Charter/BHN/TWC Review Should Start Now, FCC's Pai, O'Rielly Say
The crafting of new confidentiality rules shouldn't put Charter Communications' buy of Bright House Networks and Time Warner Cable on hold, FCC Commissioners Ajit Pai and Michael O’Rielly said Thursday, urging the agency to begin its regulatory review. The FCC "should follow the direction that the D.C. Circuit previously provided in a similar case: 'The agency has access to the relevant documents at issue in this matter and can continue to evaluate the proposed merger....' So let’s start the ‘aspirational’ merger review shot clock and get on with the process," the two said in a statement.
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The handling of video programming confidential information (VPCI) was an issue in the aborted Comcast acquisition of TWC and in the AT&T/DirecTV merger when a U.S. District Court judge ruled that an FCC order that would have let participants in those transaction proceedings review confidential programming and retransmission consent contract data is “substantively and procedurally flawed.” (see 1505080053).
Chairman Tom Wheeler’s office is using the Charter/BHN/TWC deal as leverage to try to push through an agency rules clarification and revisions for dealing with confidential information in all of the different agency proceedings, not just mergers and acquisitions, said Pai Chief of Staff Matthew Berry. Commissioners received proposed confidentiality rules -- which would govern not just the Charter/BHN/TWC deal but all FCC matters -- from Wheeler on Monday, Berry said.
O'Rielly and Pai said they were “deeply dismayed" that a formal review seemingly wouldn't start until after changes in confidential information procedures. "We don’t plan to allow this maneuver to deter us from giving careful scrutiny to the important item in front of us, which if adopted, would apply not only to future transactions but all Commission proceedings," they said in their statement. "Among other things, we believe that the better course would be for the Commission to seek public input on these proposed procedures before moving ahead." The FCC didn't comment.
TWC is hoping FCC work and voting on the protective order that would govern the treatment of confidential information during the merger approval process "is imminent," CEO Robert Marcus said during a conference call with analysts Thursday. "That will start the 180-day clock ticking."
Any VPCI rule changes could again face criticism because the work is being done in the context of a transaction, without any public input and in a rush so the commissioners have little time to review it, said one government relations attorney for a cable programmer. Meanwhile, the AT&T/DirecTV review -- done under the current transaction review policies -- highlights that the rules don't need changing, the attorney said.