{"id":3363,"date":"2017-01-26T01:04:54","date_gmt":"2017-01-26T01:04:54","guid":{"rendered":"http:\/\/legalbytes.com\/?p=3363"},"modified":"2022-04-28T20:31:39","modified_gmt":"2022-04-28T20:31:39","slug":"fcc-opens-radio-television-broadcasting-foreign-entities","status":"publish","type":"post","link":"https:\/\/legalbytes.com\/2017\/01\/26\/fcc-opens-radio-television-broadcasting-foreign-entities\/","title":{"rendered":"FCC Opens Radio and Television Broadcasting to Foreign Entities"},"content":{"rendered":"

by Stephen D\u00edaz Gavin<\/a><\/strong><\/p>\n

For more than 80 years, Section 310(b) of the Communications Act of 1934<\/a> has been interpreted as prohibiting direct foreign ownership of more than 20% and indirect ownership of 25% or more of US radio and television broadcast stations. \u00a0Effective January 31, 2017, this will change as the Federal Communications Commission <\/a>(\u201cFCC\u201d) has removed longstanding prohibitions against these limitations on foreign ownership, although it has preserved the right, on a case-by-case basis, to block a foreign acquisition of a broadcast license in excess of 25% (e.g., for reasons of national security).<\/p>\n

Foreign entities, for quite some time, have already been permitted to acquire control over non-broadcast licenses (e.g., nationwide cell carrier T-Mobil<\/a>e is majority owned by Deutsche Telekom<\/a>). But the FCC has steadfastly enforced its longstanding foreign ownership control policies over broadcast station licenses.\u00a0 Most famously, Rupert Murdoch<\/a> had to become a U.S. citizen before being able to acquire control over what we know today as Fox Broadcasting<\/a>.<\/p>\n

Changes adopted to the rules of the FCC will enable approval of up to and including 100% aggregate foreign beneficial ownership (voting and\/or equity) by foreign investors in the controlling U.S. parent of a broadcast licensee, subject to certain conditions.\u00a0 The revised rules, which newly define and in certain respects create different rules for \u201cnamed\u201d and \u201cun-named\u201d investors, they will allow a named foreign investor that acquires less than 100% to increase its controlling interest to 100% at some time in the future.\u00a0 If a named foreign investor acquires a \u201cnoncontrolling\u201d interest, that investor will now be permitted to increase its voting and\/or equity interest up to and including a \u201cnoncontrolling\u201d interest of 49.99% in the future, if it chooses to do so.<\/p>\n

Although the FCC\u2019s expansive \u201cpublic interest standard\u201d in approving sales and investments in broadcast licenses, coupled with input from other Executive government agencies, could significantly delay or block investments from some countries, the strong support of this initiative by the remaining Republican members of the FCC would tend to indicate the FCC will be disposed to allow most transactions to proceed to closing.\u00a0 Indeed, the FCC has already signaled its willingness to do so, by approving just such a foreign ownership acquisition in a recent declaratory ruling issued even before the new rules take effect, ending a decades long back-and-forth haggling over Mexican ownership of Univision<\/a>.<\/p>\n

For more information regarding the new FCC rules or assistance in handling the regulatory and transactional aspects of such an investment, contact the author, Stephen D\u00edaz Gavin<\/a>, or Phil Quatrini<\/a> or Sandy Sterrett<\/a>, all partners at Rimon, P.C.<\/p>\n

Of course, you can always contact me, Joe Rosenbaum<\/a>, the Editor!<\/p>\n","protected":false},"excerpt":{"rendered":"

by Stephen D\u00edaz Gavin For more than 80 years, Section 310(b) of the Communications Act of 1934 has been interpreted as prohibiting direct foreign ownership of more than 20% and indirect ownership of 25% or more of US radio and television broadcast stations. \u00a0Effective January 31, 2017, this will change as the Federal Communications Commission…<\/p>\n","protected":false},"author":168,"featured_media":0,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[7,18,26,32],"tags":[90,193,212,228,290,325,405,409,462,466],"acf":[],"yoast_head":"\nFCC Opens Radio and Television Broadcasting to Foreign Entities - Legal Bytes<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/legalbytes.com\/2017\/01\/26\/fcc-opens-radio-television-broadcasting-foreign-entities\/\" \/>\n<meta property=\"og:locale\" content=\"en_US\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"FCC Opens Radio and Television Broadcasting to Foreign Entities - 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