AT&T Faces Major FCC Hurdle in T-Mobile Acquisition

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U.S. regulators are playing a game of chess with AT&T as the wireless network looks to close its $39 billion T-Mobile deal. The problem is that not everyone seems to be keen on the idea—including the FCC.

The FCC has declared that the telecom company must face an extra administrative review next February. Even if AT&T eventually wins its case, the review may delay the acquisition by months. The agreement requires AT&T to secure all approvals to close the deal by September of next year, according to the Wall Street Journal.

(MORE: What the AT&T & T-Mobile Acquisition Means for Everyone)

It’s the first hearing in nine years that the FCC has asked for as the regulatory commission reviews the merger. The deal, if successful, would combine the nation’s two largest GSM networks into one single consolidated major carrier. While AT&T has said that the merger would create 100,000 or so jobs, confidential documents submitted to the FCC suggest that it would “lead to massive job losses.”

The Department of Justice also filed an antitrust complaint against AT&T back in August, saying that “AT&T’s elimination of T-Mobile as an independent, low-priced rival would remove a significant competitive force from the market.” The Department of Justice also noticed that it would substantially lessen competition. Sprint, which has been unhappy about the agreement, has filed its own antitrust suit against the big blue.

While the odds are slowly stacking up against AT&T, it’s been rumored that AT&T executives have been preparing other tactics in order to get government officials to approve the deal. For instance, there’s been talk of divesting as much as 25% of T-Mobile to get federal approval.

The last time the FCC formally requested an administrative hearing was back in 2002 concerning a proposed merger between EchoStar and DirecTV. Both companies eventually dropped the deal instead of fighting with regulators. If the deal between the two wireless networks falls through, AT&T will be on the hook to pay T-Mobile a cool $6 billion in breakup costs.

MOREJustice Department Looks to Block T-Mobile-AT&T Deal

Erica Ho is a reporter at TIME. Find her on Twitter at @ericamho and Google+. You can also continue the discussion on TIME’s Facebook page and on Twitter at @TIME.

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