May 27, 2020

May 27, 2020

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May 26, 2020

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Regulatory Update: Wireless Licenses Issued by the Federal Communications Commission

Hotels, resorts, country clubs, and other hospitality facilities commonly utilize wireless communications systems to support security, maintenance, and other functions conducted on the relevant properties.  Many private wireless radio systems used at hospitality facilities use portions of the radiofrequency spectrum that are licensed by the Federal Communications Commission (FCC).  Prior to operating radio systems (which include wireless headphone sets and handheld portable radios) it is essential to determine whether an FCC license is required to operate communications equipment and whether a license has been obtained.  The FCC considers unauthorized use of the radiofrequency spectrum to be a serious matter and has authority to initiate and enforcement action and impose monetary penalties for violations of its rules.

In addition to ensuring that any required FCC licenses are obtained, hospitality companies should be aware that the FCC also regulates changes in the ownership of FCC licenses or of licensees.   Section 310(d) of the Communications Act (47 U.S.C. § 310(d)) prohibits the assignment or transfer of control of any FCC license, including any private wireless license used for internal business communications, prior to obtaining FCC consent (see also 47 C.F.R. § 1.948).  Section 310 is applicable when an FCC license is sold to another entity in an asset sale (an assignment) and when a controlling ownership interest (50 percent or more) in a licensee is acquired (a transfer of control).  The statutory prohibition of assignments and transfers of control of an FCC license is applicable when such changes occur as the result of an internal corporate reorganization (a pro forma transaction under FCC rules), as well as when a third party is involved.  Obtaining FCC prior consent for transactions involving assignments and transfers of control of private wireless licenses is a relatively simple and inexpensive process.  However, licensees may overlook the need for FCC approval as part of larger transactions affecting the ownership or control of FCC licenses.  The importance of receiving prior consent from the FCC for assignments and transfers of control of licenses is highlighted by a recent Consent Decree entered into by the FCC and Marriott  International, Inc.  As part of the Consent Decree Marriott admitted liability, will implement a compliance plan, and will pay $504,000 as a civil penalty.  

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About this Author

Mitchell "Rick" Brecher, Greenberg Traurig Law Firm, Washington DC, Telecommunications Attorney

Mitchell F. Brecher focuses his practice on telecommunications and media law and regulation. Rick has practiced before the Federal Communications Commission (FCC), other federal departments and agencies, state regulatory commissions, and trial and appellate courts. He has also provided legislative counsel on telecommunications matters. Rick represents clients in telecommunications transactional matters and provides business counseling and contract assistance to telecommunications and media clients.

Areas of Concentration:

Debra McGuire Mercer, Greenberg Traurig Law Firm, Washington DC, Government Contracts Attorney
Of Counsel

Debra McGuire Mercer focuses her practice on communications regulation, and judicial and administrative litigation. She has practiced extensively before the Federal Communications Commission (FCC), state public utility commissions and trial and appellate courts. Debra's litigation experience encompasses civil, criminal and regulatory issues related to telecommunications, government contracts, international trade and commercial disputes. Debra also counsels companies on business, contract and transactional matters.

Areas of Concentration

  • The Communications Act and the Telecommunications Act of 1996

  • Broadcast licensing and regulation

  • Cable television franchises

  • Commercial transactions involving broadcast, cable, media, and telecommunications companies

  • FCC and state enforcement proceedings, including inquiries and investigations

  • Telemarketing and unsolicited faxes

  • Telephone Consumer Protection Act (TCPA), Junk Fax Protection Act, and Do Not Call laws

  • Administrative litigation challenging contract awards

  • Antitrust

  • Bid protests

  • Claims preparation

  • Codes of conduct

  • Due diligence for investments and transactions

  • Voluntary disclosures