Uncategorized

Updated April 30, 2024.  Originally posted March 18, 2024.

In March, the U.S. Federal Communications Commission (FCC) adopted a licensing framework that authorizes satellite operators to partner with terrestrial wireless providers to develop hybrid satellite-terrestrial networks intended to provide ubiquitous network connectivity, including in “dead zones” and other hard-to-reach areas.  Today’s Federal Register publication confirms that this new “Supplemental Coverage from Space” (SCS) regime will become effective Thursday, May 30, 2024, which will enable satellite operators to serve as a gap-filler in the networks of their wireless provider partners by using their satellite capability combined with spectrum previously allocated exclusively to terrestrial service.

Although the FCC’s new rules limit SCS deployments to a handful of spectrum bands, the licensing regime nevertheless marks a significant opportunity for joint operations by satellite operators and wireless service providers.  The FCC’s decision also demonstrates the agency’s commitment to leadership in regulating space-based technologies – a motivation the agency cited as justification for adopting an SCS regulatory framework described as “the first of its kind in the world.”

The SCS item, which the FCC adopted on March 14, 2024 consists of two parts: a Report and Order adopting a licensing framework for SCS deployments in specified frequency bands (the “Order”), and (2) a Further Notice of Proposed Rulemaking (“FNPRM”) that seeks public comment on additional issues associated with the newly authorized SCS operations. Comments on the issues raised in the FNPRM are due Thursday, May 30, 2024, with reply comments due Monday, July 1, 2024.

New SCS Licensing Framework

The new SCS rules generally are consistent with the April 2023 NPRM, which proposed to allow SCS deployments in certain frequency bands and enable a satellite operator to apply for a modification of its existing FCC license to provide satellite services in these reallocated spectrum bands, provided certain conditions are met.  However, in response to public comment, the new SCS rules reflect some key changes from what the FCC originally proposed.

Terrestrial-Only Spectrum Bands Eligible for SCS Use

The FCC’s new SCS rules authorize communications from satellites networks to mobile devices (i.e., Mobile Satellite Services or MSS) in the following spectrum bands:Continue Reading FCC’s “Supplemental Coverage from Space” Rules Take Effect May 30; New Licensing Framework Expands Satellite-to-Smartphone Coverage

Regulation (EU) 2022/2560 of the European Parliament and of the Council of 14 December 2022 on foreign subsidies distorting the internal market (FSR) entered into force on 12 January 2023 and will start to apply as of 12 July 2023.

The FSR creates a brand new instrument to fill a regulatory gap, by preventing foreign subsidies from distorting the European Union (EU) internal market. Whereas companies receiving public support in the EU are subject to strict State aid rules, companies obtaining public support outside the EU are generally not. This was perceived as putting companies in the EU at a disadvantage compared to companies that obtained subsidies outside the EU, but that also engaged in economic activity in the Union.

The FSR’s scope extends far beyond the obvious State support, to cover common types of benefits that are granted all over the world, including in countries driven by a market economy. Its obligations will inevitably place an additional administrative burden on companies engaging in an economic activity in the EU. Acceptance of a foreign subsidy distorting the EU internal market may have far-reaching consequences for the company. The FSR places additional compliance obligations on companies, and for many will entail a thorough assessment to identify and justify foreign subsidies received. For companies considering transactions in the EU, the FSR effectively creates a third layer of deal conditionality, besides merger control and Foreign Direct Investment laws. This is adding a further unique set of thresholds, timings and factual considerations, to be included in companies’ strategies to invest in the EU. This will require expertise in EU antitrust and State aid law, and a good understanding of the details of the FSR.

Key things you need to know:Continue Reading The EU Foreign Subsidies Regulation enters into force

On 19 October 2022, the European Commission (the “Commission”) adopted its new State aid Framework for research, development and innovation (the “2022 RDI aid Framework”). This instrument governs Member States’ investment in RDI activities. It is an important response to the 2020 Commission Communication on a new European Research Area for Research and Innovation (the “ERA Communication”), aiming at strengthening investments and reaching a 3% GDP investment target in the field of RDI. The 2022 RDI aid Framework is a revision of the previous version of 2014.

The three most important things you need to know about the 2022 RDI aid Framework are:

  • The Commission’s approval is subject to a set of criteria to determine whether the aid is justified and can be authorised, and compliance with recent EU objectives such as the EU Green Deal and the EU Industrial and Digital Strategies will have a positive influence on the Commission’s assessment;
  • RDI activities now explicitly include digitalisation and digital technologies; and
  • Member States can grant aid for testing and experimentation infrastructures which predominantly provide services to undertakings for R&D activities closer to the market.

Background

Similarly to its previous version, the 2022 RDI aid Framework recalls the instances where RDI aid does not qualify as a State aid and is therefore not caught by the State aid rules. This would be the case where the aid is granted to non-economic activities conducted by universities or where universities, although publicly funded, engage in RDI activities with companies pursuing commercial goals.Continue Reading The Commission has revised its framework for State aid for research and development and innovation

Yesterday, the FCC announced that on November 18, 2022, it will release a “pre-production draft” of its widely anticipated broadband maps, which will contain granular information about existing broadband infrastructure and service availability in the U.S. The maps, which the FCC was required by law to develop, will be used by the Department of Commerce’s National Telecommunications and Information Administration (“NTIA”) to distribute $42.5 billion in funding to states for allocation to service providers who will use it to construct additional broadband networks.

The federal government’s allocation of these funds is pursuant to the Broadband Equity, Access, and Deployment (“BEAD”) Program, which was established by the Infrastructure Investment and Jobs Act (“IIJA”) in November 2021. Click here for our summary of the BEAD Program.

The FCC began this particular mapping initiative in August 2019. Doing so marked a departure from the agency’s prior mapping efforts, which had acknowledged gaps. The new initiative was informed in part by the March 2020 Broadband DATA Act, which required the FCC to collect granular data about geographic areas in which broadband infrastructure exists, as well as attributes such as download and upload speeds and latency. 

To ensure accuracy and avoid over- or under-funding certain locations, the FCC incorporated a “challenge process” into its broadband map development, through which governmental entities, broadband service providers, and others are able to submit bulk challenges to the data that the FCC collected. The FCC believes that this process will help it refine its maps before subsequent versions are released.Continue Reading FCC to Release Broadband Maps on November 18: Will Determine How $42.5 Billion in Funding Will be Allocated by NTIA in 2023

On Monday, the Supreme Court granted certiorari in Gonzalez v. Google LLC, 2 F.4th 871 (9th Cir. 2021) on the following question presented:  “Does section 230(c)(1) immunize interactive computer services when they make targeted recommendations of information provided by another information content provider, or only limit the liability of interactive computer services when they

By Terrell McSweenyMegan CrowleyNicholas XenakisAlexandra Cooper-Ponte & Madeline Salinas on September 28, 2022

On September 16, the Fifth Circuit issued its decision in NetChoice L.L.C. v. Paxton, upholding Texas HB 20, a law that limits the ability of large social media platforms to moderate content and imposes various disclosure

The U.S. Securities and Exchange Commission (“SEC”) last week announced settlements with four investment advisory firms regarding alleged violations of the SEC’s pay-to-play rule, illustrating that federal regulators continue to aggressively pursue such cases.   The rule at issue, Rule 206(4)-5 (“the Rule”), prohibits investment advisors from, among other things, receiving compensation from certain government entities for two years after a person affiliated with the investment advisor makes a covered campaign contribution to an official of the government entity.  While the involved firms did not admit or deny the allegations in the settlement orders, an examination of the cases is instructive in assessing the current landscape of SEC pay-to-play rule enforcement.  Together, the four settlements are noteworthy in two major respects: (1) the circumstances of the underlying contributions that highlight the wide-reaching application of Rule 206(4)-5; and (2) the fact that one of the SEC Commissioners issued a sharp dissent that expressed deep concern about the breadth of the Rule.

The settlements involved covered associates at four different firms making contributions to four different recipients: an unsuccessful candidate for Mayor of New York City; the incumbent Governor of Hawaii ; an unsuccessful candidate for Governor of Massachusetts; and to a then-candidate for Governor of California.  In two cases, the firms managed public pension money and, in the other two, the firms managed state university endowments, an often overlooked category of government entity investors. 

While the SEC Rule is intended to prevent fraud, it seems highly unlikely that any of the contributions at issue in these four cases could have influenced state investment decisions: 

  • All four investment advisory firms had preexisting business relationships with the relevant government entities before the prohibited contributions were made and no new business was solicited after the contributions. 
  • One of the donors was not even a covered associate at the time of the contribution.
  • Only one of the four prohibited recipients was an incumbent officeholder at the time of the contribution. 
  • Two of the four recipients failed to win election to the offices they sought. 
  • Two of the cases involved situations where the donor either received a refund or requested a refund. 
  • The contribution amounts were a drop in the bucket in proportion to the tens of millions of dollars raised in these elections – three cases involved a single $1,000 contribution and the fourth involved a contribution of $1,000 and another $400. 

Continue Reading SEC Commissioner Says It’s “Past Time” To Reform Overly “Blunt” Pay-to-Play Rule