FCC Waives 25% Foreign Cap to Allow 49.5% Gulf Fund Stake in Paramount-Warner Case
The Federal Communications Commission has waived its 25% limit on foreign equity ownership to permit sovereign wealth funds run by the governments of Saudi Arabia, Qatar and Abu Dhabi to own 49.5% of the company in the Paramount-Warner Bros. case. The Verge
The authorization was issued in Declaratory Ruling DA 26-1001 on September 17, 2026, and reported on September 18. It was granted under Section 310(b)(4) of the Communications Act of 1934, as amended, the provision Paramount Global invoked when it sought a foreign ownership declaratory ruling. FCC Public Notice
Paramount's petition had sought broader authority. In filings made public in late April and early May 2026, the company asked for a ruling that would authorize up to 100 percent foreign equity ownership. FCC Filing The ruling as granted stops short of that ceiling. It permits the 49.5% holding for the three named Gulf funds.
A central condition is control, or the absence of it. The FCC stated that the stocks being purchased have no voting rights and would not enable influence or control over decisions involving the licensees. That distinction between economic interest and voting control is doing most of the work in the order. The funds hold equity exposure without a vote on licensee matters.
The ruling also imposes continuing compliance obligations. Under DA 26-1001, Paramount has an affirmative duty to monitor its foreign equity and voting interests and calculate those interests. FCC Ruling For a transaction of this structure, that is not a one time disclosure. It is an ongoing measurement duty as capitalization, syndication and secondary transfers evolve.
The approval followed months of scrutiny. An FCC commissioner sought rigorous review of foreign investment in the Warner Bros. deal in early May 2026. Reuters On June 18, 2026, senators sent a letter to FCC Chair Carr regarding foreign funding in the Paramount-WBD merger. Senate Letter A group of Democratic senators separately raised concerns about Middle Eastern sovereign wealth funds taking stakes in the Paramount-Warner merger. Straits Times
The FCC action is one piece of a wider regulatory sequence. Paramount secured clearance for its Warner Bros. Discovery tender offer from Germany's foreign investment authorities on January 27, 2026. Paramount described its $30-per-share all-cash offer for Warner Bros. Discovery as superior. The FCC has noted that it has approved foreign ownership levels of up to 100% in certain instances, following its review and approval of specific, named foreign individuals.
Looking at what this means for operators and deal teams, the structure matters more than the headline percentage. A 49.5% non-voting position is economically large and legally constrained at the same time. The FCC has chosen to treat voting rights and licensee control, not the raw equity number, as the gating issue, then backstopped that choice with a monitoring duty that sits with Paramount.
In my view, that trade will be familiar to technology counsel who work on infrastructure, spectrum and CFIUS-adjacent reviews. Capital is global. Control must be local and auditable. Non-voting equity plus calculation and reporting duties is becoming a standard bridge between those two requirements. The burden then shifts to systems: cap-table tracking, attribution analysis, timely identification of attributable interests that could tip a voting threshold even when headline equity stays fixed.
Worth flagging for longer-term planning is the precedent effect. A waiver from 25% to 49.5% for sovereign funds does not erase the limit. It confirms the limit can be waived with conditions when the equity is non-voting and named parties have been reviewed. Media distribution now rides on cloud infrastructure, recommendation systems, identity platforms and advertising stacks that technology teams build and maintain. A clear, conditional path for large-scale foreign equity, with explicit limits on influence over licensees, gives those teams a more stable basis for integration planning than an outright denial or an open-ended approval would have provided.
