CFIUS

Subscribe to CFIUS

At its September 30, 2021 Open Meeting, the Federal Communications Commission (“FCC” or the “Commission”) unanimously adopted a Second Report and Order in IB Docket No. 16-155 requiring applicants with reportable foreign ownership seeking Commission approval for certain applications to answer standardized national security and law enforcement questions (“Standard Questions”) prior to or when filing their applications. The Standard Questions were developed in coordination with the. Departments of Justice, Homeland Security, Defense, State, and Commerce and the United States Trade Representative, which conduct review of national security, law enforcement, foreign policy, or trade policy issues associated with the foreign ownership of the applicants of certain applications filed with the FCC and referred to the agencies. The Standard Questions will apply, following review and approval by the Office of Management and Budget (“OMB”) (and issuance of an associated public notice) to the types of applications the Commission generally refers to the Executive Branch, namely applications for international section 214 authorizations and submarine cable landing licenses, applications to assign, transfer control or modify such authorizations and licenses where the applicant has reportable foreign ownership, and all petitions seeking to exceed foreign ownership limits applicable to broadcast or common carrier wireless licenses set forth in Section 310(b) of the Communications Act of 1934, as amended (the “Act”) (47 C.F.R. § 310(b)).

The adoption of Standard Questions is the FCC’s complements several other reforms in the past year to formalize and streamline the FCC and Executive Branch review process conducted  pursuant to Executive Order No. 13913 of April 8, 2020, Establishing the Committee for the Assessment of Foreign Participation in the United State Telecommunications Sector (the “Committee” (commonly referred to as “Team Telecom”)). The Executive Order sets forth procedures and timelines for the Committee to conduct its reviews of referred applications. The Commission’s earlier reforms are detailed in the FCC’s (First) Report and Order  in Docket 16-155 Executive Branch Review Order released October 1, 2020 (and Erratum). As noted in the Second Report and Order, the FCC considered comments filed in response to a Public Notice containing proposed Standard Questions.

…
Continue Reading FCC Adopts Standard Questions to Facilitate Executive Branch Review of Applications Involving Foreign Interests in Applicants

Protecting the U.S. communications supply chain from national security threats has become a priority for the Federal Communications Commission (“FCC” or “Commission”) and the agency’s recent Communications Supply Chain Protection proceeding resulted in new rules restricting the use of universal service support funds for certain equipment and services and the designation of Huawei and ZTE as national security threats to the communications networks and supply chain. The recently enacted Secure and Trusted Communications Networks Act of 2019 (“Secure Networks Act”) requires the FCC to adopt additional communications supply chain protection measures and the Declaratory Ruling (“Declaratory Ruling”) and Second Further Notice of Proposed Rulemaking (“Second FNPRM”), adopted by the FCC’s at its July Open Meeting, continues the Commission’s implementation of the Secure Networks Act. The Declaratory Ruling/Second FNPRM declares the Commission’s compliance with the Secure Networks Act’s federal funding prohibition requirement and seeks comment on the FCC’s proposed interpretation and implementation of other provisions including key definitions and the identification of equipment and services subject to federal funding prohibitions.

Comments on the Second FNPRM are due by August 31, 2020 and reply comments are due by September 14, 2020.

…
Continue Reading FCC Remains Focused on Communications Supply Chain Protection; Seeks Comment on Continued Implementation of Secure Networks Act

For decades, parts of the Federal government have examined transactions that introduce and increase foreign investment in United States telecommunications businesses. Transactions that implicate reviews by the Departments of Justice, Defense, and Homeland Security (collectively, “Team Telecom”) and/or by the Committee of Foreign Investment in the United States (“CFIUS”) can face procedural hurdles and delays…

For years, there have been critiques about the lack of procedures surrounding the review, by a group of Executive Branch agencies commonly referred to as “Team Telecom”, of applications before the Federal Communications Commission (“FCC” or “Commission”) for licenses and transaction approvals involving foreign ownership, including the absence of timeframes for completing reviews. The FCC tried to implement limited changes within its jurisdiction by launching a rulemaking, but that never progressed to a conclusion. Now, by Executive Order (“EO”) on April 4, 2020, President Trump established a framework to govern such reviews and clearly include reviews of existing licenses and authorizations even where there are no current mitigations. There are still a lot of unknowns regarding the new “Committee for the Assessment of Foreign Participation in the United States Telecommunications Services Sector” (the “Committee”). It is too soon to know whether the Committee will bring a welcome measure of regularity to a previously unshackled process or will prove to be an even greater bane to applicants and licensees than the Team Telecom process its work will replace.
…
Continue Reading President Formalizes Executive Agency Review of FCC Applications and Licenses; Quick Action on FCC License Revocation