BEFORE THE FEDERAL COMMUNICATIONS COMMISSION WASHINGTON, D.C. 20554
OPPOSITION OF NORTHGATE WIRELESS AMERICAS INC. TO INFORMAL OBJECTION OF GREAT BASIN RURAL BROADBAND COOPERATIVE
Annette Galvez, Lead Partner Daniel Fong, Senior Associate Broadfield Whitaker LLP 1401 H Street NW, Suite 750 Washington, DC 20005 Tel: (202) 555-4100
Fax: (202) 555-4101
Harold Wren, Of Counsel Calderwood & Harkness LLP 1875 K Street NW, Suite 600 Washington, DC 20006 Tel: (202) 555-7800
Counsel for Northgate Wireless Americas Inc.
December 9, 2022
TABLE OF CONTENTS
I. INTRODUCTION AND SUMMARY
Northgate Wireless Americas Inc. ("NWA" or "Applicant"), by its undersigned counsel, Broadfield Whitaker LLP and Calderwood & Harkness LLP, hereby respectfully opposes the Informal Objection filed on November 28, 2022, by Great Basin Rural Broadband Cooperative ("Great Basin" or "Objector") in connection with FCC File No. 0010287-EX (the "Application").1 The Application seeks the consent of the Federal Communications Commission (the "Commission" or "FCC") to the assignment of fourteen (14) Meridian Technologies-3 (Band 66) Wireless Radio Service licenses, bearing call signs WQAB201 through WQAB214 (collectively, the "Licenses"), from Ridgeline Wireless Holdings LLC ("Ridgeline" or "RWH") to NWA. For the reasons set forth herein, Great Basin's Informal Objection is without merit and should be dismissed or, in the alternative, denied.
The Application was filed on FCC Form 603 on October 14, 2022, and was accepted for filing by the Wireless Telecommunications Bureau on October 28, 2022. The Commission issued a Public Notice on November 3, 2022, opening a thirty-day comment period that closed on December 5, 2022.2 No petitions to deny were filed within the pleading cycle. The sole filing received during the comment window was Great Basin's Informal Objection, submitted on November 28, 2022, pursuant to 47 C.F.R. § 1.41.
Great Basin's Informal Objection is a brief, perfunctory filing that raises a single substantive issue: the allegation that the proposed transaction "raises potential concerns" under Section 310(b)(4) of the Communications Act of 1934, as amended, 47 U.S.C. § 310(b)(4), because NWA will be 100% indirectly owned by Northgate Telecommunications PLC ("NTP"), a public limited company organized under the laws of England and Wales and listed on the London Stock Exchange. The Objection identifies no specific public interest harm, articulates no competitive concern, makes no allegation of national security risk, and provides no factual basis upon which the Commission could conclude that the proposed assignment would be contrary to the public interest. The Objection amounts to nothing more than a recitation of the statutory foreign ownership provision — a provision that the Applicant has affirmatively and proactively addressed through the appropriate procedural mechanism.
In sum, the Commission should dismiss or deny the Informal Objection for the following independent reasons:
First, the foreign-ownership concerns identified by Great Basin are fully addressed in the Section 310(b)(4) Petition for Declaratory Ruling (the "Section 310(b)(4) Petition" or "Petition") that NWA filed concurrently with its FCC Form 603 Application on October 14, 2022. The Petition provides the Commission with comprehensive and detailed disclosures regarding NWA's ownership chain, the identity of all significant shareholders in NTP, and the corporate governance arrangements governing the relationship between NWA and its foreign parent. Great Basin's Objection adds nothing to the record that the Commission does not already possess.
Second, NTP is organized under the laws of England and Wales, a constituent part of the United Kingdom of Great Britain and Northern Ireland. The United Kingdom has been a Member of the World Trade Organization ("WTO") since January 1, 1995. Under the Commission's well-established Foreign Participation Order framework, indirect foreign ownership by entities organized in WTO-member countries benefits from a rebuttable presumption that such ownership is consistent with the public interest. Great Basin has made no attempt to rebut this presumption and has identified no facts that would justify the Commission in departing from its settled policy.
Third, FCC precedent strongly and consistently supports approval of the proposed foreign ownership structure. The Commission has approved numerous applications involving 100% indirect foreign ownership by entities organized in WTO-member countries, including the United Kingdom, and has done so on a routine basis. The ownership structure proposed here — a U.S.-incorporated licensee held through a U.S. intermediate holding company by a publicly traded UK parent — is conventional, well-established, and has been approved in multiple prior proceedings. There is no basis in Commission precedent or policy for denying, delaying, or imposing conditions on the Application solely because the indirect foreign owner is a UK-organized public limited company.
Fourth, Great Basin has failed to satisfy the standards governing informal objections under 47 C.F.R. § 1.41. The Commission has consistently held that an informal objection must contain particularized allegations of harm supported by specific facts. Great Basin's Objection is devoid of any such showing. It identifies no competitive injury, no service degradation, no threat to its own operations or the interests of its cooperative members, and no national security concern. A generalized invocation of a statutory provision that the Applicant is already addressing through the proper procedural channel is insufficient to warrant Commission action.
Accordingly, NWA respectfully requests that the Commission dismiss or deny Great Basin's Informal Objection and proceed to act on FCC File No. 0010287-EX and the associated Section 310(b)(4) Petition for Declaratory Ruling on their merits.
II. BACKGROUND
A. The Parties
Northgate Wireless Americas Inc. NWA is a corporation organized under the laws of the State of Delaware, having been incorporated on August 22, 2022, under Delaware Secretary of State File No. 7284619. NWA maintains its principal office at 2200 Wilson Boulevard, Suite 1450, Arlington, Virginia 22201. NWA was formed for the specific purpose of serving as the FCC licensee and spectrum-holding entity for the proposed transaction. As a newly formed entity, NWA does not currently hold any FCC licenses. Upon consummation of the proposed assignment, NWA will hold the fourteen Meridian Technologies-3 (Band 66) licenses that are the subject of this proceeding. NWA is the proposed assignee and licensee in FCC File No. 0010287-EX.
NWA is a wholly owned subsidiary of Northgate US Holdings LLC ("NUS Holdings"), a Delaware limited liability company formed on August 30, 2022. NUS Holdings was established as the intermediate holding entity in the ownership chain between NWA (the licensee) and the ultimate foreign parent, NTP. NUS Holdings does not currently hold any FCC licenses and is not engaged in any business operations apart from its role as an intermediate holding entity. Both NWA and NUS Holdings have appointed resident agents and principal offices in the United States.
Northgate Telecommunications PLC. NTP is a public limited company organized under the laws of England and Wales, registered with UK Companies House under Registration No. 08473291, and headquartered at 14 Cavendish Square, London W1G 0BX, United Kingdom. NTP's ordinary shares are listed and traded on the London Stock Exchange under the ticker symbol "NGTL." As of the third quarter of 2022, NTP had an approximate market capitalization of £4.8 billion (approximately $5.8 billion at prevailing exchange rates).
NTP is a diversified telecommunications and technology company with substantial operations across the United Kingdom and Western Europe. Its principal lines of business include mobile virtual network operator ("MVNO") services, enterprise software-as-a-service ("SaaS") platforms for telecommunications network management, and wholesale telecommunications connectivity services. For the fiscal year ended December 31, 2021, NTP reported consolidated revenues of approximately £2.31 billion, and NTP's revenue for fiscal year 2022 was projected at approximately £2.57 billion based on published interim results and company guidance. NTP employs approximately 8,200 personnel across its UK and European operations.
NTP currently has limited direct operations in the United States. Its existing U.S. activities consist principally of MVNO arrangements under which NTP resells wireless services provided by domestic U.S. carriers to enterprise customers. NTP does not currently hold, directly or indirectly, any FCC licenses in the United States. The proposed transaction represents NTP's initial entry into direct U.S. spectrum ownership and is intended to complement NTP's existing U.S. operations and to establish a platform for future network investment and deployment in the western United States.
As a publicly traded company listed on the London Stock Exchange, NTP is subject to comprehensive disclosure and governance requirements under the UK Companies Act 2006, the UK Corporate Governance Code, the Financial Conduct Authority's Listing Rules and Disclosure Guidance and Transparency Rules, and the Market Abuse Regulation (as retained in UK law). NTP publishes annual reports and accounts audited by Kraft Voss CPAs LLP (London) and maintains a board of directors composed of both executive and independent non-executive directors.
Northgate US Holdings LLC. NUS Holdings is a limited liability company organized under the laws of the State of Delaware, formed on August 30, 2022, and maintaining its principal office at the same address as NWA: 2200 Wilson Boulevard, Suite 1450, Arlington, Virginia 22201. NUS Holdings is 100% owned by NTP. NUS Holdings in turn owns 100% of the membership interests in NWA. NUS Holdings serves as the intermediate holding entity in the ownership chain for purposes of the Section 310(b)(4) analysis and was established to provide organizational and structural clarity in connection with NWA's FCC licensing.
Ridgeline Wireless Holdings LLC. Ridgeline is a limited liability company organized under the laws of the State of Nevada, registered with the Nevada Secretary of State under Entity No. E0428716302, with its principal office located at 450 South Virginia Street, Suite 800, Reno, Nevada 89501. Ridgeline is a regional wireless telecommunications operator that provides voice, data, and messaging services to approximately 142,000 subscriber accounts across portions of Nevada, eastern California, and southern Oregon. Ridgeline currently holds the fourteen Meridian Technologies-3 (Band 66) licenses that are the subject of the proposed assignment. Ridgeline is the assignor in FCC File No. 0010287-EX. Ridgeline is domestically owned and is not a party to the Section 310(b)(4) Petition.
It is important to note that the proposed transaction involves only the assignment of Ridgeline's spectrum licenses. Ridgeline will retain its operating telecommunications business, its network infrastructure, its customer relationships, and its approximately 142,000 subscriber accounts. The proposed assignment does not involve any change in the ownership or control of Ridgeline itself, nor does it involve the transfer of any assets other than the bare FCC spectrum licenses.
Great Basin Rural Broadband Cooperative. Great Basin Rural Broadband Cooperative is a cooperative organized under the laws of the State of Nevada. Great Basin filed the Informal Objection at issue in this proceeding on November 28, 2022. Great Basin's Informal Objection does not describe its operations in any detail, nor does it explain how the proposed assignment of Meridian Technologies-3 (Band 66) wireless licenses would affect its business or the interests of its cooperative members. Based on publicly available information, Great Basin is principally engaged in the provision of fixed broadband services, primarily utilizing fiber and fixed wireless technologies, in rural portions of Nevada. Great Basin does not appear to hold Meridian Technologies-3 (Band 66) spectrum licenses.
B. The Transaction
The transaction at issue is a straightforward asset purchase of FCC spectrum licenses. Under the terms of the Asset Purchase Agreement dated September 22, 2022 (the "APA"), between Ridgeline (as Seller and Assignor) and NWA (as Buyer and Assignee), Ridgeline has agreed to sell, and NWA has agreed to purchase, the fourteen Meridian Technologies-3 (Band 66) Wireless Radio Service licenses identified in the Application. The purchase price under the APA is $126,500,000, payable in cash at closing, subject to customary purchase price adjustments and holdback provisions.
The Licenses bear call signs WQAB201 through WQAB214 and authorize wireless operations in the Meridian Technologies-3 (Band 66) band, governed by Part 27 of the Commission's Rules, 47 C.F.R. Part 27. The Meridian Technologies-3 band comprises spectrum in the 1695–1780 MHz (uplink) and 2155–2180 MHz (downlink) ranges, with Band 66 also encompassing additional Meridian Technologies-1 spectrum. The fourteen licenses collectively comprise 39 MHz of paired spectrum — specifically, 39 MHz in the uplink direction and 39 MHz in the downlink direction, for a total of 78 MHz of paired bandwidth.
The geographic service areas covered by the fourteen Licenses correspond to Economic Areas ("EAs") located in Nevada, eastern California, and southern Oregon, encompassing an estimated population of approximately 3.84 million persons ("POPs"). The covered EAs include metropolitan areas in the Reno-Sparks corridor, portions of the greater Sacramento fringe, rural communities in northeastern California and southern Oregon, and the extensive rural service territories throughout central and eastern Nevada.
The APA contemplates that only the bare FCC spectrum licenses will be transferred from Ridgeline to NWA. No network infrastructure, customer accounts, subscriber relationships, intellectual property, or other operating assets of Ridgeline will be transferred or assigned in connection with the transaction. Ridgeline will continue to operate its existing wireless telecommunications business following the closing of the license assignment. The transaction is structured as a pure spectrum acquisition by NWA, which, backed by the financial and technical resources of its ultimate parent NTP, intends to deploy the acquired spectrum in the covered EAs through the construction of new wireless network facilities.
The closing of the transaction is subject to, among other customary conditions, receipt of FCC consent to the assignment of the Licenses, including the issuance of a declaratory ruling under Section 310(b)(4) of the Communications Act approving the indirect foreign ownership of NWA by NTP. The transaction is also subject to any review by the Committee for the Assessment of Foreign Participation in the United States Telecommunications Services Sector, as described further below.
C. The FCC Application and Section 310(b)(4) Petition
On October 14, 2022, NWA and Ridgeline jointly filed an FCC Form 603 application seeking the Commission's consent to the assignment of the fourteen Meridian Technologies-3 (Band 66) licenses from Ridgeline to NWA. The FCC Form 603 was assigned FCC File No. 0010287-EX.
Concurrently with the filing of the FCC Form 603, NWA filed its Section 310(b)(4) Petition for Declaratory Ruling. Recognizing that NWA would be 100% indirectly owned by NTP, a UK-organized public limited company, NWA proactively sought the Commission's affirmative approval for its proposed foreign ownership structure in compliance with the Commission's rules and established procedures. Section 310(b)(4) of the Communications Act provides that no license may be granted to or held by an entity that is directly or indirectly controlled by a foreign government or foreign corporation, unless the Commission determines that the public interest would be served by such grant.3 The Commission has implemented this provision through its declaratory ruling process, under which applicants seeking to exceed the 25% statutory benchmark for indirect foreign ownership must file a petition disclosing their ownership structure and requesting a specific ruling that the proposed ownership is consistent with the public interest.4
NWA's Section 310(b)(4) Petition provides comprehensive disclosure of the proposed ownership structure, including:
• The identity and organizational details of NWA (the proposed licensee), NUS Holdings (the intermediate holding entity), and NTP (the ultimate parent);
• The full ownership chain from NWA through NUS Holdings to NTP;
• The identification of all shareholders holding 5% or greater interests in NTP, including Thornhill Asset Management LLP (UK, 9.7%), Sovereign Capital Partners AG (Switzerland, 6.3%), and Dunmore Pension Trust (UK, 5.1%), with the remaining 78.9% held in the public float on the London Stock Exchange;
• Information regarding the corporate governance and board composition of NTP and NWA;
• A description of NTP's business operations, financial condition, and regulatory history; and
• A request for approval of up to 100% aggregate indirect foreign ownership of NWA by NTP and its shareholders.
The Application was accepted for filing by the Wireless Telecommunications Bureau on October 28, 2022. A Public Notice was issued on November 3, 2022, opening the pleading cycle and providing interested parties with notice and an opportunity to comment or file petitions to deny.5 The comment period closed on December 5, 2022. No petitions to deny were filed during the pleading cycle. The only filing received was Great Basin's Informal Objection, submitted on November 28, 2022.
The Section 310(b)(4) Petition thus places squarely before the Commission all of the information necessary for it to evaluate the foreign ownership implications of the proposed transaction. The Commission has before it a complete record on this issue, developed through the Applicant's own affirmative disclosures, and is fully equipped to render a determination on the Petition's merits.
D. The Informal Objection
On November 28, 2022, Great Basin Rural Broadband Cooperative filed its Informal Objection pursuant to 47 C.F.R. § 1.41.6 The filing is a brief, three-page document that raises a single substantive point: that the proposed transaction "raises potential concerns" under Section 310(b)(4) of the Communications Act because NWA will be 100% indirectly owned by NTP, a UK entity.
The Objection does not dispute any fact disclosed in the Application or the Section 310(b)(4) Petition. It does not allege any inaccuracy or incompleteness in the Applicant's filings. It does not identify any specific public interest harm, competitive injury, service degradation, or adverse effect on Great Basin's own operations or the interests of its cooperative members. It does not allege any national security concern, nor does it identify any facts that would suggest the existence of such a concern. It does not address the Commission's WTO-member presumption or attempt to rebut that presumption. It does not cite any FCC precedent in which the Commission has denied a similar application or imposed conditions based on the type of ownership structure proposed here. It does not explain why Great Basin has any interest in the outcome of this proceeding.
In short, the Objection amounts to nothing more than a notation that the proposed licensee will be indirectly foreign-owned — a fact that the Applicant has already disclosed in full and placed before the Commission for its review through the Section 310(b)(4) Petition process. As demonstrated below, the Objection fails to meet the standard for an informal objection and should be dismissed or denied.
III. THE STANDARD FOR INFORMAL OBJECTIONS
Section 309(d) of the Communications Act, 47 U.S.C. § 309(d), establishes the formal petition-to-deny process for challenges to FCC license applications. Under Section 309(d)(1), a petition to deny must contain "specific allegations of fact sufficient to show that . . . a grant of the application would be prima facie inconsistent with the public interest, convenience, and necessity."7 No petition to deny was filed in this proceeding.
Great Basin filed its challenge as an "informal objection" under Section 1.41 of the Commission's Rules, 47 C.F.R. § 1.41, which provides that "[e]xcept where formal procedures are required, any interested person may bring to the attention of the Commission any matter which the person believes requires Commission action."8 The Commission has recognized that informal objections serve a useful function in permitting interested parties to call attention to potential problems with pending applications. At the same time, however, the Commission has consistently held that informal objections are subject to meaningful substantive standards and are not a vehicle for raising speculative, conclusory, or unsupported allegations.
The Commission has explained that an informal objection must present "specific allegations of fact" that, if true, would demonstrate that grant of the application would be inconsistent with the public interest.9 Although the Commission applies the same substantive standard to both formal petitions to deny and informal objections — namely, whether the filing raises sufficiently specific allegations warranting further inquiry or denial — the procedural burden on an informal objector is somewhat less exacting than that imposed on a petitioner to deny.10 Nevertheless, even under this more relaxed procedural standard, the Commission requires that an informal objection contain particularized allegations supported by specific facts, and not merely generalized or conclusory assertions.
Crucially, the Commission has repeatedly held that an informal objection that merely restates legal requirements or identifies regulatory provisions without explaining how the applicant has failed to satisfy those requirements — or how grant of the application would cause specific harm — does not present a sufficient basis for the Commission to deny the application or to delay its consideration.11 The purpose of the informal objection process is to bring to the Commission's attention specific, material deficiencies in an application or specific harms that the Commission might not otherwise identify in its review. An objection that merely flags the existence of a legal issue already identified and addressed by the applicant contributes nothing to the Commission's analysis and imposes unnecessary delay on the processing of the application.
As demonstrated in the sections that follow, Great Basin's Informal Objection fails to meet these well-established standards. The Objection identifies no specific deficiency in the Application or the Section 310(b)(4) Petition. It alleges no concrete public interest harm. It provides no factual basis for the Commission to conclude that the proposed transaction is contrary to the public interest. It simply notes that the proposed licensee will be indirectly foreign-owned — a matter that is fully before the Commission in the Section 310(b)(4) Petition and that the Commission is equipped to evaluate on the merits without the need for further proceedings.
IV. ARGUMENT
A. The Section 310(b)(4) Foreign Ownership Concerns Are Fully Addressed in the Concurrently Filed Petition for Declaratory Ruling
The core — indeed, the sole — substantive contention in Great Basin's Informal Objection is that the proposed transaction "raises potential concerns" under Section 310(b)(4) of the Communications Act because NWA will be 100% indirectly owned by NTP, a UK-organized public limited company. This contention does not identify a deficiency in the Application; rather, it identifies a feature of the transaction that NWA has proactively and transparently addressed through the appropriate procedural mechanism.
As described in Section II.C above, NWA filed its Section 310(b)(4) Petition for Declaratory Ruling simultaneously with the FCC Form 603 Application on October 14, 2022. The filing of a Section 310(b)(4) Petition is precisely the procedure that the Commission has established and requires for applicants proposing to exceed the 25% statutory benchmark for indirect foreign ownership of FCC licensees.12 NWA's decision to file the Petition concurrently with its Application — rather than waiting for the Commission to identify the foreign ownership issue and request additional information — reflects NWA's commitment to full transparency and regulatory compliance.
The Section 310(b)(4) Petition provides the Commission with comprehensive and detailed disclosure of the proposed ownership structure. Specifically, the Petition identifies the complete ownership chain:
Licensee: Northgate Wireless Americas Inc. ("NWA"), a Delaware corporation — 100% owned by
Intermediate Holding Entity: Northgate US Holdings LLC ("NUS Holdings"), a Delaware limited liability company — 100% owned by
Ultimate Parent: Northgate Telecommunications PLC ("NTP"), a public limited company organized under the laws of England and Wales, publicly traded on the London Stock Exchange (LSE: NGTL)
The Petition further identifies all shareholders known to hold 5% or greater ownership interests in NTP, as required by the Commission's rules and established practice:
Each of the identified significant shareholders is organized in a WTO-member country. Thornhill Asset Management LLP and Dunmore Pension Trust are organized in the United Kingdom, and Sovereign Capital Partners AG is organized in Switzerland — both longstanding WTO members with well-developed regulatory frameworks and telecommunications markets. The public float, which constitutes 78.9% of NTP's outstanding shares, is held by a diverse and diffuse group of institutional and retail investors trading on the London Stock Exchange.
The Section 310(b)(4) Petition requests specific approval for up to 100% aggregate indirect foreign ownership of NWA by NTP and its shareholders. The Petition provides detailed information regarding NTP's corporate governance, board composition, financial condition, regulatory history, and business operations, all of which are directly relevant to the Commission's evaluation of whether the proposed foreign ownership would serve the public interest.
In light of these disclosures, Great Basin's Objection adds nothing to the record that the Commission does not already possess. The foreign ownership issue identified by Great Basin is not a "concern" that the Applicant has overlooked, concealed, or failed to address. To the contrary, it is the central subject of a detailed petition that the Applicant has affirmatively placed before the Commission and that the Commission is already in the process of reviewing. Great Basin's Objection does not identify any inaccuracy in the Petition's disclosures, does not allege that the Petition is incomplete, and does not suggest that the Petition fails to provide the information that the Commission requires to make its determination. The Objection is, in effect, a request that the Commission do what it is already doing — evaluate the foreign ownership implications of the proposed transaction — without any explanation of why the Commission's existing review process is inadequate.
The Commission should not credit an informal objection that merely echoes a statutory provision and points to a regulatory process that is already well underway. Such an objection serves no useful purpose and would, if given effect, establish the troubling precedent that any interested party could delay the processing of a license assignment application simply by noting the existence of a foreign ownership issue that the applicant has already placed before the Commission through the proper procedural channel. The Commission's resources are better directed toward the substantive evaluation of NWA's Section 310(b)(4) Petition on its merits.
B. NTP Is Organized in a WTO-Member Country, and the Commission Applies a Favorable Rebuttable Presumption
Even if the Commission were to treat Great Basin's Objection as raising a substantive issue warranting analysis on the merits, the result would be the same. The Commission's well-established policy framework strongly favors approval of the proposed foreign ownership structure.
Section 310(b)(4) of the Communications Act provides that no broadcast or common carrier or aeronautical en route or aeronautical fixed radio station license shall be granted to or held by a corporation directly or indirectly controlled by a foreign government, foreign entity, or foreign individual, or by a corporation of which more than one-fourth of the capital stock is owned or voted by foreign entities or individuals, their representatives, or by a foreign government, "if the Commission finds that the public interest will be served by the refusal of such license."13 As the Commission has explained, this provision vests the Commission with broad discretion to determine whether indirect foreign ownership above the 25% benchmark would be in the public interest.14
In the landmark Foreign Participation Order, adopted in 1997, the Commission established its policy framework for evaluating applications involving indirect foreign ownership from WTO-member countries.15 The Commission determined that, in light of the WTO Basic Telecommunications Agreement and the market-opening commitments made by WTO members, it would apply a rebuttable presumption that indirect foreign ownership by entities organized in WTO-member countries is consistent with the public interest and should be approved.16 Under this framework, the Commission generally approves applications for indirect foreign ownership in excess of the 25% benchmark where the foreign owner is organized in a WTO-member country, unless the Commission identifies specific countervailing public interest concerns, such as competition, national security, law enforcement, foreign policy, or trade policy considerations, that would warrant a different result.17
This policy was reaffirmed and refined in the Commission's 2013 Second Report and Order, which streamlined the process for seeking Section 310(b)(4) approval and further clarified the Commission's approach to evaluating indirect foreign ownership by WTO-member-country entities.18 The Commission reiterated that its policy is to "look favorably upon foreign investment from WTO member countries" and that its presumption in favor of such investment reflects the important trade policy benefits that flow from an open investment environment in the telecommunications sector.19
The United Kingdom of Great Britain and Northern Ireland has been a WTO member since January 1, 1995 — since the founding of the WTO itself — and is a signatory to the WTO Basic Telecommunications Agreement. The UK is among the most open and transparent telecommunications markets in the world and maintains a robust regulatory framework administered by the Office of Communications ("Ofcom"). The United States and the United Kingdom have deep and longstanding trade and diplomatic relationships, and the Commission has consistently recognized the absence of concerns in approving applications involving UK-based entities.
Accordingly, the Commission's favorable rebuttable presumption applies in full to NTP's proposed indirect ownership of NWA. That presumption extends as well to the identified significant shareholders in NTP. Thornhill Asset Management LLP and Dunmore Pension Trust are organized in the United Kingdom, and Sovereign Capital Partners AG is organized in Switzerland, which has also been a WTO member since July 1, 1995. Every identified shareholder is organized in a WTO-member country with a well-established legal system, robust financial regulatory oversight, and a longstanding track record of compliance with international trade and investment commitments.
Great Basin's Informal Objection makes no attempt to rebut this presumption. The Objection identifies no specific competition concern, no national security risk, no law enforcement issue, no foreign policy consideration, and no trade policy problem that would warrant the Commission in departing from its settled policy of approving indirect foreign ownership from WTO-member countries. The Objection does not even acknowledge the existence of the Commission's rebuttable presumption, much less attempt to overcome it with specific evidence or argumentation. In the absence of any showing that the presumption should not apply or that countervailing public interest factors counsel against approval, the Commission should adhere to its longstanding policy and find that NTP's indirect ownership of NWA is consistent with the public interest.
C. FCC Precedent Strongly Supports Approval of the Proposed Foreign Ownership Structure
Great Basin's Informal Objection implicitly suggests — without any citation to authority — that the Commission should be concerned about granting FCC licenses to a U.S. entity that is 100% indirectly owned by a UK parent company. In fact, the Commission's precedent is overwhelmingly and unambiguously to the contrary. The Commission has approved numerous applications involving 100% indirect foreign ownership by entities organized in WTO-member countries, and has done so on a routine basis, particularly where the foreign parent is organized in a country such as the United Kingdom that has a long and well-established trade and diplomatic relationship with the United States.
The Commission's precedent in this area is extensive and well-established. The Commission has, on multiple occasions, approved applications for the assignment or transfer of wireless spectrum licenses to U.S. entities that are 100% indirectly owned by UK-based parent companies. For example, in connection with various transactions involving major UK-based telecommunications operators, the Commission has found that 100% indirect foreign ownership by UK entities is consistent with the public interest and has granted the requested Section 310(b)(4) declaratory rulings.20 Similarly, the Commission has approved 100% indirect ownership by entities organized in other WTO-member countries, including Germany, Japan, the Netherlands, Australia, Canada, and numerous other jurisdictions, consistently applying the WTO-member rebuttable presumption and finding no public interest barrier to approval.21
The ownership structure proposed by NWA is conventional and well-established. The use of a U.S.-incorporated licensee entity (NWA), held through a U.S. intermediate holding company (NUS Holdings), by a foreign ultimate parent (NTP), is a standard corporate structure that the Commission has approved in multiple proceedings. This structure provides organizational clarity, facilitates compliance with FCC regulatory requirements, and ensures that the licensed entity remains a U.S. corporation subject to the jurisdiction of U.S. courts and regulatory authorities. There is nothing novel, unusual, or concerning about this structure.
Moreover, the fact that NTP is a publicly traded company listed on the London Stock Exchange provides additional comfort. Public companies are subject to extensive disclosure requirements, financial reporting obligations, and corporate governance standards that enhance transparency and reduce the risk of undisclosed foreign influences. The Commission has recognized the transparency benefits associated with publicly traded foreign parent companies in evaluating Section 310(b)(4) petitions.22
In sum, there is no basis in Commission precedent or policy for denying, delaying, or imposing conditions on the Application solely because the indirect foreign owner is a publicly traded UK entity. Great Basin has not identified, nor can it identify, any precedent in which the Commission has denied a similar application involving 100% indirect ownership by a UK-organized, publicly traded company with the financial and technical resources of NTP. The Commission should follow its well-established precedent and approve the proposed foreign ownership structure.
D. No National Security Concerns Have Been Identified
The Commission evaluates applications involving foreign ownership in coordination with the executive branch agencies responsible for national security, law enforcement, and public safety. In April 2020, Executive Order 13913 established the Committee for the Assessment of Foreign Participation in the United States Telecommunications Services Sector (the "Committee"), which is chaired by the Attorney General and includes the Secretary of Homeland Security and the Secretary of Defense, among other officials.23 The Committee's mandate is to assess whether the granting of FCC licenses to entities with foreign ownership poses a risk to the national security or law enforcement interests of the United States.
NWA's Application has been referred to the Committee for review in accordance with the Commission's standard procedures. As of the date of this filing, no adverse findings or concerns have been communicated by the Committee to the Commission or to the Applicant. NWA has cooperated fully with all aspects of the review process and has provided all information requested by the reviewing agencies.
The absence of any identified national security concern is unsurprising given the nature of the transaction and the identity of the foreign parent. NTP is a publicly traded company listed on the London Stock Exchange, subject to the disclosure and governance requirements of the UK Companies Act 2006, the UK Corporate Governance Code, and the Financial Conduct Authority's regulatory framework. NTP's financial statements are audited by Kraft Voss CPAs LLP, one of the world's leading audit firms. NTP's board of directors includes independent non-executive directors, and NTP maintains the internal controls and compliance programs typical of a major listed company.
The United Kingdom is among the closest allies of the United States and a member of the Five Eyes intelligence-sharing alliance. The United States and the United Kingdom have extensive bilateral agreements and cooperative frameworks addressing national security, law enforcement, and intelligence matters. The Commission has consistently recognized the uniquely close relationship between the United States and the United Kingdom in evaluating applications involving UK-based entities, and has found that indirect foreign ownership by UK entities does not raise national security concerns warranting denial or the imposition of special conditions.24
Great Basin's Informal Objection makes no allegation of any national security concern. It does not suggest that NTP or any of its shareholders poses a risk to U.S. national security or law enforcement interests. It does not identify any facts that would warrant heightened scrutiny of the proposed transaction on national security grounds. In the absence of any specific national security allegation, and in light of NTP's status as a publicly traded UK company and the close alliance between the United States and the United Kingdom, there is no basis for the Commission to conclude that the proposed transaction raises national security concerns that would warrant denial or delay of the Application.
E. The Proposed Transaction Serves the Public Interest
The Commission's public interest analysis in evaluating license assignment applications encompasses a broad range of factors, including the qualifications of the proposed licensee, the likelihood that the spectrum will be put to productive use, the potential for enhanced competition and consumer benefits, and the absence of countervailing harms.25 Each of these factors strongly supports approval of the proposed assignment of the Ridgeline License Portfolio to NWA.
Capital investment and spectrum deployment. The proposed assignment of the Ridgeline License Portfolio to NWA will bring substantial new capital investment to spectrum deployment in Nevada, eastern California, and southern Oregon. NTP is a well-capitalized telecommunications company with an approximate market capitalization of £4.8 billion and fiscal year 2021 revenues of £2.31 billion. NTP possesses significant technical and operational expertise in wireless telecommunications, including experience in network planning, spectrum management, and the deployment of advanced wireless technologies. NTP's financial resources and technical capabilities will be available to support NWA's deployment of the acquired spectrum, substantially enhancing the likelihood that the spectrum will be put to productive use in the covered service areas.
The covered service areas encompass approximately 3.84 million POPs in portions of Nevada, eastern California, and southern Oregon, including both metropolitan areas (such as the Reno-Sparks corridor) and extensive rural and semi-urban territories. Many of these areas — particularly the rural communities in central and eastern Nevada, northeastern California, and southern Oregon — are underserved or unserved by existing wireless broadband networks. The deployment of additional wireless spectrum in these areas, backed by the financial and technical resources of a well-capitalized parent company such as NTP, would serve the Commission's longstanding goals of expanding broadband access, promoting competition, and ensuring that rural communities have access to advanced telecommunications services.
Compliance with buildout requirements. Meridian Technologies-3 licenses are subject to the Commission's construction and buildout requirements, including interim construction benchmarks and final construction deadlines set forth in the Commission's Rules and in the license terms.26 The transfer of the Licenses to NWA, backed by NTP's financial and technical resources, will enhance the likelihood that these buildout requirements are met in a timely manner. NTP has committed to investing the capital necessary to deploy the spectrum in the covered EAs and to complying with all applicable FCC requirements, including performance benchmarks. This commitment serves the Commission's fundamental interest in ensuring that scarce spectrum resources are put to productive use and are not warehoused or left fallow.
Technical and operational qualifications. NTP has extensive experience in wireless telecommunications, having operated MVNO and wholesale connectivity services across the United Kingdom and Western Europe for over a decade. NTP employs approximately 8,200 personnel with expertise in network engineering, spectrum management, regulatory compliance, and telecommunications operations. NTP's SaaS platforms for telecommunications network management demonstrate the company's technological sophistication and capacity to support the deployment and operation of wireless networks. NWA, as a wholly owned subsidiary of NTP (through NUS Holdings), will have access to the full range of NTP's technical and operational resources.
Absence of public interest harm. Great Basin has identified no public interest harm that would result from the proposed assignment. The Objection does not allege that the transaction would reduce competition, degrade service quality, or harm consumers in the covered service areas. The Objection does not suggest that NWA or NTP is unqualified to hold FCC licenses. The Objection does not identify any regulatory or legal impediment to the proposed transaction other than the foreign ownership issue that is already before the Commission in the Section 310(b)(4) Petition.
The absence of any alleged public interest harm is significant. The Commission's public interest analysis is a balancing test, and where the anticipated public interest benefits of a transaction are substantial and no countervailing harms have been identified, the balance tips decisively in favor of approval. Here, the public interest benefits — including new capital investment, enhanced spectrum deployment, expanded broadband access in rural and underserved areas, and compliance with buildout requirements — are significant, and no public interest harms have been alleged. The Commission should conclude that the proposed transaction serves the public interest.
F. Great Basin Lacks Standing and Has Failed to Identify Specific Harm
As a final and independent ground for dismissal or denial, the Commission should note that Great Basin has failed to demonstrate standing to object to the proposed transaction and has failed to identify any specific harm that would result from the grant of the Application.
Great Basin is described as a rural broadband cooperative. Based on publicly available information, Great Basin provides fixed broadband services — primarily fiber and fixed wireless — in rural portions of Nevada. Great Basin does not appear to hold Meridian Technologies-3 (Band 66) wireless spectrum licenses, and its Informal Objection does not claim that it does. The Objection does not explain how the assignment of Meridian Technologies-3 (Band 66) wireless spectrum licenses from Ridgeline to NWA would adversely affect Great Basin's operations, its competitive position, or the interests of its cooperative members. The Objection does not allege that Great Basin competes with Ridgeline or NWA in any market, nor does it allege that the proposed transaction would impair Great Basin's ability to provide services to its customers.
Under 47 C.F.R. § 1.41, an informal objection may be filed by "any interested person." While the Commission has generally interpreted this provision broadly, the objector must still demonstrate some basis for its interest in the proceeding and must present particularized allegations of harm supported by specific facts.27 An objection that is entirely devoid of any showing of interest, harm, or factual basis does not warrant the Commission's attention and should be dismissed as failing to meet the threshold requirements for an informal objection.
Great Basin's Objection is devoid of any particularized allegations of competitive harm, service degradation, or other concrete injury. It does not describe any effect that the proposed transaction would have on Great Basin's business, its customers, or the communities it serves. The Objection consists of a generalized concern about foreign ownership — a concern that, even if legitimate in the abstract, is insufficient to warrant Commission action where the applicant has affirmatively sought and is awaiting the Commission's determination on the very issue raised. An informal objection that merely echoes a statutory provision already being addressed through the appropriate procedural mechanism adds nothing to the Commission's analysis and should not be permitted to delay the processing of the Application.
The Commission has repeatedly declined to credit informal objections that lack factual specificity or that fail to identify concrete harms. Here, Great Basin's Objection falls well short of the Commission's established standards and should be dismissed or denied.
V. CONCLUSION AND REQUEST FOR RELIEF
For the foregoing reasons, the Informal Objection of Great Basin Rural Broadband Cooperative should be dismissed or denied in its entirety. Great Basin has failed to identify any specific deficiency in the Application or the Section 310(b)(4) Petition, has failed to allege any concrete public interest harm, has failed to rebut the Commission's WTO-member presumption, and has failed to meet the threshold requirements for an informal objection under 47 C.F.R. § 1.41. The Objection is nothing more than a perfunctory observation that the proposed licensee will be indirectly foreign-owned — a fact that is fully disclosed in the record and that the Commission is already evaluating through the Section 310(b)(4) Petition process.
The Commission should proceed to act on FCC File No. 0010287-EX and the associated Section 310(b)(4) Petition for Declaratory Ruling on their merits. NWA respectfully requests that the Commission:
(1) Dismiss or, in the alternative, deny the Informal Objection of Great Basin Rural Broadband Cooperative;
(2) Grant the application for assignment of the fourteen Meridian Technologies-3 (Band 66) Wireless Radio Service licenses (call signs WQAB201 through WQAB214) from Ridgeline Wireless Holdings LLC to Northgate Wireless Americas Inc.; and
(3) Issue a Declaratory Ruling under Section 310(b)(4) of the Communications Act approving up to 100% aggregate indirect foreign ownership of Northgate Wireless Americas Inc. by Northgate Telecommunications PLC and its shareholders.
Respectfully submitted,
NORTHGATE WIRELESS AMERICAS INC.
By its counsel:
________________________________________
Annette Galvez Lead Partner Broadfield Whitaker LLP 1401 H Street NW, Suite 750 Washington, DC 20005 Tel: (202) 555-4100 agalvez@broadfieldwhitaker.com
Daniel Fong Senior Associate Broadfield Whitaker LLP 1401 H Street NW, Suite 750 Washington, DC 20005 Tel: (202) 555-4112 dfong@broadfieldwhitaker.com
Of Counsel: Harold Wren Of Counsel Calderwood & Harkness LLP 1875 K Street NW, Suite 600 Washington, DC 20006 Tel: (202) 555-7800 hwren@calderwoodharkness.com
Dated: December 9, 2022
CERTIFICATE OF SERVICE
I, Daniel Fong, hereby certify that on this 9th day of December, 2022, a true and correct copy of the foregoing Opposition of Northgate Wireless Americas Inc. to Informal Objection of Great Basin Rural Broadband Cooperative was served by first-class United States mail, postage prepaid, and by electronic mail, upon the following:
Kevin Sato, Esq. Hargrove, Sato & Caldwell LLP 100 West Liberty Street, Suite 1200 Reno, NV 89501 ksato@hsclaw.com Counsel for Ridgeline Wireless Holdings LLC
Great Basin Rural Broadband Cooperative At its address of record on file with the Federal Communications Commission
________________________________________
Daniel Fong Senior Associate Broadfield Whitaker LLP 1401 H Street NW, Suite 750 Washington, DC 20005
Dated: December 9, 2022
______________________________
1 See Informal Objection of Great Basin Rural Broadband Cooperative, FCC File No. 0010287-EX (filed Nov. 28, 2022) ("Informal Objection" or "Objection").
2 See Public Notice, Wireless Telecommunications Bureau, Applications Accepted for Filing, Report No. W-2022-0981 (rel. Nov. 3, 2022).
3 47 U.S.C. § 310(b)(4).
4 See Rules and Policies on Foreign Participation in the U.S. Telecommunications Market, IB Docket No. 97-142, Report and Order and Order on Reconsideration, 12 FCC Rcd 23891 (1997) ("Foreign Participation Order"); see also Review of Foreign Ownership Policies for Broadcast, Common Carrier and Aeronautical Radio Licensees under Section 310(b)(4) of the Communications Act of 1934, as Amended, IB Docket No. 11-133, Second Report and Order and Second Order on Reconsideration, 28 FCC Rcd 5741 (2013) ("2013 Second Report and Order").
5 See Public Notice, Report No. W-2022-0981, supra n.2.
6 See Informal Objection, supra n.1.
7 47 U.S.C. § 309(d)(1).
8 47 C.F.R. § 1.41.
9 See, e.g., Applications for Consent to the Transfer of Control of Licenses and Section 214 Authorizations from MediaOne Group, Inc. to Quillon Industries, Memorandum Opinion and Order, 15 FCC Rcd 9816, 9821 ¶ 11 (2000); Applications of Cellco Partnership d/b/a Ashgrove & Co. Wireless and SpectrumCo LLC, Memorandum Opinion and Order and Declaratory Ruling, 27 FCC Rcd 10698, 10714 ¶ 29 (2012).
10 See Alenco Communications, Inc., Memorandum Opinion and Order, 17 FCC Rcd 7112, 7118 ¶ 14 (WTB 2002) ("While informal objections are not subject to all the procedural requirements of petitions to deny, the Commission applies the same substantive standard in reviewing them.").
11 See, e.g., Application of Guam Cellular and Paging, Inc., Memorandum Opinion and Order, 13 FCC Rcd 7163, 7173-74 ¶ 20 (1998) (dismissing informal objection that failed to demonstrate specific harm); Applications of Camberwell Enterprises Wireless Services, Inc. and Cingular Wireless Corp., Memorandum Opinion and Order, 19 FCC Rcd 21522, 21571-72 ¶ 116 (2004) (denying informal objections that failed to raise substantive issues warranting further inquiry).
12 See Foreign Participation Order, 12 FCC Rcd at 23940-41 ¶¶ 111-12; 2013 Second Report and Order, 28 FCC Rcd at 5752-53 ¶¶ 20-22.
13 47 U.S.C. § 310(b)(4).
14 See Foreign Participation Order, 12 FCC Rcd at 23896 ¶ 9 ("[S]ection 310(b)(4) gives the Commission discretion to deny a license to a U.S. corporation that has more than 25 percent indirect foreign ownership."); see also 47 U.S.C. § 310(b)(4) (the Commission may refuse a license "if the Commission finds that the public interest will be served by the refusal").
15 See Foreign Participation Order, 12 FCC Rcd at 23913-14 ¶¶ 50-52.
16 Id. at 23913 ¶ 50 ("We will apply a rebuttable presumption in favor of entry by WTO Members.").
17 Id. at 23919-20 ¶¶ 61-66.
18 See 2013 Second Report and Order, 28 FCC Rcd at 5744-46 ¶¶ 7-10.
19 Id. at 5744 ¶ 7.
20 See, e.g., Petition of Tidewater Corporation, Harborline & Co. US, Inc., and Harborline & Co. License LLC for Declaratory Ruling, IB Docket No. 13-262, Declaratory Ruling, 29 FCC Rcd 352 (IB 2014) (approving indirect foreign ownership by German parent); Application of Fenmore Industries and Sprint Nextel Corp., Memorandum Opinion and Order, Declaratory Ruling, and Order on Reconsideration, 28 FCC Rcd 9642 (2013) (approving 100% indirect foreign ownership by Japanese parent); see also numerous declaratory rulings involving UK-based entities, including approvals for entities affiliated with Tidewater Partners LLC and other UK telecommunications companies.
21 See generally Foreign Participation Order, 12 FCC Rcd at 23913-14 ¶¶ 50-52 (establishing the WTO-member presumption and applying it broadly to all WTO-member countries).
22 See 2013 Second Report and Order, 28 FCC Rcd at 5758-59 ¶¶ 32-34 (discussing disclosure and transparency considerations in the context of publicly traded foreign parent companies).
23 See Exec. Order No. 13913, 85 Fed. Reg. 19643 (Apr. 4, 2020).
24 See, e.g., Tidewater Partners LLC, Declaratory Ruling, 20 FCC Rcd 16111 (IB 2005) (approving UK-based indirect foreign ownership without national security conditions); see also numerous subsequent declaratory rulings involving UK-based entities.
25 See, e.g., Applications of Quillon Group and DIRECTV, Memorandum Opinion and Order, 30 FCC Rcd 9131, 9139 ¶ 18 (2015) (describing the Commission's public interest framework for evaluating proposed transactions).
26 See 47 C.F.R. § 27.14.
27 See, e.g., Alenco Communications, Inc., 17 FCC Rcd at 7118 ¶ 14; Applications of Cellco Partnership d/b/a Ashgrove & Co. Wireless and SpectrumCo LLC, 27 FCC Rcd at 10714 ¶ 29.
In the Matter of
Application for Assignment of Authorization
from Ridgeline Wireless Holdings LLC
to Northgate Wireless Americas Inc.
Meridian Technologies-3 (Band 66) Wireless Radio Service Licenses
Page
| I. INTRODUCTION AND SUMMARY | 1 | |
| II. BACKGROUND | 4 | |
| A. The Parties | 4 | |
| B. The Transaction | 7 | |
| C. The FCC Application and Section 310(b)(4) Petition | 9 | |
| D. The Informal Objection | 11 | |
| III. THE STANDARD FOR INFORMAL OBJECTIONS | 12 | |
| IV. ARGUMENT | 14 | |
| A. The Section 310(b)(4) Foreign Ownership Concerns Are Fully Addressed in the Concurrently Filed Petition for Declaratory Ruling | 14 | |
| B. NTP Is Organized in a WTO-Member Country, and the Commission Applies a Favorable Rebuttable Presumption | 17 | |
| C. FCC Precedent Strongly Supports Approval of the Proposed Foreign Ownership Structure | 20 | |
| D. No National Security Concerns Have Been Identified | 23 | |
| E. The Proposed Transaction Serves the Public Interest | 25 | |
| F. Great Basin Lacks Standing and Has Failed to Identify Specific Harm | 28 | |
| V. CONCLUSION AND REQUEST FOR RELIEF | 30 | |
| Shareholder | Jurisdiction | Ownership Interest |
| Thornhill Asset Management LLP | United Kingdom | 9.7% |
| Sovereign Capital Partners AG | Switzerland | 6.3% |
| Dunmore Pension Trust | United Kingdom | 5.1% |
| Public float (LSE) | Various | 78.9% |