President Joe Biden on Wednesday signed an executive order directing DOJ to establish rules blocking large-scale transfers of Americans’ personal data to entities in hostile nations.
Proposed revisions to Section 214 international authorization rules seem likely to result in increased scrutiny of foreign ownership by Team Telecom, said Jonathan Gafni, a foreign investment lawyer at Linklaters, during a Wednesday American Bar Association event. Team Telecom refers to the Committee for the Assessment of Foreign Participation in the U.S. Telecommunications Services Sector. “We expect to see more Team Telecom reviews,” Gafni said. The FCC proposed the changes in an NPRM last year (see 2304200039) that was met with industry concern (see 2310030070). While the "threshold of foreign ownership for carrier licensees and a couple of other types of licensees has traditionally been 25%," the FCC is "considering lowering that threshold to be more in line with" Committee on Foreign Investment in the U.S. "thresholds for looking at foreign investors," he said. "But another thing is that the FCC has actually asked that parties give a one-time disclosure of all their foreign ownership -- that carrier licensees provide a one-time disclosure -- because they hadn't looked at them for years. And so they have no idea how somebody who received a license 10 years ago may or may not have foreign ownership today, and whether that should be a concern.” Gavni expects "to see more Team Telecom reviews as these disclosures" are filed with the FCC, he said. In cases where the foreign ownership exceeds the new threshold, the agency could then make "referrals to the Team Telecom agencies for these national security and law enforcement reviews,” he said.
The 120-day initial national security review for Element8's acquisition of AtLink Services began Tuesday, the Committee for the Assessment of Foreign Participation in the U.S. Telecom Services Sector, known as Team Telecom, said in a letter to the FCC posted Wednesday in docket 23-268. Team Telecom said it will notify the FCC if an extension or additional 90-day review is necessary. Element8, a Texas-based ISP, announced the acquisition of AtLink, an Oklahoma City-based ISP, in March for "an undisclosed sum." Element8 received a $200 million investment for the purchase from Digital Alpha, a strategic investment firm with foreign ownership.
The Committee for the Assessment of Foreign Participation in the U.S. Telecom Services Sector has reviewed T-Mobile’s proposed buy of Ka’ena, best known for Mint Mobile, a low-cost prepaid wireless brand, and has no objections, said a letter posted Tuesday in docket 23-171. T-Mobile announced the proposed buy in March (see 2303150032). The committee was previously known as Team Telecom.
The Committee for the Assessment of Foreign Participation in the U.S. Telecommunications Services Sector, known as Team Telecom, is reviewing a foreign ownership request involving a number of TV and radio stations in Puerto Rico, said a DOJ letter in docket 23-2. The letter concerns a petition for declaratory ruling from Searchlight II HMT (see 2301040065) seeking permission for its parent company, Hemisphere Media Group, to be up to 100% foreign owned. That request is connected with pending broadcast station transactions at the FCC involving Searchlight subsidiary Televicentro of Puerto Rico and Univision. The deal would lead to the stations being controlled by “certain Searchlight investment fund entities organized in the Cayman Islands that are ultimately controlled by foreign individuals.” The FCC will be notified when responses to Team Telecom’s initial request for information are complete and the 120-day initial review period can begin, the letter said.
A foreign-ownership request for Standard General’s proposed $8.6 billion buy of Tegna was OK'd by the Committee for the Assessment of Foreign Participation in the U.S. Telecom Services Sector, said an NTIA letter posted in docket 22-162 Friday. The committee, sometimes called Team Telecom, "has no recommendation at this time to the Commission approving the application and no objection to the Commission granting it,” said the letter. The foreign-ownership request was for Teton Parent, a subsidiary of Apollo Global Management, which owns deal participant Cox Media Group and is separately a financier of the transaction. Teton Parent sought permission to be up to 100% foreign owned, but the original petition for declaratory ruling also said 50% of the equity of Standard General is controlled through investment funds in the Cayman Islands and the British Virgin Islands, and Apollo’s nonvoting shares in Tegna after the deal is concluded will mean Tegna will be 49.16% foreign owned.
The aviation safety concerns the FAA and airlines voiced about top U.S. wireless carriers’ use of 5G on the C band “won’t be completely resolved by this summer,” though ongoing “dialogue and collaboration” between all parties means “we’re on a better path” now, said Transportation Secretary Pete Buttigieg during a Thursday Senate Appropriations Transportation Subcommittee hearing. Buttigieg’s assessment of the current situation kicked off a new case of heartburn among some communications sector stakeholders.
NTIA said FCC approval of Intelsat's license transfers as part of its Chapter 11 bankruptcy reorganization (see 2108270001) should include conditions on adoption of cybersecurity and system security plans that are guided by the National Institute of Standards and Technology cybersecurity framework. In a docket 21-375 petition Wednesday on behalf of the Committee for the Assessment of Foreign Participation in the U.S. Telecommunications Services Sector, NTIA said the proposed conditions on the transfer of Intelsat's authorizations come from a letter of agreement with Intelsat. DOJ, DOD and the Department of Homeland Security say conditions worked out with Intelsat include it not allowing disclosure or access to U.S domestic communications infrastructure records without prior consent. The letter said Intelsat consented to report within 48 hours any security incident. "This is a normal part of the FCC approval process," Intelsat emailed Thursday. "The conditions mentioned by the NTIA have already been agreed upon between Intelsat and Team Telecom [and] their sending it over to the FCC saying these are the conditions for approval and Intelsat and the government agencies have agreed, paves the way for the FCC to give its approval. We are expecting the FCC approval imminently." The agency didn't comment.
IHeart Media’s request for FCC OK to be more than 25% foreign-owned got the nod by the Committee for the Assessment of Foreign Participation in the U.S. Telecom Services Sector, said an NTIA letter posted in docket 20-51 Wednesday (see 2110140043). The approval is among the first under the revised process that replaced the former "Team Telecom" review by U.S. security agencies after a 2020 FCC vote. The committee wants the FCC to condition approval on iHeart’s compliance with the same conditions it agreed to for a previous foreign ownership request: to hire a U.S.-based U.S. citizen to oversee national security concerns and be approved by DOJ. IHeart would notify DOJ before using any “new Outsourced or Offshored Service Provider” to collect personal information about subscribers, and about changes to where such data is stored. Those conditions are standard for foreign ownership requests, broadcast attorneys told us.
FCC commissioners approved an NPRM on making networks more resilient during disasters 4-0 Thursday, as expected (see 2109280051). Commissioners said more mandates could come as a result of the investigation. Acting Chairwoman Jessica Rosenworcel said the FCC plans a virtual field hearing as part of the Oct. 26 meeting on Hurricane Ida. Rosenworcel and Commissioner Brendan Carr traveled to Louisiana this week to tour areas hit by the latest storm. Commissioners also unanimously adopted an order on foreign ownership and an NPRM about closing two methods for scammers taking control of victims' mobile phones, SIM swapping and port-out fraud. Such actions were as expected (see 2109280009).