[Federal Register Volume 62, Number 137 (Thursday, July 17, 1997)] [Proposed Rules] [Pages 38244-38245] From the Federal Register Online via the Government Publishing Office [www.gpo.gov] [FR Doc No: 97-18882] ======================================================================= ----------------------------------------------------------------------- FEDERAL COMMUNICATIONS COMMISSION 47 CFR Chapter I [CC Docket No. 97-146, FCC 97-219] Complete Detariffing for Competitive Access Providers and Competitive Local Exchange Carriers AGENCY: Federal Communications Commission. ACTION: Proposed rule. ----------------------------------------------------------------------- SUMMARY: This Notice of Proposed Rulemaking (NPRM) proposes adopting a policy of complete detariffing for all non-ILEC providers of interstate exchange access services because of the public interest benefits from complete detariffing, including eliminating the abuse of the filed rate doctrine, reducing administrative burdens on the Commission, and hindering price coordination afforded by tariffing. DATES: Comments are due on or before August 18, 1997. ADDRESSES: Secretary, Federal Communications Commission, Room 222, Washington, D.C. 20554. FOR FURTHER INFORMATION CONTACT: William Bailey, (202) 418-1520. SUPPLEMENTARY INFORMATION: This is a summary of the Commission's NPRM in CC Docket No. 97-146 adopted and released on June 19, 1997. The full text of this NPRM is available for inspection and copying during normal business hours in the FCC Reference Center (Room 239), 1919 M Street, N.W., Washington, D.C. 20037. The complete text may also be obtained through the World Wide Web at http://www.fcc.gov or may be purchased from the Commission's copy contractor, International Transcription Services, Inc. (202) 857-3800, 2100 M Street, N.W., Suite 140, Washington, D.C. 20037. Regulatory Flexibility Analysis As required by the Regulatory Flexibility Act, 5 U.S.C. 603, the Commission has prepared the following Initial Regulatory Flexibility Analysis (IRFA) of the expected significant economic impact on small entities by the policies and rules proposed in the NPRM to establish complete detariffing of non-ILEC providers of interstate exchange access services. Written public comments are requested on the IRFA. Comments must be identified as responses to the IRFA and must be filed on or before August 18, 1997. Need for and Objectives of the Proposed Rule: The Commission, in compliance with Section 10(a) of the Telecommunications Act of 1996, proposes to adopt complete detariffing for non-ILEC providers of interstate exchange access services. Section 10 of the Communications Act of 1934, as amended (Communications Act), requires the Commission to forbear from tariff filing requirement if statutory criteria are met. We anticipate that the proposed rule will: reduce transaction costs and administrative burdens for providers, permit providers to make rapid responses to market conditions, and facilitate entry by new providers. Legal Basis: As stated above, Section 10 of the Communications Act requires the Commission to forbear from applying a regulation if statutory criteria are met. The Commission has previously determined that complete detariffing is more consistent with the public interest than permissive detariffing in the context of interexchange services. The Commission seeks comment regarding whether this is also true with respect to interstate exchange access services. Description and Estimate of the Number of Small Entities To Which the Proposed Rule Will Apply: Under the RFA, small entities may include small organizations, small businesses, and small governmental jurisdictions. The RFA generally defines the term ``small business'' as having the same meaning as the term ``small business concern'' under the Small Business Act, 15 U.S.C. 632. A small business concern is one that: (1) is independently owned and operated; (2) is not dominant in its field of operation; and (3) meets any additional criteria established by the SBA. SBA has defined a small business for Standard Industrial Classification (SIC) category 4813 (Telephone Communications, Except Radiotelephone) to be small entities when they have no more than 1500 employees. Total Number of Telephone Companies Affected: The proposals in the NPRM would have an impact on a substantial number of small telephone companies identified by SBA. The United States Bureau of the Census (``the Census Bureau'') reports that, at the end of 1992, there were 3,497 firms engaged in providing telephone service, as defined therein, for at least one year. This number contains a variety of different category of carriers, including local exchange carriers, interexchange carriers, competitive access providers, cellular carriers, mobile service carriers, operator service providers, pay telephone operators, PCS providers, covered SMR providers, and resellers. It seems certain that some of those 3,497 telephone service firms may not qualify as small entities or small incumbent LECs because they are not independently owned and operated. Local Exchange Carriers: Neither this agency nor SBA has developed a definition of small providers of local exchange service (LECs). The closest applicable definition under SBA rules is for telephone communications companies other than radiotelephone (wireless) companies. The most reliable source of information regarding the number of LECs nationwide of which we are aware appears to be the data that we collect annually in connection with Telecommunications Relay Service (TRS). According to our most recent data, 1,347 companies reported that they were engaged in the provision of local exchange service. Although it seems certain that some of these carriers are not independently owned and operated, or have more than 1500 employees, we are unable at this time to estimate with greater precision the number of LECs that would qualify as small business concerns under SBA's definition. We conclude that there are fewer than 1,347 small incumbent LECs that may be affected by the proposals in this Report and Order. Competitive Access Providers: Neither the Commission nor SBA has developed a definition of small entities specifically applicable to providers of competitive access services (CAPs). The closest applicable definition under SBA rules is for telephone communications companies other than radiotelephone (wireless) companies. The most reliable source of information regarding the number of CAPs nationwide of which we are aware appears to be the data that [[Page 38245]] we collect annually in connection with the TRS. According to our most recent data, 30 companies reported that they were engaged in the provision of competitive access services. Although it seems certain that some of these carriers are not independently owned and operated, or have more than 1,500 employees, we are unable at this time to estimate with greater precision the number of CAPs that would qualify as small business concerns under SBA's definition. Consequently, we estimate that there are fewer than 30 small entity CAPs. Small Businesses (Workplaces): Workplaces encompass establishments for profit and nonprofit, plus local, state and federal governmental entities. SBA guidelines to the SBREFA state that about 99.7 percent of all firms are small and have fewer than 500 employees and less than $25 million in sales or assets. There are approximately 6.3 million establishments in the SBA database. Interexchange Carriers: Neither the Commission nor SBA has developed a definition of small entities specifically applicable to providers of interexchange services (IXCs). The closest applicable definition under SBA rules is for telephone communications companies other than radiotelephone (wireless) companies. The most reliable source of information regarding the number of IXCs nationwide of which we are aware appears to be the data that we collect annually in connection with TRS. According to our most recent data, 97 companies reported that they were engaged in the provision of interexchange services. Although it seems certain that some of these carriers are not independently owned and operated, or have more than 1,500 employees, we are unable at this time to estimate with greater precision the number of IXCs that would qualify as small business concerns under SBA's definition. Consequently, we estimate that there are fewer than 97 small entity IXCs that may be affected by the decisions and rules proposed in the NPRM. Description of Projected Reporting, Recordkeeping and Other Compliance Requirements: The rule which the Commission proposes would reduce substantially reporting and recordkeeping because non-ILEC providers of interstate exchange access services would no longer file tariffs with the Commission. Steps Taken to Minimize Any Significant Economic Impact on Small Entities, and Significant Alternatives Considered: The Commission has considered, as alternatives, requiring either mandatory tariffing or permissive detariffing. Each of these options, however, would maintain an economic burden on a substantial number of small entities. We believe that this burden would be detrimental to small carriers because they would need to expend resources to file tariffs, and we have tentatively concluded that such filings are no longer in the public interest. Federal Rules That May Duplicate, Overlap, or Conflict With the Proposed Rules: The Commission is proposing to adopt complete detariffing for the provision of exchange access services by non-ILECs. We are aware of no rules that may duplicate, overlap, or conflict with the proposed rules. We seek comment on this conclusion. Paperwork Reduction Act Complete detariffing for non-ILEC providers of interstate access would eliminate requirements that these carriers file tariffs. Synopsis of Notice of Proposed Rulemaking The Commission tentatively concludes that complete detariffing for non-ILECs would provide the benefits identified in its June 19, 1997 Memorandum Opinion and Order adopting permissive detariffing: reduction of transaction costs for providers; reduction of administrative burdens for service providers; permitting rapid response to market conditions through elimination of costs on carriers that attempt to make new offerings; and, facilitating entry by new providers. The Commission also tentatively concludes that complete detariffing for those carriers could offer additional public interest benefits beyond those of permissive detariffing. Complete detariffing could preclude carriers from attempting to use the filed rate doctrine to nullify contractual arrangements, and remove uncertainty about the application of the doctrine to tariffed arrangements that are filed on a permissive basis. Complete detariffing could also eliminate any threat of price coordination through tariffing. Complete detariffing could also reduce the administrative burden on the Commission of maintaining the tariff filing program. Although permissive detariffing would cause some reduction in the resources expended for tariff filing, complete detariffing would eliminate administration of all but ILECs' tariffs. The Commission seeks comment on these tentative conclusions and any other potential benefits to be derived from a policy of complete detariffing. The Commission also solicits comment on whether we should require any non-ILEC providers of interstate exchange access services subject to any degree of tariff forbearance to make rates available to the Commission and to interested persons upon request. Federal Communications Commission. William F. Caton, Acting Secretary. [FR Doc. 97-18882 Filed 7-16-97; 8:45 am] BILLING CODE 6712-01-P