[Federal Register Volume 76, Number 163 (Tuesday, August 23, 2011)]
[Proposed Rules]
[Pages 52625-52632]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2011-21547]
[[Page 52625]]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 64
[CG Docket Nos. 11-116 and 09-158; CC Docket No. 98-170; FCC 11-106]
Empowering Consumers To Prevent and Detect Billing for
Unauthorized Charges (``Cramming''); Consumer Information and
Disclosure; Truth-in-Billing and Billing Format
AGENCY: Federal Communications Commission.
ACTION: Proposed rule.
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SUMMARY: The purpose of this document is to seek comment on proposed
amendments to the Commission's Truth-in-Billing rules that would
require wireline telephone companies (i.e. wireline telecommunications
common carriers) to notify subscribers clearly and conspicuously, at
the point of sale, on each bill, and on their Web sites, of the option
to block third-party charges from their telephone bills, if the company
offers that option, and place charges from non-telephone company third-
parties in a bill section separate from telephone company charges, and
would require both wireline and wireless (i.e. Commercial Mobile Radio
Service (``CMRS'') common carriers) telephone companies to notify
subscribers on all telephone bills and on their Web sites that
subscribers may file complaints with the Commission, provide the
Commission's contact information for the submission of complaints, and
include on Web sites a link to the Commission's complaint Web page.
This action will enable subscribers to detect, rectify, and prevent
placement of unauthorized charges on their telephone bills; a practice
known as ``cramming.''
DATES: Comments are due on or before October 24, 2011. Reply comments
are due on or before November 21, 2011.
ADDRESSES: You may submit comments, identified by CG Docket No. 11-116
by any of the following methods:
Federal Communications Commission's Web site: Follow the
instructions for submitting comments.
Federal eRulemaking Portal: http://www.regulations.gov.
Follow the instructions for submitting comments.
People with Disabilities: Contact the FCC to request
reasonable accommodations (accessible format documents, sign language
interpreters, CART, etc.) by e-mail: [email protected] or phone: 202-418-
0530 or TTY: 202-418-0432.
For detailed instructions for submitting comments and additional
information on the rulemaking process, see the SUPPLEMENTARY
INFORMATION section of this document.
FOR FURTHER INFORMATION CONTACT: John B. Adams, Consumer and
Governmental Affairs Bureau, Policy Division, at (202) 418-2854
(voice), or e-mail [email protected].
For additional information concerning the potential new or revised
information collection requirements contained in document FCC 11-106,
contact Cathy Williams, Federal Communications Commission, at (202)
418-2918, or via e-mail [email protected].
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Notice
of Proposed Rulemaking (``NPRM''), FCC 11-106, adopted and released on
July 12, 2011, in CG Docket Nos. 11-116 and 09-158, and CC Docket No.
98-170. The full text of this document and copies of any subsequently
filed documents in this matter will be available for public inspection
and copying via ECFS, and during regular business hours at the FCC
Reference Information Center, Portals II, 445 12th Street, SW., Room
CY-A257, Washington, DC 20554. They may also be purchased from the
Commission's duplicating contractor, Best Copy and Printing, Inc.,
Portals II, 445 12th Street, SW., Room CY-B402, Washington, DC 20554,
telephone: (202) 488-5300, fax: (202) 488-5563, or Internet: http://www.bcpiweb.com. This document can also be downloaded in Word or
Portable Document Format (``PDF'') at http://www.fcc.gov/guides/cramming-unauthorized-misleading-or-deceptive-charges-placed-your-telephone-bill. To request materials in accessible formats for people
with disabilities (Braille, large print, electronic files, audio
format), send an e-mail to [email protected] or call the Consumer and
Governmental Affairs Bureau at 202-418-0530 (voice), 202-418-0432
(TTY).
Pursuant to 47 CFR 1.1200 et seq., this matter shall be treated as
a ``permit-but-disclose'' proceeding in accordance with the
Commission's ex parte rules. Persons making ex parte presentations must
file a copy of any written presentation or a memorandum summarizing any
oral presentation within two business days after the presentation
(unless a different deadline applicable to the Sunshine period
applies). Persons making oral ex parte presentations are reminded that
memoranda summarizing the presentation must: (1) List all persons
attending or otherwise participating in the meeting at which the ex
parte presentation was made; and (2) summarize all data presented and
arguments made during the presentation. If the presentation consisted
in whole or in part of the presentation of data or arguments already
reflected in the presenter's written comments, memoranda or other
filings in the proceeding, the presenter may provide citations to such
data or arguments in his or her prior comments, memoranda, or other
filings (specifying the relevant page and/or paragraph numbers where
such data or arguments can be found) in lieu of summarizing them in the
memorandum. Documents shown or given to Commission staff during ex
parte meetings are deemed to be written ex parte presentations and must
be filed consistent with section 1.1206(b) of the Commission's rules.
In proceedings governed by section 1.49(f) or for which the Commission
has made available a method of electronic filing, written ex parte
presentations and memoranda summarizing oral ex parte presentations,
and all attachments thereto, must be filed through the electronic
comment filing system available for that proceeding, and must be filed
in their native format (e.g., .doc, .xml, .ppt, searchable .pdf).
Participants in this proceeding should familiarize themselves with the
Commission's ex parte rules.
Synopsis
In the NPRM, the Commission proposes rules to require wireline and
wireless telephone companies to provide to subscribers information that
will enable subscribers to detect, rectify, and prevent cramming.
Cramming is the placement of unauthorized charges on subscribers'
telephone bills. Specifically, the Commission proposes that wireline
telephone companies disclose to subscribers information about blocking
of third-party charges and place third-party charges in a separate bill
section from all telephone company charges. The Commission further
proposes that wireline and wireless telephone companies, on their bills
and on their Web sites, notify subscribers that they can file
complaints with the Commission, provide the Commission's contact
information for filing complaints, and provide a link to the
Commission's complaint Web site on their Web sites.
Disclosure of Blocking of Third-Party Charges
The Commission proposes that wireline telephone companies that
offer subscribers the option to block third-party charges from their
telephone bills must clearly and conspicuously notify subscribers of
this option at the point of sale, on each bill, and on their Web
[[Page 52626]]
sites. The Commission seeks comment on specific details about how this
disclosure should be implemented. The proposed rules amend the
Commission's Truth-in-Billing rules (codified at 47 CFR 64.2400-
64.2401), which mandate ``clear and conspicuous'' disclosure (i.e.
notice that would be apparent to the reasonable consumer) of certain
information on telephone bills. The Commission seeks comment on the
wording, placement, font size, and other relevant factors, at the point
of sale, on bills, and on Web sites, that would be necessary for this
notification, as well as any notification about fees for blocking, to
satisfy this standard. Can existing practices of telephone companies
that already offer blocking be improved other than by the proposed
disclosures, such as by better training of customer service
representatives?
Separate Bill Section for Third-Party Charges
The Commission proposes that wireline telephone companies place
charges from non-telephone company third parties in a distinct section
of the telephone bill separate from telephone company charges. The
Commission's Truth-in-Billing rules already require charges from
different telephone companies on a single telephone bill to be
separated. Those rules also permit service bundles to be listed as a
single service offering of the telephone company, even if the bundle
includes third-party services. No change is proposed as to the manner
in which bundles may be billed under our rules. Are more specific
requirements needed? Should third-party charges be listed separately on
the first page of telephone bills or further highlighted in some other
fashion? Is there any need to require identification of the third-party
vendor associated with each charge beyond the requirements already
contained in the Truth-in-Billing rules? What changes will telephone
companies need to make to billing systems to comply with this proposed
rule? How much will these changes cost and how long will they take? Are
there ways to minimize burdens on telephone companies, especially
smaller ones?
Disclosure of Commission Contact Information
Information available to the Commission, including a report from
the General Accountability Office, indicates that many telephone
subscribers do not know how to file complaints about telephone service.
The Commission proposes that wireline and wireless telephone companies,
on their bills and on their Web sites, clearly and conspicuously notify
subscribers that they can file complaints with the Commission, provide
the Commission's contact information for filing complaints, and provide
a link on their Web sites to the Commission's complaint Web site. The
disclosure should include the Commission's telephone number and Web
site address. How much will it cost telephone companies to comply with
this requirement, and how long will it take them to comply?
Wireless and Internet Telephone Service
The Commission seeks comment on whether all of the rules proposed
for wireline telephone service also should apply to wireless and
Internet telephone service. Complaint data from the Commission and the
Federal Trade Commission indicate that approximately 80% to 90% of
cramming complaints relate to wireline telephone service. What is the
nature and magnitude of cramming for wireless telephone service? What
percentage of unauthorized charges is from wireless telephone
companies, and what percentage is from third parties? Do unauthorized
charges occur more frequently with particular types of wireless service
plans or features? Does cramming affect wireless telephone subscribers
differently than wireline telephone subscribers? How? Are there
differences between wireline and wireless telephone industry practices
or billing platforms that are relevant in assessing the propriety and
effectiveness of potential regulatory solutions? What are the
differences? The Commission seeks current and updated data from states
regarding wireless cramming and how differences in state authority over
wireless telephone service impact the need for federal oversight. Can
industry practices or voluntary guidelines successfully address
cramming for wireless telephone service? To what extent are industry
guidelines and practices evolving to address cramming, such as in-
application marketing? Are options to block third-party charges, if
any, clearly and conspicuously disclosed to subscribers?
Additional Questions for Comment
The Commission seeks comment on other possible requirements that
may help subscribers to detect, rectify, and prevent cramming.
Disclosure of Third-Party Contact Information: Should telephone
companies clearly and conspicuously provide contact information for
each third party in association with its charges? Should specific
contact information be provided, such as the third party's name and
toll-free customer service telephone number? The Commission's Truth-in-
Billing rules permit, but do not require, telephone companies to
provide contact information for third parties if the third party
possesses sufficient information to answer questions concerning the
subscriber's account and is fully authorized to resolve subscriber
complaints. Implicit in this proviso is a requirement for the telephone
company to verify the contact information. To what extent do telephone
companies already verify third-party contact information? What would be
the incremental burden on telephone companies to do so? How and to what
extent would imposing a verification requirement benefit subscribers,
telephone companies, or both? Should any particular form of
verification be required? At what intervals should telephone companies
be required to re-verify third-party contact information?
Requiring Wireline Telephone Companies to Offer Blocking: Should
wireline telephone companies be required to block third-party charges
upon subscriber request? If so, should they be prohibited from charging
a fee for doing so? Many wireline telephone companies already offer
blocking at no additional fee, which suggests that there is no
technical or cost barrier to making blocking available, or that the
cost of doing so is not sufficiently high to warrant additional fees
beyond the monthly recurring charge for wireline telephone service.
What technical or cost barriers exist? Which telephone companies offer
blocking? What specific types or categories of charges are blocked? Is
an additional fee is assessed for blocking, and what is the amount of
the fee? How was the amount of the fee determined? What kinds or types
of charges should be subject to blocking if wireline telephone
companies were required to block them, such as charges from long
distance telephone companies, Internet service providers and other
providers affiliated with the telephone company, and non-telephone
company third parties? Should bundles, which may contain services
provided by third parties, be treated differently?
Prohibiting All Third-Party Charges on Wireline Telephone Bills:
The Commission seeks comment on the impact, both positive and negative,
that prohibiting third-party charges on wireline telephone bills,
unless the subscriber opts in, may have on wireline telephone
companies, subscribers, and third parties. What is the scope of the
Commission's authority to impose such a ban? What kinds or types of
charges
[[Page 52627]]
should be subject to such a prohibition on third-party charges?
Due Diligence: The Commission seeks comment on whether it should
require carriers, before contracting or agreeing with a third party to
place its charges on telephone bills, to screen each third party to
ensure that it has operated and will continue to operate in compliance
with all relevant state and federal laws. What is the nature and
adequacy of current industry practices in this regard? How are
telephone companies monitoring and tracking subscriber complaints with
respect to cramming? What thresholds exist with respect to cramming
complaints before a telephone company takes adverse action against a
third party? Should such thresholds be required and what should they
be? What annual percentage of charges from third parties is refunded,
uncollectible, or unbillable? To what extent do telephone companies
attempt to identify affiliated companies after one affiliate has been
identified as engaging in cramming, attempt to track whether a company
continues under a different name, or attempt to track whether the same
persons engage in cramming via a new company? How successful have
telephone companies been in doing so? What penalties or other measures
are employed to deter cramming? Are there improvements that could be
made or do better deterrents exist? How many third parties submit
charges to telephone companies for placement on telephone bills? What
are their lines of business or types of products? How many real parties
in interest are there owning or operating these companies? How could
third parties change or improve their efforts to monitor and track
cramming complaints?
Federal-State Coordination: To address potential subscriber
confusion about to which state and federal agencies they can complain
about cramming and recognizing that coordinated state and federal
efforts is a critical component to protecting subscribers, the
Commission seeks comment on how to better coordinate sharing of
cramming complaints and information. Are there ways to share
information, such as through the shared complaint database maintained
by the Federal Trade Commission? Should wireline and wireless telephone
companies report trends or spikes in complaints they receive about
specific third parties? What is the nature and extent of the cramming
problem in each state? What is the number of wireline and wireless
cramming complaints? What are the trends in the last few years? What
enforcement or legislative actions have states taken to address
cramming?
Accessibility: How will the Commission's proposed rules affect, and
could they be improved to better assist, people with disabilities,
people living in Native Nations on Tribal Lands in Native communities,
and people with limited English proficiency. What measures should
telephone companies take to ensure that the information they provide to
subscribers is accessible to such individuals.
Internet Telephone Service: The Commission seeks comment on whether
any of the proposed rules, any of the other requirements discussed, or
similar requirements should apply to providers of Internet telephone
service (i.e. interconnected VoIP service). Do bills for Internet
telephone service raise the same risks of cramming as wireline or
wireless telephone service? Are there differences that necessitate a
different regulatory approach? What kinds of safeguards are needed to
protect and would be effective in protecting Internet telephone service
subscribers from cramming?
Definition of Service Provider or Service: The Commission seeks
comment on the need to define ``service provider'' or ``service,'' as
those terms are used in the Truth-in-Billing rules, to better address
charges that arguably may not be for a service. What specific
definitions would be effective? Are there alternatives, such as
changing the Truth-in-Billing rules to refer to more than services and
service providers? What specific rules would need to be changed and
what specific changes would be needed?
Effective Consumer Information Disclosure
In proposing rules to improve transparency on cramming or any other
consumer issue, the Commission intends to look at the many factors
involved in effective consumer information disclosure. This will ensure
that the rules serve their intended purpose without posing an undue
burden on industry. There are two key criteria for the success of such
an approach. First, acknowledging the potential difficulty of
quantifying benefits and burdens, the Commission needs to determine
whether the proposed disclosure rules will significantly benefit
consumers and, in fact, clarify important issues for them--for example,
by helping them detect hidden charges, making contractual terms more
transparent, or clarifying rates and fees. Second, the Commission seeks
to maximize the benefits to consumers from our proposed rules while
taking into consideration the burden of compliance to carriers. These
costs and benefits can have many dimensions, including cost and revenue
implications for industry, financial benefits to consumers, and other,
less tangible benefits, such as the value of increasing consumer choice
or preventing fraud.
To address the first criterion in the case of cramming, the
Commission seeks comment on the best ways to ensure that the proposed
disclosures will actually benefit consumers. To what extent may
consumers be expected to utilize the additional information? Are there
ways to implement the disclosures that would increase the number of
consumers who will benefit and the nature of the benefits? What are the
best ways to ensure that disclosure of third-party charges on bills is
clear and conspicuous; that third-party blocking options are clearly
disclosed; and that FCC contact information is provided in ways that
consumers will see it and know how to use it? What, if any, are the
best practices of consumer disclosure in other areas and of assessing
the effectiveness of disclosures? Are there other examples, research,
and recommendations that would be applicable here?
To address the second criterion in the case of cramming, the
Commission seeks comment on the nature and magnitude of the costs and
benefits of the proposed rules to consumers and carriers. How, if at
all, do these vary by telephone company and by type (e.g., wireline,
wireless) and size of telephone company? What, if any, specific
concerns exist for telephone companies serving rural areas, Native
Nations on Tribal lands and Native communities, and their customers.
The Commission seeks specific information about whether, how, and by
how much such carriers and their customers may be impacted differently
in terms of the costs and benefits of the proposed rules. What is the
most cost-effective approach for modifying existing policies and
practices to achieve the goals of the proposed rules?
The Commission seeks comment on the extent of cramming, including
totals for all charges and unauthorized charges from third parties,
total annual unauthorized charges to wireline and CMRS consumers,
amounts credited annually to consumers for unauthorized charges, total
uncollectible charges, how much the proposed rules will reduce these
amounts, and methods to quantify unauthorized charges accurately. The
Commission also seeks comment on the costs to consumers to block third-
party charges, to monitor bills to guard against
[[Page 52628]]
cramming, and to resolve disputes over unauthorized charges, including
intangible costs like time. The Commission invites comment regarding
consumers' experiences with unauthorized charges.
How and how much has cramming affected consumer confidence and
decisions of whether to purchase particular kinds of goods or services?
Will the proposed rules lead to increased consumer purchasing, and how
much? What are potential costs of cramming to third-party vendors that
do not engage in cramming, such as costs associated with reduced demand
for their products due to a loss of consumer confidence in the
marketplace, and reduced innovation and investment due to lower demand
for their products? What are the potential costs that the proposed
rules and other potential requirements may impose on third-party
vendors, such as lost revenue from legitimate transactions? Are there
any other potential costs and/or benefits to third-party vendors from
the proposed rules?
What are the specific kinds and amounts of compliance costs that
carriers may incur? If billing or other system modifications are
required, what is the exact nature of those modifications, the time
required to implement them, and their cost? What is the amount of
annual revenue that carriers receive from providing billing-and-
collection services to third parties and the anticipated reduction, if
any, that would result from adoption of the proposed rules or other
requirements? Will these figures differ depending upon which third-
party charges are blocked? What are telephone companies' costs to offer
the ability to block all third-party charges?
The Commission seeks comment on the nature and magnitude of costs
that carriers might avoid or reduce by complying with the proposed
rules. Some possible cost savings might be reductions in the number of
calls to customer service, reduced costs to process refunds, reduced
costs to investigate disputed charges, reduced uncollectible charges,
reduced costs to monitor billing activities by third parties, and
reduced costs to audit third parties or to develop and monitor
performance improvement plans imposed upon third parties.
The Commission seeks comment on and quantification of any other
costs and benefits that it should consider, and information that will
enable it to weigh the costs and benefits associated with the proposed
rules. Commenters should provide specific data and information, such as
actual or estimated dollar figures for each specific cost or benefit
addressed, including a description of how the data or information was
calculated or obtained and any supporting documentation or other
evidentiary support. Vague or unsupported assertions generally can be
expected to be less persuasive than more specific and supported
statements.
Legal Issues
Communications Act: What is the nature and scope of the
Commission's authority under the Communications Act of 1934, as
amended, to adopt the proposed rules and regarding the additional
issues for comment? The Commission believes that it has authority under
Section 201(b) of the Communications Act to adopt the proposed rules.
The bill format and labeling requirements in the Truth-in-Billing rules
are based, in whole or part, on the Commission's authority under
Section 201(b) of the Communications Act to enact rules to implement
the requirement that all charges, practices, classifications, and
regulations for and in connection with interstate communications
service be just and reasonable. The problem of crammed third-party
charges depends on and arises from the relationship between the
telephone company and its customer; telephone bills are an integral
part of this relationship. Unauthorized third-party charges appear on
telephone bills only because the telephone company permits them to be
there. Further, if it is not clear on a telephone bill what a charge is
for and who the service provider is, a consumer may erroneously believe
that the charge is related to a service provided by the telephone
company.
Section 332(c)(1)(A) of the Communications Act states that wireless
telephone companies are subject to Section 201(b) authority for their
common carrier services. They largely are subject to the Truth-in-
Billing rules promulgated under Section 201(b) to the same extent as
wireline telephone companies for common carrier services. Thus, the
Commission believes that its authority to extend the proposed rules and
other requirements to wireless telephone companies is co-extensive with
its authority to promulgate them for wireline telephone companies. The
Commission seeks comment on this analysis.
Does the Commission need to invoke its ancillary Title I authority
to adopt requirements to address cramming? The Commission ``may
exercise ancillary jurisdiction only when two conditions are satisfied:
(1) the Commission's general jurisdictional grant under Title I [of the
Communications Act] covers the regulated subject and (2) the
regulations are reasonably ancillary to the Commission's effective
performance of its statutorily mandated responsibilities.'' Comcast
Corp. v. FCC, 600 F.3d 642, 646 (DC Cir. 2010) (quoting American
Library Ass'n v. FCC, 406 F.3d 689, 691-92 (DC Cir. 2005)). An exercise
of such authority under Title I may be necessary here because entities
that are not classified as common carriers nonetheless may, like common
carriers, provide billing-and-collection services for third parties or
submit charges for inclusion on a telephone bill.
The Commission has previously asserted ancillary jurisdiction over
VoIP providers in other contexts. See, e.g., IP-Enabled Services; E911
Requirements for IP-Enabled Service Providers, 20 FCC Rcd 10245, 10261-
66, paragraphs 26-35 (2005) (rules requiring VoIP providers to supply
enhanced 911 capabilities to their customers), aff'd sub nom. Nuvio
Corp. v. FCC, 473 F.3d 302 (DC Cir. 2007). Can and should the
Commission exercise Title I authority to apply the proposed rules to
any non-carriers? Are there particular entities, including but not
limited to interconnected VoIP providers, that should be subject to the
proposed rules? Further, the Commission has previously asserted that
its Title I authority extends to a common carrier's provision of
billing-and-collection services to third parties that are not carriers.
See Detariffing of Billing and Collection Services, Report and Order,
102 FCC 2d 1150, paragraphs 35-38 (1986). It seeks comment on whether
that authority would extend to the proposals in the NPRM.
First Amendment: A regulation of commercial speech will be found
compatible with the First Amendment if: (1) There is a substantial
government interest; (2) the regulation directly advances the
substantial government interest; and (3) the proposed regulation is not
more extensive than necessary to serve that interest. Central Hudson
Gas and Electric Corp. v. Public Service Commission, 447 U.S. 557, 566
(1980). Moreover, ``regulations that compel `purely factual and
uncontroversial' commercial speech are subject to more lenient review
than regulations that restrict accurate commercial speech.'' See, e.g.,
New York State Restaurant Association v. New York City Board of Health,
556 F.3d 114, 132 (2nd Cir. 2009) (upholding New York City health code
requiring restaurants to post calorie content information on their
menus and menu boards) (citing Zauderer v. Office of Disciplinary
[[Page 52629]]
Counsel, 471 U.S. 626, 651 (1985)); National Elec. Mfrs. Ass'n v.
Sorrell, 272 F.3d 104, 113 (2nd Cir. 2001) (upholding Vermont statute
prescribing labeling requirements on mercury-containing lamps).
The Commission's statutory obligations include protecting consumers
from unjust or unreasonable charges and practices. The record in this
proceeding suggests that consumers continue to incur substantial costs
each year from the inclusion of unauthorized charges on their telephone
bills. The proposed rules are designed to advance the government's
interest by providing consumers with basic tools necessary to protect
themselves from these unauthorized charges. The Commission seeks
comment on whether the proposed rules and other issues for comment are
consistent with these and any other First Amendment considerations.
Procedural Matters
Ex Parte Presentations: This is a permit-but-disclose notice and
comment rulemaking proceeding. Ex parte presentations are permitted in
accordance with the Commission's rules.
Filing of Comments and Reply Comments: Pursuant to sections 1.415
and 1.419 of the Commission's rules, interested parties may submit
comments, identified by CG Docket No. 11-116 by any of the following
methods:
Electronic Filers: Comments may be filed electronically
using the Internet by accessing the Commission's Electronic Comment
Filing System (ECFS) http://fjallfoss.fcc.gov/ecfs2/. Filers should
follow the instructions provided on the Web site for submitting
comments and transmit one electronic copy of the filing to each docket
number referenced in the caption, which in this case is CG Docket No.
11-116. For ECFS filers, in completing the transmittal screen, filers
should include their full name, U.S. Postal Service mailing address,
and the applicable docket number.
Parties may also submit an electronic comment by Internet
e-mail. To get filing instructions, filers should send an e-mail to
[email protected], and include the following words in the body of the
message, ``get form .'' A sample form and
directions will be sent in response.
Paper Filers: Parties who choose to file by paper must
file an original and four copies of each filing. Because three docket
numbers appears in the caption of this proceeding, filers must submit
four additional copies for the additional docket numbers. In addition,
parties must send one copy to the Commission's duplicating contractor,
Best Copy and Printing, Inc., 445 12th Street, SW., Washington, DC
20554, or via e-mail to [email protected]. Filings can be sent by hand or
messenger delivery, by commercial overnight courier, or by first-class
or overnight U.S. Postal Service mail. All filings must be addressed to
the Commission's Secretary, Office of the Secretary, Federal
Communications Commission.
All hand-delivered or messenger-delivered paper filings
for the Commission's Secretary must be delivered to FCC Headquarters at
445 12th St., SW., Room TW-A325, Washington, DC 20554. All hand
deliveries must be held together with rubber bands or fasteners. Any
envelopes must be disposed of before entering the building. The filing
hours are 8:00 a.m. to 7:00 p.m.
Commercial overnight mail (other than U.S. Postal Service Express
Mail and Priority Mail) must be sent to 9300 East Hampton Drive,
Capitol Heights, MD 20743. U.S. Postal Service first-class, Express,
and Priority mail must be addressed to 445 12th Street, SW., Washington
DC 20554.
The comments and reply comments filed in response to this NPRM will
be available via ECFS at: http://fjallfoss.fcc.gov/ecfs2/. You may
search by docket number (Docket No. CG-11-116). Comments are also
available for public inspection and copying during business hours in
the FCC Reference Information Center, Portals II, 445 12th Street, SW.,
Room CY-A257, Washington, DC 20554. Copies may also be purchased from
Best Copy and Printing, Inc., telephone (800) 378-3160, facsimile (301)
816-0169, e-mail [email protected].
Accessibility Information: To request materials in accessible
formats for people with disabilities (Braille, large print, electronic
files, audio format), send an e-mail to [email protected] or call the
Consumer & Governmental Affairs Bureau at 202-418-0530 (voice) or 202-
418-0432 (TTY). This Notice of Proposed Rulemaking also can be
downloaded in Word and Portable Document Formats (``PDF'') at http://www.fcc.gov/guides/cramming-unauthorized-misleading-or-deceptive-charges-placed-your-telephone-bill. Contact the FCC to request
reasonable accommodations for filing comments (accessible format
documents, sign language interpreters, CART, etc.) by e-mail at:
[email protected]; phone: 202-418-0530 or TTY: 202-418-0432.
Initial Regulatory Flexibility Analysis
As required by the Regulatory Flexibility Act of 1980, as amended,
(``RFA''), the Commission has prepared this Initial Regulatory
Flexibility Analysis (``IRFA'') of the possible significant economic
impact on a substantial number of small entities by the policies and
rules proposed in the NPRM. Written public comments are requested on
the IRFA. Comments must be identified as responses to the IRFA and must
be filed by the deadlines for comments on the NPRM provided on the
first page of this document. The Commission will send a copy of the
NPRM, including this IRFA, to the Chief Counsel for Advocacy of the
Small Business Administration.
Need for, and Objectives of, the Proposed Rules
In document FCC 11-106, the Commission summarized the record
compiled in this proceeding and the Commission's own complaint data.
The record confirms that cramming is a significant and ongoing problem
that has affected wireline consumers for over a decade, and drawn the
notice of Congress, states, and other federal agencies. The substantial
volume of wireline cramming complaints that the Commission, FTC, and
states continue to receive underscores the ineffectiveness of voluntary
industry practices and highlights the need for additional safeguards.
Recent evidence, such as the volume of wireless cramming complaints and
wireless carriers'' settlement of litigation regarding unauthorized
charges, raises a similar concern with unauthorized charges on
Commercial Mobile Radio Service (``CMRS'') bills, such as those of
providers of wireless voice telephone service.
Although the Commission has addressed cramming as an unreasonable
practice under Section 201(b) of the Communications Act, there are
currently no rules that specifically address unauthorized charges on
wireline telephone bills. The Commission believes that adopting such
requirements will provide consumers with the safeguards they need to
protect themselves from this risk.
Legal Basis
The legal basis for any action that may be taken pursuant to the
NPRM is contained in Sections 1-2, 4, 201, 301, 303, 332, and 403 of
the Communications Act of 1934, as amended, 47 U.S.C. 151-152, 154,
201, 301, 303, 332, and 403.
[[Page 52630]]
Description and Estimate of the Number of Small Entities to Which the
Proposed Rules Will Apply
The RFA directs agencies to provide a description of, and where
feasible, an estimate of the number of small entities that will be
affected by the proposed rules, if adopted. The RFA generally defines
the term ``small entity'' as having the same meaning as the terms
``small business,'' ``small organization,'' and ``small governmental
jurisdiction.'' In addition, the term ``small business'' has the same
meaning as the term ``small business concern'' under the Small Business
Act. Under the Small Business Act, 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 Small Business Administration (``SBA''). Nationwide,
there are a total of approximately 29.6 million small businesses,
according to the SBA. The NPRM seeks comment generally on wireline and
wireless telecommunications common carriers. However, as noted in
Section IV of the NPRM, the Commission seeks comment on how to reduce
burdens on small entities.
Incumbent Local Exchange Carriers (``Incumbent LECs''). Neither the
Commission nor the SBA has developed a small business size standard
specifically for incumbent local exchange services. The appropriate
size standard under SBA rules is for the category Wired
Telecommunications Carriers. Under that size standard, such a business
is small if it has 1,500 or fewer employees. Census Bureau data for
2007, which now supersede data from the 2002 Census, show that there
were 3,188 firms in this category that operated for the entire year. Of
this total, 3,144 had employment of 999 or fewer, and 44 firms had had
employment of 1000 or more. According to Commission data, 1,307
carriers reported that they were incumbent local exchange service
providers. Of these 1,307 carriers, an estimated 1,006 have 1,500 or
fewer employees and 301 have more than 1,500 employees. Consequently,
the Commission estimates that most providers of local exchange service
are small entities that may be affected by the rules and policies
proposed in the NPRM. Thus, under this category and the associated
small business size standard, the majority of these incumbent local
exchange service providers can be considered small.
Competitive Local Exchange Carriers (``Competitive LECs''),
Competitive Access Providers (``CAPs''), Shared-Tenant Service
Providers, and Other Local Service Providers. Neither the Commission
nor the SBA has developed a small business size standard specifically
for these service providers. The appropriate size standard under SBA
rules is for the category Wired Telecommunications Carriers. Under that
size standard, such a business is small if it has 1,500 or fewer
employees. Census Bureau data for 2007, which now supersede data from
the 2002 Census, show that there were 3,188 firms in this category that
operated for the entire year. Of this total, 3,144 had employment of
999 or fewer, and 44 firms had had employment of 1,000 employees or
more. Thus under this category and the associated small business size
standard, the majority of these Competitive LECs, CAPs, Shared-Tenant
Service Providers, and Other Local Service Providers can be considered
small entities. According to Commission data, 1,442 carriers reported
that they were engaged in the provision of either competitive local
exchange services or competitive access provider services. Of these
1,442 carriers, an estimated 1,256 have 1,500 or fewer employees and
186 have more than 1,500 employees. In addition, 17 carriers have
reported that they are Shared-Tenant Service Providers, and all 17 are
estimated to have 1,500 or fewer employees. In addition, 72 carriers
have reported that they are Other Local Service Providers. Of the 72,
seventy have 1,500 or fewer employees and two have more than 1,500
employees. Consequently, the Commission estimates that most providers
of competitive local exchange service, competitive access providers,
Shared-Tenant Service Providers, and Other Local Service Providers are
small entities that may be affected by rules adopted pursuant to the
NPRM.
Interexchange Carriers. Neither the Commission nor the SBA has
developed a small business size standard specifically for providers of
interexchange services. The appropriate size standard under SBA rules
is for the category Wired Telecommunications Carriers. Under that size
standard, such a business is small if it has 1,500 or fewer employees.
Census Bureau data for 2007, which now supersede data from the 2002
Census, show that there were 3,188 firms in this category that operated
for the entire year. Of this total, 3,144 had employment of 999 or
fewer, and 44 firms had had employment of 1,000 employees or more. Thus
under this category and the associated small business size standard,
the majority of these Interexchange carriers can be considered small
entities. According to Commission data, 359 companies reported that
their primary telecommunications service activity was the provision of
interexchange services. Of these 359 companies, an estimated 317 have
1,500 or fewer employees and 42 have more than 1,500 employees.
Consequently, the Commission estimates that the majority of
interexchange service providers are small entities that may be affected
by rules adopted pursuant to the NPRM.
Wireless Telecommunications Carriers (except Satellite). Since
2007, the Census Bureau has placed wireless firms within this new,
broad, economic census category. Prior to that time, such firms were
within the now-superseded categories of ``Paging'' and ``Cellular and
Other Wireless Telecommunications.'' Under the present and prior
categories, the SBA has deemed a wireless business to be small if it
has 1,500 or fewer employees. For the category of Wireless
Telecommunications Carriers (except Satellite), Census data for 2007
show that there were 1,383 firms that operated that year. Of those,
1,368 firms had fewer than 100 employees, and 15 firms had more than
100 employees. Thus, under this category and the associated small
business size standard, the majority of firms can be considered small.
Similarly, according to Commission data, 413 carriers reported that
they were engaged in the provision of wireless telephony, including
cellular service, Personal Communications Service (``PCS''), and
Specialized Mobile Radio (``SMR'') telephony services. An estimated 261
of these firms have 1,500 or fewer employees and 152 firms have more
than 1,500 employees. Consequently, the Commission estimates that
approximately half or more of these firms can be considered small.
Thus, using available data, it estimates that the majority of wireless
firms are small.
Wireless Telephony. Wireless telephony includes cellular, personal
communications services, and specialized mobile radio telephony
carriers. As noted, the SBA has developed a small business size
standard for Wireless Telecommunications Carriers (except Satellite).
Under the SBA small business size standard, a business is small if it
has 1,500 or fewer employees. According to Commission data, 434
carriers report that they are engaged in wireless telephony. Of these,
an estimated 222 have 1,500 or fewer employees, and 212 have more than
1,500 employees. Therefore, the
[[Page 52631]]
Commission estimates that 222 of these entities can be considered
small.
Description of Projected Reporting, Recordkeeping, and Other Compliance
Requirements
In the NPRM, the Commission proposes requirements that: (1) Require
wireline carriers to notify subscribers clearly and conspicuously at
the point of sale, on each bill, and on their Web sites, of the option
to block third-party charges from their telephone bills, if the carrier
offers that option; (2) require wireline carriers to place charges from
non-carrier third-parties in a bill section separate from carrier
charges; and (3) require wireline and CMRS carriers to include on all
telephone bills and on their Web sites the Commission's contact
information for the submission of complaints. The record reflects that
cramming primarily has been an issue for wireline telephone customers.
However, there is evidence of a concern with unauthorized charges on
wireless bills. Therefore, the Commission also seeks comment on whether
it should extend any similar protections to wireless consumers.
These proposed rules may necessitate that some common carriers make
changes to their existing billing formats and/or disclosure materials.
For example, to provide the required contact information on their bills
may necessitate changes to billing formats. However, some carriers may
be in compliance with many of these requirements and require no
additional compliance efforts.
Steps Taken To Minimize Significant Economic Impact on Small Entities,
and Significant Alternatives Considered
The RFA requires an agency to describe any significant alternatives
that it has considered in reaching its proposed approach, which may
include the following four alternatives (among others): (1) The
establishment of differing compliance or reporting requirements or
timetables that take into account the resources available to small
entities; (2) the clarification, consolidation, or simplification of
compliance or reporting requirements under the rule for small entities;
(3) the use of performance, rather than design, standards; and (4) an
exemption from coverage of the rule, or any part thereof, for small
entities.
In the NPRM, the Commission seeks comment on ways to minimize the
economic impact on carriers to comply with the proposed rules. For
example, it seeks comment on establishing timeframes that will allow
carriers sufficient opportunity to make any necessary changes to comply
with any rules adopted in a cost efficient manner. The Commission also
seeks comment on how to alleviate burdens on small carriers. It seeks
guidance on whether the proposed rules should be limited to wireline
service or whether there are justifications to extend those safeguards
to wireless service. Finally, it seeks comment on an extensive cost and
benefit analysis to determine the overall impact on consumers and
industry of the proposed rules.
Federal Rules That May Duplicate, Overlap, or Conflict With the
Proposed Rules
None.
Initial Paperwork Reduction Act of 1995
The NPRM seeks comment on a potential new or revised information
collection requirement or may result in a new or revised information
collection requirement. If the Commission adopts any new or revised
information collection requirements, the Commission will publish
another notice in the Federal Register inviting the public to comment
on the requirements, as required by the Paperwork Reduction Act of
1995, Public Law 104-13 (44 U.S.C. 3501-3520). In addition, pursuant to
the Small Business Paperwork Relief Act of 2002, Public Law 107-198,
see 44 U.S.C. 3506(c)(4), the Commission seeks-comment-on how it might
``further reduce the information collection burden for small business
concerns with fewer than 25 employees.''
Ordering Clauses
Pursuant to the authority contained in sections 1-2, 4, 201, 301,
303, 332, and 403 of the Communications Act of 1934, as amended 47
U.S.C. 151-152, 154, 201, 301, 303, 332, and 403, the Notice of
Proposed Rulemaking is adopted.
The Commission's Consumer and Governmental Affairs Bureau,
Reference Information Center, SHALL SEND a copy of the NPRM, including
the Initial Regulatory Flexibility Analysis, to the Chief Counsel for
Advocacy of the Small Business Administration.
List of Subjects in 47 CFR Part 64
Reporting and recordkeeping requirements, Telecommunications,
Telephone.
Federal Communications Commission.
Marlene H. Dortch,
Secretary.
For the reasons discussed in the preamble, the Federal
Communications Commission proposes to amend Part 64 as follows:
PART 64--MISCELLANEOUS RULES RELATING TO COMMON CARRIERS
1. The authority citation for part 64 continues to read as follows:
Authority: 47 U.S.C. 154, 254(k); secs. 403(b)(2)(B), (c), Pub.
L. 104-104, 110 Stat. 56. Interpret or apply 47 U.S.C. 201, 218,
222, 225, 226, 228, 254(k), and 620 unless otherwise noted.
2. Section 64.2400 is amended by revising paragraph (b) to read as
follows:
Sec. 64.2400 Purpose and scope.
(a) * * *
(b) These rules shall apply to all telecommunications common
carriers, except that Sec. Sec. 64.2401(a)(2), 64.2401(c), and
64.2401(f) shall not apply to providers of Commercial Mobile Radio
Service as defined in Sec. 20.9 of this chapter, or to other providers
of mobile service as defined in Sec. 20.7 of this chapter, unless the
Commission determines otherwise in a future rulemaking.
3. Section 64.2401 is amended by revising paragraphs (a)(2) and (d)
and by adding new paragraph (f) to read as follows:
Sec. 64.2401 Truth-in-Billing Requirements.
(a) * * *
(2) Where charges for two or more carriers appear on the same
telephone bill, the charges must be separated by service provider.
Where charges for one or more service providers that are not carriers
appear on a telephone bill, the charges must be placed in a distinct
section separate from all carrier charges.
* * * * *
(d) Clear and conspicuous disclosure of inquiry and complaint
contacts.
(1) Telephone bills must contain clear and conspicuous disclosure
of any information that the subscriber may need to make inquiries about
or contest charges on the bill. Common carriers must prominently
display on each bill a toll-free number or numbers by which subscribers
may inquire or dispute any charges on the bill. A carrier may list a
toll-free number for a billing agent, clearinghouse, or other third
party, provided such party possesses sufficient information to answer
questions concerning the subscriber's account and is fully authorized
to resolve the consumer's complaints on the carrier's behalf.
(2) Where the subscriber does not receive a paper copy of his or
her telephone bill, but instead accesses that bill only by e-mail or
the Internet, the common carrier may comply with these
[[Page 52632]]
billing disclosure requirements by providing on the bill an e-mail or
Web site address. Each carrier must make a business address available
upon request from a consumer.
(3) Telephone bills and carrier Web sites must clearly and
conspicuously state that the subscriber may submit inquiries and
complaints to the Federal Communications Commission, and provide the
telephone number, Web site address, and, on the carrier's Web site, a
direct link to the webpage for filing such complaints. That information
must be updated as necessary to ensure that it remains current and
accurate.
* * * * *
(f) Blocking of third-party charges. Common carriers that offer
subscribers the option to block third-party charges from appearing on
telephone bills must clearly and conspicuously notify subscribers of
this option at the point of sale, on each telephone bill, and on each
carrier's Web site.
[FR Doc. 2011-21547 Filed 8-22-11; 8:45 am]
BILLING CODE 6712-01-P