictability, and reduce regulatory burdens and costs.”

NAB Executive VP of Communications Dennis Wharton commented on the announcement: “NAB applauds the FCC for opening a rulemaking exploring opportunities for easing foreign investment in local radio and TV stations. We share the commissioners’ belief that relaxing these ownership regulations will spur new investment in broadcasting leading to job creation, increased production of locally oriented programming, and greater public service to communities.”