[Federal Register Volume 78, Number 157 (Wednesday, August 14, 2013)]
[Rules and Regulations]
[Pages 49370-49372]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2013-19770]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 1

[DA 13-1615]


Inflation Adjustment of Maximum Forfeiture Penalties

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: This document increases the maximum civil monetary forfeiture 
penalties available to the Commission under its rules governing 
monetary forfeiture proceedings to account for inflation. The inflation 
adjustment is necessary to implement the Debt Collection Improvement 
Act of 1996 (DCIA), which requires federal agencies to adjust ``civil 
monetary penalties provided by law'' at least once every four years.

DATES: Effective September 13, 2013.

FOR FURTHER INFORMATION CONTACT: Kimbarly Taylor, Enforcement Bureau, 
Telecommunication Consumers Division, 202-418-1188.

SUPPLEMENTARY INFORMATION: This is a summary of the Order by the 
Commission, DA 13-1615, adopted on August 1, 2013, and released on 
August 1, 2013. The complete text of this Order is available for 
inspection and copying during normal business hours in the FCC 
Reference Information Center, Courtyard Level, 445 12th Street SW., 
Washington, DC and also may be purchased from the Commission's copy 
contractor, Best Copy and Printing, Inc., at (202) 488-5300, Room CY-
B402, Portals II at 445 12th Street SW., Washington, DC.
    This Order amends Sec.  1.80(b) of the Commission's rules, 47 CFR 
1.80(b), to increase the maximum civil penalties established in that 
section to account for inflation since the last adjustment to these 
penalties. The adjustment procedure is set forth in detail in Sec.  
1.80(b)(9) of the Commission's rules. That section implements the Debt 
Collection Improvement Act of 1996, 28 U.S.C. 2461 note, which requires 
federal agencies to adjust maximum statutory civil monetary penalties 
at least once every four years.
    This Order adjusts the maximum penalties to account for the cost-
of-living increase in the Consumer Price Index (CPI) between June of 
the year the forfeiture amount was last set or adjusted,\1\ and June 
2012. Once the cost-of-living adjustment is calculated for the relevant 
period, each existing maximum penalty is multiplied by the cost-of-
living adjustment percentage. See 28 U.S.C. 2461 note 5(a). Each result 
is then rounded using the statutorily defined rules, which are set 
forth in the Commission's rules at 47 CFR 1.80(b)(9)(ii).\2\ Finally, 
the rounded result is added to the existing penalty amount to adjust 
each maximum monetary forfeiture penalty accordingly.\3\
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    \1\ Under the rounding rules set forth in Sec.  1.80(b)(9)(ii), 
47 CFR 1.80(b)(9)(ii), the inflationary adjustment for a statutory 
forfeiture amount must reach a specific threshold before the 
Commission may increase the maximum forfeiture amount. That 
adjustment is based on the difference between the CPI of ``June of 
the preceding year'' (here, June 2012) and that of June of the year 
a particular forfeiture was ``last set or adjusted.'' 47 CFR 
1.80(b)(9)(i). Thus, different CPIs may be used to calculate the 
inflation factors for different statutory forfeitures, depending on 
when a particular forfeiture was last increased. Specifically, we 
calculate the difference between the CPI for June 2012 and: June 
2011 (to adjust the penalties for 227(e) of the Communications Act 
of 1934, as amended (Communications Act or Act)), June 2010 (to 
adjust the penalties for Section 503(b)(2)(F)), June 2008 (to adjust 
the penalties for Sections 202(c), 203(e), 220(d), 223(b), 364(a), 
386(a), 503(b)(2)(A), 503(b)(2)(B), 503(b)(2)(D), 506(a), and 634), 
June 2007 (to adjust the penalties for Section 503(b)(2)(C)), June 
2004 (to adjust the penalties for Sections 205(b), 214(d), and 
219(b)), and June 1997 (to adjust the penalties for Sections 364(b), 
386(b), and 506(b)).
    \2\ Based on our application of the rounding rules, there are a 
number of penalties currently set forth in Sec.  1.80(b) of the 
Commission's rules that do not require adjustments for inflation at 
this time, including the penalties imposed pursuant to Sections 
202(c), 203(e), 214(d), 219(b), 220(d), 227(e) (the amounts for a 
single violation or single day of a violation), 364(a) & (b), 386(a) 
& (b), 503(b)(2)(A) (the amount for a single violation or single day 
of a violation), 503(b)(2)(D) (the amount for a single violation or 
single day of a violation), 506(a) & (b), and 634 of the Act. We 
also do not alter the penalties imposed pursuant to Sections 
6507(b)(4) and 6507(b)(5) of the Middle Class Tax Relief and Job 
Creation Act of 2012 because the Commission only implemented the Tax 
Relief Act in 2012. See Implementation of the Middle Class Tax 
Relief and Job Creation Act of 2012, 72 FR 71131, 71134 (November 
29, 2012). Accordingly, the only penalties adjusted in this order 
are those set forth in Sections 205(b), 223(b), 227(e) (for 
continuing violations), 503(b)(2)(A) (for continuing violations), 
503(b)(2)(B), 503(b)(2)(C), 503(b)(2)(D) (for continuing 
violations), and 503(b)(2)(F).
    \3\ Pursuant to the DCIA, Sec.  1.80(b)(9) includes a note that 
specifies one further consideration: ``[T]he first inflation 
adjustment [of a given penalty] cannot exceed 10 percent of the 
[existing] statutory maximum amount,'' 47 CFR 1.80(b)(9) note. The 
Sec.  1.80(b)(9) note was inadvertently omitted from Sec.  1.80(b) 
of the Commission's rules when the penalties in that section were 
previously adjusted. This order corrects that omission by 
reinserting the Sec.  1.80(b)(9) note in the Sec.  1.80 rules. 
Relevant to the Sec.  1.80(b)(9) note requirement, there are three 
sets of penalties addressed in this order that the Commission has 
not previously adjusted for inflation: the penalties set forth in 
Section 227(e) of the Act (continuing violations), those set forth 
in Section 503(b)(2)(C) of the Act, and those set forth in Section 
503(b)(2)(F) of the Act. With respect to Section 227(e), Section 
503(b)(2)(C), and Section 503(b)(2)(F) of the Act, our adjustments 
do not exceed 10 percent of the existing statutory maximum 
forfeiture amounts.
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    Because Congress has mandated these periodic rule changes and the 
Commission is required to make them, we find that, for good cause, 
compliance with the notice and comment provisions of the Administrative 
Procedure Act is unnecessary. See 5 U.S.C 553(b)(B).
    Likewise, because a notice of proposed rulemaking is not required 
for these rule changes, the Regulatory Flexibility Act, 5 U.S.C. 601 et 
seq., does not apply.
    Further, the Commission has analyzed the actions taken here with 
respect to the Paperwork Reduction Act of 1995

[[Page 49371]]

(PRA), and we find them to impose no new or modified information 
collection subject to the PRA. In addition, therefore, pursuant to the 
Small Business Paperwork Relief Act of 2002, the Commission's actions 
do not impose any new or modified ``information collection burden for 
small business concerns with fewer than 25 employees.'' See 44 U.S.C. 
3506(c)(4).
    The Commission will send a copy of this order to Congress and the 
Government Accountability Office pursuant to the Congressional Review 
Act, see 5 U.S.C. 801(a)(1)(A).

List of Subjects in 47 CFR Part 1

    Administrative practice and procedure, Penalties.

Federal Communications Commission.
David Kolker,
Deputy Bureau Chief, Enforcement Bureau.

Rule Changes

    For the reasons discussed in the preamble, the Federal 
Communications Commission amends 47 CFR part 1 as follows:

PART 1--PRACTICE AND PROCEDURE

0
1. The authority citation for part 1 continues to read as follows:

    Authority:  15 U.S.C. 79 et seq., 47 U.S.C. 151, 154(i) and (j), 
155, 157, 225, 227, 303(r), and 309.


Sec.  1.80  [Amended]

0
2. Amend Sec.  1.80 as follows:
0
a. Revise paragraphs (b)(1) through (b)(4).
0
b. Revise paragraph (b)(7).
0
c. Redesignate the note to paragraph (b)(5) as note to paragraph (b)(8) 
and revise the third and fourth sentences of its introductory text.
0
d. Revise the table in Section III of the note to paragraph (b)(8).
0
e. Revise the fourth sentence in paragraph (b)(9)(i).
0
f. Revise the table in paragraph (b)(9)(iii).
0
g. Add note to paragraph (b)(9).


Sec.  1.80  Forfeiture proceedings.

* * * * *
    (b) Limits on the amount of forfeiture assessed. (1) If the 
violator is a broadcast station licensee or permittee, a cable 
television operator, or an applicant for any broadcast or cable 
television operator license, permit, certificate, or other instrument 
of authorization issued by the Commission, except as otherwise noted in 
this paragraph, the forfeiture penalty under this section shall not 
exceed $37,500 for each violation or each day of a continuing 
violation, except that the amount assessed for any continuing violation 
shall not exceed a total of $400,000 for any single act or failure to 
act described in paragraph (a) of this section. There is no limit on 
forfeiture assessments for EEO violations by cable operators that occur 
after notification by the Commission of a potential violation. See 
section 634(f)(2) of the Communications Act. Notwithstanding the 
foregoing in this section, if the violator is a broadcast station 
licensee or permittee or an applicant for any broadcast license, 
permit, certificate, or other instrument of authorization issued by the 
Commission, and if the violator is determined by the Commission to have 
broadcast obscene, indecent, or profane material, the forfeiture 
penalty under this section shall not exceed $350,000 for each violation 
or each day of a continuing violation, except that the amount assessed 
for any continuing violation shall not exceed a total of $3,300,000 for 
any single act or failure to act described in paragraph (a) of this 
section.
    (2) If the violator is a common carrier subject to the provisions 
of the Communications Act or an applicant for any common carrier 
license, permit, certificate, or other instrument of authorization 
issued by the Commission, the amount of any forfeiture penalty 
determined under this section shall not exceed $160,000 for each 
violation or each day of a continuing violation, except that the amount 
assessed for any continuing violation shall not exceed a total of 
$1,575,000 for any single act or failure to act described in paragraph 
(a) of this section.
    (3) If the violator is a manufacturer or service provider subject 
to the requirements of section 255, 716, or 718 of the Communications 
Act, and is determined by the Commission to have violated any such 
requirement, the manufacturer or service provider shall be liable to 
the United States for a forfeiture penalty of not more than $105,000 
for each violation or each day of a continuing violation, except that 
the amount assessed for any continuing violation shall not exceed a 
total of $1,050,000 for any single act or failure to act.
    (4) Any person determined to have violated section 227(e) of the 
Communications Act or the rules issued by the Commission under section 
227(e) of the Communications Act shall be liable to the United States 
for a forfeiture penalty of not more than $10,000 for each violation or 
three times that amount for each day of a continuing violation, except 
that the amount assessed for any continuing violation shall not exceed 
a total of $1,025,000 for any single act or failure to act. Such 
penalty shall be in addition to any other forfeiture penalty provided 
for by the Communications Act.
* * * * *
    (7) In any case not covered in paragraphs (b)(1) through (b)(6) of 
this section, the amount of any forfeiture penalty determined under 
this section shall not exceed $16,000 for each violation or each day of 
a continuing violation, except that the amount assessed for any 
continuing violation shall not exceed a total of $122,500 for any 
single act or failure to act described in paragraph (a) of this 
section.
    (8) * * *
    Note to paragraph (b)(8): * * * The forfeiture ceilings per 
violation or per day for a continuing violation stated in section 503 
of the Communications Act and the Commission's rules are described in 
Sec.  1.80(b)(9). These statutory maxima became effective September 13, 
2013. * * *
* * * * *
Section III. Non-Section 503 Forfeitures That Are Affected by the 
Downward Adjustment Factors
* * * * *

------------------------------------------------------------------------
               Violation                       Statutory amount ($)
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Sec. 202(c) Common Carrier               $9,600, 530/day.
 Discrimination.
Sec. 203(e) Common Carrier Tariffs.....  9,600, 530/day.
Sec. 205(b) Common Carrier               23,200.
 Prescriptions.
Sec. 214(d) Common Carrier Line          1,320/day.
 Extensions.
Sec. 219(b) Common Carrier Reports.....  1,320.
Sec. 220(d) Common Carrier Records &     9,600/day.
 Accounts.
Sec. 223(b) Dial-a-Porn................  80,000/day.

[[Page 49372]]

 
Sec. 227(e)............................  10,000/violation. 30,000/day
                                          for each day of continuing
                                          violation, up to 1,025,000 for
                                          any single act or failure to
                                          act.
Sec. 364(a) Forfeitures (Ships)........  7,500 (owner).
Sec. 364(b) Forfeitures (Ships)........  1,100 (vessel master).
Sec. 386(a) Forfeitures (Ships)........  7,500/day (owner).
Sec. 386(b) Forfeitures (Ships)........  1,100 (vessel master).
Sec. 634 Cable EEO.....................  650/day.
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    (9) * * *
    (i) * * * Round off this result using the rules in paragraph 
(b)(9)(ii) of this section. * * *
* * * * *
    (iii) * * *

------------------------------------------------------------------------
                                                         Maximum penalty
                   U.S. Code citation                       after DCIA
                                                         adjustment  ($)
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47 U.S.C. 202(c).......................................            9,600
                                                                     530
47 U.S.C. 203(e).......................................            9,600
                                                                     530
47 U.S.C. 205(b).......................................           23,200
47 U.S.C. 214(d).......................................            1,320
47 U.S.C. 219(b).......................................            1,320
47 U.S.C. 220(d).......................................            9,600
47 U.S.C. 223(b).......................................           80,000
47 U.S.C. 227(e).......................................           10,000
                                                                  30,000
                                                               1,025,000
47 U.S.C. 362(a).......................................            7,500
47 U.S.C. 362(b).......................................            1,100
47 U.S.C. 386(a).......................................            7,500
47 U.S.C. 386(b).......................................            1,100
47 U.S.C. 503(b)(2)(A).................................           37,500
                                                                 400,000
47 U.S.C. 503(b)(2)(B).................................          160,000
                                                               1,575,000
47 U.S.C. 503(b)(2)(C).................................          350,000
                                                               3,300,000
47 U.S.C. 503(b)(2)(D).................................           16,000
                                                                 122,500
47 U.S.C. 503(b)(2)(F).................................          105,000
                                                               1,050,000
47 U.S.C. 507(a).......................................              750
47 U.S.C. 507(b).......................................              110
47 U.S.C. 554..........................................              650
------------------------------------------------------------------------

    Note to paragraph (b)(9): Pursuant to Public Law 104-134, the first 
inflation adjustment cannot exceed 10 percent of the statutory maximum 
amount.
* * * * *
[FR Doc. 2013-19770 Filed 8-13-13; 8:45 am]
BILLING CODE 6712-01-P