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TerreStar Networks Inc

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Released: December 23, 2009

Federal Communications Commission

DA 09-2628

Before the

Federal Communications Commission

Washington, D.C. 20554

In the Matter of
)
)

TerreStar Networks Inc.
)
File No. ISP-PDR-20080229-00004
)
Petition for Declaratory Ruling Under Section
)
310(b) (4) of the Communications Act of 1934, as )
amended
)

ORDER AND DECLARATORY RULING

Adopted: December 23, 2009

Released: December 23, 2009

By the Chief, International Bureau:

I.

INTRODUCTION

1.
In this Order and Declaratory Ruling, we consider a petition for declaratory ruling
(“Petition”) filed by TerreStar Networks, Inc. (“TerreStar” or “Petitioner”) pursuant to section 310(b)(4)
of the Communications Act of 1934, as amended (the “Act”), to permit TerreStar to have indirect foreign
equity and voting interests above the 25 percent benchmark set forth in section 310(b)(4) of the Act.1 As
discussed below, we find that the public interest would not be served by prohibiting indirect foreign
ownership of TerreStar in excess of the 25 percent benchmark in section 310(b)(4) of the Act, and
therefore grant the Petition, subject to the conditions specified in this Order and Declaratory Ruling.

II.

BACKGROUND

A.

The Petitioner

2.
TerreStar, a Delaware corporation, holds a non-common carrier license that permits it to
operate fixed earth stations in the provision of fixed satellite service.2 On December 5, 2006, TerreStar


1 47 U.S.C. § 310(b)(4). TerreStar Networks Inc., Petition for Declaratory Ruling Pursuant to Section 310(b)(4) of
the Communications Act of 1934, as amended, File No. ISP-PDR-20080229-00004 (dated Feb. 29, 2008)
(“Petition”); see also TerreStar Networks, Inc., Supplement to Petition for Declaratory Ruling (dated July 7, 2009)
(“July 7, 2009 Supplement”); Supplement to Petition for Declaratory Ruling (dated Aug. 21, 2009) (“August 21,
2009 Supplement”); Partial Withdrawal of Supplement to Petition for Declaratory Ruling (dated Aug. 31, 2009);
Submission of Information Requested by International Bureau Staff (dated Oct. 16, 2009); Submission of
Information Requested by International Bureau Staff (dated Oct. 27, 2009) (“October 27, 2009 Supplement”); and
Letter from Joseph A. Godles, Counsel to TerreStar Networks, Inc., to Marlene H. Dortch, Secretary, FCC (dated
Dec. 3, 2009).
2 See Satellite Communications Services Information Re: Actions Taken, Public Notice, Report No. SES-01087
(Int'l Bur., Nov. 19, 2008) (granting SES-LIC-20070530-000732, effective Nov. 13, 2008). TerreStar also holds
grants of Special Temporary Authority for its earth station license. See File Nos. SES-STA-20090625-00794 and
SES-STA-20090728-00927. On September 30, 2009, the Commission granted TerreStar’s application for consent
to a pro forma transfer of control of its earth station license, SES-T/C-20090925-01237. See Satellite
(continued….)

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DA 09-2628

filed an application seeking blanket authority to operate, on a common carrier basis, up to 2 million
portable handset mobile earth terminals (“METS Application”) to communicate with the TerreStar-1
mobile satellite.3 The METS Application was amended to include (1) a request for authority to operate,
on a common carrier basis, an Ancillary Terrestrial Component (“ATC”) in connection with its 2 GHz
mobile satellite service station (“METS/ATC Application”),4 and (2) a petition for a declaratory ruling to
permit TerreStar to have indirect foreign equity and voting interests above the 25 percent benchmark in
section 310(b)(4) of the Act.5 TerreStar filed supplemental ownership information to its Petition for
declaratory ruling on July 7, 2009, August 21, 2009, August 31, 2009, October 16, 2009, and October 27,
2009.6 The METS/ATC Application is pending before the Commission.

B.

Public Notice and Comments

3.
The Petition was placed on public notice on March 13, 2008.7 A Petition to Deny was
filed by Sprint Nextel Corporation on April 10, 2008 (“Sprint Petition”),8 followed by TerreStar’s
Opposition to the Petition to Deny, filed on April 23, 2008 (“TerreStar Opposition”),9 and Sprint Nextel’s
(Continued from previous page)


Communications Services Information Re: Actions Taken, Public Notice, Report No. SES-01181 (Int’l Bur., Oct. 7,
2009) (granting SES-T/C-20090925-01237, effective Sep. 30, 2009).
3 See Satellite Communications Services Information Re: Accepted for Filing, Public Notice, Report No. SES-00931
(Int’l Bur., May 30, 2007). TerreStar-1, owned by and licensed to TerreStar Networks Canada, an affiliated
Canadian company, is a geostationary orbit satellite that operates on 2 GHz frequencies. TerreStar holds a Letter of
Intent (LOI) authorization, originally granted to TMI Communications and Company, Limited Partnership in 2001,
to provide mobile satellite services in the United States using spectrum in the 2 GHz band via TerreStar-1. See TMI
Communications and Company, Limited Partnership, and TerreStar Networks, LLC Application for Modification of
Spectrum Reservation for 2 GHz Mobile Satellite Service System,
Order, 22 FCC Rcd 8602 (Int’l Bur. 2007); TMI
Communications and Company, Limited Partnership Letter of Intent to Provide Mobile-Satellite Service in the 2
GHz Bands,
Order, 16 FCC Rcd 13808 (Int’l Bur. 2001); TMI Communications and Company, Limited Partnership,
and TerreStar Networks Inc. Application for Review and Request for Stay,
Memorandum Opinion and Order, 19
FCC Rcd 12603 (2004).
4 See Satellite Communications Services Information Re: Actions Taken, Public Notice, Report No. SES-01037 (Int’l
Bur., May 28, 2008) (correcting SES-AMD-20070723-00978, effective May 20, 2008). According to TerreStar, the
ancillary terrestrial component (ATC) of the TerreStar Corporation (“TerreStar Corp.”) network is designed to
enable uninterrupted mobile communications in areas where satellite reception is difficult, allowing its customers to
use mobile terminals to access both satellite and terrestrial infrastructure in the United States. See TerreStar
Networks Inc., Application for 2 GHz band Mobile Earth Terminal Blanket License, Amendment at 5-6 (filed Sept.
7, 2007).
5 TerreStar filed the Petition as an amendment to the METS Application, stating that changes in foreign ownership
have occurred since the METS application was filed. See Petition at 4. See also Letter from Joseph A. Godles,
counsel for TerreStar, to Marlene H. Dortch, FCC (dated July 13, 2007) (notifying the Commission that foreign
ownership of TerreStar’s parent, TerreStar Corp., may be in excess of 25 percent).
6 TerreStar filed supplemental ownership information in response to inquiries by International Bureau staff.
TerreStar’s most recent filing, dated October 27, 2009, is a spreadsheet containing detailed ownership information
for TerreStar Corp.’s voting, common stock and non-voting, preferred stock. This submission supplements and
clarifies the ownership information that TerreStar provided in the July 7, 2009 Supplement and August 21, 2009
Supplement.
7 See Non Streamlined International Applications/Petitions Accepted for Filing, Public Notice, Report No. TEL-
01245NS (Int’l Bur., Mar. 13, 2008).
8 See Sprint Nextel Corporation Petition to Deny (filed Apr. 10, 2008) (“Sprint Petition”).
9 See TerreStar Opposition to Sprint Petition (filed Apr. 23, 2008) (“TerreStar Opposition”).
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DA 09-2628

Reply to TerreStar’s Opposition filed May 5, 2008 (“Sprint Reply”).10 An Agreement dated December
18, 2009, was entered into between TerreStar Corporation, TerreStar Networks Inc. and all of their
affiliates and subsidiaries (collectively “TerreStar”) and the U.S. Department of Justice (“DOJ”), and the
U.S. Department of Homeland Security (“DHS”, collectively, “the Government Parties”).11

III. DISCUSSION

A.

Ownership Structure of TerreStar

4.
TerreStar is majority owned (88.4%) and controlled by TerreStar Corporation (“TerreStar
Corp.”), a publicly traded Delaware corporation.12 TerreStar Corp. holds its indirect ownership interest in
TerreStar through TerreStar Corp.’s wholly-owned subsidiary, Motient Ventures Holding Inc. (“MVHI”),
which is also organized in Delaware.13 The remaining ownership interests in TerreStar (11.6%) are held
as follows: (1) SkyTerra Investors LLC, formerly MSV Investors LLC (“SkyTerra Investors”) (11.1%),
(2) Continental Casualty Company (0.3%), and (3) Andy Africk (0.1%).14 The sole member of SkyTerra
Investors is SkyTerra Communications, Inc., a publicly traded Delaware corporation.15 Continental
Casualty Company is headquartered in Chicago, Illinois, and Andy Africk is a U.S. citizen.16
5.
TerreStar states that no individual or group of individuals has de jure or de facto control
of TerreStar Corp.17 According to TerreStar, TerreStar Corp.’s largest shareholders are EchoStar
Corporation (“EchoStar”) (21.55% voting and 16.41% equity interest) and two Harbinger Capital Partners
Funds (the “Harbinger Funds”) (in the aggregate, 32.16% voting and 43.58% equity interest).18 TerreStar


10 See Sprint Nextel Reply to TerreStar Opposition (filed May 5, 2009) (“Sprint Reply”). See also Letter from Trey
Hanbury, Director, Government Affairs, Sprint Nextel Corporation, to Marlene H. Dortch, Secretary, FCC (filed
May 13, 2008) (detailing ex parte meeting between Sprint Nextel and International Bureau staff on May 12, 2008).
11 U.S. Department of Justice and the Department of Homeland Security, Agreement on Petition for Declaratory
Ruling (dated December 18, 2009) (“Agreement”). The Agreement is attached to this Order and Declaratory
Ruling
as Appendix B.
12 See Petition at 3; July 7, 2009 Supplement at Exhibit 1, Response to Question 3.
13 See July 7, 2009 Supplement at 1. On September 30, 2009, the Commission granted its consent to the pro forma
transfer of control of TerreStar’s gateway license located in North Las Vegas, Nevada. By letter dated November
20, 2009, TerreStar requested an extension of time to consummate the pro forma transfer of control from November
29, 2009, through December 31, 2009. Upon consummation, two new holding companies, wholly owned by
TerreStar Corp., will be inserted into the organizational structure between TerreStar Corporation and Motient
Ventures Holding Inc. “(MVHI”). The two new holding companies, TerreStar Holdings Inc. and MVH Holdings
Inc., are both incorporated in the state of Delaware. An updated organizational chart showing TerreStar’s post
consummation organizational structure is attached to this Order and Declaratory Ruling as Appendix A.
14 Id. at Exhibit 1, Response to Question 3.
15 See July 7, 2009 Supplement at Exhibit 1, Response to Question 3.
16 See July 7, 2009 Supplement at Exhibit 1.
17 See July 7, 2009 Supplement at Exhibit 1, Response to Question 5. According to TerreStar, TerreStar Corp.’s
shareholders do not have any shareholder agreements addressing the election of directors or other matters voted
upon by shareholders. Id.
18 See August 21, 2009 Supplement, Response to Question 4; July 7, 2009 Supplement at 8. The Harbinger Funds
consist of Harbinger Capital Partners Master Fund I, Ltd. and Harbinger Capital Partners Special Situations Fund,
L.P. July 7, 2009 Supplement at 8 n.15. We note that since this filing, the ownership percentages have changed.
See infra ¶¶ 14-18.
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DA 09-2628

Corp. has an eight person board of directors. No shareholder of TerreStar Corp. has the right to designate
board members, but EchoStar, as the holder of the sole share of Series C preferred stock, has the right to
nominate two directors, and Harbinger Capital Partners Master Fund I, Ltd., as the holder of the sole
share of Series D preferred stock, also has the right to nominate two directors.19

B.

Section 310 Foreign Ownership Review

6.
TerreStar requests a declaratory ruling that the public interest would be served by
permitting it to have indirect foreign equity and voting interests above the 25 percent benchmark set forth
in section 310(b)(4) of the Act.20 In addition, TerreStar requests approval to have up to and including an
additional aggregate 25 percent indirect equity and/or voting interests from foreign individuals or entities
without seeking further Commission approval under section 310(b)(4).21 For the reasons stated below, we
find that the public interest would not be served by prohibiting indirect foreign ownership of TerreStar in
excess of 25 percent, subject to certain conditions.
1.

Legal Standard for Foreign Ownership of Radio Licensees

7.
We review the foreign ownership of TerreStar under section 310(b)(4) of the Act and the
Commission’s foreign ownership policies adopted in the Foreign Participation Order.22 As part of our
foreign ownership analysis, we consider any national security, law enforcement, foreign policy, or trade
policy concerns raised by the foreign investment.23 Relying on Commission precedent, we find that the
ownership of TerreStar does not raise any issues under section 310(a) or 310(b)(1)-(3) of the Act.24 Our
analysis focuses on issues raised under section 310(b)(4).


19 See July 7, 2009 Supplement at Exhibit 1, Response to Question 5. Two individuals who were nominated by
EchoStar Corporation (“EchoStar”) have been elected and serve on TerreStar Corp.’s board of directors. Two
individuals who were nominated by Harbinger Capital Partners Master Fund I, Ltd. (“Harbinger Master Fund”) have
been elected and serve on TerreStar Corp.’s board of directors.
20 47 U.S.C. § 310(b)(4).
21 See Petition at 1.
22 47 U.S.C. § 310(b)(4); Rules and Policies on Foreign Participation Order in the U.S. Telecommunications
Market
, IB Docket Nos. 97-142, 95-22, Report and Order and Order on Reconsideration, FCC 97-398, 12 FCC Rcd
23891 (1997) (“Foreign Participation Order”), Order on Reconsideration, FCC 00-339, 15 FCC Rcd 18158 (2000).
23 See Foreign Participation Order, 12 FCC Rcd at 23918-21, ¶¶ 59-66. In assessing the public interest, we
consider the record and accord the appropriate level of deference to Executive Branch expertise on these issues. See
id.

24 Section 310(a) of the Act prohibits any radio license from being “granted to or held by” a foreign government or
its representative. 47 U.S.C. § 310(a). In this case, no foreign government or its representative will hold the subject
radio licenses. Section 310(b)(1)-(2) of the Act prohibits common carrier, broadcast and aeronautical fixed or
aeronautical en route radio licenses from being “granted to or held by” aliens, or their representatives, or foreign
corporations. 47 U.S.C. § 310(b)(1)-(2). We find that no alien, representative, or foreign corporation will hold the
common carrier radio licenses in this case. Accordingly, we find that proposed transaction is not inconsistent with
the foreign ownership provisions of section 310(a) or 310(b)(1)-(2) of the Act. See Applications of VoiceStream
Wireless Corp., Powertel, Inc., Transferors, and Deutsche Telekom AG, Transferee
, IB Docket No. 00-187,
Memorandum Opinion and Order, 16 FCC Rcd 9779, 9804-9809, ¶¶ 38-48. Additionally, because the foreign
investment in TerreStar is held through its direct and indirect controlling U.S. parent companies, issuance of a
common carrier radio license to TerreStar would not trigger section 310(b)(3) of the Act, which places a 20% limit
on alien, foreign corporate or foreign government ownership of entities that themselves hold common carrier,
broadcast and aeronautical fixed or aeronautical en route Title III licenses. Compare 47 U.S.C. § 310(b)(3) with §
310(b)(4). See Request for Declaratory Ruling Concerning the Citizenship Requirements of Sections 310(b)(3) and
(continued….)
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8.
Section 310(b)(4) of Act establishes a 25 percent benchmark for investment by foreign
individuals, corporations, and governments in U.S.-organized entities that control U.S. common carrier
radio licensees. This section also grants the Commission discretion to allow higher levels of foreign
ownership if it determines that such ownership is not inconsistent with the public interest.25 The presence
of aggregated alien equity or voting interests in a common carrier licensee’s U.S. parent in excess of 25
percent triggers the applicability of section 310(b)(4)’s statutory benchmark.26 Once the benchmark is
triggered, section 310(b)(4) directs the Commission to determine whether the “public interest will be
served by the refusal or revocation of such license.”27
9.
In the Foreign Participation Order, the Commission concluded that the public interest
would be served by permitting greater investment by individuals or entities from World Trade
Organization (“WTO”) Member countries in U.S. common carrier and aeronautical fixed and aeronautical
en route radio licensees.28 Therefore, with respect to indirect foreign investment from WTO Members,
the Commission adopted a rebuttable presumption that such investment generally raises no competitive
concerns.29 In evaluating requests for approval of foreign ownership interests under section 310(b)(4), the
Commission uses a “principal place of business” test to determine the nationality or “home market” of
foreign investors.30
10.
In light of Commission policies adopted in the Foreign Participation Order, we begin
our evaluation of the indirect foreign ownership of TerreStar under section 310(b)(4) by calculating the
foreign voting and equity interests that are held in its indirect U.S. parent company, TerreStar Corp. We
then determine whether these foreign interests properly are ascribed to individuals or entities that are
(Continued from previous page)


(4) of the Communications Act of 1934, as amended, Declaratory Ruling, 103 F.C.C. 2d 511 (1985) (“Wilner &
Scheiner I
”), recon. in part, 1 FCC Rcd 12 (1986).
25 47 U.S.C. § 310(b)(4). The calculation of foreign ownership interests under section 310(b)(4) is a two-pronged
analysis in which the Commission examines separately the equity interests and the voting interests in the licensee’s
direct or indirect parent. See BBC License Subsidiary L.P., Memorandum Opinion and Order, 10 FCC Rcd 10968,
10973, ¶ 22 (1995) (“BBC License Subsidiary”). The Commission calculates the equity interest of each foreign
investor in the parent and then aggregates these interests to determine whether the sum of the foreign equity interests
exceeds the statutory benchmark. Similarly, the Commission calculates the voting interest of each foreign investor
in the parent and aggregates these voting interests. Id. at 10972, ¶ 20, 10973-74, ¶¶ 22-25.
26 See id. at 10973-74, ¶ 25.
27 47 U.S.C. § 310(b)(4).
28 Foreign Participation Order, 12 FCC Rcd at 23896, 23913, 23940 ¶¶ 9, 50, 111-112.
29 Id. at 23913, 23940 ¶¶ 50, 111-112. The Commission stated, in the Foreign Participation Order, that it will deny
an application if it finds that more than 25% of the ownership of an entity that controls a common carrier radio
licensee is attributable to parties whose principal place(s) of business are in non-WTO Member countries that do not
offer effective competitive opportunities to U.S. investors in the particular service sector in which the applicant
seeks to compete in the U.S. market, unless other public interest considerations outweigh that finding. See id. at
23946 ¶ 131.
30 To determine a foreign entity’s home market for purposes of the public interest determination under section
310(b)(4), the Commission will identify and balance the following factors: (1) the country of a foreign entity’s
incorporation, organization, or charter; (2) the nationality of all investment principals, officers, and directors; (3) the
country in which the world headquarters is located; (4) the country in which the majority of the tangible property,
including production, transmission, billing, information, and control facilities, is located; and (5) the country from
which the foreign entity derives the greatest sales and revenues from its operations. Foreign Participation Order, 12
FCC Rcd at 23941 ¶ 116 (citing Market Entry and Regulation of Foreign-Affiliated Entities, Report and Order, 11
FCC Rcd 3873, 3951 ¶ 207 (1995)).
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DA 09-2628

citizens of, or have their principal places of business in, WTO Member countries. The purpose of our
inquiry is to determine whether at least 75 percent of TerreStar’s voting and equity interests are held by
individuals that are citizens of, or entities that have their principal places of business in, the United States
and other WTO Member countries.31
11.
In calculating attributable alien equity interests in a parent company, the Commission
uses a multiplier to dilute the percentage of each investor’s equity interest in the parent company when
those interests are held through intervening companies. The multiplier is applied to each link in the
vertical ownership chain, regardless of whether any particular link in the chain represents a controlling
interest in the company positioned in the next lower tier.32 By contrast, in calculating alien voting
interests in a parent company, the multiplier is not applied to any link in the vertical ownership chain that
constitutes a controlling interest in the company positioned in the next lower tier.33
2.

Attribution of Foreign Ownership Interests

12.
TerreStar Corp. is a widely held, publicly traded company organized in Delaware. As of
April 30, 2009, TerrStar Corp. had 182,817,596 shares issued and outstanding consisting of 139,202,289
shares of common, voting stock and 43,615,307 shares of preferred, non-voting stock.34 Most of
TerreStar Corp.’s total capital stock (74.23% of common and preferred stock) is held in “street name”
brokerage accounts.35 The remaining shares of total capital stock (25.77% of common and preferred
stock) are held by “registered shareholders.”36 According to TerreStar Corp., it is unable to determine the


31 See supra n.28.
32 See BBC License Subsidiary, 10 FCC Rcd at 10973-74, ¶¶ 24-25.
33 See id. at 10973, ¶ 23; see also Wilner & Scheiner I, 103 FCC 2d at 522, ¶ 19. When evaluating foreign voting
interests in the U.S. parent company of a common carrier licensee, it is possible that multiple investors will be
treated as holding the same voting interest in a U.S. parent company where the investment is held through multiple
intervening holding companies. Our purpose in identifying the citizenship of the specific individuals or entities that
hold these interests is not to increase the aggregate level of foreign investment, but rather to determine whether any
particular interest that a foreign investor proposes to acquire raises potential risks to competition or other public
interest concerns, such as national security or law enforcement concerns. See Foreign Participation Order, 12 FCC
Rcd at 23940-41, ¶¶ 111-15.
34 The number of shares of preferred, non-voting stock are stated throughout this Order and Declaratory Ruling on
an as-converted basis (i.e., as if converted to common stock) using the equivalence ratios reflected in the conversion
rights of the preferred shares. See August 21, 2009 Supplement, Response to Question 1. The spreadsheet attached
to the October 27, 2009 Supplement (“October 27, 2009 spreadsheet”) specifies the conversion ratios and the
number of preferred shares for three (3) of the five (5) of TerreStar’s classes of preferred stock on a pre-conversion
and post-conversion basis (Series C and Series D classes of preferred stock are not convertible). Of the classes of
preferred non-voting stock that are convertible, Series A and Series B are convertible into common stock at a rate of
1 to 33.3 for a total share number of 13,615, 305. The total number of shares of Series E preferred non-voting stock,
convertible into common stock at a rate of 1 to 25, is 1,200,000, bringing the total shares of preferred non-voting
stock, once converted to common stock, to 43,615,305. The October 27, 2009 spreadsheet also lists TerreStar’s: (1)
total number of shares of voting, common stock and (2) total number of shares of non-voting, preferred stock. For
both the common and preferred stock, the spreadsheet lists separately the number of shares held by U.S. investors
and by foreign investors broken down by the number of: (1) U.S. registered shares; (2) foreign registered shares; (3)
U.S. street name shares; (4) foreign street name shares; (5) undetermined street name shares; and (6) street name
shares ascribed to investors from non-WTO Member countries. October 27, 2009 spreadsheet.
35 Shares held in “street name” are registered on a corporation’s books in the name of a third party, which typically
means the shareholder’s broker. See July 7, 2009 Supplement, Declaration of Douglas Brandon, General Counsel
and Secretary, TerreStar Corporation (“Brandon Declaration”) at ¶ 4.
36 “Registered shareholders” hold their shares in their own name on the corporation’s books. Id.
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identity of the beneficial owners of its shares held in “street name,” except to the extent it has been able to
identify specific shareholdings as a result of shareholder litigation, financing transactions, proxy votes,
and reports filed with the Securities and Exchange Commission (“SEC”) by the company’s largest
shareholders.37
13.
In an effort to identify all beneficial owners of its shares held in street name, TerreStar
Corp. retained the services of Broadridge Financial Solutions (“Broadridge”), a securities services firm.
On behalf of TerreStar Corp., Broadridge contacted brokers holding TerreStar Corp. shares in street name
and asked that the beneficial owners of the shares be identified. TerreStar Corp. states that the request
resulted in the identification of the beneficial ownership of only a limited percentage of TerreStar Corp.’s
shares. TerreStar Corp. explains that most of the beneficial owners of TerreStar Corp. are objecting
beneficial owners (“OBOs”), i.e., under SEC rules and policies, they object to release of their names and
addresses. And, according to TerreStar Corp., it lacks authority to compel financial institutions to release
such information. TerreStar Corp. thus concludes that it cannot determine the citizenship of its beneficial
owners by querying a random sample of shareholders. Broadridge was able to obtain aggregate
information, however, consistent with OBO restrictions, as to the addresses of the beneficial owners of
TerreStar Corp. shares held in street name. Based on this information, TerreStar Corp. has submitted for
the record the percentage of its shares that are owned by persons or entities with U.S. addresses, addresses
in other WTO Member countries, and addresses in non-WTO Member countries.38 As we discuss below,
we recognize that TerreStar Corp. has undertaken numerous steps and appears to have exhausted other
readily-available means to ascertain the citizenship of its beneficial owners for the purpose of
demonstrating compliance with section 310(b)(4) of the Act and the Commission’s foreign ownership
policies. Therefore, we find it reasonable to accept TerreStar Corp.’s reliance on the addresses of the
beneficial owners of TerreStar Corp.’s shares as a proxy for their citizenship in this particular case.39
14.
We calculate below the percentage of TerreStar Corp.’s voting stock and total capital
stock (equity) held by foreign investors based on the address-of-record information obtained by
Broadridge, information TerreStar Corp. has gleaned from its corporate share registry, and information
TerreStar Corp. has obtained as a result of shareholder litigation, financing transactions, proxy votes, and
reports filed with the SEC. The granular data that TerreStar Corp. has collected from these various
sources is presented in spreadsheet form in the October 27, 2009 Supplement to the Petition.
15.
Common Stock (Voting). As indicated in the October 27, 2009 spreadsheet, TerreStar
Corp. has 39,202,289 shares of voting, common stock. The following entities hold, in the aggregate,
58.81 percent of TerreStar Corp.’s voting, common stock: Harbinger Capital Partners Master Fund I, Ltd.
(“Harbinger Master Fund”) (28.25%); Harbinger Capital Partners Special Situations Fund, L.P.
(“Harbinger Special Situations Fund”) (2.84%); EchoStar (21.55%);40 and SOLA Ltd. (approximately


37 See July 7, 2009 Supplement, Brandon Declaration at ¶ 6. TerreStar Corp. reviewed filings of its shareholders
with the SEC. In general, persons acquiring an interest in excess of 5% of any class of TerreStar Corp.’s stock must
disclose their interest in filings with the SEC.
38 The report that Broadridge prepared for TerreStar Corp. is attached to the August 21, 2009 Supplement. The
report covers TerreStar Corp.’s voting, common stock and Series B non-voting, preferred stock. TerreStar Corp.
knows the identity of all holders of its Series A, C, D, and E non-voting, preferred stock. See infra ¶ 17.
39 See infra ¶ 22.
40 According to TerreStar Corp., EchoStar holds 30 million voting, common shares in street name. See October 27,
2009 spreadsheet. These shares constitute 21.55% of TerreStar Corp.’s voting shares (30,000,000 voting shares
divided by 139,202,289 total voting shares). August 21, 2009 Supplement, n.6. and Response to Question 5.
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6.17%) (“SOLA”).41 All of these entities are organized in the United States with the exception of
Harbinger Master Fund and SOLA, which are organized in the Cayman Islands.42
16.
The remaining 41.19 percent of TerreStar Corp.’s shares of voting, common stock are
widely held, primarily in street name.43 Based on the Broadridge report and TerreStar Corp.’s review of
its share registry,44 we calculate that 32.24 percent of its voting shares are held by beneficial owners with
U.S. addresses and 7.33 percent of its voting shares are held by beneficial owners with foreign addresses,
of which only 260 shares (<0.01 %) have an address in a non-WTO Member country (specifically,
Monaco). TerreStar could not determine a beneficial owner address for 1.62 percent of its voting shares.
Consistent with Commission precedent, we treat this unidentified 1.62 percent voting interest as non-
WTO Member investment.45
17.
Total Capital Stock (Equity). TerreStar Corp. has 182,817,596 shares of total capital
stock, consisting of the 139,202,289 shares of voting, common stock and 43,615,307 shares of non-
voting, preferred stock.46 According to TerreStar Corp., its voting, common shares and non-voting,
preferred shares have different values, as is reflected by the fact that each convertible preferred share can
be converted into more than one common share.47 Using the conversion ratios provided by TerreStar
Corp., which reflect the conversion rights of its preferred shares, we find that the following entities hold,
in the aggregate, 68.39 percent of TerreStar Corp.’s total capital stock (equity): Harbinger Master Fund


41 TerreStar Corp. calculated SOLA’s 6.17% voting interest based on a proxy submitted to TerreStar Corp.
representing 8,586,971 voting shares. The total capital stock figure is based on SOLA’s common stock holding and
on notes and convertible preferred stock that SOLA, in an SEC filing, reported are convertible into 5,263,805 shares
of common stock. Because the SEC filing does not provide a breakout between the convertible notes and the
convertible preferred stock held by SOLA, TerreStar Corp. has assumed a worst case basis that all of SOLA’s
convertible holdings are held in the form of convertible preferred stock. According to TerreStar Corp., it is possible
that SOLA holds additional shares in street name that are not known to TerreStar Corp. because they were not
identified on SOLA’s proxy. SOLA holds its shares in street name (SOLA is not on the list of registered
shareholders), and SOLA must be an objecting beneficial owner, because it does not appear on TerreStar Corp.’s list
of non-objecting beneficial owners. See August 21, 2009 Supplement, Response to Question 4; October 27, 2009
spreadsheet. See also supra ¶ 13.
42 See August 21, 2009 Supplement, Responses to Question 6 and Question 9.
43 See October 27, 2009 spreadsheet (indicating that, of the 41.19% voting shares that are widely held, 36.09% are
held in street name and the remaining 5.10% are held by registered shareholders). See also supra n.36 (definition of
registered shareholders).
44 TerreStar Corp. has determined from its review of its share registry that employees and directors of TerreStar
Corp. hold approximately 2.06% of its voting shares. TerreStar Corp. believes that all but two of these employees
and directors are citizens of the United States. One director is a citizen of Canada and holds 30,000 shares of
registered stock. One employee is a citizen of the United Kingdom and holds 3,000 shares of registered stock. See
August 21, 2009 Supplement, Response to Question 6. See also supra n.42.
45 See, e.g., Mobile Satellite Ventures Subsidiary LLC and SkyTerra Communications, Inc. Petition for Declaratory
Ruling Under Section 310(b) of the Communications Act of 1934, as Amended; Harbinger Capital Partners Master
Fund I, Ltd. and Harbinger Capital Partners Special Situations Fund, L.P. Petition for Expedited Action for
Declaratory Ruling Under Section 310(b) of the Communications Act of 1934, as Amended
, Order and Declaratory
Ruling, FCC 08-77, 23 FCC Rcd 4436, 4457 Appendix B ¶ 15 n.95 (2008).
46 See supra ¶ 12. In order to calculate the pro rata equity interests held by TerreStar Corp. shareholders for
purposes of our section 310(b)(4) foreign ownership analysis, we consider all of TerreStar Corp.’s issued and
outstanding stock, voting and non-voting. As calculated above, the total number of shares of preferred non-voting
stock, when converted into common stock, is 43,615,305. See supra n.34.
47 See August 21, 2009 Supplement, Response to Question 1.
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(36.00%);48 Harbinger Special Situations Fund (6.76%); EchoStar (16.41%);49 SOLA (approximately
7.58%);50 and various investment funds affiliated with Highland Capital Management, L.P. (1.64%). 51
18.
The remaining 31.61 percent of TerreStar Corp.’s total capital stock (equity) consists of
TerreStar Corp.’s shares of voting, common stock that are widely held, primarily in street name; and
shares of Series B non-voting, preferred stock, as converted, other than the Series B shares attributed to
Harbinger Master Fund52 and SOLA.53 We calculate that U.S. and foreign ownership of its voting,
common stock constitutes 24.55 percent and 5.58 percent of its total capital stock, respectively. As
discussed above, only 260 of the foreign-owned voting shares have an address in a non-WTO Member
country, which constitutes a de minimis amount (<0.01 percent of TerreStar Corp.’s total capital stock).54
The shares of voting, common stock for which Broadridge could not obtain the beneficial owner’s address
constitute 1.23 percent of TerreStar Corp.’s total capital stock, which we treat as non-WTO Member
investment.55
19.
Based on the ownership information submitted by TerreStar Corp., we find it reasonable
to conclude that at least 75 percent of its voting and equity interests are held by individuals that are
citizens of, or entities that have their principal places of business in, the United States and other WTO
Member countries.56 Harbinger Master Fund and Harbinger Special Situations Fund hold, in the


48 The October 27, 2009 spreadsheet does not indicate whether the preferred shares denominated as “Harbinger
Series B” shares are held by Harbinger Master Fund or also by Harbinger Special Situations Fund. We therefore
assume, on a worst case basis, that the foreign-organized Harbinger Master Fund holds all of the 4,894,143 shares
listed on the spreadsheet as “Harbinger Series B” shares. Harbinger Master Fund also holds the sole share of Series
D preferred stock and 21,600,000 shares of Series E preferred stock.
49 The 16.41% figure is based for the most part on EchoStar’s 30 million shares of voting, common stock
(30,000,000 voting, common shares divided by 182,817,596 shares of total capital stock). EchoStar also holds the
sole share of TerreStar Corp.’s Series C non-voting preferred stock, which, according to TerreStar Corp., entitles
EchoStar to nominate two TerreStar Corp. board members. See July 7, 2009 Supplement, Exhibit 1, Response to
Question 5; October 27, 2009 spreadsheet.
50 This figure is based on SOLA’s known common stock holdings (which consist of 8,586,971 shares of common
stock and constitute 4.70% of TerreStar Corp.’s total capital stock) and on notes and Series B preferred stock that
SOLA, in an SEC filing, reported are convertible into an additional 5,263,805 shares of common stock (which
would constitute an additional 2.88% of TerreStar Corp.’s total capital stock). See August 21, 2009 Supplement,
Response to Question 4 n.7. We note that TerreStar Corp. could not determine from the SEC filing the portion of
these additional shares that reflect only SOLA’s Series B preferred shareholdings (as opposed to the notes held by
SOLA, which we would not normally include in our section 310(b)(4) calculations until actually converted).
TerreStar Corp. therefore assumed, on a “worst case” basis, that all 5,263,805 shares reported to the SEC reflect
SOLA’s Series B preferred shareholdings for purposes of calculating the equity interest that SOLA, a foreign-
organized entity, holds in TerreStar Corp. See id.
51 See October 27, 2009 spreadsheet (listing Highland as holding 2,999,700 shares (as converted) of preferred non-
voting Series A stock).
52 See supra n.48.
53 See supra n.50.
54 See supra ¶ 16.
55 See supra n.45 and accompanying text.
56 As explained above, the Commission has stated that it will deny an application if it finds that more than 25% of
the ownership of an entity that controls a common carrier radio licensee is attributable to parties whose principal
place(s) of business are in non-WTO Member countries that do not offer effective competitive opportunities to U.S.
investors in the particular service sector in which the applicant seeks to compete in the U.S. market, unless other
(continued….)
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aggregate, 31.09 percent of TerreStar Corp.’s voting, common stock and 42.76 percent of its total capital
stock (equity). Although Harbinger Master Fund is organized in the Cayman Islands,57 we have
determined previously that Harbinger Master Fund and the U.S.-organized Harbinger Special Situations
Fund have their principal places of business in the United States or the Cayman Islands, which is a WTO
Member country. We also have determined previously that all but a de minimis portion of the investment
in Harbinger Master Fund and Harbinger Special Situations Fund is held by individuals that are citizens
of, or that principally conduct business in, WTO Member countries.58 Accordingly, we find that the
equity and voting interests held in TerreStar by Harbinger Master Fund and by Harbinger Special
Situations Fund are properly ascribed to investors from the United States and other WTO Member
countries.
20.
We also find that Echostar, which holds 21.55 percent and 16.41 percent of TerreStar
Corp.’s voting and total capital stock (equity) interests, has its principal place of business in the United
States. It is organized in Nevada, its controlling shareholder, Charles W. Ergen, is a U.S. citizen59 and all
of its officers and directors are U.S. citizens. EchoStar is headquartered in Englewood, Colorado; the
majority of its tangible properly is located in the United States; and it derives the vast majority of its
revenues from within the United States.60 According to TerreStar Corp., EchoStar commissioned a broker
survey of its shareholders (as of April 30, 2008). The results of that survey, combined with information
from EchoStar’s share registry, indicates that approximately 1.33 percent of its equity and 0.23 percent of
its voting interests are held by foreign investors, including non-WTO investment that is less than 0.10
percent for both equity and voting interests.61
21.
SOLA, which holds approximately 6.17 percent and 7.58 percent of TerreStar Corp.’s
voting and equity interests, is an investment fund that is organized and has its world headquarters in the
Cayman Islands, which is also its tax jurisdiction.62 SOLA’s investment decisions are directed by Solus
Alternative Asset Management LP (“Solus Asset Management”), which is organized in the United
(Continued from previous page)


public interest considerations outweigh that finding. See supra ¶ 9 n.27 (citing Foreign Participation Order, 12
FCC Rcd at 23946, ¶ 131).
57 Shares held by or on behalf of Harbinger Master Fund and SOLA are properly counted as foreign for purposes of
our section 310(b) calculations because these funds are organized in the Cayman Islands. We note that TerreStar
Corp. listed these shares as U.S. shares in its October 27, 2009 spreadsheet and treated them as U.S. shares when it
calculated its foreign voting and equity interests. Thus, we have calculated that TerreStar Corp. has a higher
percentage of foreign voting interests (43.37%) and foreign equity interests (50.39%) than TerreStar Corp. has
calculated (9% foreign voting interests and 8% foreign equity interests). See July 7, 2009 Supplement, as clarified
in the October 27, 2009 spreadsheet (calculating TerreStar Corp.’s foreign ownership). Our calculations reflect the
aggregate voting interests and the aggregate equity interests held by Harbinger Master Fund, SOLA, the foreign
widely-held shares, and the undetermined shares. See supra ¶¶ 15-18.
58 Harbinger 2009 Order, 24 FCC Rcd at ¶ 19. See also 2008 MSV Order, 23 FCC Rcd at 4444, ¶ 18, Appendix B
at 4454-57, ¶¶ 9-14. Passive investment from non-WTO Member countries constitutes approximately 0.59% of the
voting interests and approximately 0.37% of the equity interests in Harbinger Master Fund. Applying the multiplier,
we attribute to these non-WTO investors a 0.17% voting interest (0.59% x 28.25%) and a 0.13% equity interest
(0.37% x 36.00%) in TerreStar.
59 TerreStar Corp. states that, as of May 28, 2009, Mr. Ergen had an equity interest of approximately 54% in
EchoStar and a voting interest of approximately 87.3%. See July 7, 2009 Supplement, Exhibit 1, Response to
Question 7.
60 Id.
61 Id.
62 See July 7, 2009 Supplement, Exhibit 1, Response to Question 9.
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States.63 The general partner of Solus Asset Management is Solus GP, LLC, a Delaware limited liability
company. Christopher Pucillo, a U.S. citizen, is the managing member of Solus GP, LLC.64 Although
there is no information as to the citizenship of SOLA’s investors, we find these other indicia sufficient to
establish, for purposes of this proceeding, that SOLA principally conducts business in the United States.
With respect to the 1.64 percent equity interest held by funds affiliated with Highland Capital
Management, L.P., we also lack information as to the citizenship of fund investors or whether any of the
funds are organized in a non-WTO Member country. The Highland funds are controlled, however, by
Highland Capital Management, L.P., and its controlling principal, James Dondero, a U.S. citizen.65 On
this basis, and for purposes of this proceeding, we similarly find it reasonable to treat Highland’s 1.64
equity interest in TerreStar Corp. as equity investment from the United States and/or other WTO Member
countries.66
22.
As to TerreStar Corp.’s remaining shares, which are widely held, we calculate that U.S.
investors hold, in the aggregate, 32.4 percent and 24.55 percent of its voting and equity interests; and
foreign investors from WTO Member countries (with the exception of 260 shares that round to 0.00
percent) hold an aggregate 7.33 percent voting interest and 5.58 percent of its equity interests. Shares for
which TerreStar could not determine a beneficial owner address constitute a 1.62 percent voting interest
and 1.23 percent equity interest, which we treat as non-WTO Member Although the addresses of
TerreStar Corp.'s beneficial owners - as recorded in TerreStar Corp.’s share registry and as provided to
Broadridge by brokers holding shares for clients - do not prove the citizenship of those investors, we
recognize that TerreStar Corp. has undertaken numerous steps and appears to have exhausted other
readily-available means to ascertain the citizenship of its beneficial owners for the purpose of
demonstrating compliance with section 310(b)(4) of the Act and the Commission's foreign ownership
policies. We also note that the Commission previously approved the use of beneficial owner addresses, in
two proceedings, Verizon Wireless-Alltel67 and Verizon Wireless-RCC,68 for the purpose of allowing
Verizon Wireless to demonstrate compliance with its existing foreign ownership ruling.69 For these
reasons, we find it reasonable to accept TerreStar Corp.’s reliance on the addresses of the beneficial
owners of TerreStar Corp.’s shares as a proxy for their citizenship in this particular case. We caution our
licensees that our acceptance of street address as a proxy for citizenship in this particular case should not


63 Id.
64 See July 7, 2009 Supplement, Exhibit 1, Response to Question 8.
65 See also Highland Distressed Opportunities, Inc., Schedule 13D, at Appendix 1 (filed June 12, 2009) (“Highland
13D”), available at http://www.sec.gov/Archives/edgar/data.
66 The record in this proceeding reflects the difficulties that U.S. public companies face in identifying the citizenship
of their non-controlling, minority investors, including institutional investors, mutual funds, private equity funds and
other investment vehicles that may accumulate capital from both U.S. and foreign sources.
67 Applications of Cellco Partnership d/b/a Verizon Wireless and Atlantis Holdings LLC For Consent to Transfer
Control of Licenses, Authorizations, and Spectrum Manager and De Facto Transfer Leasing Arrangement,
WT
Docket No. 08-95, Memorandum Opinion and Order and Declaratory Ruling, FCC 08-258, 23 FCC Rcd 17444,
17543-45, ¶¶ 226-29 (2008) (“Verizon Wireless-Alltel”).
68 Applications of Cellco Partnership d/b/a Verizon Wireless and Rural Cellular Corporation For Consent to
Transfer Control of Licenses, Authorizations, and Spectrum Manager Leases
, WT Docket No. 07-208,
Memorandum Opinion and Order and Declaratory Ruling, FCC 08-181, 23 FCC Rcd 12463, 12524-26, ¶¶ 146-150
(2008) (“Verizon Wireless-RCC”).
69 Both of Verizon Wireless’s general partners, Verizon Communications Inc. and Vodafone plc, are widely held,
publicly traded companies. See Verizon Wireless-Alltel, 23 FCC Rcd at 17447-50, ¶¶ 5-8; Verizon Wireless-RCC,
23 FCC Rcd at 12467-68, ¶¶ 5-7.
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be construed as an indication that we will do so in all cases in the future. FCC licensees with foreign
ownership are reminded that their ownership must comply with requirements of section 310 of the Act
and that they be prepared to demonstrate such compliance to the Commission as requested.
23.
Based on the findings above, we conclude that TerreStar is entitled to a rebuttable
presumption that the foreign ownership of its controlling U.S. parent, TerreStar Corp., in excess of the 25
percent benchmark in section 310(b)(4) of the Act does not pose a risk to competition in the U.S. market,
and we find no credible evidence in the record to rebut this presumption.70 We also determine in Section
III.D. below that the Agreement among the Government Parties (i.e., the Department of Justice and the
Department of Homeland Security) and TerreStar addresses any national security and law enforcement
concerns.

C.

Declaratory Ruling

24.
Accordingly, this declaratory ruling permits TerreStar to have indirect foreign equity and
voting interests in excess of the 25 percent benchmark in section 310(b)(4) of the Act as a result of
foreign ownership interests held in its publicly traded, controlling U.S. parent, TerreStar Corp. This
ruling is subject to the following conditions: First, TerreStar shall obtain prior approval before any
foreign individual or entity, with the exception of Harbinger Master Fund, acquires individually an
indirect equity and/or voting interest in TerreStar Corp. in excess of 25 percent. Second, TerreStar shall
obtain prior Commission approval before TerreStar Corp.’s indirect equity or voting interests from non-
WTO Member countries exceeds 25 percent.71 Third, TerreStar shall obtain prior Commission approval
before Harbinger Master Fund increases in shareholdings in TerreStar Corp. other than through purchases
of TerreStar Corp. stock in the public market.
25.
We emphasize that, as a Commission licensee, TerreStar has an affirmative duty to
monitor its foreign equity and voting interests and to calculate these interests consistent with the
attribution principles enunciated by the Commission.72

D.

National Security, Law Enforcement and Public Safety Concerns

26.
When analyzing a petition for declaratory ruling in which foreign investment is involved,
we also consider any national security, law enforcement, foreign policy, or trade policy concerns.73 On


70 See infra Section IV.
71 For purposes of the ruling issued in this Order and Declaratory Ruling, we attribute 1.79% and 1.36% of the
voting and equity interests in TerreStar Corp. to investors from non-WTO Member countries. These amounts
consist of a 1.62% voting interest and 1.23% equity interest in TerreStar Corp. for which it could not make a
citizenship or principal place of business determination, and an additional 0.17% voting interest and 0.13% equity
interest in TerreStar Corp. as a result of non-WTO investment in Harbinger Master Fund. See supra ¶¶ 16, 18.
72 Mobile Satellite Ventures Subsidiary LLC and SkyTerra Communications, Inc., Petition for Declaratory Ruling
Under section 310(b) of the Communications Act of 1934, as Amended; Harbinger Capital Partners Master Fund I,
Ltd. and Harbinger Capital Partners Special Situations Fund, L.P. Petition for Expedited Action for Declaratory
Ruling Under section 310(b) of the Communications Act of 1934, as Amended,
Order and Declaratory Ruling, FCC
08-77, 23 FCC Rcd 4436, 4443, ¶ 16 (2008); Verizon Communications, Inc., Transferor and America Movil, S.A. de
C.V., Transferee, Application for Authority to Transfer Control of Telecomunicaciones de Puerto Rico, Inc.
(TELPRI), WT Docket No. 06-113,
Memorandum Opinion and Order and Declaratory Ruling, FCC 07-43, 22 FCC
Rcd 6195, 6225, ¶ 68 (2007).
73 Foreign Participation Order, 12 FCC Rcd at 23918, ¶ 58; Amendment of the Commission’s Regulatory Policies to
Allow Non-U.S. Licensed Space Stations to Provide Domestic and International Satellite Service in the United
States,
IB Docket No. 96-111, FCC 97-399, 12 FCC Rcd 24094, 24170, ¶ 178 (1997) (“Disco II Order”).
12

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December 22, 2009, the Department of Justice and the Department of Homeland Security filed a Petition
to Adopt Conditions advising the Commission that they have no objection to grant of the captioned
Petition for Declaratory Ruling provided that the Commission conditions its grant on compliance by the
Petitioner with the Agreement, executed December 18, 2009, between the two agencies, on the one hand,
and TerreStar Corporation, TerreStar Networks Inc., and their affiliates, on the other hand.74 The
Government Parties state that the Agreement is intended to enhance the protection of national security,
law enforcement and public safety.75 Under Commission precedent, we defer to Executive Branch
expertise on national security and law enforcement issues.76 Accordingly, we condition the grant of the
Petition on compliance by TerreStar Corporation and TerreStar Networks Inc., and their respective
subsidiaries and affiliates, with the commitments and undertakings set forth in the Agreement dated
December 18, 2009.77

IV.

SPRINT PETITION

27.
The Sprint Petition alleges that TerreStar appears to have violated the foreign ownership
limitations set forth in the Act and is not entitled to any presumption that exceeding these statutory limits
is in the public interest.78 Sprint Nextel also asserts that TerreStar will have an unfair competitive
advantage over Sprint Nextel in providing wireless services in the 2 GHz band if TerreStar does not bear
its fair share of the cost of clearing the band currently associated with broadcast auxiliary service (BAS).79
Sprint Nextel is requesting that the Commission deny approval of TerreStar’s foreign investment unless
TerreStar provides assurances that it will pay its share of BAS relocation expenses.
28.
According to TerreStar, the Sprint Petition does not address the merits of TerreStar’s
Petition because it neither raises an objection to the showing TerreStar made under section 310(b)(4) of
the Act nor does it address the applicable legal standard under section 310(b)(4) of the Act.80 TerreStar
argues that the foreign ownership limits of section 310(b) of the Act apply to FCC licensees, and since
TerreStar holds no radio licenses subject to Section 310(b) of the Act, then there can be no violation of
Commission rules.81 Finally, TerreStar claims that the Sprint Petition’s band clearing arguments are
addressed in another Commission proceeding and have nothing to do with the merits of TerreStar’s
Petition.
29.
Sprint, in its Reply, alleges that TerreStar’s request to exceed the foreign ownership
limits poses a risk to competition because, if granted without appropriate conditions, it would allow a
foreign-controlled company to offer services in the U.S. without complying with its regulatory obligation


74 Petition to Adopt Conditions; Letter from Greg Pinto, Director – RCO, U.S. Department of Homeland Security
and Richard C. Sofield, U.S. Department of Justice, Director – Foreign Investment Review Staff, National Security
Division, to Marlene H. Dortch, Secretary, FCC (dated December 22, 2009).
75 See Petition to Adopt Conditions at 3; and Agreement at Article 7 and Exhibit A.
76 See Foreign Participation Order, 12 FCC Rcd at 23918, ¶ 59, 23919-21, ¶¶ 61-66; DISCO II Order, 12 FCC Rcd
24094 at 24100, ¶ 15.
77 The Agreement is attached to the Order and Declaratory Ruling as Appendix B; see supra n.11 and ¶ 3.
78 See Sprint Petition at 1, 3.
79 Id. at 1, 3-8.
80 Id. at 2-3.
81 See TerreStar Opposition at 4-5. TerreStar states the Petition was filed because it had applied for radio licenses,
and a public interest determination must be made by the Commission prior to acting on TerreStar’s applications.
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either to relocate 2 GHz BAS licensees or pay its fair share of BAS relocation costs.82 The Sprint Reply
requests that the Commission should “condition” any grant of TerreStar’s request on the requirement that
TerreStar pay its pro rata share of the total cost of relocating BAS operators through the completion of
the BAS relocation process.83
30.
This Order and Declaratory Ruling denies the Petition to Deny filed by Sprint Nextel on
the basis that the approval of TerreStar’s Petition has little, if no bearing on BAS relocation costs, the
subject of another Commission proceeding.84 We also do not find merit in Sprint Nextel’s argument that
TerreStar violated the foreign ownership limitations set forth under section 310(b) of the Act. The
foreign ownership limitations under section 310(b) of the Act apply to FCC common carrier licenses and,
pending Commission action on its common carrier license application, TerreStar only holds a non-
common carrier license.85

V.

ORDERING CLAUSES

31.
Accordingly, IT IS ORDERED that, pursuant to section 310(b)(4) of the
Communications Act of 1934, as amended, 47 § 310(b)(4), and pursuant to authority delegated to the
International Bureau in section 0.261 of the Commission’s rules, 47 C.F.R. § 0.261, the Petition for
Declaratory Ruling filed by TerreStar Networks Inc. IS GRANTED to the extent specified in this Order
and Declaratory Ruling.

32.
IT IS FURTHER ORDERED that pursuant to sections 4(i) and (j), 309, and 310(d) of the
Communications Act of 1934, as amended, 47 U.S.C. §§ 154(i), (j), 309, 310(d), the Petition to Deny
filed by Sprint Nextel Corporation is denied.
33.
IT IS FURTHER ORDERED that this authorization is subject to compliance with the
provisions of the Agreement attached hereto between TerreStar, on the one hand, and the Department of
Justice (“DOJ”) and the Department of Homeland Security (“DHS”), on the other hand, dated December
18, 2009, which Agreement is intended to enhance the protection of U.S. national security, law
enforcement, and public safety. Nothing in this Agreement is intended to limit any obligation imposed by
Federal law or regulation.
34.
IT IS FURTHER ORDERED that this Order and Declaratory Ruling SHALL BE
EFFECTIVE upon release. Petitions for reconsideration under section 1.106 of the Commission’s rules,
47 C.F.R. § 1.106, may be filed within thirty days of the date of public notice of this order.
Federal Communications Commission
Mindel De La Torre
Chief, International Bureau


82 See Sprint Reply at 1.
83 Id. at 6.
84 See Improving Public Safety Communications in the 800 MHz Band, WT Docket No. 02-55, Report and Order
and Order and Further Notice of Proposed Rulemaking, FCC 09-49, 24 FCC Rcd 7904 (2009).
85 See supra ¶ 2.
14

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APPENDIX A

TerreStar Ownership


APPENDIX B

Network Security Agreement, dated December 18, 2009

























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