Democratic senators are again urging the FCC to not rubber-stamp Paramount Skydance‘s proposed $111 billion takeover of Warner Bros. Discovery — citing concerns over foreign investors, including Middle Eastern wealth funds, that are backing the pact.
The pending Paramount-WBD merger “raises national security alarms,” according to the senators, led by U.S. Sen. Maria Cantwell (D-Wash.), the ranking member of the Senate Committee on Commerce, Science and Transportation. The group sent a letter May 20 to FCC Chairman Brendan Carr outlining their concerns. That came after another group of Senate Democrats sent the agency chief a similar letter two months ago.
The crux of their misgivings: In April, Paramount disclosed in an FCC filing that the merged Paramount-WBD would be 49.5% owned by foreign investors, with about 38.5% of the equity in the new company owned by the sovereign wealth funds of Saudi Arabia, Qatar and Abu Dhabi. Paramount’s filing seeks a declaratory ruling by the FCC permitting that foreign ownership — and in fact, asked the agency to authorize up to 100% foreign equity ownership in its broadcast licensees. Congress set a 25% limit on direct foreign ownership of American TV and radio stations.
“The scale, concentration and scope of this proposal raise serious questions,” the senators wrote. “Foreign governments hostile to a free and independent press could exert unprecedented influence over a media conglomerate vital to American journalism and culture.”
They continued, “If the filing is approved, Saudi, UAE and Qatari sovereign investment funds would have significant influence over a number of the most significant and impactful news reporting and investigative journalism outlets in the United States, including CNN, CBS News, 60 Minutes, and 28 local Paramount-owned television stations in 17 of the country’s largest media markets.”
“Paramount’s petition asks for an unprecedented degree of foreign control of U.S. broadcasting,” the senators wrote. “[W]e have serious doubts that paving the way for these anti-democratic governments to own between 49.5% and 100% of an American media empire serves the ‘public interest.’”
Carr, at a press conference earlier Wednesday following the FCC’s monthly open meeting, acknowledged that the Paramount-WBD deal has “some foreign investment or foreign dollars that are involved in being invested in CBS to complete the purchase. And so we are running regular course process on that. So we put out a public notice to seek comment on that foreign investment.”
Carr added, “My understanding is there is a role for CFIUS,” referring to the U.S.’s intra-agency Committee on Foreign Investment in the United States, which reviews foreign investments in American businesses for potential national security risks. CFIUS, Carr said, “will ultimately make an up-or-down decision on that foreign investment. But the transaction itself isn’t going to come before the FCC, other than that foreign-ownership piece.”
The Treasury Department, which leads CFIUS, has not confirmed that it is reviewing the Paramount-WBD transaction. In March, Democratic Sens. Elizabeth Warren and Richard Blumenthal criticized the Trump administration for failing to initiate a CFIUS review of the deal. Paramount has said that the Gulf States backing the WBD deal would not be given board representation and that, therefore, CFIUS review is not warranted. The Ellison family and RedBird Capital Partners would collectively hold the largest equity stake in the combined company and continue to hold 100% of the voting shares, according to Paramount.
Meanwhile, at the May 20 meeting, Democratic FCC Commissioner Anna Gomez said that what Paramount’s petition is asking for is “very serious.” Earlier this month she had called for the FCC to conduct a “vigorous” review of the foreign investment in the proposed Paramount-WBD pact.
“These are not just some foreign companies. These are sovereign wealth funds controlled by countries that are not friendly to the press,” Gomez said. “And Paramount has said, ‘Give us up to 100% foreign ownership.’” Because the Middle Eastern funds would have indirect ownership stakes, under the statute, the FCC can waive the limit on foreign government ownership — “but it doesn’t mean we should,” Gomez said.
Others signing on to the May 20 letter to Carr were Sens. Edward J. Markey (D-Mass.), Ben Ray Luján (D-N.M.) John Hickenlooper (D-Colo.), Andy Kim (D-N.J.) and Warren. The full text of the letter is at this link.
The lawmakers pointed out that the FCC has never before allowed a sovereign wealth fund to hold a significant ownership stake of a U.S. broadcaster. They also noted that Carr in 2024 expressed concerns about foreign ownership of TikTok, and he also opposed a transfer of radio stations because of a lack of plans to “wall off the unvetted foreign interests.”
But Carr “appears to have no such concerns about this deal,” according to the Democratic senators. They cited an interview Carr gave to CNBC in March in which he said about the proposed Paramount-WBD merger, “I think this is a good deal, and I think it should get through [FCC review] pretty quickly.” In the letter to Carr, the senators said, “These comments raise questions about your impartiality and the rigor of the Commission’s review of this unprecedented foreign investment.”
The senators also referenced an unconfirmed report that China’s Tencent was among the investors in Paramount’s WBD bid. In December, Paramount said Tencent, which had committed $1 billion to the Paramount Skydance bid, was no longer a financing partner because of the WBD board’s concerns over foreign ownership. In March, Bloomberg reported that Tencent was back on board as an investor in the deal with fresh funding.
About the reported involvement of Tencent, the senators wrote, “Allowing our most significant global adversary to partly own Paramount or a combined new entity that will own CNN and CBS News would risk our national security.”
The lawmakers posed the following questions to Carr, requesting answers and documents by June 5:
- Will you commit to a comprehensive review by Team Telecom, especially given the unprecedented risks to press freedom posed by the proposed equity investors?
- Will the Commission and Team Telecom specifically review Tencent’s role in the transaction and equity stake in Paramount?
- Will you commit to voting on Paramount’s request to raise its foreign ownership at the Commission level? If not, why?
- Do you believe that foreign ownership of between 49.5% and 100% of Paramount, contemplated by the filing, would mean that the Middle Eastern sovereign wealth investment funds would have effective control or influence over decision making?
- What specific assurances have the Saudi, Emirati, and Qatari sovereign wealth funds, and Tencent, provided the Commission that they will not attempt to influence the editorial, journalistic, or content decisions at Paramount, either by suppressing reporting and creative content unfavorable to their governments or by promoting content that runs contrary to American interests or values? Please provide all related documents.
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