Baker Outlines Framework For Merger Review Overhaul

Says FCC should set timetable and limiting principles so process will not chill investment
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FCC Commissioner Meredith Attwell Baker Wednesday said
the FCC should set a timetable and limiting principles for merger
reviews so the process will not chill investment.

Baker, one of two Republicans on the Five-member
commission, says the FCC should enforce its 180-day shot clock on
vetting industry mergers, should make it clear merger conditions have to be
truly merger-specific rather than general policy in conditions' clothing or the
FCC equivalent of earmarks for public interest groups, and consider whether to
get rid of the dual-review system that has both the FCC and either Justice or
the Federal Trade Commission reviewing the same merger.

That came in a speech to the Institute for Policy Innovation
Communications summit
Wednesday in Washington,
according to a copy provided by Baker's office.

She opined that revising merger review processes was not
part of FCC Chairman Julius Genachowski's ongoing institutional
reforms. To date, our merger review rules have been missing from that broader
review.

She would like to see that change to answer three main
questions, which are should mergers be subject to dual reviews, do the reviews
take longer than necessary, and do adopting wide-ranging conditions serve the
public interest. She did not definitively answer the first question, but
suggested the dual review was duplicative and that the FCC's role of approving
license transferred had "morphed into a full-fledged merger review: 
similar to, but not identical to, the antitrust review." She said the FCC
should "We should work with Congress to help evaluate whether this dual
review structure as currently configured remains the best use of limited
government resources in this era of tightening budgets."

Her answer to the issue of mergers taking too long was more
definitive. She said the FCC should start enforcing its 180-day shot clock,
which is currently only voluntary and frequently exceeded. "Moving
forward, we should either retire the shot clock or actually enforce it. The
only choice-in my view-is to enforce it.  A fixed timetable is critical to
providing applicants and interested parties the certainty needed to invest, and
the current structure simply takes too long. "

She had plenty to say about the conditions the FCC imposed
in the Comcast/NBCU merger and others. She said there needed to be common sense
limits.

For example, she said that while she applauded Comcast for
agreeing to deploy broadband as a voluntary condition, she did not see how that
was merger-specific. She also did not see how that was voluntary. She said the
FCC's first step in reforming its merger condition process would be to stop
advertising them as voluntary. "Using the leverage of a merger denial or
merger delay to extract concessions from the applicants cannot fairly be
characterized as a voluntary process.  They should simply be called
conditions. "

Her other suggestions included setting up ground rules for
conditions, which include rebuttable presumptions against conditions that: 1)
adversely affect the rights of third parties, 2) deal with matters subject to
an active rulemaking (network neutrality, for example), 3) are based on
"Speculative future harms," or that are not within the FCC's statutory
authority. "We should not do through condition what we could not do
through rulemaking," she said.

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