[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]


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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.

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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