Audacy Asks FCC to Raise Foreign Ownership Cap Amid GOP Flak

Days after FCC Chairwoman Jessica Rosenworcel addressed GOP concerns about foreign ownership in Audacy following the company’s Chapter 11 restructuring, the broadcaster has filed a petition requesting an increase in its foreign ownership cap to 49.99%.

In a petition for declaratory ruling filed October 29, Audacy seeks the FCC’s permission to allow foreign individuals and entities to hold up to 49.99% of Audacy’s equity and voting interests, exceeding the standard 25% threshold outlined in the Communications Act and obtain specific approval for a group of non-US entities that collectively hold an equity interest exceeding 5% in the company.

Upon exercising these special warrants, foreign individuals and entities are expected to hold approximately 27.2% of Audacy’s equity and 31.4% of its voting interests.

Importantly, Audacy notes that Laurel Tree Opportunities Corporation, which is US-based and owned, will remain its single majority shareholder. The foreign equity holders for whom specific approval is sought are entirely unrelated to Laurel Tree.

This filing comes directly following earlier concerns expressed by Republican lawmakers over Laurel Tree, which is indirectly connected to billionaire Democratic donor George Soros’s Fund for Policy Reform. Republican legislators questioned the FCC’s review process, especially given the proximity to the 2024 elections and potential foreign influence.

While the current foreign ownership request does not involve Soros or Laurel Tree, it could renew scrutiny over the restructuring. Audacy argues that granting the petition is in the public interest. By increasing the foreign ownership cap the company can access a broader pool of capital, enhancing its ability to invest in programming and compete effectively in the media marketplace.

It would also align with FCC precedents where other broadcasters have been permitted to exceed the 25% threshold, recognizing the benefits of foreign investment under certain conditions. Audacy assures that the foreign investors in question will not have the ability to influence programming decisions or access sensitive information, addressing potential national security and law enforcement concerns.

Now the FCC will review Audacy’s petition, considering both the potential benefits of increased foreign investment and the legislative concerns previously raised. Stakeholders and legislators will be monitoring the situation closely, mindful of these political sensitivities.