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Pai FCC Moves Quickly to Rescind Wheeler FCC Actions

After the election, it was clear that we would be seeing a much different FCC in 2017. Such transitions typically take time, as a president’s nomination of new candidates to fill the Chairman’s or commissioners’ seats, along with the delay typically associated with obtaining Senate confirmation, means that a new fully-staffed FCC won’t typically be ready for action until May or June following the January change in administrations. By that time, the actions of the prior FCC have often become final and unappealable, or at least the regulated industries have already begun to adapt their operations to comply with those rules, making subsequent changes more complicated.

But, like nearly every other aspect of the Trump transition, what has happened in the past serves as a poor predictor of this transition. With the departures of Chairman Wheeler and Commissioner Rosenworcel, Republicans were already guaranteed an immediate majority at the FCC. More dramatic, however, has been the impact of the President’s designation of Commissioner Pai as the permanent Chair of the agency rather than nomination of a new candidate for that slot. That action eliminated the normal delay factor in obtaining Senate confirmation, enabling the FCC to move immediately to chart a new and durable agenda in a way that an agency led by a temporary chair (whose priorities may be cast aside upon the arrival of a permanent chair) just can’t. Contributing to the speed with which a new agenda is being implemented is the simple fact that Commissioner Pai, with his lengthy tenure at the FCC and knowledge of the issues currently pending before the agency, arrives at the Chairmanship uniquely prepared to move quickly on the tasks ahead.

The pace of the transition has therefore been nearly without precedent, opening up a rare opportunity for Chairman Pai. While it is not unusual for a new chair to launch proceedings or entertain appeals that will ultimately lead to the reversal or modification of prior agency actions, that can (as noted above) be a slow process. But with Commissioner Rosenworcel departing the FCC in December, leaving the FCC with a 2-2 partisan split, actions by the full Commission in the waning weeks of the Obama Administration became extremely difficult to accomplish. Chairman Wheeler thus utilized the bureaus of the FCC to accomplish via delegated authority various actions that remained on his agenda.

This is where the rapid designation of Commissioner Pai as permanent Chairman comes into play. As a general rule, the FCC bureaus have thirty days after the release of a decision to reconsider the action on their own motion. Because many of these decisions occurred in early January, time is now running out on rescinding them. With Chairman Pai firmly in place, the agency can move quickly to withdraw decisions before they become final. Indeed, we wrote last Thursday about the Media Bureau’s rescission of a ruling regarding noncom ownership reporting rules.

It turned out that was not an isolated action, and on Friday multiple FCC bureaus rescinded decisions, guidance statements (which can be withdrawn at any time), and pending investigations. For example, we wrote about the FCC’s rushed move last month to make airing political ads more complicated. You can now scratch that, because the Media Bureau on Friday set aside its decisions in that matter, concluding that it should not have been resolved by the Bureau on delegated authority, but instead by the full Commission.  In other words, the Media Bureau returned the political file complaints against all twelve stations to “pending status [to be] considered by the Commission” and consequently returned the political file rules to their less-complicated pre-January 2017 state.

Not to be left out, the Wireline Competition Bureau revoked the Lifeline Broadband Provider designations for nine entities, returning their petitions for designation to pending status and removing them from streamlined treatment. Additionally, the Public Safety & Homeland Security Bureau closed a Notice of Inquiry seeking comment on 5G wireless network and device security, and the Wireless Telecommunications Bureau closed pending inquiries related to suspected violations of net neutrality rules.

Discussing these actions, Chairman Pai issued a brief statement on “Revoking Midnight Regulations” in which he explained that “last-minute actions” released in the “waning days of the last Administration . . . did not enjoy the support of the majority of Commissioners at the time they were taken, [and] should not bind us going forward.  Accordingly, they are being revoked.”

Of particular interest to broadcasters, and reaching back a little further, the Media Bureau on Friday also rescinded its Broadcast Processing Guidance Relating to Sharing Arrangements and Contingent Interests.  This is the 2014 application processing guidance that announced the sudden reversal under Chairman Wheeler of the Media Bureau’s decade-long acceptance of TV Joint Sales Agreements as efficiency-enhancing arrangements. So, Friday’s Public Notice announcing that action is actually the Media Bureau reversing itself on reversing itself.

Communications lawyers are used to working in a very fast-moving field, but we’ve entered a period where major changes are coming at lightning speed. For broadcasters, having experienced some tough years dealing with an FCC whose only real interest in broadcasting seemed to be as a source of spectrum for other services, the changes can’t come fast enough.

(Click here for more news and insights on evolving regulations and policies under the Trump Administration.)