Team Telecom Two-Year Anniversary | White & Case LLP

This month marks two years since the formation of the Committee for the Assessment of Foreign Participation in the United States Telecommunications Services Sector (see our previous client alert here). Informally known as Team Telecom, this interagency committee assists the Federal Communication Commission (“FCC” or “the Commission”) in reviewing national security and law enforcement concerns that may be raised by foreign participation in the US telecommunications sector¹. In this alert, we refresh our 2020 overview of Team Telecom, including its history and notable developments, and provide an outlook on what to expect going forward given the increasingly robust review of the telecommunications sector, in particular as it relates to matters involving China.

Team Telecom Overview

History

Pursuant to the Communications Act of 1934, as amended, no telecommunications carrier may provide certain international services until it obtains from the FCC a certificate that such services will serve the public interest, convenience, and necessity.² As part of its public interest analysis, the Commission considers whether such an application raises national security, law enforcement, foreign policy, or trade policy concerns related to the applicant’s reportable foreign ownership.³ With regard to these concerns, the FCC has sought the expertise of the Executive Branch for over twenty-five years, referring cases to the Departments of Defense, Homeland Security, Justice, State, Commerce, and the US Trade Representative (the “Executive Branch Agencies”).⁴ Although the FCC ultimately makes an independent decision, it has traditionally accorded deference to the Executive Branch Agencies’ recommendations.⁵ Similarly, pursuant to Executive Order 10530, the FCC has been delegated the President’s authority to grant licenses for the landing and operation of submarine cables.⁶ This executive order requires the Commission to obtain the approval of the State Department, and other Executive Branch agencies as necessary, before granting any such license.

Under these authorities, where an applicant has ten percent or greater direct or indirect foreign ownership, the FCC has referred the following types of applications to the Executive Branch Agencies for their input on any national security, law enforcement, foreign policy, and trade policy concerns: (1) international section 214 authority, (2) assignment or transfer of control of domestic or international section 214 authority, (3) submarine cable landing licenses,⁷ and (4) assignment or transfer of control of submarine cable landing license. The Commission has also referred petitions seeking authority to exceed foreign ownership levels for broadcast and common carrier wireless and common carrier satellite earth station applicants and licensees.⁸

Prior to 2020, upon receiving a referred application from the FCC, the Departments of Defense, Homeland Security, and Justice (informally known as “Team Telecom”) initiated a review of the application by sending the applicant a set of questions seeking further information.⁹ Relying on the responses to these and any subsequent questions, Team Telecom conducted its review focused specifically on national security and law enforcement concerns.¹⁰ These opaque reviews often took years to complete. For example, in the China Mobile case discussed below, Team Telecom did not submit its recommendation to the FCC until seven years after the initial application was filed.¹¹ Even in cases that were ultimately cleared, Team Telecom’s average time for review between 2016 and 2019 was 260 days.¹² This lack of transparency and timeliness resulted in calls by the FCC and members of the Executive Branch Agencies for telecom reform.¹³

Executive Order 13913

On April 4, 2020, the President signed Executive Order 13913 (the EO), “Establishing the Committee for the Assessment of Foreign Participation in the United States Telecommunications Services Sector,” formalizing Team Telecom (or “the Committee”).¹⁴ Pursuant to the EO, the Committee’s primary objective is to assist the FCC in its public interest review of national security and law enforcement concerns that may be raised by foreign participation in the United States telecommunications sector.¹⁵ The “Committee Members” include the Attorney General, who chairs the Committee, and the Secretaries of Homeland Security and Defense.¹⁶ For matters that may result in certain recommendations to the FCC, Committee Members consult “Committee Advisors” who include the Secretaries of State, Treasury, and Commerce; the Directors of the Office of Management and Budget, National Intelligence, and the Office of Science and Technology Policy; the United States Trade Representative; the Administrator of General Services; the Chair of the Council of Economic Advisers; and the Assistants to the President for National Security Affairs and to the President for Economic Policy.

New Timelines and Procedures

As we detailed in