[Federal Register Volume 86, Number 68 (Monday, April 12, 2021)]
[Proposed Rules]
[Pages 18932-18934]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-07173]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 54

[WC Docket No. 18-89; DA 21-355; FRS 19427]


Wireline Competition Bureau Seeks Comment on a Report and 
Preliminary Cost Catalog and Replacement List To Help Providers 
Participate in the Supply Chain Reimbursement Program

AGENCY: Federal Communications Commission.

ACTION: Notification.

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SUMMARY: In this document, the Wireline Competition Bureau (Bureau) 
invites interested parties to comment on the Supply Chain Reimbursement 
Program Study (Report) and a preliminary Catalog of Eligible Expenses 
and Estimated Costs (Catalog) to assist the Federal Communications 
Commission (Commission) with establishing the Secure and Trusted 
Communications Networks Reimbursement Program (Reimbursement Program).

DATES: Comments are due April 26, 2021.

ADDRESSES: Pursuant to Sec. Sec.  1.415 and 1.419 of the Commission's 
rules, interested parties may file comments on or before the date 
indicated on the first page of this document. Comments must reference 
WC Docket No. 18-89 and must be addressed to the Commission's 
Secretary, Office of the Secretary, Federal Communications Commission. 
Comments may be filed using the Commission's Electronic Comment Filing 
System (ECFS).
     Electronic Filers: Comments may be filed electronically 
using the internet by accessing ECFS: https://www.fcc.gov/ecfs/.
     Paper Filers: Parties who choose to file by paper must 
file an original and one copy of each filing. Filings can be sent by 
hand or messenger delivery, by commercial overnight courier, or by 
first-class or overnight U.S. Postal Service mail.
    [ssquf] Commercial overnight mail (other than U.S. Postal Service 
Express Mail and Priority Mail) must be sent to 9050 Junction Drive, 
Annapolis Junction, MD 20701.
    [ssquf] U.S. Postal Service First-Class, Express, and Priority mail 
must be addressed to 45 L Street NE, Washington, DC 20554.
     Effective March 19, 2020, and until further notice, the 
Commission no longer accepts any hand or messenger delivered filings at 
its headquarters. This is a temporary measure taken to help protect the 
health and safety of individuals, and to mitigate the transmission of 
COVID-19. The Commission encourages outside parties to take full 
advantage of the Commission's electronic filing system. Any party that 
is unable to meet the filing deadline due to the building closure may 
request a waiver of the comment or reply comment deadline, to the 
extent permitted by law.
    People with Disabilities. To request materials in accessible 
formats for people with disabilities (Braille, large print, electronic 
files, audio format), the Commission asks that requests for 
accommodations be made as soon as possible in order to allow the agency 
to satisfy such requests whenever possible. Send an email to 
[email protected] or call the Consumer and Governmental Affairs Bureau at 
(202) 418-0530.

FOR FURTHER INFORMATION CONTACT: Christopher Koves, Wireline 
Competition Bureau, 202-418-7400 or by email at [email protected]. We 
ask that requests for accommodations be made as soon as possible in 
order to allow the agency to satisfy such requests whenever possible. 
Send an email to [email protected] or call the Consumer and Governmental 
Affairs Bureau at (202) 418-0530.

SUPPLEMENTARY INFORMATION: This is a summary of the Bureau's Public 
Notice (Notice) in WC Docket No. 18-89; DA 21-355, released on March 
25, 2021. The full text of this document is available at the following 
internet address: https://www.fcc.gov/document/fcc-releases-preliminary-supply-chain-reimbursement-program-documents.
    1. By the Notice, the Bureau invites interested parties to comment 
on the Report and a preliminary Catalog, https://docs.fcc.gov/public/attachments/DA-21-355A1.pdf, to assist the Commission with establishing 
the Reimbursement Program. The Report and Catalog will help eligible 
providers of advanced communications services participate in the 
Reimbursement Program. The Bureau also seeks comment on a preliminary 
List of Categories of Suggested Replacement Equipment and Services 
(Replacement List) to aid with the replacement of communications 
equipment and services deemed to pose an unacceptable risk to U.S. 
national security or the security and safety of U.S. persons (i.e., 
covered communications equipment or services).
    2. Section 4 of the Secure and Trusted Communications Networks Act 
of 2019 (Secure Networks Act), as amended, directs the Commission to 
establish a Reimbursement Program for the reimbursement of costs 
incurred by eligible providers of advanced communications services for 
the removal, replacement, and disposal of any covered communications 
equipment or services. Eligible providers include those providers that 
have previously obtained covered communications equipment or services, 
and, as recently amended, includes providers with up to 10 million or 
fewer customers. Eligible providers seeking reimbursement are required 
to submit an ``initial reimbursement cost estimate at the time of 
application, with supporting materials substantiating the costs.'' The 
Commission is required, as part of the Reimbursement Program, to 
develop a Replacement List to assist participants.
    3. On December 11, 2020, the Commission adopted the Supply Chain 
Second Report and Order, 86 FR 2904, January 13, 2021, which, among 
other measures, promulgated rules for the Reimbursement Program and the 
Replacement List. The Commission interpreted ``providers of advanced 
communications service'' to mean those providers with a broadband 
connection to an end user with at least a speed of 200 kbps in one 
direction and promulgated a ``costs reasonably incurred'' standard to 
determine reimbursement expense eligibility. The Commission also 
directed the Bureau to develop and finalize a Catalog to ``identify 
reimbursable costs with as much specificity as possible, provide 
guidance to entities seeking reimbursement, streamline the 
reimbursement process, and increase accountability.''
    4. The Bureau contracted with Widelity, Inc. (Widelity) to produce 
a report detailing the anticipated steps in removing, replacing, and 
disposing of covered communications equipment or services and an 
initial proposed version of the Catalog and Replacement List. Widelity 
conducted a series of confidential interviews with a broad range of 
communications industry stakeholders to understand the process and 
costs associated with removing, replacing, and disposing of covered 
communications equipment or services. The Bureau now seeks comment on 
the Report, Catalog, and Replacement List.

[[Page 18933]]

    5. Report: Supply Chain Reimbursement Program Study. Widelity 
produced the Report detailing the ``requirements, timing, and costs 
involved in the removal, replacement, and disposal of covered 
communications equipment, or services, from the networks of advanced 
communications service providers'' participating in the Reimbursement 
Program. The Report provides an industry and technology overview and 
explains Widelity's methodologies used to develop the initial version 
of the proposed Catalog and Replacement List. In preparing the Report, 
Widelity focused on the removal, replacement, and disposal of 
communications equipment and services produced or provided by Huawei 
and ZTE. Widelity acknowledges that the reimbursement process will be 
``complex and resource intensive'' but concludes that the Reimbursement 
Program ``can be achieved with the desired outcomes.''
    6. The Bureau seeks comment from interested parties on the Report, 
including Widelity's methodologies, and how the Report should inform 
the Reimbursement Program. In particular, does the Report accurately 
capture all anticipated steps and categories of expenses associated 
with the removal, replacement, and disposal of covered communications 
equipment or services?
    7. Catalog of Eligible Expenses and Estimated Costs. The Catalog is 
intended to ``help the Commission and applicants satisfy the Secure 
Networks Act's requirements[,] not only by helping applicants with 
transition planning and estimating costs for application submissions, 
but also with identifying potential replacement equipment and services 
and expediting the Commission's reimbursement request review process.'' 
When requesting funding from the Reimbursement Program, applicants 
``can reference the final [Catalog], which will contain a list of many, 
but not necessarily all, of the relevant expenses in lieu of providing 
additional supporting documentation to justify the specific cost 
estimate.'' As the Commission said, ``[i]f an applicant believes the 
predetermined estimate does not fully account for its specific 
circumstances or a predetermined cost estimate is not provided in the 
[Catalog] for the cost identified by the applicant, the applicant can 
provide its own individualized cost estimate.''
    8. Widelity produced the proposed Catalog, which includes a range 
of cost estimates, organized by category and subcategory of 
communications equipment and services, that may be eligible for 
reimbursement under the Reimbursement Program. These suggested costs 
are estimates only and are not meant to indicate that reimbursement 
will reflect the estimated costs. As the Commission explained, listing 
in the Catalog is not a guarantee of reimbursement for any individual 
expense under the Reimbursement Program. All claimed cost estimates 
submitted in a reimbursement application are subject to review by 
Commission staff to ensure each expense and request for reimbursement 
is reasonable. The Catalog is not exhaustive and inclusion or exclusion 
of a particular category of costs should not be read to state or imply 
that the expense will or will not be eligible for reimbursement. After 
considering public comments on the proposed Catalog, the Bureau will 
issue a public notice adopting a final version of the Catalog.
    9. The Bureau seeks comment from interested parties on the proposed 
Catalog, including the suggested ranges of estimated costs and cost 
categories and subcategories, and how the Catalog should inform the 
Reimbursement Program. To what extent are the cost estimates included 
in the proposed Catalog reasonable? Are the suggested cost ranges 
likely to help carriers estimate the costs for application submissions 
and identify potential replacement equipment and services? Are there 
additional cost categories and subcategories that should be included in 
the final Catalog?
    10. List of Categories of Suggested Replacement Equipment and 
Services. Section 4(d)(1) of the Secure Networks Act directs the 
Commission to establish a Replacement List that ``will identify 
categories of suggested replacements of real and virtual hardware and 
software equipment and services to guide providers removing covered 
communications equipment from their networks.'' The Commission 
explained that the Catalog would ``inform the Replacement List by 
helping to target the type of equipment that will be removed and 
replaced.'' The Commission found that the ``Replacement List should 
include equipment and services equipped, or upgradable to, be used in 
[Open Radio Access Networks (O-RAN)], or in virtualized networks.'' In 
adopting a rule for the Replacement List, however, the Commission 
declined ``to identify specific equipment and services'' or a ``list of 
manufacturers'' due to concerns about ``inadvertently overlooking some 
equipment or manufacturers,'' ``influenc[ing] purchases'' by appearing 
``to convey that the Commission believes certain equipment meets 
quality and security metrics,'' and possibly leading to ``security 
threats.''
    11. Widelity produced the proposed Replacement List which includes 
categories of replacement equipment and services that may be used to 
replace potentially covered equipment and services under the 
Reimbursement Program. Widelity relied on the network categories the 
Commission's Office of Economics and Analytics developed to identify 
Huawei and ZTE equipment and services potentially subject to 
replacement, removal, and disposal. Based on these network categories, 
Widelity analyzed core layer, distribution layer, access layer 
software, and services to prepare the proposed Replacement List. After 
considering public comments on the proposed Replacement List, the 
Bureau will release a public notice adopting the final version of the 
Replacement List which will be published on the Commission's website 
and annually updated to ensure that it remains current consistent with 
the Supply Chain Second Report and Order.
    12. The Bureau seeks comment on the proposed Replacement List. Are 
there additional categories of equipment and services that could be 
used to replace potentially covered communications equipment and 
services that the Bureau should include in the Replacement List?
    13. Ex Parte Rules. 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

[[Page 18934]]

be written ex parte presentations and must be filed consistent with 
rule 1.1206(b). In proceedings governed by rule 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 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.

Federal Communications Commission.
Cheryl Callahan,
Assistant Chief, Telecommunications Access Policy Division, Wireline 
Competition Bureau.
[FR Doc. 2021-07173 Filed 4-8-21; 4:15 pm]
BILLING CODE 6712-01-P