On April 20, 2023, the Federal Communications Commission (FCC) adopted a Notice of Proposed Rulemaking (NPRM) proposing rules requiring all companies providing international telecommunications services pursuant to Section 214 authorization (214 License) to file renewal applications every ten (10) years. In an Enforcement Advisory released the same day, the FCC reminded current holders of international 214 Licenses of their legal duties, including the requirement to provide updates on ownership changes, seek approval of certain transactions and ownership changes, and other requirements. The proposed rules aim to enable up-to-date review of international Section 214 authorizations to fully take into account rapidly changing national security, law enforcement, and other considerations.
Historically, the FCC received updated information regarding 214 Licensees only when a license holder filed an application for a modification, assignment, or transfer of control of the authorization or notified the Commission of a discontinuance while it is providing service to customers. Otherwise, the Commission would not ordinarily receive updated information about the ownership or the national security, law enforcement, trade, and foreign policy implications associated with these authorized services. As a result, the Commission has long had significantly incomplete and outdated information regarding international section 214 authorization holders with reportable foreign ownership. If adopted, the rules proposed by the FCC would fundamentally alter the way it has overseen international 214 Licensees by creating (very likely) a one-time update and review requirement, followed by an every ten (10) year, mandatory renewal process.
In light of the changing geo-political environment over the past several years, where the federal government has been laser focused on eliminating foreign espionage threats, both to America’s commercial and national security interests, the introduction of a mandatory ownership and national security review to each and every holder of an international 214 License is a potentially Earth shifting move by the FCC. If the proposed rules are adopted without adequate procedures and controls that take into consideration and accommodate the complex intricacies of foreign owned communications enterprises, there will be a great many unintended and potentially costly consequences. As it were, even the intended consequences will create challenges to many global and domestic telecom companies and the, sometimes, intricate web of owners and investors.
The NPRM has not yet been published. Our firm is monitoring developments and will provide updates as they become available. For affected clients and entities, we recommend reading the Fact Sheet released by the FCC and staying abreast of any news related to the proposed rule changes. Our firm will announce the Comment and Reply Comment deadlines when they are established and invite affected parties to consider participating in the proceeding. In the meantime, if you have any questions, please contact the attorney assigned to your account or Jonathan S. Marashlian at jsm@commlawgroup.com.
