Start Planning Broadcast Transactions Around The License Renewal Processing Periods - Or Expect Closing Delays

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With only four and a half months until the start of the first radio license renewal cycle, broadcasters need to start to consider the processing time for license renewal applications and its implications - particularly if they are considering the purchase or sale of the station with a license renewal due in the near future. The FCC has a processing policy that, in most cases, will forbid the closing of the sale of a broadcast station once the license renewal for that station has been filed - delaying any closing until the renewal has been granted . Given that routine processing of a license renewal will take an absolute minimum of 90 days, and the processing can take much longer if there is a protest or other problem, closing of a contract for the sale of a broadcast station which is signed too close to the license renewal filing may be significantly delayed by the license renewal process. Parties need to plan for such delays.

As we wrote several months ago, the first set of license renewals are to be filed on or before June 1 of this year - for radio stations in Virginia, West Virginia, Maryland and the District of Columbia. Owners planning a station sale in those states should be looking to finalize any deal have any plans to sell their station in the very near future to allow for the processing time necessary to get an FCC application approved and the transaction closed before the renewal is filed. For instance, if a seller is thinking of selling his or her station in one of these states, and is in the process of negotiating a contract right now, the process contract would need to be completed very soon, and processing would need to run without a hitch, for a closing after "finality" of the FCC approval of the transaction to be possible before the renewal is granted. Otherwise, the parties will need to be willing to wait until at least September to close. To demonstrate, here is the likely timeline for an application for the sale of a station if the contract was signed by February 1, and an FCC application was filed by February 4. The application would likely be on an FCC public notice late in the second week of February, triggering the required 30 day public comment period. The end of the public comment period would be in mid-March, most likely putting an FCC grant in late March - if the application was uncontested, non-controversial and otherwise processed quickly by the FCC. That would put finality (40 days after the public notice of the initial staff grant of the application, assuming no petitions for reconsideration of the grant, other appeals, or decisions by the FCC Commissioners to review the application) in mid-May.

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