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FCC’s Pai calls AT&T merger conditions a “regulatory wish-list”

FCC Commissioner Ajit Pai (R)

FCC commissioner Ajit Pai didn’t mince words in his dissent of the agency’s conditions on the AT&T-DirecTV merger, accusing the agency of ignoring its own authority to gain more control over the Internet and of imposing conditions that set a dangerous precedent.

The FCC gave its final approval of the $48.5 billion deal Friday once all five commissioners voted. FCC chairman Tom Wheeler and the two Democratic commissioners cast votes in favor of the merger and its conditions. Pai dissented in part. His Republican colleague, Mike O’Rielly, concurred in part.

Calling the conditions “a regulatory wish-list that has nothing to do with the transaction at hand,” Pai accused the agency of using the merger process to set policy.

That’s a criticism often leveled at the FCC by GOP lawmakers. And Pai’s objections will likely be one of many salvos launched at the FCC during an oversight hearing Tuesday before the House communications and technology subcommittee when Pai will face off with chairman Tom Wheeler.

While the FCC was careful to say it would forbear from rate regulation when it passed its open Internet order in February, Pai accuses the agency of doing just that when it required AT&T to offer “qualifying households” wireline broadband service at a specific speed at a specific price.

“There is a name for that. It is called rate regulation,” Pai wrote, warning that the FCC’s condition “is merely a preview of coming attractions.”

Another condition that Pai said goes against prior-stated FCC policy is the condition requiring AT&T to submit to the FCC every interconnection agreement for the next four years.

“It has been said that the commission’s Title II order makes the FCC the referee on the field, ready to throw the flag whenever a broadband service provider does something that it doesn’t like. This condition goes beyond that and injects the FCC into the huddle, monitoring a team’s play calling,” Pai wrote.

Pai called the two required independent compliance officers for AT&T “a dangerous precedent, a “pernicious intrusion into the affairs of private business and a dramatic expansion of the commissioner’s authority.”

“There is no justification for the commission to adopt this extraordinary condition…. I have little doubt that when we consider future transactions, there will be calls for future applicants to accept independent compliance officers as a condition of approval.”

And finally, like O’Rielly, Pai has concerns about a process that took 408 days.

“To state the obvious, this matter has taken far too long to resolve and has made a joke of the commission’s 180-day shot clock,” Pai wrote.