February 22, 2022
Last week the Federal Communications Commission (FCC) issued a Report and Order that affects many contracts with cable/communications providers for multi-tenant properties, including apartments, public housing, condos, coops, trailer parks, shopping centers, and commercial multi-tenant environments (MTEs).
The FCC adopted a Report and Order and Declaratory Ruling aimed at providing competitive choice of communications and cable services for those living and working in MTEs. While the FCC and Order regulates providers and not owners/operators of MTEs, this may impact contracts with cable/communications providers for services to such MTEs.
The Order is limited to three actions:
1. Adopts new rules prohibiting providers from enforcing certain types of revenue sharing agreements.
2. Adopts new rules requiring providers to disclose the existence of exclusive marketing arrangements.
3. Clarifies that existing Commission rules regarding cable inside wiring prohibit so-called "sale-and-leaseback" arrangements, which effectively deny access to alternative providers.
For new contracts, the new rules and the declaratory ruling take effect 30 days after publication in the Federal Register. For existing contracts with exclusive and graduated revenue sharing agreements, compliance with the prohibition on enforcing such provisions will be required 180 days after publication in the Federal Register to allow providers and MTE owners an opportunity to renegotiate such provisions, if necessary. Additionally, the Commission will not enforce compliance with the disclosure requirement for existing exclusive marketing arrangements until the later of (1) the Office of Management and Budget completing its review of the new requirements pursuant to the paperwork Reduction Act, or (2) 180 days after publication in the Federal Register. The FCC will issue a public notice when such disclosure rules become effective.
It may be necessary to evaluate existing agreements and new agreements going forward in light of this Order. If you have any questions, please do not hesitate to contact Gary Resnick at Gary.Resnick@gray-robinson.com or via phone at 954-761-7478