Trump Formalizes 'Team Telecom' Foreign Investment Review Process
President Donald Trump issued a “Team Telecom” executive order on April 4 that formalizes the executive branch’s process for reviewing foreign takeovers of U.S. communications assets, but some observers questioned the extent to which it will alter the status quo. The departments of Homeland Security, Defense and Justice do those evaluations. Federal Communications Commission Chairman Ajit Pai said the EO means the commission can advance a 2016 proposal to speed up the review process.
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 EO formalizes Team Telecom as the Committee for the Assessment of Foreign Participation in the U.S. Telecommunications Services Sector. It will “assist the FCC in its public interest review of national security and law enforcement concerns that may be raised by foreign participation” in the industry. The attorney general will chair the committee, which will include secretaries of defense and homeland security and “the head of any other executive department or agency, or any” assistant to the president deemed “appropriate,” the EO said. Other administration officials will act as advisers, including the secretaries of state, treasury and commerce and directors of the Office of Management and Budget and the Office of Science and Technology Policy.
Trump's decree sets a shot clock for the Team Telecom committee to complete its review process. The committee must complete any initial review within 120 days after the AG determines an applicant’s responses to questions and information requests are complete. Any secondary assessment must be completed within 90 days after the committee decides it’s needed. The committee can extend a review timeline if an applicant fails to respond to requests for additional information, or recommend the FCC “dismiss the application without prejudice.”
This formalizes the committee’s ability to request information from applicants. It requires the national intelligence director “produce a written assessment of any threat to national security interests of the United States posed by granting the application or maintaining the license.” The committee can recommend the FCC condition an application’s approval on “compliance with any mitigation measures in order to mitigate a risk to the national security or law enforcement interests.” The committee would monitor mitigation steps.
Pai said Trump’s order allows the FCC to “move forward to conclude” the proposed rulemaking. That rulemaking proposes a 90-day time frame for executive branch review, with a 90-day extension in “rare circumstances.” The order establishes “a process that will allow the Executive Branch to provide its expert input to the FCC in a timely manner,” Pai said. “As we demonstrated last year in rejecting the China Mobile application” the FCC “will not hesitate to act to protect our networks from foreign threats. At the same time, we welcome beneficial investment in our networks and believe that this Executive Order will allow us to process such applications more quickly.”
Wiley Rein telecom and internet governance lawyer David Gross said in an interview that he believes Trump’s order will ensure “greater clarity” and a “better process” for Team Telecom reviews, which will give investors “more certainty going forward” about foreign investment in the U.S. telecom sector. Team Telecom traditionally had a more “ad hoc” approach to advising the FCC, generally with no time frame and a “fairly flexible process,” Gross said. The order will “provide much clearer roles” for the executive branch to make FCC recommendations, he said.
Brookings Institution Senior Fellow Blair Levin said in an interview that he questions the extent to which the EO changes the process. “Team Telecom’s worked very well,” so it’s unclear an order was needed now, he said: “I don’t see an inherent problem with [the EO]. I just don’t know what problem it solves.