Broadcasters seeking to raise foreign ownership levels beyond statutory benchmarks may soon be eligible for the same streamlined review procedures that the FCC applies to common carriers, contingent on the adoption of rules outlined last Thursday in a Notice of Proposed Rulemaking (NPRM) issued by the FCC. If approved, the proposed rules would extend to broadcasters the same policies and procedures that the FCC enacted in 2013 for review of common carrier foreign ownership.
Pursuant to the 1934 Communications Act, foreign ownership of broadcast radio and television licensees is capped at 25%. The FCC accepts requests to exceed that cap, and considers such requests on an individual, case-by-case basis, considering the effect of the proposed foreign ownership on the public interest. Specifically, the NPRM would streamline the current review process by (1) codifying current FCC policy to allow broadcasters to request foreign ownership stakes of up to 100%, (2) allowing broadcasters to request that a proposed controlling foreign investor, upon FCC approval, be permitted to increase its stake to 100% without having to submit a new petition, and (3) allowing broadcasters to request that any non-controlling foreign investor, upon FCC approval, be allowed to increase its stake in a U.S. parent company up to 49.99% without filing a new petition. With the goal of easing regulatory burdens on broadcasters, the NPRM also proposes that broadcasters would not be required to seek FCC approval to add non-controlling foreign investors with stakes of 5% or less or with interests of less than 10% in certain circumstances.
Asserting that the proposals outlined in the NPRM “will . . . provide the broadcast sector with greater transparency and predictability,” the FCC predicted that the streamlined rules, once enacted, will “facilitate investment from new sources of capital at a time of growing need for investment in this important sector of our nation’s economy.” As a spokesman for the National Association of Broadcasters welcomed the FCC’s action as one that will “spur new investment in broadcasting,” ranking House Communications Subcommittee member Anna Eshoo (D-CA) agreed that the NPRM “makes common sense, and is consistent with the Communications Act’s core principles of promoting diversity, localism and competition.”