[Federal Register Volume 90, Number 48 (Thursday, March 13, 2025)]
[Proposed Rules]
[Pages 12036-12103]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2025-03718]
[[Page 12035]]
Vol. 90
Thursday,
No. 48
March 13, 2025
Part II
Federal Communications Commission
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47 CFR Parts 0, 1, and 43
Review of Submarine Cable Landing License Rules and Procedures To
Assess Evolving National Security, Law Enforcement, Foreign Policy, and
Trade Policy Risks; Schedule of Application Fees; Proposed Rule
Federal Register / Vol. 90, No. 48 / Thursday, March 13, 2025 /
Proposed Rules
[[Page 12036]]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Parts 0, 1, and 43
[OI Docket No. 24-523, MD Docket No. 24-524; FCC 24-119; FR ID 282229]
Review of Submarine Cable Landing License Rules and Procedures To
Assess Evolving National Security, Law Enforcement, Foreign Policy, and
Trade Policy Risks; Schedule of Application Fees
AGENCY: Federal Communications Commission.
ACTION: Proposed rule.
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SUMMARY: The Federal Communications Commission (``FCC'' or
``Commission'') takes another important step to protect the Nation's
submarine cable infrastructure from threats in an evolving national
security and law enforcement landscape by undertaking the first major
comprehensive review of the Commission's submarine cable rules since
2001. This review seeks to develop forward-looking rules to better
protect submarine cables, identify and mitigate harms affecting
national security and law enforcement, and facilitate the deployment of
submarine cables and capacity to the market. Among other things, the
Commission proposes to adopt a three-year periodic reporting
requirement for submarine cable landing licenses; in the alternative,
the Commission seeks comment on shortening the current 25-year
submarine cable license term or adopting a shorter license term in
combination with periodic reporting. The Commission also proposes or
seeks comment on codifying the Commission's legal jurisdiction and
other legal requirements in its rules to provide regulatory certainty
to submarine cable owners and operators. Additionally, the Commission
proposes and seeks comment on appropriate applicant and application
requirements to account for the evolution of technologies and
facilities and changes in the national security landscape over the last
two decades and to ensure the Commission has targeted and granular
information regarding the ownership, control, use of a submarine cable
system, and other things, which are critical to the Commission's review
to assess potential national security risks and other important public
interest factors. Further, the Commission seeks comment on improving
the quality of the circuit capacity data and facilitating the sharing
of such information with other Federal agencies. Through these
proposals, the Commission seeks to ensure that the Commission is
exercising appropriate oversight of submarine cables to safeguard U.S.
communications networks.
DATES: Comments are due on or before April 14, 2025; and reply comments
are due on or before May 12, 2025. Written comments on the Paperwork
Reduction Act proposed information collection requirements must be
submitted by the public, Office of Management and Budget (OMB), and
other interested parties on or before May 12, 2025.
ADDRESSES: Pursuant to Sec. Sec. 1.415 and 1.419 of the Commission's
rules, 47 CFR 1.415, 1.419, interested parties may file comments and
reply comments on or before the dates indicated in the DATES section of
this document. Comments may be filed using the Commission's Electronic
Comment Filing System (ECFS). You may submit comments, identified by OI
Docket No. 24-523 and MD Docket No. 24-524, by any of the following
methods:
Electronic Filers: Comments may be filed electronically
using the internet by accessing the 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 courier, or by the U.S. Postal Service. All filings must be
addressed to the Secretary, Federal Communications Commission.
Hand-delivered or messenger-delivered paper filings for
the Commission's Secretary are accepted between 8:00 a.m. and 4:00 p.m.
by the FCC's mailing contractor at 9050 Junction Drive, Annapolis
Junction, MD 20701. All hand deliveries must be held together with
rubber bands or fasteners. Any envelopes and boxes must be disposed of
before entering the building.
Commercial courier deliveries (any deliveries not by the
U.S. Postal Service) must be sent to 9050 Junction Drive, Annapolis
Junction, MD 20701.
Filings sent by U.S. Postal Service First-Class Mail,
Priority Mail, and Priority Mail Express must be sent to 45 L Street
NE, Washington, DC 20554.
People with Disabilities. To request materials in
accessible formats for people with disabilities (braille, large print,
electronic files, audio format), send an email to [email protected] or
call the Consumer & Governmental Affairs Bureau at 202-418-0530
(voice), 202-418-0432 (TTY).
Send a copy of your comment on the proposed information collection
to Cathy Williams, FCC, via email to [email protected] and to
[email protected]. Include in the comments the OMB control number
3060-0944.
FOR FURTHER INFORMATION CONTACT: Desiree Hanssen, Attorney Advisor,
Telecommunications and Analysis Division, Office of International
Affairs, at (202) 418-0887 or via email at [email protected]. For
additional information concerning the Paperwork Reduction Act
information collection requirements contained in this document, send an
email to [email protected] or contact Cathy Williams, Office of Managing
Director, at (202) 418-2918 or [email protected].
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Notice
of Proposed Rulemaking (NPRM), in OI Docket No. 24-523 and MD Docket
No. 24-524; FCC 24-119, adopted on November 21, 2024, and released on
November 22, 2024. The full text of this document is available on the
FCC's website at https://docs.fcc.gov/public/attachments/FCC-24-119A1.pdf. The Notice of Proposed Rulemaking is adopted pursuant to
sections 1, 4(i), 4(j), 201-255, 303(r), 403, 413 of the Communications
Act of 1934, as amended, 47 U.S.C. 151, 154(i), 154(j), 201-255,
303(r), 403, 413, and the Cable Landing License Act of 1921, 47 U.S.C.
34-39, and Executive Order 10530, section 5(a) (May 12, 1954) reprinted
as amended in 3 U.S.C. 301.
To request materials in accessible formats for people with
disabilities, send an email to [email protected] or call the Consumer &
Governmental Affairs Bureau at (202) 418-0530 (voice), (202) 418-0432
(TTY).
Providing Accountability Through Transparency Act. Consistent with
the Providing Accountability Through Transparency Act, Public Law 118-
9, a summary of this document is available on https://www.fcc.gov/proposed-rulemakings.
Initial Paperwork Reduction Act of 1995 Analysis. This document
contains proposed information collection requirements. The Commission,
as part of its continuing effort to reduce paperwork burdens, invites
the general public and the Office of Management and Budget (OMB) to
comment on the information collection requirements contained in this
document, as required by the Paperwork Reduction Act of 1995, Public
Law 104-13. Public and agency comments are due May 12, 2025.
Comments should address: (a) whether the proposed collection of
information is necessary for the proper performance of the functions of
the Commission, including whether the information shall have practical
utility; (b) the accuracy of the Commission's
[[Page 12037]]
burden estimates; (c) ways to enhance the quality, utility, and clarity
of the information collected; (d) ways to minimize the burden of the
collection of information on the respondents, including the use of
automated collection techniques or other forms of information
technology; and (e) way to further reduce the information collection
burden on small business concerns with fewer than 25 employees. 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
specific comment on how the Commission might further reduce the
information collection burden for small business concerns with fewer
than 25 employees.
Synopsis
I. Notice of Proposed Rulemaking
1. In the NPRM, the Commission initiates a comprehensive review of
its submarine cable rules to develop forward-looking rules to better
protect submarine cables, identify and mitigate harms affecting
national security and law enforcement, and facilitate the deployment of
submarine cables and capacity to the market. The Commission believes
this proceeding will improve Commission review and oversight of
submarine cable landing licenses and ensure each licensee continues to
serve the public interest in an evolving national security and law
enforcement landscape.
A. Legal Authority Under the Cable Landing License Act of 1921
1. Commission Jurisdiction
a. General License Requirement
2. As an initial matter, the Commission proposes to codify in its
rules when a submarine cable license is required under the Cable
Landing License Act. The Cable Landing License Act states that ``[n]o
person shall land or operate in the United States any submarine cable
directly or indirectly connecting the United States with any foreign
country, or connecting one portion of the United States with any other
portion thereof, unless a written license to land or operate such cable
has been issued by the President.'' The Cable Landing License Act
further states that ``[t]he conditions of sections 34 to 39 of this
title shall not apply to cables, all of which, including both
terminals, lie wholly within the continental United States.'' \1\
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\1\ In 1921, the definition of ``United States'' included ``the
Canal Zone, the Philippine Islands, and all territory, continental
or insular, subject to the jurisdiction of the United States of
America.'' In 1946, following the proclamation of the independence
of the Philippines by the President, the definition was amended to
remove the Philippines. In 1959, Hawaii and Alaska became part of
the United States and were admitted as states. The Cable Landing
License Act definition, however, was not later amended to
incorporate Hawaii and Alaska as part of the continental United
States, or other territories or possessions.
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3. Specifically, the Commission proposes to adopt a rule stating
that a submarine cable landing license must be obtained prior to
landing a submarine cable that connects:
(1) the continental United States with any foreign country;
(2) Alaska, Hawaii or the U.S. territories or possessions with a
(i) foreign country,
(ii) the continental United States, or
(iii) with each other; or
(3) points within the continental United States, Alaska, Hawaii, or
a territory or possession in which the cable is laid in international
waters.
Although the Commission believes that the scope of the Cable
Landing License Act has been well-understood, the Commission also
believes that codifying these requirements will bring additional
clarity to the application process and provide regulatory certainty to
submarine cable owners and operators.
b. Submarine Cable System Definition
4. For the same reasons the Commission proposes to codify in its
rules when a submarine cable landing license must be obtained, the
Commission seeks comment generally on whether to adopt a definition of
a submarine cable system. Conceptually and in simple terms, a submarine
cable system is comprised of a cable laid beneath the water that
carries telecommunication transmission signals between two or more
cable landing stations containing equipment that converts submarine
cable signals to terrestrial signals.\2\ The wet segment of the
submarine cable system makes landfall at the beach manhole or beach
joint that, in turn, connects to the dry segment and submarine cable
landing stations. A submarine cable landing station is a dry land
facility where submarine cables terminate traffic, allowing voice,
data, and internet to be transmitted to terrestrial or local
networks.\3\ At the terminal, equipment such as Submarine Line Terminal
Equipment (SLTE),\4\ converts cable signals to terrestrial signals
allowing the cable to interconnect to terrestrial facilities in the
United States.
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\2\ In the Technical Appendix, the Commission provides a
technical description of a submarine cable system for informational
purposes.
\3\ Cable landing stations contain equipment that supplies power
to optical submarine cables and equipment that receives signals from
submarine cables and transmits signals to a backhaul network that
terminates at a Point of Presence (PoP). A data center can serve as
a cable landing station, and PoPs can be located within a cable
landing station or data center.
\4\ The SLTE determines the cable's data throughput or
performance.
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5. Based on the description above, the Commission seeks comment on
whether it is necessary to adopt a definition of submarine cable for
purposes of the Commission's licensing process. If so, should the
Commission define a submarine cable as a cable(s) laid beneath the
water \5\ that transmits voice, data, and internet between terminal
cable landing stations that, among other functions, contain the SLTE
located in the continental United States, Alaska, Hawaii, or the U.S.
territories or possessions. The Commission believes that defining a
submarine cable accordingly would account for a submarine cable system
that may have more than one terminal landing point
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located on or near the coast. Moreover, the Commission believes this
definition is sufficiently flexible to also account for the various
technical options available to cable owners and operators for routing
traffic from a cable landing station located near the coast--which may
have only certain equipment such as Power Feed Equipment (PFE) \6\--to
another cable landing station to connect to a PoP, or similar facility.
The Commission seeks comment on this definition and whether it would
capture the current state of submarine cable systems and account for
the evolution and upgrades of submarine cable technologies.
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\5\ The Cable Landing License Act does not apply to submarine
cables wholly within the continental United States, such as a cable
traversing a river or a lake located wholly within the continental
United States. A submarine cable landing license is required under
the Cable Landing License Act, however, if a cable connects the
United States to a foreign country, such as Canada or Mexico. The
Commission has granted cable landing licenses, for instance, (1) to
land and operate a submarine cable under the Rio Grande River
connecting the United States and Mexico, (2) to land and operate a
submarine cable located within a tunnel traversing the Detroit River
between the United States and Canada, and (3) to land and operate a
submarine cable across Lake Ontario connecting the United States and
Canada. File No. SCL-LIC-20210930-00042, Actions Taken Under Cable
Landing License Act, Public Notice, Report No. SCL-00376, 37 FCC Rcd
7380, 7381-82 (IB 2022) (granting a cable landing license to Neural
Networks USA LLC ``for the purpose of landing and operating a non-
common carrier fiber optic submarine cable, the Neutral Networks
Laredo Cable, that connects Laredo, Texas and Nuevo Laredo,
Tamaulipas, Mexico,'' which ``will consist of three fiber optic
cables in a seven duct conduit extending 251 feet under the Rio
Grande River''); GTE Sprint Communications Corp.; Application for a
license to land in the United States a submarine cable extending
between the United States at Detroit, Michigan and Canada at
Windsor, Ontario, S-C-L-85-002, Cable Landing License, 1986 WL
292524 at *1, paras. 2, 4 (CCB Jan. 10, 1986) (granting to GTE
Sprint Communications Corp. a cable landing license ``to land and
operate a submarine cable between Detroit, Michigan and Windsor,
Ontario, Canada,'' which ``will be located within the conduit space
of the Detroit-Windsor tunnel which traverses the Detroit River
between Detroit[,] Michigan and Windsor, Ontario''); File No. SCL-
LIC-20180216-00002, Actions Taken Under Cable Landing License Act,
Public Notice, Report No. SCL-00226, DA 18-1026, 2018 WL 4851455 at
*2 (IB 2018) (granting a cable landing license to Crosslake Fiber
USA LP ``for the purpose of constructing, landing and operating a
private fiber-optic submarine cable network, the Crosslake Fibre
cable system, connecting Toronto, Ontario, with Cambria, New York,''
which ``will consist of a single, unrepeatered segment across Lake
Ontario'').
\6\ The PFE, in general, provides the electrical current that
powers submarine cable system repeaters and/or optical branching
units, and are located in or close to terminal landing stations.
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c. Public Interest Standard
6. The Commission proposes to codify in its rules the longstanding
practice that applicants seeking a submarine cable landing license or
modification, assignment, transfer of control, and renewal or extension
of a cable landing license must include in their application
information demonstrating how the grant of the application will serve
the public interest, convenience, and necessity, consistent with the
Commission's authority to withhold or revoke any license where doing so
``will assist in securing rights for the landing or operation of cables
in foreign countries, or in maintaining the rights or interests of the
United States or of its citizens in foreign countries, or will promote
the security of the United States.'' The Commission has long found that
national security, law enforcement, foreign policy, and trade policy
concerns are important to its public interest analysis of submarine
cable applications, and these concerns warrant continued consideration
in view of evolving and heightened threats to the Nation's
communications infrastructure.\7\ The Commission's determination
assesses whether the public interest, convenience, and necessity would
be served by the grant of an application for a cable landing license or
modification, assignment, transfer of control, and renewal or extension
of a cable landing license and is based on the totality of the
circumstances presented by each application, supplemented with
additional information as necessary. The Commission seeks comment on
this proposed codification.
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\7\ See Executive Branch Review Report and Order, 85 FR 76360
(November 27, 20220), 35 FCC Rcd at 10928-29, para. 3 (``In adopting
rules for foreign carrier entry into the U.S. telecommunications
market over two decades ago in its Foreign Participation Order, the
Commission affirmed that it would consider national security, law
enforcement, foreign policy, and trade policy concerns in its public
interest review of application for international section 214
authorizations and submarine cable landing licenses and petitions
for declaratory ruling under section 310(b) of the Act.''); see,
e.g., Applications of T-Mobile US, Inc. and Sprint Corporation for
Consent to Transfer Control of Licenses and Authorizations, et al.,
WT Docket 18-197, Memorandum Opinion and Order, Declaratory Ruling,
and Order of Proposed Modification, 34 FCC Rcd 10578, 10732-33,
para. 349 (2019) (``When analyzing a transfer of control or
assignment application that involves foreign investment, we also
consider public interest issues related to national security, law
enforcement, foreign policy, or trade policy concerns.'').
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d. Character Qualifications
7. The Commission proposes to codify in its rules regarding
submarine cable applications the Commission's longstanding practice
regarding the character qualifications of applicants for Commission
licenses and authorizations. Specifically, the Commission proposes that
it will consider whether an applicant seeking a cable landing license
or modification, assignment, transfer of control, and renewal or
extension of a cable landing license has the requisite character
qualifications, including whether the applicant has violated the Cable
Landing License Act, the Communications Act, or Commission rules,
including making false statements or misrepresentations to the
Commission; whether the applicant has been convicted of a felony; and
whether there is an adjudicated determination that the applicant has
violated U.S. antitrust or other competition laws, has been found to
have engaged in fraudulent conduct before another government agency, or
has engaged in other non-FCC misconduct the Commission has found to be
relevant in assessing the character qualifications of a licensee or
authorization holder.\8\ The Commission has found in other contexts
that such conduct demonstrates that an applicant may fail to comply
with the Commission's rules and policies as well as any conditions on
its authorization.\9\ The public interest may therefore require, in a
particular case, that the Commission deny an application for a cable
landing license or modification, assignment, transfer of control, and
renewal or extension of a cable landing license because the applicant
has violated the Cable Landing License Act, the Communications Act, or
the Commission rules, or other laws that may be indicative of the
applicant's truthfulness and reliability, or that the Commission revoke
a cable landing license on such grounds. The Commission believes
consideration of an applicant's or cable landing licensee's regulatory
compliance and adherence to other relevant laws is also consistent with
the Commission's review of applications in other contexts and is
important to the Commission's assessment as to whether the public
interest, convenience, and necessity would be served by grant of the
applications. The Commission seeks comment on this proposed
codification.
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\8\ The term ``non-FCC misconduct'' refers to misconduct other
than a violation of the Rules or the Act. The Commission and the
courts have recognized that ``[t]he FCC relies heavily on the
honesty and probity of its licensees in a regulatory system that is
largely self-policing.'' Reliability is a key, necessary element to
operating a broadcast station in the public interest. An applicant
or licensee's propensity to comply with the law generally is
relevant because a willingness to be less than truthful with other
government agencies, to violate other laws, and, in particular, to
commit felonies, is potentially indicative of whether the applicant
or licensee will in the future conform to the Commission's rules or
policies.
\9\ See also MCI Telecommunications Corp.; Petition for
Revocation of Operating Authority, 3 FCC Rcd 509, 512, n.14 (1988)
(stating that character qualifications standards adopted in the
broadcast context, while not applicable to common carriers, can
provide guidance in the common carrier context).
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e. Process To Withhold or Revoke a Cable Landing License
8. In the NPRM, the Commission proposes and seeks comment on
adopting a procedural framework that it may use to consider whether
withholding a grant of a cable landing license or revocation of a cable
landing license is warranted pursuant to the Cable Landing License Act
and Executive Order 10530. The Commission has specific statutory
authority to withhold or revoke cable landing licenses under the Cable
Landing License Act and Executive Order 10530. Section 35 of the Cable
Landing License Act states that ``[t]he President may withhold or
revoke such license when he shall be satisfied after due notice and
hearing that such action will assist in securing rights for the landing
or operation of cables in foreign countries, or in maintaining the
rights or interests of the United States or of its citizens in foreign
countries, or will promote the security of the United States . . . .''
In addition, section 5 of Executive Order 10530 states that the
Commission is ``designated and empowered to . . . withhold[ ] or revoke
licenses to land or operate submarine cables in the United States . . .
.'' The Commission has not prescribed specific procedures applicable to
withholding or revocation of a cable landing license, yet in the
Executive Branch Review Report and Order, it has stated that if it is
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considering revoking a license that was granted following referral to
the Committee for the Assessment of Foreign Participation in the United
States Telecommunications Services Sector (the Committee) or its
predecessor pursuant to Executive Order 13913, it will provide ``such
notice and an opportunity to respond as is required by due process and
applicable law, and appropriate in light of the facts and
circumstances.'' \10\ The Commission seeks to adopt a process
applicable to withholding or revocation of cable landing licenses that
will enable it to fulfill its statutory responsibilities--including,
among other things, promotion of the national and economic security of
the United States and other public interest considerations, such as
character issues--while ensuring procedural safeguards to protect
licensees' due process rights.
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\10\ Section 6 of Executive Order 13913 provides that the
Committee may at any time ``review existing licenses to identify any
additional or new risks to national security or law enforcement
interests of the United States.'' Executive Order 13913 defines
``license'' as ``any license, certificate of public interest, or
other authorization issued or granted by the Federal Communications
Commission (FCC) after referral of an application by the FCC to the
Committee established by subsection 3(a) of this order or, if
referred before the date of this order, to the group of executive
departments and agencies involved in the review process that was
previously in place.''
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9. Specifically, the Commission seeks comment on integrating the
approach it utilized in recent section 214 revocation proceedings--and
which the Court of Appeals for the D.C. Circuit upheld \11\--where the
Commission exercised its discretion to ``resolve disputes of fact in an
informal hearing proceeding on a written record,'' and reasonably
determined that the issues raised in those cases could be properly
resolved through the presentation and exchange of full written
submissions before the Commission itself.\12\ The Commission
tentatively finds that it may exercise similar procedural discretion in
its evaluation of each case as to whether withholding or revocation of
a cable landing license is warranted. The Commission believes that the
statutory language ``withhold . . . such license'' is identical to the
concept of denying an application. For purposes of submarine cable
licenses, withholding of a license would apply to the Commission's
consideration of a grant of an initial application for a cable landing
license and an application to modify, assign, transfer control of, or
renew or extend a cable landing license.\13\ The Commission seeks
comment on whether it may use the same informal hearing process or an
alternative process if it considers termination of a cable landing
license due to a licensee's failure to comply with any condition of the
license.
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\11\ China Telecom. (Ams.) Corp. v. FCC, 57 F.4th at 262 (citing
Procedural Streamlining of Administrative Hearings, Report and
Order, 35 FCC Rcd 10729, 10732-33, para. 11 (2020) (Administrative
Hearings Order) (`` `The Communications Act gives the Commission the
power of ruling on facts and policies in the first instance. In
exercising that power, the Commission may resolve disputes of fact
in an informal hearing proceeding on a written record. And the
Commission may reach any decision that is supported by substantial
evidence in the record.' '')).
\12\ China Telecom (Ams.) Corp. v. FCC, 57 F.4th at 256, 269
(``As explained above, the FCC has broad discretion to craft its own
rules `of procedure and to pursue methods of inquiry capable of
permitting them to discharge their multitudinous duties.' Schreiber,
381 U.S. at 290, 85 S.Ct. 1459 (internal quotations omitted); see
also Vermont Yankee, 435 U.S. at 543, 98 S.Ct. 1197). The Commission
has exercised this discretion to `resolve disputes of fact in an
informal hearing proceeding on a written record.' Streamlining
Order, 35 FCC Rcd. at 10732. Here, the Commission reasonably
determined that the issues raised in this case could be properly
resolved through the presentation and exchange of full written
submissions before the Commission itself.'').
\13\ Section 1.767(g)(15) sets forth that ``[t]he cable landing
license shall expire twenty-five (25) years from the in-service
date, unless renewed or extended upon proper application. Upon
expiration, all rights granted under the license shall be
terminated.'' The Commission notes that within the category of
applications for modifications, different procedures might be
appropriate based on the nature of the modification. For example,
procedures for reviewing an application seeking to incorporate a
revised mitigation agreement may be more streamlined than procedures
applicable to modifications to update facilities or add a submarine
cable landing station.
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10. Further, the Commission proposes to modify the Office of
International Affairs' (OIA) existing delegated authority to codify the
Commission's existing ability to deny an application and to revoke and/
or terminate a submarine cable landing license under the Cable Landing
License Act and Executive Order 10530.\14\ The Commission also proposes
to delegate authority to OIA to implement these procedures described
above for denial, revocation, and/or termination, as required by due
process and applicable law and in light of the relevant facts and
circumstances, including providing the applicant or licensee with
notice and opportunity to respond.\15\
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\14\ The Commission's proposed delegation of authority to OIA
would broaden OIA's existing delegated authority to act pursuant to
Sec. 0.19(q) and (r).
\15\ OIA's implementation could include, for example,
establishing response and pleading cycle deadlines, addressing
waiver requests, addressing requests for live hearing procedures,
seeking additional information, and providing for additional
pleading cycles.
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(i) Due Process and Procedural Requirements
11. The Commission tentatively finds that the process it seeks to
apply in cases involving withholding or revocation of cable landing
licenses--which, in effect, would constitute an informal hearing
process through the presentation and exchange of full written
submissions before the Commission--is consistent with due process and
procedural requirements under relevant statutes including the Cable
Landing License Act, the Communications Act, and the Administrative
Procedure Act (APA). The Cable Landing License Act sets forth, among
other things, that ``[t]he President may withhold or revoke such
license when he shall be satisfied after due notice and hearing that
such action will assist in securing rights for the landing or operation
of cables in foreign countries, or in maintaining the rights or
interests of the United States or of its citizens in foreign countries,
or will promote the security of the United States . . . .'' The
authority vested in the President, including the authority to withhold
or revoke cable landing licenses, is delegated to the Commission
pursuant to Executive Order 10530, on the condition that ``[n]o such
license shall be granted or revoked by the Commission except after
obtaining approval of the Secretary of State and such advice from any
executive department or establishment of the Government as the
Commission may deem necessary.'' \16\ Currently, the Commission's rules
codify as a condition of such license that ``[t]he cable landing
license is revocable by the Commission after due notice and opportunity
for hearing pursuant to Section 2 of the Cable Landing License Act, 47
U.S.C. 35, or for failure to comply with the terms of the license or
with the Commission's rules.'' \17\
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\16\ Executive Order 10530, sec. 5(a).
\17\ Except as otherwise ordered by the Commission, the rules in
Sec. 1.767(g) apply to each licensee of a cable landing license
granted on or after March 15, 2002.
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12. The Cable Landing License Act, which is the source of authority
from which authority to withhold or revoke a cable landing license
emanates, states that the President may ``withhold or revoke such
[cable landing] license . . . after due notice and hearing,'' but does
not identify particular procedures that must be followed. As the
Commission has stated, where an agency's enabling statute does not
expressly require an ``on the record'' hearing and instead calls simply
for a ``hearing,'' a ``full hearing,'' or uses similar terminology,
[[Page 12040]]
the statute does not trigger the APA's formal adjudication procedures
absent clear evidence of congressional intent to do so.\18\ Agencies
must adhere to the formal hearing procedures in sections 554, 556, and
557 of the APA only in cases of ``adjudication required by statute to
be determined on the record after opportunity for an agency hearing.''
\19\ In addition to the Cable Landing License Act, neither the
Communications Act, the Commission's rules, nor the APA requires trial-
type hearing procedures. Congress has granted the Commission broad
authority to ``conduct its proceedings in such manner as will best
conduce to the proper dispatch of business and to the ends of
justice.'' The Commission has broad discretion to craft its own rules
``of procedure and to pursue methods of inquiry capable of permitting
them to discharge their multitudinous duties.'' \20\ Furthermore, the
Communications Act gives the Commission the power of ruling on facts
and policies in the first instance. In exercising that power, the
Commission may resolve disputes of fact in an informal hearing
proceeding on a written record. For instance, the Commission's subpart
B hearing rules provide procedures for hearings in appropriate
circumstances, including procedures for the revocation of station
licenses and construction permits.\21\ In the 2023 VoIP Direct Access
to Numbers Report and Order (88 FR 80617, November 20, 2023), the
Commission delegated authority to the Wireline Competition Bureau and
the Enforcement Bureau to determine appropriate procedures and initiate
revocation and/or termination proceedings and to revoke and/or
terminate a direct access authorization, as required by due process and
applicable law and in light of the relevant facts and circumstances,
including providing the direct access authorization holder with notice
and opportunity to respond.
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\18\ See United States v. Florida East Coast Railway Co., 410
U.S. 224, 234-38 (1973) (the words ``after hearing'' in the
Interstate Commerce Act do not require formal APA adjudication); see
also, e.g., City of W. Chicago, Ill. v. U.S. Nuclear Regulatory
Comm'n, 701 F.2d 632, 641 (statutory requirement of a ``hearing''
does not trigger formal, on-the-record hearing provisions of the
APA); Chem. Waste Mgmt., Inc. v. EPA, 873 F.2d 1477, 1480-83 (D.C.
Cir. 1989) (no presumption that ``public hearing'' means ``on the
record'' hearing); Farmers Union Cent. Exch. v. FERC, 734 F.2d 1486,
1499 n.39 (D.C. Cir. 1984) (``after full hearing'' is ``not
equivalent to the requirement of a decision `on the record' '')
(internal citation omitted).
\19\ 5 U.S.C. 551(7) (defining ``adjudication'').
\20\ Numbering Policies for Modern Communications et al., WC
Docket No. 13-97 et al., Second Report and Order (88 FR 80617,
November 20, 2023) and Second Further Notice of Proposed Rulemaking
(88 FR 74098, October 30, 2023), 38 FCC Rcd 8951, 8972, para. 64
(2023) (delegating authority to the Wireline Competition Bureau and
the Enforcement Bureau to determine appropriate procedures and
initiate revocation and/or termination proceedings and to revoke
and/or terminate a direct access authorization, as required by due
process and applicable law and in light of the relevant facts and
circumstances, including providing the direct access authorization
holder with notice and opportunity to respond).
\21\ Section 1.91 of the Commission's rules applies subpart B
hearing rules to revocations of ``station license[s]'' or
``construction permit[s],'' which refer to spectrum licenses issued
under title III of the Communications Act.
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13. The Commission proposes an informal written process for
Commission actions on denial of applications and revocation and
termination of cable landing licenses.\22\ The Commission seeks comment
on the procedural measures necessary to ensure the development of an
adequate administrative record, including procedures for participation
by other interested parties, and on the appropriate procedural
safeguards to ensure due process. To determine what process is due, the
Commission considers the factors set forth in the Mathews v. Eldridge
three-part test: (1) ``the private interest that will be affected by
the official action;'' (2) ``the risk of an erroneous deprivation of
such interest through the procedures used, and the probable value, if
any, of additional or substitute procedural safeguards;'' and (3) ``the
Government's interest, including the function involved and the fiscal
and administrative burdens that the additional or substitute procedural
requirement would entail.'' With regard to the first Mathews factor
(the nature of the private interest), while the Commission recognizes
that denial of a cable landing license application or revocation of a
cable landing license will have an impact on the applicant(s) or on the
licensee(s) and any customers, the Commission tentatively finds that
private companies have no unqualified right to land or operate a
submarine cable in the United States. On the contrary, the Cable
Landing License Act sets forth that a cable landing license may be
withheld or revoked, stating that the President may ``withhold or
revoke such license when he shall be satisfied after due notice and
hearing that such action will assist in securing rights for the landing
or operation of cables in foreign countries, or in maintaining the
rights or interests of the United States or of its citizens in foreign
countries, or will promote the security of the United States.'' The
Cable Landing License Act and Executive Order 10530, which delegates
this denial and revocation authority to the Commission, thereby puts
regulated parties on notice that any application for a cable landing
license is subject to denial by the Commission and any grant of a cable
landing license is contingent on the Commission's authority to revoke
such license. Further, whereas licensees facing revocation have a
private interest in continuing to operate licensed facilities,
applicants typically have no such interest.
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\22\ In the 2020 Executive Branch Review Report and Order, the
Commission addressed how it would handle modifications and
revocations requested by the executive branch. See Executive Branch
Review Report and Order, 35 FCC Rcd at 10963-64, para. 92
(``Consistent with current practice, the Commission will provide any
affected authorization holder or licensee an opportunity to respond
to the Committee's recommendation prior to any action by the
Commission. This will address the commenters' concern that the
Commission might proceed with modification or revocation of an
existing authorization or license without warning or the opportunity
to comment. [The Commission finds] that new rules or a separate
proceeding are unnecessary to address Committee reviews of existing
licenses as the Commission already has procedural safeguards in
place to protect licensees' due process rights, and that until such
time as the Commission has more experience with such Committee
recommendations, it is more appropriate to tailor such procedures to
the facts and circumstances of a particular Committee
recommendation.'').
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14. With regard to the second Mathews factor (risk of erroneous
deprivation without additional procedures and their probable value),
the Commission tentatively finds that the process it seeks to apply
would provide cable landing licensees with sufficient due process--
notice and the opportunity to be heard ``at a meaningful time and in a
meaningful manner.'' \23\ Neither the Cable Landing License Act, the
APA, nor the Communications Act requires the conduct of evidentiary
hearings for denial of cable landing license applications or revocation
of cable landing licenses. The Commission tentatively finds it
sufficient due process to provide applicants or cable landing licensees
with timely and adequate notice of the reasons for any denial or
revocation action, and opportunity to respond with their own evidence
and to make any factual, legal, or policy arguments. Further, the
process the Commission proposes would provide any other interested
parties, including any joint applicants or licensees or other proposed
or existing owners of a submarine cable, with notice and the
opportunity to be heard. Finally, as noted above, the
[[Page 12041]]
private interests in grant of an application typically are less than
the private interests in continued use of licensed facilities, thus,
the Commission believes that it may appropriately deny an application
with fewer procedures than would be appropriate for revocation. The
Commission seeks comment on this analysis. Would the Commission's
proposed process for denying initial applications be appropriate for
renewal and extension applications \24\ or for modification,
assignment, or transfer of control applications? If not, what is the
due process rationale for using different procedures in these
circumstances?
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\23\ See, e.g., Mathews, 424 U.S. at 333 (citing Armstrong v.
Manzo, 380 U.S. 545, 552 (1965)); cf. 5 U.S.C. 558(c)(1) and (2)
(permitting ``revocation . . . of a license'' following ``notice by
the agency in writing'' of any basis for revocation and an
``opportunity to demonstrate compliance'').
\24\ For purposes of this proceeding, the Commission refers to
applications to renew or extend a cable landing license collectively
as ``renewal applications.''
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15. With regard to the third Mathews factor (the Government's
interest), the Commission tentatively finds that ``the fiscal and
administrative burdens'' on the Commission and the relevant executive
branch agencies, including the Committee, weigh in favor of the
Commission's proposal to base its procedures on those it utilized in
the denial of an international section 214 application of China Mobile
USA and in subsequent section 214 revocation proceedings involving
Chinese state-owned entities. As the Commission stated in the China
Telecom Americas Order on Revocation and Termination, China Unicom
Americas Order on Revocation, and Pacific Networks and ComNet Order on
Revocation and Termination,\25\ courts have recognized that hearings
before an administrative law judge, with live testimony and cross
examination, impose significant temporal and cost burdens on agencies.
The Commission determined, among other things, that the fiscal and
administrative burden on the Government would be especially heavy in
those cases, as a trial before an administrative law judge could
require participation by officials from other agencies and take time
away from their essential duties to participate in additional
administrative proceedings. For these same reasons, the Commission
tentatively finds that the administrative burden on the Government
would be heavy in cases involving denial of cable landing license
applications or revocation of cable landing licenses. More importantly,
given the national security issues that may be at stake, any resulting
unwarranted delay could be harmful. The Commission also believes that
traditional live hearing procedures involving testimony and cross-
examination could entail significant administrative burdens on the
Commission even in cases involving other issues that do not involve the
executive branch agencies, such as character concerns, or other
Commission rule violations. The Commission seeks comment on this
assessment.
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\25\ China Telecom (Americas) Corporation, GN Docket No. 20-109,
File Nos. ITC-214-20010613-00346, ITC-214-20020716-00371, ITC-T/C-
20070725-00285, Order on Revocation and Termination, 36 FCC Rcd
15966, 15958, para. 27 (2021) (China Telecom Americas Order on
Revocation and Termination), aff'd, China Telecom. (Ams.) Corp. v.
FCC, 57 F.4th 256 (D.C. Cir. 2022); China Unicom (Americas)
Operations Limited, GN Docket No. 20-110, File Nos. ITC-214-
20020728-00361, ITC-214-20020724-00427, Order on Revocation, 37 FCC
Rcd 1480, 1499, para. 35 (2022) (China Unicom Americas Order on
Revocation), appeal pending sub nom China Unicom (Americas)
Operations Limited v. FCC, No. 22-70029 (9th Cir.); Pacific Networks
Corp. and ComNet (USA) LLC, GN Docket No. 20-111, File Nos. ITC-214-
20090105-00006 and ITC-214-20090424-00199, Order on Revocation and
Termination, 37 FCC Rcd 4220, 4242, para. 29 (2022) (Pacific
Networks and ComNet Order on Revocation and Termination) (``A
detailed procedural history of Pacific Networks' and ComNet's
authorizations can be found in the Order to Show Cause.''), aff'd,
Pacific Networks Corp. v. FCC, 77 F.4th 1160 (D.C. Cir. 2023); see,
e.g., Chem. Waste Mgmt., Inc. v. EPA, 873 F.2d at 1485; G.E. v. EPA,
595 F. Supp. 2d 8, 38-39 (D.D.C. 2009).
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16. The Commission seeks comment generally on its Mathews analysis
and whether the process it proposes herein would provide applicants and
cable landing licensees with sufficient due process and notice and
opportunity to respond. The Commission notes that the process that it
proposes to apply in cases involving denial of cable landing license
applications or revocation of cable landing licenses is distinct from
the Commission's subpart B hearing rules, including the written hearing
rules codified in Sec. Sec. 1.371 through 1.377. The Commission has
never applied its subpart B hearing rules to every adjudication,\26\
and has never had an established practice of requiring subpart B
hearings for denial of cable landing license applications or revocation
of cable landing licenses. Indeed, the Commission does not believe it
would be appropriate to require subpart B rules and procedures,
including the written hearing rules providing for discovery and the
ability to request an oral hearing before a presiding officer, in all
proceedings to deny cable landing license applications or to revoke
cable landing licenses, particularly in cases involving national
security issues, where the Commission has previously concluded that the
burdens on the Government of implementing such procedures outweighed
the private interest and the probable value of additional procedures.
Moreover, under the subpart B hearing rules, if the Commission were to
delegate initial responsibility to an administrative law judge, the
resulting decision could be appealed to the full Commission--which
would be required to review the record independently and would not owe
any deference to the administrative law judge's determinations.\27\ The
Commission tentatively concludes that the extra step of appointing an
administrative law judge to preside prior to the Commission's
independent review, rather than simply proceeding directly before the
Commission, will not be necessary for nor will enhance the ability of
the Commission, which will be the ultimate arbiter, to decide matters
that may arise in its evaluation of applications for a cable landing
license or existing cable landing licenses. Further, courts have held
that the question of whether to hold an evidentiary hearing is ``within
[the agency's] discretion, and it may `properly deny an evidentiary
hearing if the issues, even disputed issues, may be adequately resolved
on the written record, at least where there is no issue of motive,
intent or credibility.' '' Nevertheless, the Commission seeks comment
on whether it should provide a process by which an applicant for a
cable landing license or a cable landing licensee may request a live
hearing in certain cases. The Commission also seeks comment on whether
it should use different procedures for matters that do not involve
executive branch expertise. If so, what due process or administrative
considerations are relevant to this determination?
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\26\ In fact, Sec. 1.201 of those rules provides that subpart B
applies only to cases that ``have been designated for hearing.'' An
explanatory note makes clear that the new procedures for written
hearings are a subset of such cases.
\27\ See Kay v. FCC, 396 F.3d 1184, 1189 (D.C. Cir. 2005)
(explaining how ``an agency reviewing an ALJ decision is not in a
position analogous to a court of appeals reviewing a case tried to a
district court'').
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17. Furthermore, unlike revocations of title III station licenses
and construction permits, the Commission may not revoke a cable landing
license ``except after obtaining approval of the Secretary of State and
such advice from any executive department or establishment of the
Government as the Commission may deem necessary.'' Therefore, in
contrast to subpart B hearings, any revocation procedures for cable
landing licenses must integrate approval or objection by the State
Department before the Commission may issue a final decision. The
Commission notes that the Commission and the State Department have
existing procedures by which the State Department approves
[[Page 12042]]
the Commission's grant of a cable landing license application or
revocation of a cable landing license, as required by Executive Order
10530, and these procedures would continue to apply to any revocation
of a cable landing license. Such procedures would not apply to the
Commission's denial of a cable landing license application, given
Executive Order 10530 does not require the State Department's approval
of a denial action and expressly states that ``no such license shall be
granted or revoked by the Commission except after obtaining approval of
the Secretary of State . . . .'' The Commission notes that the language
in Executive Order 10530 appears inconsistent with Sec. 1.767(b) of
the existing rules, which states that cable license applications are
``acted upon by the Commission after obtaining the approval of the
Secretary of State.'' The term ``acted upon'' would appear to include
denial of an application. The Commission proposes to amend the rule so
that it does not state that denial of an application requires approval
by the Secretary of State. The Commission seeks comment on the change.
While the procedures under subpart B do not automatically apply to
denial of cable landing license applications or revocation of cable
landing licenses, the Commission seeks comment on whether it should
incorporate these or similar procedures, including hearings before an
administrative law judge, should the Commission determine they are
appropriate in a specific case, for example where a matter does not
involve executive branch participation. Under what circumstances, if
any, should any such procedures be incorporated in denial or revocation
proceedings involving cable landing licenses? The Commission further
seeks comment on whether its procedures for denial of an application
might be more streamlined than the Commission's procedures for
revocation of an existing license, consistent with the Cable Landing
License Act, the APA, and due process.\28\ Should the Commission's
procedures for denial of an application to modify, assign, or transfer
control of a license, or for renewal and extension applications mirror
the Commission's procedures or denial of an initial application? What
considerations are relevant to this determination?
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\28\ The Commission notes, for example, that it denied China
Mobile USA's application for an international section 214
authorization after review of the executive branch recommendation,
China Mobile USA's opposition, and the executive branch reply. In
contrast, when the Commission subsequently revoked the international
section 214 authorizations of CTA, the Commission provided notice
and an opportunity to respond before it instituted a revocation
proceeding. Similarly, under the APA, the procedure for denying an
application need not mirror the procedure for revoking a license.
Compare 5 U.S.C. 558(c) (``When application is made for a license
required by law, the agency, with due regard for the rights and
privileges of all the interested parties or adversely affected
persons and within a reasonable time, shall set and complete
proceedings required . . . by law and shall make its decision'')
with id. (``Except in cases of willfulness or those in which public
health, interest, or safety requires otherwise, the withdrawal,
suspension, revocation, or annulment of a license is lawful only if,
before the institution of agency proceedings therefor, the licensee
has been given--(1) notice by the agency in writing of the facts or
conduct which may warrant the action; and (2) opportunity to
demonstrate or achieve compliance with all lawful requirements.'').
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(ii) Denial and Revocation Proceedings
18. Under the Commission's existing rules, the filing of an initial
application for a cable landing license or an application to modify,
assign, transfer control, or renew or extend a cable landing license
after the Commission places the application on an Accepted for Filing
public notice commences a proceeding in which the Commission may grant
or deny an application. Commission staff may seek additional
information after an application is filed, and once complete, the
application is placed on public notice.\29\ Any executive branch
recommendation to deny or condition the grant of an application is
included in the record of the proceeding, and the Commission provides
the applicant a written opportunity to respond. The Commission
considers the entire record in reaching its determination. The
Commission or OIA, pursuant to its delegated authority, can deny
applications for cable landing licenses.\30\ Consistent with the
Commission's rules, applicants may seek reconsideration of a denial of
an application. The Commission seeks comment on the extent to which
existing procedures for denial of applications should be modified in
any respect. The Commission tentatively concludes that additional
procedures are not warranted but that OIA should have delegated
authority to adopt additional procedures on a case-by-case basis as
circumstances warrant, and consistent with due process. The Commission
proposes that it may commence a revocation proceeding either on its own
initiative or upon the filing of a recommendation by the executive
branch agencies, including the Committee, to revoke the license of a
cable landing licensee. To the extent the Commission considers whether
revocation of a cable landing license is warranted, the Commission
proposes to implement the approach it used in the most recent section
214 revocation proceedings. Specifically, in those revocation
proceedings, the Commission exercised its discretion to ``resolve
disputes of fact in an informal hearing proceeding on a written
record,'' and reasonably determined that the issues raised in those
cases could be properly resolved through the presentation and exchange
of full written submissions before the Commission itself. The
Commission explained that although it adopted regulations prescribing
certain procedures for the revocation of station licenses and
construction permits pursuant to part 1, subpart B of its rules, those
regulations do not apply to the revocation of a section 214
authorization. To provide affected carriers with due process, the
Commission allowed them to submit evidence and arguments in writing and
determined the need for the revocation and/or termination of section
214 authorizations on the basis of a written record. The court of
appeals affirmed the Commission's use of these procedures.\31\ The
Commission seeks comment on whether it should incorporate similar
procedures to determine whether revocation of a cable landing license
is warranted. The Commission also seeks comment on whether it should
retain authority to modify these procedures on a case-by-case basis as
circumstances warrant, as long as any alternative procedures provide
adequate due process.
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\29\ See 47 CFR 1.767(a)(10) (requiring ``[a]ny other
information that may be necessary to enable the Commission to act on
the application.'').
\30\ 47 CFR 0.351(a)(9) (delegating authority to OIA ``[t]o act
upon applications for cable landing licenses pursuant to Sec. 1.767
of this chapter'').
\31\ China Telecom (Americas) Corp., 57 F.4th at 262 (citing
Administrative Hearings Order, 35 FCC Rcd at 10732-33, para. 11) (``
`The Communications Act gives the Commission the power of ruling on
facts and policies in the first instance. In exercising that power,
the Commission may resolve disputes of fact in an informal hearing
proceeding on a written record. And the Commission may reach any
decision that is supported by substantial evidence in the record.'
'')); id. at 268-71 (holding that discovery and live hearing
procedures, and an opportunity to achieve or demonstrate compliance
were not required ``by statute, regulation, FCC practice, or the
Constitution'').
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19. The Commission seeks comment on whether it may use the same
process or an alternative process if it considers termination of a
cable landing license due to a licensee's failure to comply with any
condition of the license. Under section 5 of Executive Order 10530, the
Commission is ``designated and empowered to . . . withhold[ ] or revoke
licenses to land or operate submarine cables in the United States . . .
.'' Separate and apart from revocation, the Commission uses the term
[[Page 12043]]
``termination'' where a license or authorization is terminated based on
the licensee's or authorization holder's failure to comply with a
condition of the license or authorization, and has determined that the
procedures applicable to termination need not mirror the procedures
used for revocation of licenses or authorizations.\32\ The Commission
proposes to delegate authority to OIA to determine appropriate
procedures, within the framework authorized by the Commission and
consistent with Commission precedent and guidance, and initiate
revocation and/or termination proceedings and revoke and/or terminate a
cable landing license, as required by due process and applicable law
and in light of the relevant facts and circumstances, including
providing a licensee with notice and opportunity to respond and, where
appropriate, to achieve compliance with all lawful requirements.\33\
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\32\ See China Telecom Americas Order on Revocation and
Termination, 36 FCC Rcd at 15988, para. 35; see also id. at 15989,
para. 36 (``[S]ection 558(c)(2) does not grant a substantive right
to escape from a condition that terminates a license.''); Atlantic
Richfield Co. v. United States, 774 F.2d 1193, 1200-01 (D.C. Cir.
1985) (holding that the procedural requirements of section 558(c)
apply only where ``the licensee [may] be able to establish
compliance with all legal requirements or . . . change its conduct
in a manner that will put its house in lawful order'') (internal
quotation and citations omitted).
\33\ See China Telecom. (Ams.) Corp. v. FCC, 57 F.4th at 270
(``Given the futility of offering China Telecom even more of an
opportunity to demonstrate or achieve compliance than they received,
the Commission did not err in denying it.''); Pacific Networks Corp.
v. FCC, 77 F.4th at 1166 (``In short, the FCC reasonably explained
why no realistic agreement could have worked given the carriers'
proven lack of trustworthiness.'').
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20. The Commission seeks comment on whether this procedural
framework would provide cable landing licensees and any other affected
parties with sufficient notice of the basis for any denial, revocation,
or termination action, an opportunity to present evidence and arguments
that support their respective positions, and an opportunity to respond
to opposing evidence and arguments. The Commission also seeks comment
on whether this process would ensure the development of an adequate
administrative record, including procedures for participation by other
affected individuals and entities, and appropriate procedural
safeguards to ensure due process.
21. Cable Landing Licenses/Licensees That are Insolvent or No
Longer Exist. Section 1.767(m)(2) of the rules requires that ``[a]ny
licensee that seeks to relinquish its interest in a cable landing
license shall file an application to modify the license.'' The
Commission's records in the International Communications Filing System
(ICFS) and other records, indicate that some submarine cables licensed
by the Commission may not have commenced service and/or some cable
landing licensees of record may be insolvent or no longer in
operation.\34\ Furthermore, some licensees that may be insolvent or no
longer exist did not file a modification application to relinquish
their interest in the cable landing license or otherwise notify the
Commission. The Commission seeks comment on what processes it should
adopt when submarine cables and/or licensees are insolvent or no longer
exist generally. The Commission seeks comment on whether the same
process proposed above is appropriate in all cases involving cable
landing licenses, or whether the Commission should consider alternative
processes. For example, should the Commission adopt a similar
cancellation process as proposed in the Evolving Risks NPRM (88 FR
50486, August 1, 2023) for international section 214 authorization
holders that are no longer in business, where failure to timely respond
to an information collection or other inquiry by the Commission may be
deemed presumptive evidence that the cable landing licensee is no
longer in operation? \35\ In these instances, the Commission or OIA may
assess whether the cable landing licensee no longer complies with
certain terms of the license or the Commission's rules,\36\ and thus
revocation and/or termination of the license or the licensee's rights
under the license and the Cable Landing License Act is warranted.\37\
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\34\ See, e.g., Letter from Peter J. Schildkraut, Counsel for
AT&T Mobility Puerto Rico Inc., to Marlene H. Dortch, Secretary, FCC
at 2-3 (Feb. 5, 2020) (on file in File No. SCL-MOD-20191202-00038)
(filing supplement to modification application and addressing, among
other things, that the corporate status of certain licensees is void
according to state records).
\35\ See Evolving Risks NPRM, 38 FCC Rcd at 4363, paras. 25-26;
id. at 4377, para. 66.
\36\ 47 CFR 1.767(g)(14) (``The cable landing license is
revocable by the Commission after due notice and opportunity for
hearing pursuant to section 2 of the Cable Landing License Act, 47
U.S.C. 35, or for failure to comply with the terms of the license or
with the Commission's rules . . . .'').
\37\ For instance, the Commission's rules require, as a
condition of a cable landing license, that ``[t]he licensee, or in
the case of multiple licensees, the licensees collectively, shall
maintain de jure and de facto control of the U.S. portion of the
cable system, including the cable landing stations in the United
States, sufficient to comply with the requirements of the
Commission's rules and any specific conditions of the license.'' See
also 47 CFR 1.767(m)(2).
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22. For consortium cables, if any of the cable landing licensees no
longer exists and was unable to file an application to modify the
license to relinquish its interest in the license, should the
Commission adopt rules requiring the remaining joint licensee(s) of the
cable, if any, to collectively file a modification application to
remove the licensee from the license by demonstrating and certifying
that (1) the licensee no longer exists as a legal entity, and (2) the
remaining licensee(s) will retain collectively de jure and de facto
control of the U.S. portion of the cable system sufficient to comply
with the requirements of the Commission's rules and any specific
conditions of the license? Or, should the Commission adopt rules
requiring joint licensees of a submarine cable system to identify the
lead licensee responsible for administrative matters concerning the
cable system, including directing the lead licensee to submit a filing
in the record demonstrating and certifying whether or not an identified
licensee is insolvent or has ceased to exist and that the remaining
licensee(s) will retain collectively de jure and de facto control of
the U.S. portion of the cable system?
2. Three-Year Periodic Reporting
23. Currently, a cable landing license expires ``twenty-five (25)
years after the in-service date for the cable, unless renewed or
extended upon proper application'' pursuant to Sec. 1.767(g)(15) of
the Commission's rules.\38\ The Commission, however, does not routinely
require a submarine cable landing licensee to provide updated ownership
and related submarine cable system information during the 25-year term
with the exception of annual circuit capacity data. The annual circuit
capacity data, however, lacks critical ownership and facilities
information that would allow the Commission and other Government
agencies to assess for evolving national security and law enforcement
concerns. To ensure that the Commission has the information it needs to
timely monitor and continually assess national security or other risks
that may arise over the course of a licensee's 25-year license term,
the Commission proposes to require
[[Page 12044]]
licensees to provide certain information to the Commission every three
years (hereinafter, ``periodic reporting''). Alternatively, the
Commission seeks comment on whether a different time period would
support the Commission's goals.
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\38\ 47 CFR 1.767(g)(15) (``The licensee must notify the
Commission within thirty (30) days of the date the cable is placed
into service. The cable landing license shall expire twenty-five
(25) years from the in-service date, unless renewed or extended upon
proper application. Upon expiration, all rights granted under the
license shall be terminated.''). See 2001 Cable Report and Order, 67
FR 1615 (January 14, 2002), 16 FCC Rcd 22167 (codifying the 25-year
license term condition in Sec. 1.767(g)(14), and which is currently
codified in Sec. 1.767(g)(15)). The 25-year license term is one of
the routine conditions the Commission adopted in 2001 that applies
to ``each licensee of a cable landing licenses granted on or after
March 15, 2002.''
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24. As a fundamental matter, it is critical that the Commission has
a continuous and systematic understanding of who owns and controls
submarine cables and how they are used because submarine cables are a
significant component of the global communications ecosystem. Submarine
cables serve as the foundation for the global internet infrastructure
and carry over 99% of transoceanic digital communications. Submarine
cables are also critical infrastructure that historically have carried
more than 95% of all U.S.-international voice, data, and internet
traffic, including civilian and military U.S. Government traffic. And
increasing demand for capacity \39\ has spurred the deployment of more
submarine cables.
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\39\ Telegeography reports that, ``[a]s recently as 2016,
internet backbone providers accounted for the majority of demand.''
At that time, internet backbone providers or internet Service
Providers (ISPs) included businesses, such as AT&T, Verizon,
Comcast, Tata Communications, CenturyLink, Cogent Communications,
Deutsche Telekom, GTT, NTT Communications, and Sprint, among others.
Now, internet backbone providers no longer dominate the demand for
global submarine cable capacity. According to TeleGeography, ``a
handful of major content and cloud service providers--namely Google,
Facebook, Amazon, and Microsoft--have become the primary sources of
demand. As of 2020, these companies are the dominant users of
international bandwidth, account for two-thirds of all used
international capacity.'' These entities ``led the way in building
mega Data Centers to meet th[e] growing demand [for data processing
and storage capacity.'' Moreover, the ``data demands of
hyperscalers' subsea cable is surging 45% to 60% per year.'' Indeed,
as of 2023, content and cloud networks accounted for more than 70%
of all bandwidth usage.''
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25. Because the Commission does not ordinarily receive updated
information about changes in the ownership of licensees or the
submarine cable system over the course of the 25-year license term, the
Commission likely has incomplete and outdated information regarding
submarine cable landing licensees with foreign ownership and the
submarine cable system itself. The Commission does receive such
information when an applicant/licensee (1) seeks Commission consent to
the substantial transfer of control and/or assignment or modification
of its existing cable landing license, (2) the licensee undergoes a pro
forma transfer of control and/or assignment that require(s)
notification to the Commission, (3) files a foreign carrier affiliation
notification, or (4) files a renewal application.\40\ The information
obtained from substantial or pro forma assignment and/or transfer of
control applications and foreign carrier affiliation notifications,
however, is limited to that particular licensee and does not provide
updated information about the other licensees. In the case of renewal
applications, the information obtained is based on the end of the
license term. The Commission also has authority to conduct an ad hoc
assessment of whether a licensee's cable landing license presents
national security, law enforcement, foreign policy, and/or trade policy
risks that warrant revocation. Reliance on sporadic submissions of
applications and ad hoc assessments for important information regarding
this critical infrastructure, however, creates an information gap that
limits the Commission's knowledge of the licensees, updated information
on the cable itself, and its ability to assess any national security,
law enforcement, foreign policy, and/or trade policy concerns.
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\40\ The Commission notes that submarine cable landing licensees
are required to submit annual circuit capacity data under Sec.
43.82 of its rules.
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26. The Commission tentatively concludes that the periodic
reporting requirement would improve the Commission's oversight of
submarine cable licenses and ensure the license continues to serve the
public interest. In this regard, the Commission tentatively finds that
the information the Commission would obtain from its proposed three-
year periodic reporting requirement provides crucial information about
submarine cables that complements the capacity information the
Commission already receives from the annual Sec. 43.82 circuit
capacity reports provided by filing entities. Among other things, the
Commission tentatively concludes information derived from the periodic
reports such as updated contact information for licensees and cable
landing stations and geographic coordinates of the cable landing
stations, coupled with information from the Commission's annual circuit
capacity reports, would better enable the Commission to carry out its
public interest responsibilities such as assessing capacity information
and conducting time-sensitive outreach to licensees during a natural
disaster or in a state of emergency.\41\ Importantly, the Commission
believes the updated information regarding this critical infrastructure
would improve consistency in the Commission's consideration of evolving
public interest risks (including national security risks), completeness
of the Commission's information regarding submarine cable landing
licensees, and timely Commission attention to issues that warrant
heightened scrutiny.
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\41\ See Proposed Rules, Sec. 1.70016(b) (setting forth the
contents that must be included in the proposed periodic report).
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27. Additionally, the Commission tentatively concludes the periodic
reporting requirement would ensure a more consistent and complete
referral of relevant evolving issues to the executive branch agencies,
including the Committee, for their review and ultimately, improved
protection of U.S. communications infrastructure. With updated
information regarding this critical infrastructure, the Commission
tentatively concludes it, in coordination with the relevant executive
branch agencies, could assess national security and other public
interest risks and, if necessary, pursue remedial action and/or
initiate a revocation or termination proceeding. As noted above, the
executive branch agencies recommended that the Commission revoke
certain international section 214 authorizations that posed
unacceptable risks to national security and law enforcement interests
of the United States. Ultimately, the Commission believes that its
proposed periodic reporting requirement would meet the Commission's
principal goal of providing it with updated critical information
regarding licensees and the cable systems and ``promote the security of
the United States . . . .'' in accordance with the Cable Landing
License Act.
28. Accordingly, as discussed below, the Commission proposes to
adopt and codify in its rules a routine condition that would require
all submarine cable landing licensees to jointly or separately submit
to the Commission every three years updated information about, among
other things, the licensee and its ownership, points of contact for the
submarine cable system, use of foreign owned Managed Network Service
Providers (MNSPs), as well as cybersecurity and regulatory compliance
certifications. The Commission also proposes that failure to timely
submit a periodic report would constitute a breach of this condition
that could warrant Commission enforcement action or revocation, the
procedures of which are discussed above. The Commission tentatively
concludes that the proposed reporting requirement would address the
aforementioned information gap by providing the Commission with updated
critical information necessary to fulfill its national security and
other public interest responsibilities on a more
[[Page 12045]]
regular and systematic basis. The Commission seeks comment on this
proposal and the impact on small entities, as well as any alternatives.
29. Under the Commission's proposed approach, the submarine cable
landing license would continue in force throughout its term. To the
extent circumstances in any particular situation raise national
security, law enforcement, foreign policy, and/or trade policy or other
concerns (for example, due to incompleteness of the periodic report or
new foreign ownership), the Commission could initiate a further inquiry
to assess the risks and concerns raised and coordinate with the
relevant executive branch agencies that may, in turn, result in
Commission enforcement action, executive branch mitigation efforts,
and/or a revocation or termination proceeding. The Commission's
proposed periodic reporting requirement would not supplant existing
Commission authority to conduct an ad hoc assessment of whether a
licensee's cable landing license presents public interest concerns,
including national security, law enforcement, foreign policy, and/or
trade policy risks nor would this proposed approach replace the 25-year
license term. The Commission proposes that each periodic report would
be submitted through a filing in ICFS, or any successor system, under
each licensee's license file number and would not require action from
the Commission, i.e., a grant or confirmation. The Commission proposes
that licensees with reportable foreign ownership as of thirty (30) days
prior to the date of the submission or that have a mitigation agreement
with the Committee or particular agencies must also file a copy of the
report directly with the Committee.
30. The Commission seeks comment generally on this approach and
whether a three-year period is the appropriate timeframe. The
Commission proposes a three-year period because it strikes an
appropriate balance between the Commission's need for current
ownership, location and facilities information and the reporting burden
on the Commission's licensees. The Commission can also stagger the
reviews over three years, reducing the workload on the Commission and
on the Committee. The Commission seeks comment on whether it should
adopt a time period that is longer or shorter for purposes of assessing
national security, law enforcement, and other risks. The Commission
notes, however, that because the marketplace changes quickly, it
believes requiring periodic information longer than three years might
result in the Commission missing significant changes in ownership and
changes in facilities, thus potentially endangering national security
and other concerns.
31. The Commission proposes that any new report would reflect
updated information since the report three-years prior or other
substantive filing. If no changes have occurred since the licensee's
last periodic report or other substantive filing--which may be an
application for a cable landing license or modification, assignment,
transfer of control, and renewal or extension of a cable landing
license--should the licensee have to provide only a periodic statement
that its license remains in compliance with the Commission's rules and
with its most recent periodic report, or other substantive filing? How
should the Commission account for a situation where the substantive
filing does not require all of the same information that would be in a
periodic report? Lastly, should the licensee re-certify, such as to the
character qualification requirements, among other requirements?
32. The Commission seeks comment on how to properly account for
multiple licensees on a submarine cable system. The Commission proposes
to require joint licensees to submit one joint periodic report per
submarine cable system, subject to the proposed filing contents
requirements. In what the Commission expects will be the unlikely event
of potential issues that may prevent a joint filing, the Commission
seeks comment on whether to permit an individual licensee to file its
own report. Should the Commission adopt a rule that joint licensees or
consortium members must identify a lead licensee that would be required
to file the periodic report on behalf of the joint licensees or
consortium? How can joint licensees or consortium members provide the
periodic information while remaining accountable for providing
truthful, complete, and accurate information? Additionally, how can the
Commission minimize burdens on licensees while balancing the
Commission's policy considerations with administrative efficiency for
the Commission and the relevant executive branch agencies, including
the Committee? What other options should the Commission consider given
evolving national security, law enforcement, foreign policy, and/or
trade policy risks?
a. Prioritizing the Periodic Reporting and Other National Security and
Law Enforcement Concerns
33. The Commission proposes to adopt a schedule that prioritizes
the filing and review of periodic reports based on whether the cable's
licensee(s) have reportable foreign ownership and the length of the
time since the Commission's most recent review of the license. The
proposal would structure the timing of the submission of periodic
reports to minimize burdens on licensees, the Commission,\42\ and the
executive branch staff, while ensuring that the Commission receives the
information it needs to protect this critical infrastructure. The
Commission also proposes to delegate authority to OIA to establish and
modify, as appropriate, the filing categories and associated deadlines,
and if needed, to consult with the relevant executive branch agencies
concerning prioritization of the periodic reports.
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\42\ See Review of the Commission's Assessment and Collection of
Regulatory Fees for Fiscal Year 2024 Assessment and Collection of
Space and Earth Station Regulatory Fees for Fiscal Year 2024, MD
Docket Nos. 24-85 and 24-86, Second Report and Order, 89 FR 78452
(September 25, 2024), FCC-24-93, para. 45 (2024) (2024 Regulatory
Fee Second Report and Order) (noting that ``in the Office of
International Affairs, there are eight Full-Time Equivalents (FTEs)
within the Telecommunications and Analysis Division that work on
international bearer circuit-related issues, including the services
provided over submarine cables . . . .'').
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34. The Commission proposes to assign each of the existing licensed
cable systems to one of four categories with a different deadline for
each, and with the deadlines separated by six months. The Commission
proposes to require that licensees of submarine cable systems in
Category 1 shall submit their initial periodic report by six months
following the effective date of new rules adopted in this proceeding,
and licensees of submarine cable systems in Categories 2, 3, and 4,
respectively, shall submit their initial periodic reports thereafter in
fixed intervals separated by six months.
Category 1: Submarine cable systems that: (1) have a
licensee that is directly or indirectly wholly or partially owned by a
government of, or other entities with a place of organization in, a
``foreign adversary'' country, as defined in the Department of
Commerce's rule, 15 CFR 791.4; (2) have a licensee with a place of
organization in a ``foreign adversary'' country; or (3) land in a
``foreign adversary'' country.\43\
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\43\ 15 CFR 7.4 (stating ``[t]he Secretary has determined that
the following foreign governments or foreign non-government persons
have engaged in a long-term pattern or serious instances of conduct
significantly adverse to the national security of the United States
or security and safety of United States persons and, therefore,
constitute foreign adversaries solely for the purposes of the
Executive Order, this rule, and any subsequent rule'' promulgated
pursuant to the Executive Order); see 15 CFR 7.2 (``Foreign
adversary means any foreign government or foreign non-government
person determined by the Secretary to have engaged in a long-term
pattern or serious instances of conduct significantly adverse to the
national security of the United States or security and safety of
United States persons.'').
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[[Page 12046]]
Category 2: Submarine cable systems where the Commission's
most recent review of the license \44\ occurred 4 or more years ago
\45\ and where a licensee has reportable foreign ownership.
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\44\ The Commission refers to its review of the license to
include the grant of an initial application for a cable landing
license or an application for modification, substantial assignment,
substantial transfer of control, or renewal or extension of a cable
landing license.
\45\ For purposes of prioritizing the filing and review of
periodic reports, the Commission refers to its most recent review of
the license as its most recent action, which would include grant of
an initial application for a cable landing license or an application
for modification, substantial assignment, substantial transfer of
control, or renewal or extension of a cable landing license and
ensure that the Committee or particular executive branch agencies
also reviewed the cable system for any national security, law
enforcement, and other concerns.
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Category 3: Submarine cable systems where the Commission's
most recent review of the license occurred less than 4 years ago and
where a licensee has reportable foreign ownership.
Category 4: All other submarine cable systems, including
those where no licensee has reportable foreign ownership.
35. FCC's Preliminary Review of Existing Licensed Submarine Cables.
Commission staff have conducted a preliminary review of its records,
and based on this review, the Commission assesses that eight of the 84
licensed submarine cable systems would meet one or more of the criteria
under Category 1: (1) Americas-1 Cable System, (2) Asia-America Gateway
(AAG), (3) FASTER Cable System, (4) Japan-U.S. Cable Network,\46\ (5)
Jupiter, (6) New Cross-Pacific (NCP), (7) PPC-1, and (8) Trans-Pacific
Express (TPE) Cable Network. Based on the Commission's preliminary
review of the 84 licensed cables to date,\47\ Category 1 would include
eight submarine cable systems; Category 2 would include 21 submarine
cable systems; Category 3 would include 36 submarine cable systems; and
Category 4 would include 19 submarine cable systems. The full set of
categories and the licensed submarine cable systems associated with
each category are set forth in the table labeled ``Three-Year Periodic
Reporting Prioritization Schedule.'' The Commission seeks comment on
the results of its preliminary review.
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\46\ On June 18, 2024, the current licensees of the Japan-U.S.
Cable Network filed an application to modify the license to remove
all licensees except Verizon Business Global LLC (Verizon) from the
license, and request a waiver of Sec. 1.767(h)(1) to replace AT&T
Enterprises, LLC with Verizon as the licensee that controls the
cable landing facilities in Makaha, Hawaii. On July 25, 2024,
Verizon and Hawaiian Telcom Services Company, Inc. filed an
application for a license to land and operate the California-Hawaii
S1, which will consist of Segment 1 of the Japan-U.S. Cable Network.
To the extent the Commission grants these applications prior to the
adoption of any final Report and Order in this proceeding, the
Commission proposes that it would adjust the categorization of the
Japan-U.S. Cable Network accordingly in such Report and Order.
\47\ This number of 84 licensed cables does not include cables
for which the license expired and has not been renewed or extended,
including where an application is pending before the Commission to
renew or extend the license. See, e.g., File No. SCL-STA-20240626-
00028, Actions Taken Under Cable Landing License Act, Report No.
SCL-00484, DA 24-926 (OIA 2024) (granting the request for special
temporary authority (STA) filed by GCI Communication Corp. to
continue operation of the Alaska United East Cable System (AU-East)
(SCL-LIC-19961205-00615, SCL-LIC-19980602-00008, SCL-MOD-20020409-
00018, SCL-MOD-20020409-00019) while the Commission considers an
application for a new cable landing license for the cable system
(SCL-LIC-20240815-00036)). To the extent the Commission grants any
application to renew or extend a cable landing license prior to the
adoption of any final Report and Order in this proceeding, the
Commission proposes that it would include or adjust the
categorization of the respective cable system accordingly in such
Report and Order.
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36. FCC's Review of Future Licensed Submarine Cables. The
Commission proposes to require that cable landing licensees of
submarine cable systems that are licensed after the effective date of
new rules shall submit their initial periodic report by a deadline of
three years following the date of the grant of authority. The
Commission proposes to require licensees of future licensed submarine
cable systems to file the periodic reports every three years after the
deadline of their initial periodic report. The Commission seeks comment
on whether a cable landing licensee should file the required report
every three years based on the date of such grant of authority, until
and unless the Commission grants a subsequent application filed by the
licensee, at which point the three-year reporting cycle would commence
anew as of the date of the new grant.
37. The Commission believes these approaches would simplify the
reporting requirement and minimize administrative burdens while
prioritizing the Commission's consideration of those licensees that
most likely raise national security, law enforcement, foreign policy,
and/or trade policy concerns. Prioritizing the Commission's review in
the manner described above ensures the Commission focuses on those
cables that potentially raise concerns and those that have not been
reviewed by the Commission and the Committee. The Commission believes
this approach would accomplish its national security objectives and
provide regulatory certainty to licensees. What are the benefits and
potential drawbacks of this approach? Should the Commission instead
follow the Evolving Risks NPRM proposal and factor in mitigation
agreements? Why or why not? The Commission seeks comment generally on
this and other approaches for periodic reporting of licensed submarine
cables.
b. Shorten the 25 Year License Term
38. As an alternative to the proposed periodic reporting
requirement the Commission seeks comment on whether shortening the
current 25-year submarine cable license term or adopting a shorter
license term in combination with periodic reporting would similarly
account for evolving national security, law enforcement, and other
risks. Like the Commission's proposed periodic reporting requirement,
the Commission would codify either of these options as a routine
condition in its rules. The Commission notes that by rule, a submarine
cable landing licensee's failure to renew its license would cause the
license to expire, and ``[u]pon expiration, all rights granted under
the license shall be terminated.'' \48\
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\48\ See 47 CFR 1.767(a)(9) (requiring applicants to certify
``that the applicant accepts and will abide by the routine
conditions specified in paragraph (g) of this section''); 47 CFR
1.767(g)(15) (``[T]he cable landing license shall expire twenty-five
(25) years from the in-service date, unless renewed or extended upon
proper application. Upon expiration, all rights granted under the
license shall be terminated.'').
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39. Given changed circumstances since the Commission codified the
25-year license term, the Commission believes that a shortened license
term or a shortened term in combination with periodic reporting, would
be consonant with its public interest responsibilities under the Cable
Landing License Act regarding national security. The Commission notes
that the 25-year license term appears to relate to operational aspects
of submarine cable systems.\49\ Also, in light of the
[[Page 12047]]
constantly changing national security environment, 25 years is a long
time period in which a license is not reviewed. Shortening the license
term by itself or in combination with periodic reporting, could enable
the Commission to assess--earlier than the current 25-year license
term--whether a particular cable landing licensee complies with the
relevant statutory and rule requirements, whether there are any rule-
compliant but unreported changes in ownership or operations, or other
factors that present national security, law enforcement, foreign policy
and/or trade policy concerns, and whether the license continues to
serve the public interest.
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\49\ For example, according to a working group report of
Communications, Security, Reliability, and Interoperability Council
(CSRIC) IV, ``[t]he normal planned commercial lifespan of the cables
is 25 years, though they often get used for longer periods of time.
Nevertheless, the commercial lifespan of submarine cable systems may
extend well beyond 25 years, particular where the systems have been
upgraded or redeployed. Consistent with these characteristics, the
Federal Communications Commission (`FCC') grants cable landing
licenses for a term of 25 years (subject to renewal) from
commencement of commercial service.'' TeleGeography, Submarine Cable
Frequently Asked Questions, https://www2.telegeography.com/submarine-cable-faqs-frequently-asked-questions (last visited Nov.
12, 2024) (``[c]ables are engineered with a minimum design life of
25 years . . .'').
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40. The Commission tentatively concludes that a shortened license
term or a shortened term in combination with periodic reporting would
provide the Commission and the relevant executive branch agencies the
ability and opportunity to assess in a more timely and systematic
manner, the evolving national security, law enforcement, foreign
policy, and/or trade policy risks associated with cable landing
licenses.\50\ The Commission seeks comment on an appropriate time frame
to better account for evolving risks while minimizing burdens on
licensees, recognizing the significant capital expenditures and long
lead times in planning and constructing submarine cable systems. What
is the current lifespan of a modern submarine cable system, and should
that factor into the Commission's analysis? The Commission also seeks
comment on the economic impact of shortening the 25-year license term.
Would a 5-year or 10-year license term alter investment incentives in
new submarine cable infrastructure? Would shortened license terms
impact the upgradation and maintenance of existing submarine cable
systems? The Commission notes that it has adopted various license terms
for differing services. For example, wireless and broadcast licensees
have renewal terms. For Miscellaneous Wireless Communications Services
(WCS), the license term varies according to spectrum band, which
results in different license periods such as 10, 12, or 15 years.
License terms for satellites also vary. Space stations licensed under
part 25 of the Commission's rules have a 15-year license term, except
that small satellites have a 6-year license term and certain Satellite
Digital Audio Radio Service (SDARS) and Direct Broadcast Satellite
(DBS) space stations have an 8-year license term.\51\ In the context of
broadcast licensing, each license granted for the operation of a
broadcasting station is limited to a term not to exceed eight years. In
the Evolving Risks NPRM, the Commission tentatively concluded that a
10-year timeframe is reasonable under the proposed renewal framework
for structuring a formalized and systemic reassessment of carriers'
international section 214 authority.\52\
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\50\ See Executive Branch Review Report and Order, 35 FCC Rcd at
10934-35, para. 17 (discussing executive branch referral process for
those applications for international section 214 authorizations and
submarine cable licenses or to assign, transfer control or modify
such authorizations and licenses where the applicant has reportable
foreign ownership filed pursuant to Sec. Sec. 1.767, 63.18, and
63.24 of the rules, 47 CFR 1.767, 63.18, and 63.24).
\51\ For geostationary space stations that are issued an initial
license term for a period of 15 years, licensees may apply for a
modification to extend the license term in increments of five years
or less.
\52\ In the Evolving Risks NPRM, the Commission tentatively
found that a renewal timeframe of 10 years--in conjunction with the
proposal in that NPRM to require authorization holders to provide
updated ownership information, cross border facilities information,
and other information every three years--would ensure that the
Commission and the relevant executive branch agencies can
continually reassess and account for evolving national security, law
enforcement, foreign policy, and/or trade policy concerns associated
with international section 214 authorizations. Moreover, the
Commission noted that a 10-year timeframe would minimize burdens on
authorization holders and balance the Commission's policy
considerations with administrative efficiency for the Commission and
the relevant executive branch agencies, including the Committee.
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41. Would a shortened license term similar to the terms for a
broadcast or wireless license or the proposed 10-year timeframe
proposed for international section 214 authorizations be appropriate,
and if so, why? Would adopting a 15-year license term similar to
geostationary space station licenses under part 25 be more appropriate
given the large capital investment typically required to launch these
satellites and deploy submarine cable systems? Would a 10- to 15-year
renewal time frame, as opposed to a 25-year term, better ensure that
the Commission and the relevant executive branch agencies can
continually reassess and account for evolving national security and
other concerns? The Commission also seeks comment on whether licensees
should or could ask for different renewal terms prior to the expiration
of their current license term based on their particular circumstances.
What is the capital investment and lifespan of current fiber optic
cable infrastructure and how should that impact the Commission's
proposal? While most cable landing licensees have asked for a renewal
term of 25 years, a few have asked for a shorter term.\53\ Should the
Commission adopt a rule reserving its discretion to impose a shorter
license term on a case-by-case basis based on risk factors where the
Commission deems it would be in the public interest? \54\ Should a
license term reset if a submarine cable landing licensee undergoes a
complete review, such as during the review of a substantial assignment
or transfer of control application? \55\ What factors should the
Commission take into consideration in its analysis of whether to
shorten the submarine cable landing license term and renewal process?
The Commission seeks comment on whether to adopt a renewal expectancy
standard for submarine cable licenses, subject to any approval of or
objection to a proposed grant of an application by the State
Department. Should such a standard apply only in the event the
Commission shorten the license term? Should a specific showing at
renewal be required, such as certification that the licensee has been
in operation consistent with their initial application
[[Page 12048]]
for a license? \56\ Commenters should address the burdens that will be
placed on the licensees based on the length of the license term and
identify the costs and benefits overall and impact, if any, on small
businesses.
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\53\ File No. SCL-MOD-20190305-00007, Actions Taken Under Cable
Landing License Act, Public Notice, Report No. SCL-00238, 34 FCC Rcd
2810 (IB 2019) (granting Hawaiian Telecom, Inc.'s application to
modify the cable landing license for the Hawaiian Interisland Cable
System, to extend the license term for an additional five-year
period).
\54\ The Commission's rules expressly preserve its discretion to
grant individual broadcast station licenses for less than the
standard license term if the public interest, convenience, and
necessity would be served by such action. See 47 CFR 73.1020(a)
(``Both radio and TV broadcasting stations will ordinarily be
renewed for 8 years. However, if the FCC finds that the public
interest, convenience and necessity will be served thereby, it may
issue either an initial license or a renewal thereof for a lesser
term.''); id. Sec. 74.15(d) (``Lower power TV and TV translator
station and FM translator station licenses will ordinarily be
renewed for 8 years. However, if the FCC finds that the public
interest, convenience or necessity will be served, it may issue
either an initial license or a renewal thereof for a lesser term.
The FCC may also issue a license renewal for a shorter term if
requested by the applicant.''); 1997 Broadcast License Terms Order,
62 FR 5339 (February 5, 1997), 12 FCC Rcd at 1729, 1739, n.24, Appx.
A. See also 47 U.S.C. 309(k)(2) (where applicant fails to meet the
standards for renewal, the Commission may grant the application ``on
terms and conditions as are appropriate, including renewal for a
term less than the maximum otherwise permitted.'').
\55\ For example, assuming the Commission were to adopt a 10-
year license term, if an entity that is granted a license in 2025,
so that its 10-year renewal period would be 2035, subsequently files
a substantial transfer of control application which is granted in
2030, should the 10-year renewal period be reset to 2040?
\56\ The Commission notes that broadcast licenses must be
renewed unless the Commission makes one of the findings enumerated
by statute. See also Amendment of Parts 1, 22, 24, 27, 74, 80, 90,
95, and 101 to Establish Uniform License Renewal, Discontinuance of
Operation, and Geographic Partitioning and Spectrum Disaggregation
Rules and Policies for Certain Wireless Radio Services, WT Docket
No. 10-112, Second Report and Order (82 FR 41530, September 1, 2017)
and Further Notice of Proposed Rulemaking (82 FR 41580, September 1,
2017), 32 FCC Rcd 8874 (adopting rules that, among other things,
establish a consistent standard for renewing wireless licenses).
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42. The Commission tentatively affirms that, regardless of whether
it adopts any new license term separately or in combination with
periodic reporting, the Commission will continue to exercise its
existing authority, as it deems necessary, to conduct ad hoc reviews of
submarine cable landing licenses at any time during any license term.
For instance, if the Commission were to adopt a license term of 10
years combined with periodic reporting, it might still elect to
exercise its existing authority to review and, if necessary, modify or
revoke or terminate licenses at any time during the 10-year license
term. The Commission seeks comment on its proposed approach.
43. Potential Rules Would Apply to All Licensees. The Commission
generally seeks comment on the application of any new license term it
may adopt to all submarine cable landing licensees. In particular, the
Commission seeks comment on whether all submarine cable landing
licenses, regardless of issuance date, should be subject to any new
license term.
44. Licensees Whose License is Granted After the Effective Date of
New Rules. With respect to licensees whose license is granted after the
effective date of any new rules adopted in this proceeding, the
Commission tentatively concludes that it would apply any new license
term adopted in this proceeding to such licensees. If the Commission
adopts a new license term, it proposes to direct OIA to include a
condition in submarine cable landing licenses granted after the
effective date of any new rules requiring compliance with any new
license term. The Commission seeks comment on this approach.
45. Licensees Whose License Was or is Granted Prior to the
Effective Date of New Rules. With respect to licensees whose license
was or is granted prior to the effective date of the new rules, the
Commission seeks comment on whether their existing license term should
remain the same, but that at the time of renewal, the Commission would
apply any new license term it adopts in this proceeding. The Commission
also seeks comment on whether any license granted after the issuance of
the NPRM and before the effective date of the new rules should be
subject to any shortened term the Commission may adopt in this
proceeding.\57\ If the Commission applies a shortened license term to
existing licenses, how should it handle situations in which an existing
license has been in effect for a period that exceeds the new license
term?
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\57\ The Commission notes that applicants seeking licenses after
issuance of the NPRM will be aware of the possibility that the
Commission may adopt a shortened license term and that any new
license term may be a condition of grant of their application.
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46. Other Matters. The Commission seeks comment on whether to apply
any shortened license term as a condition of granting an application
for a substantial and/or pro forma assignment or transfer of control of
an existing submarine cable landing license. The Commission also seeks
comment on whether cable landing licensees that have a pending renewal
application prior to the effective date of any shortened license term
should be subject to any new license term the Commission might adopt.
47. Due Process and Retroactivity. The Commission seeks comment on
due process and retroactivity concerns--including ``primary'' versus
``secondary'' retroactivity--that may arise from modifying existing
licenses to conform the license term with any shorter term that may be
adopted in final rules or from applying a new, shorter license term as
a condition of granting applications for modification, assignment,
transfer of control, and renewal or extension of existing licenses.\58\
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\58\ See, e.g., Mobile Relay Assocs. v. FCC, 457 F.3d 1, 11
(D.C. Cir. 2006) (non-renewal resulting from a new regulatory
framework may ``upset[ ] expectations based on prior law,'' but that
is not primarily retroactive).
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48. The courts have established a distinction for rules between
``primary'' retroactivity and ``secondary'' retroactivity. A rule is
primarily retroactive if it (1) ``increase[s] a party's liability for
past conduct''; (2) ``impair[s] rights a party possessed when he
acted''; or (3) ``impose[s] new duties with respect to transactions
already completed.'' The standard for primary retroactivity assesses
whether a rule has changed the past legal consequences of past actions.
In contrast, a rule would be ``secondarily'' retroactive if it
``affects a regulated entity's investment made in reliance on the
regulatory status quo before the rule's promulgation.'' Secondary
retroactivity will be upheld ``if it is reasonable.''
49. The Commission tentatively concludes that any shorter license
term it ultimately adopts would not be ``primarily'' retroactive, as
the mere adoption of such a requirement would not make past conduct
unlawful, alter rights the licensee had at the time when it acted, or
impose new duties with respect to completed transactions.
50. The Commission recognizes, however, that such a requirement
could upset the expectations of existing submarine cable landing
licensees. To the extent that applying any new license term may
constitute ``secondary'' retroactivity, the Commission seeks comment on
any impact of applying a new license term to existing licensees. How
would such an impact compare to the benefits of applying a shortened
license term to existing submarine cable landing licenses, including
those granted before the issuance of the NPRM, such as providing for a
more timely, systematic, and uniform review process that will enable
the Commission to consider pertinent issues, including national
security, law enforcement, foreign policy, and/or trade policy
concerns, in the context of a renewal application without waiting for
current licenses to expire, potentially decades from now? The
Commission also seeks comment on whether and under what circumstances
denial of a submarine cable landing license renewal application or an
application for assignment/transfer of control would trigger primary or
secondary retroactivity concerns. For example, if the Commission adopts
a shorter license term and applies it to existing licensees, would non-
renewal of a submarine cable landing license based on evolving national
security, law enforcement, foreign policy, and/or trade policy risks,
regardless of that submarine cable landing licensee's prior compliance
with the Commission's rules, have primary or secondary retroactive
effect? Additionally, would the application of a new license term to
existing cable landing licensees require different standards or
procedures based on retroactivity, reliance interests, or fair notice
concerns? How would application of a new license term to existing
licensees affect those licensees' operations, financial position, or
investment incentives?
[[Page 12049]]
B. Updated Application Requirements for National Security and Other
Purposes
51. In this section, the Commission proposes and seeks comment on
appropriate applicant and application requirements to account for the
evolution of technologies and facilities and changes in the national
security landscape over the last two decades. The Commission's goal is
to update and improve its rules to ensure it has targeted and granular
information regarding the ownership, control, use of a submarine cable
system, and other things, which are critical to the Commission's review
to assess potential national security risks and other important public
interest factors.
1. Requirements To Be an Applicant/Licensee
52. The Commission seeks comment on modernizing its existing rules
setting forth minimum applicant/licensee eligibility requirements to
ensure that the Commission identifies and captures information on those
entities that own and control the submarine cable system and connect
with terrestrial networks in the United States.\59\ Currently, Sec.
1.767(h) of the Commission's rules identifies the following as those
entities that, at a minimum, shall be applicants for and licensees on a
cable landing license: (1) ``[a]ny entity that owns or controls a cable
landing station in the United States[,]''and (2) ``[a]ll other entities
owning or controlling a five percent (5%) or greater interest in the
cable system and using the U.S. points of the cable system.'' \60\ The
Commission seeks comment generally on an appropriate rule that would
capture who should be an applicant/licensee on a cable landing license
under the Cable Landing License Act today and in the future to ensure
the Commission meets its public interest responsibilities.
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\59\ The Commission has reserved the ability to expand the
minimum requirements as to who must apply for and become a licensee
on a cable landing license. 47 CFR 1.767(h) (``Except as otherwise
required by the Commission, the following entities, at a minimum,
shall be applicants for, and licensees on, a cable landing license .
. . .''). Although the Commission prescribes the minimum
requirements concerning who must be an applicant for and licensee on
a cable landing license, this does not foreclose entities that do
not meet the minimum requirements from applying to be joint
applicants for and licensees on a cable landing license.
\60\ The Commission has reserved the ability to expand the types
of entities who must be applicants and licensees on a cable landing
license. Section 1.767(h) (stating that ``Except as otherwise
required by the Commission . . . .''). Thus, other entities are not
foreclosed from applying to be a joint applicant and licensee.
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53. Entities that Own or Control a U.S. Landing Station or
Submarine Line Terminal Equipment (SLTE). The Commission seeks comment
on whether to require not only entities that own or control the U.S.
cable landing station, but also entities that own or control the SLTE
or equivalent equipment to be applicants for and licensees on a cable
landing license. The SLTE is among the most important equipment
associated with the submarine cable system and this modification to the
Commission's rule would enable it to know and assess any national
security and law enforcement concerns related to the entities that will
deploy SLTE and thus who can significantly affect the cable system's
operations. Specifically, the Commission seeks comment on whether to
expand the applicant/licensee requirement to include any entity that
owns or controls or operates a cable landing station(s) or the SLTE or
equivalent that converts submarine signals into terrestrial signals
located in the U.S. portion of a cable system. The Commission believes
that including the term ``submarine line terminal equipment'' and a
general description of the functionality of the equipment would better
reflect technological advances in submarine cable systems. Would this
be consistent with the statutory requirement that ``[n]o person shall
land or operate . . . any submarine cable'' without a license as
specified in the Cable Landing License Act? Moreover, the Commission
believes that including such language would capture the potential of a
submarine cable system to have more than one cable landing station or a
cable landing station that includes multiple SLTEs that could be
located farther inland such as in another facility (e.g., a data
center). A proposed cable system could also have multiple locations
where SLTE is deployed. The Commission seeks comment on whether and if
so, how, to incorporate entities with ownership and control of SLTE
into the Commission's regulatory framework. Lastly, the Commission
seeks comment on how this potential change could impact existing
entities, including small business entities, that were not previously
required to obtain a cable landing license but now would be required to
do so because they own or control SLTE. Should the Commission apply any
new requirement to such existing entities and if so, when should it
require such existing entities to submit applications? The Commission
seeks comment on the burdens this potential change could have on such
existing entities, as well as existing licensees, which may include
small entities, including how long it would take them to comply with
this potential requirement.
54. This option would require any entity with ownership or control
of a cable landing station or SLTE or equivalent equipment to be
applicants/licensees for a submarine cable landing license. Under this
option, Indefeasible Right of Use (IRU) \61\ holders or grantees likely
meet these requirements. As background, companies that own and operate
submarine cable systems may choose to use the capacity on their
submarine cable systems themselves or seek to lease, sell, or swap
unused or unowned capacity to recoup their investment in the submarine
cable project. Internet Content Providers (ICPs) that are licensees may
use the capacity themselves to connect to their data centers abroad to
serve customers globally. Alternatively, they may choose to sell,
lease, or swap capacity of the submarine cable fiber to
telecommunications companies or other entities in need of capacity
along a certain route, such as research institutions, education
institutions, governments, banks, and enterprises, among others.
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\61\ See also Katie Terrell Hanna, TechTarget, Definition:
Indefeasible Right of Use (IRU) (March 2022), https://www.techtarget.com/searchunifiedcommunications/definition/Indefeasible-Right-of-Use (``In telecommunications, the Indefeasible
Right of Use (IRU) is a contractual agreement (temporary ownership)
of a portion of the capacity of an international cable. As the name
suggests, the contract provides an indefeasible right to use a cable
and cannot be annulled or voided. IRU contracts are specified in
terms of a certain number of channels of a given bandwidth.'') (IRU
Definition); id. (``Large-scale internet service providers (ISPs)
are typical IRU owners. This gives ISPs the ability to assure their
own customers of international telecom service on a long-term basis.
IRU fibers are also referred to as dark fibers. Here, dark fiber
means fiber between two locations that has no electronics attached
to it. This needs to be lit by the IRU grantee rather than the cable
provider.'').
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55. Although IRUs can be short-term, they more typically constitute
long-term contracts of 20 years or longer and provide a holder or
grantee with a certain amount of bandwidth of capacity or fiber on a
submarine cable system.\62\ These contracts provide holders or grantees
with the rights to use the capacity, which includes equipment, fibers,
or capacity, and may constitute assets as well, even though legal title
is held by the grantor.\63\ Holders or
[[Page 12050]]
grantees of these rights may further lease out capacity to other
companies that need only a portion of the holder's capacity. The
contracts to lease unused or unowned capacity typically constitute
short-term contracts of five years or may be shorter or longer and,
unlike IRUs, generally do not require an upfront payment. However,
these lease contracts do typically require monthly payments during the
course of the lease term and provide a grantee with a certain amount of
bandwidth of capacity or spectrum of a fiber on a submarine cable
system. Importantly, as noted above, some IRU holders or grantees, such
as dark fiber IRU holders, may own, control, and use specific SLTE at
the ends of the cable system to interconnect with their terrestrial
networks,\64\ and such SLTE could be physically or logically accessed
by IRU holders or grantees, thus potentially raising national security
and law enforcement concerns arising from the Commission's lack of
information about and regulatory oversight of these relationships and
the ownership of the IRU holder or grantee.
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\62\ Understanding IRU Fiber: A Comprehensive Guide, 123NET
(Mar. 15, 2024), https://www.123.net/blog/understanding-iru-fiber-a-comprehensive-guide/ (``An Indefeasible Right of Use (IRU) agreement
is a legal contract that grants the buyer a permanent right to use a
portion of a fiber-optic cable's capacity for a set period.'').
\63\ Fernando Margarit et al., IRUS AND FIBER OPTIC CABLES: An
Overview and Examination of Associated Risks, Submarine Telecoms
Forum, https://subtelforum.com/telecom-indefeasible-rights-of-use/
(last visited Aug. 11, 2024) (``These critical instruments grant
exclusive, long-term rights to use specific assets, such as fiber
cables, closely mirroring actual ownership without the transfer of
legal title.'').
\64\ Open Submarine Cables Handbook at 4 (``Apart from increased
competition for the SLTE supply and deployment of the latest SLTE
technology, the open cable model is also more adapted to new
business models by providing multiple system owners more
independence. Many recent new cables have been built with a per-
fiber pair ownership model allowing multiple cable systems owners to
use different SLTE (including management systems) on their own fiber
pairs. Spectrum sharing within a fiber pair can also be supported.
Lastly, when the different owners want to upgrade, they can do so
independently from the other owners.'').
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56. Would requiring entities with ownership or control of a cable
landing station or SLTE to be applicants/licensees for a submarine
cable landing license appropriately address national security and law
enforcement concerns regarding physical and/or logical access? Would
this be consistent with the statutory requirement that ``[n]o person
shall land or operate . . . any a submarine cable'' without a license
as specified in the Cable Landing License Act? Does the Commission's
legal authority to withhold or grant a cable landing license \65\
extend to authorizing such purchases or sales of capacity? Would this
be consistent with the statutory requirement to obtain a license to
``land or operate . . . any submarine cable''? If the Commission
requires such entities that meet this requirement to become applicants/
licensees for a submarine cable landing license, how should this
requirement be implemented as to such existing entities as well as
existing licensees? The Commission seeks comment on the burdens this
potential change could have on affected entities, including small
entities, and to identify how long it would take them to comply with
this potential requirement.
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\65\ 47 U.S.C. 35.
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57. The Commission notes that with respect to the entities that own
or control the cable landing stations, it frequently receives waiver
requests from entities, such as data center owners, that do not seek to
become an applicant or licensee. These entities state that they own the
real property/facility in which the cable landing station is located
but do not have any ability to significantly affect the cable system's
operation.\66\ The Commission has granted such waiver requests, based
on its review of the particular circumstances raised in each waiver
request and done so in coordination with the Committee, as
necessary.\67\ The Commission seeks comment generally on the
applicability of its rules to data center owners, including the access
they have over submarine cables and the site operations, such as
physical security, power, backup power, HVAC, and other environmental
support essential to proper operations of cable landing systems housed
in their facilities.
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\66\ The Commission has seen instances where a submarine cable
system will land in an internet exchange, PoP, data center, or a
like facility that is owned by a company that leases colocation
space and services to submarine cable owners and operators but does
not have any ability to significantly affect the cable system's
operation.
\67\ See e.g., File No. SCL-LIC-20210329-00020, Actions Taken
Under Cable Landing License Act, Public Notice, Report No. SCL-
00353, DA 22064 (IB 2022) (granting the applicants' request for a
waiver of 47 CFR 1.767(h)(1)).
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58. Own or Control a 5% or Greater Interest in the Cable System and
Using the U.S. Points of the Cable System. The Commission seeks comment
on whether it should retain the requirement that an entity that owns or
controls a 5% or greater interest in the cable and uses the U.S. points
of the cable system shall be an applicant for and licensee on a cable
landing license. Prior to the rules adopted in 2001, there was no
exception for those entities that owned less than a 5% interest in the
cable. In the 2001 Cable Report and Order, the Commission recognized
that ``the greater a firm's investment in a cable system, the greater
ability the firm has to influence the way in which a cable is operated
. . . [and] observed that entities with minimal investment in a cable
system, on the other hand, do not have the same ability to affect the
operation of the cable system[.]'' \68\ The Commission concluded that
``there is not the same need, therefore, to subject these entities to
the conditions and responsibilities that come with a cable landing
license'' unless such entities had at least a 5% or greater ownership
interest in the cable system and used the U.S. points of the cable
system. At the time of that proceeding, it was commonplace for
consortia of many telecommunications companies to join to co-fund and
own and operate a submarine cable system. Now, it is less common for
consortia of more than a few entities to jointly pursue a submarine
cable project. Moreover, the 5% ownership threshold was created in part
to not unduly burden small carriers or investors that lacked the
ability to significantly affect the operation of a cable system, such
as those consortia members that entered the consortia to obtain
capacity on the cable system, but held minimal investments in the cable
system and did not have any ability to control the submarine cable
system.
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\68\ 2001 Cable Report and Order, 16 FCC Rcd at 22167, n.131
(citing 2000 Cable NPRM, 65 FR 41613 (July 6, 2000), 15 FCC Rcd at
20824, para. 82); see id. at 22194-95, paras. 53-54 (modifying the
rules to require any entity that could exert influence or control
over the cable system or who owned or controlled the cable landing
station(s), or the facilities that would permit the cable to
interconnect to a terrestrial network in the United States, to be an
applicant and licensee on a cable landing license).
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59. Should the Commission retain the 5% or greater interest
threshold requirement for the same reasons noted above? Is the same
rationale to retain the 5% threshold reasonable in today's national
security environment? Do commenters believe the Commission can
accomplish its goals in this proceeding by retaining the 5% threshold?
At this level of ownership, can the Commission continue to properly
assess whether certain applicants present any national security and law
enforcement risks? If the Commission retains the 5% threshold, will it
be able to assess whether entities should not obtain a submarine cable
license based on public interest assessments? Or should the Commission
instead adopt a lower or higher threshold, and if so, why? If the
Commission retains a threshold for when an owner of the cable must be
an applicant/licensee, the Commission seeks comment on whether it
should require the applicant(s) to identify all of the owners of the
cable, and for those owners that are not applicants, provide an
explanation for each one as to why it is not required to be an
applicant/licensee.
[[Page 12051]]
60. The Commission also seeks comment on how entities are currently
calculating ownership interests to determine if they hold a 5% or
greater interest.\69\ Should the Commission specify a method for making
this calculation? If so, what is an appropriate basis for the
calculation given all of the varying pieces of infrastructure in a
cable system--the U.S. cable landing station(s) that has the terminal
equipment, including the SLTE and the dry segment; the wet segment
(including the U.S. beach manhole and every segment and branching unit
of the cable system to the foreign beach manhole(s)); and ultimately,
the foreign dry plant(s) terminating with the SLTE in the cable landing
station(s)? Should the calculation be based on the number of fiber
pairs owned by each entity, the percentage of capacity held by each
entity, the percent of the total cost of the cable system that each
applicant is contributing, or the percentage of the total distance of
the cable system from SLTE to SLTE or from beach manhole to beach
manhole? \70\ The Commission seeks comment on these and other bases for
making this calculation.
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\69\ 47 CFR 1.767(h)(2) (``All other entities owning or
controlling a five percent (5%) or greater interest in the cable
system and using the U.S. points of the cable system'' shall be
applicants for, and licensees on, a cable system). The Commission
has reserved the ability to expand the types of entities who must be
applicants and licensees on a cable landing license. 47 CFR 1.767(h)
(stating that ``Except as otherwise required by the Commission. . .
.''). Thus, other entities are not foreclosed from applying to be a
joint applicant and licensee.
\70\ For example, assuming that the total cable system distance
was 20,000 km, and Company A owns a segment of a cable system that
is 1,000 km in length and will use the U.S. points of the cable
system, should Company A be attributed with a 5% ownership (1,000
km/20,000 km = 0.05) and required to be an applicant/licensee?
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61. In discussing the basis for adopting the 5% requirement in the
2000 Cable NPRM, the Commission stated that it intended for an entity
that has a ``five percent or greater ownership interest in the proposed
cable . . . and . . . will use the U.S. points of the cable system in
any capacity, unless that use was simply to hard patch through the
United States and would not drop traffic in the United States or would
use the U.S. points to re-originate traffic,'' to be included as an
applicant. The Commission, however, did not further define the phrase
``use of the U.S. points of the cable system'' in the 2001 Cable Report
and Order. Since the Commission adopted this rule over two decades ago,
are there new developments in the landing and operation of submarine
cable systems that the Commission should take into account when
providing guidance on what it means to use the U.S. points of the cable
system? In addition, how should the Commission consider use of the U.S.
points of the cable system when the traffic's destination is not the
United States? The Commission seeks comment on whether and how it
should consider ``use of the U.S. point'' today and for the benefit of
any public interest concerns.
62. Any Entity that Owns the Submarine Cable System. The Commission
seeks comment on whether it should instead require any entity that owns
the submarine cable system to be an applicant/licensee, even if the
entity does not use the cable system. Should the Commission require
that any entity that owns any interest in the cable to become a
licensee similar to the Commission's rules prior to 2001? Prior to the
rules adopted in 2001, there was no exception for those entities that
owned less than a 5% interest in the cable. Would this approach be
consistent with the statutory requirement that no person shall ``land
or operate . . . any submarine cable'' without a license as specified
in the Cable Landing License Act? Given the importance of this critical
infrastructure and to protect against national security and law
enforcement threats, would a rule requiring entities that have any
ownership in the cable system to become applicants/licensees be more
appropriate today and into the future? Could the Commission better
accomplish its goals by adopting this requirement? What are the
benefits and concerns with adopting this rule and how would this
increase the number of applicants/licensees? What burdens would be
imposed on existing and future applicants/licensees, including any
implementation concerns? How would this option affect investment
incentives and what would be the impact for implementation of this
option on existing licenses? How long would it take for entities to
come into compliance? How would this change affect small entities? If
the Commission were to adopt this rule, would it be able to better
assess applicants/licensees for any public interest concerns, including
national security or law enforcement risks?
63. Any Entity that Has Capacity on the Submarine Cable System. The
Commission seeks comment generally on whether to require any entity
that holds capacity on the submarine cable to be an applicant/licensee.
Would this be consistent with the statutory requirement that no person
shall ``land or operate . . . any submarine cable'' without a license
as specified in the Cable Landing License Act? Any entity that holds
capacity on the submarine cable system, such as an entity that leases
capacity and may not own the terminal equipment or SLTE, may still have
an ability to operate a portion of the cable system. Would this broader
requirement better facilitate the Commission's public interest
assessment? Would small entities be affected by this rule change? For
example, the Commission seeks comment on whether holding capacity on
the cable system should be defined to include the leasing, purchasing,
selling, buying, or swapping of a fiber (spectrum, capacity, partial
fiber pair, or a full fiber pair, among others) for transmission of
voice, data, and internet over the cable system to interconnect with a
U.S. terrestrial network. The Commission seeks comment on whether the
rule should be limited to entities that hold capacity and are selling,
leasing, and/or swapping spectrum or capacity, or extend to those
entities that enter into contracts or arrangements to receive spectrum
or capacity or a fiber pair. The Commission seeks comment on the same
implementation questions as above. For example, what burdens would be
imposed on existing and future applicants/licensees? How would this
option affect investment incentives and what would be the impact for
implementation of this option on existing licenses? How long would it
take for entities to come into compliance? How would this change affect
small entities? Should the rule apply to entities that lease or employ
SLTE in the U.S. point(s) of the cable system for operation of spectrum
or capacity? The Commission intends that the rule should not extend to
customers on the edge of a network and should instead apply to entities
that hold capacity and are using the U.S. end of a submarine cable,
which may include ICPs, telecommunications providers, or other
businesses.
2. Presumption of Entities Not Qualified To Become a New Submarine
Cable Landing Licensee
64. To protect U.S. communications networks from national security
and law enforcement threats, the Commission proposes to adopt a
presumption that certain entities and their current and future
affiliates and subsidiaries shall not be qualified to become a new
submarine cable landing licensee. The Commission proposes that such
entities shall bear the burden of overcoming this presumption if they
file an application for a cable landing license. The Commission also
seeks comment on whether it should instead adopt a categorical
qualifying condition that would preclude the grant of a cable
[[Page 12052]]
landing license application filed by any applicant: (1) that is
directly and/or indirectly owned or controlled by, or subject to the
influence of a government organization of a foreign adversary country,
as defined under 15 CFR 791.4; (2) that is directly and/or indirectly
owned or controlled by, or subject to the influence of an individual or
entity that has a citizenship(s) or place(s) of organization in a
foreign adversary country; (3) that is directly and/or indirectly owned
or controlled by, or subject to the influence of an individual or
entity on the Commission's Covered List; and/or (4) that is using or
will use equipment or services identified on the Commission's Covered
List in the proposed submarine cable infrastructure. Should the
Commission also adopt a categorical qualifying condition based on other
U.S. Government determinations that certain individuals and entities
pose national security or other risks, such as the Consolidated
Screening List from the Departments of Commerce, State, and Treasury?
\71\
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\71\ The Consolidated Screening List is a list of parties for
which the United States Government maintains sanctions or
restrictions on certain exports, reexports, or transfers of items.
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65. Specifically, the Commission proposes to adopt a presumption
that any entity whose application for international section 214
authority was previously denied or whose domestic or international
section 214 authority was previously revoked in view of national
security and law enforcement concerns, and its current and future
affiliates and subsidiaries, shall not be qualified to become a new
cable landing licensee. The Commission proposes to apply the
definitions of affiliate and subsidiary that are set out in Sec.
2.903(c) of the rules and seeks comment on this approach.\72\ The
Commission proposes that such entities shall bear the burden of
overcoming this presumption if they file an application for a cable
landing license. Accordingly, the Commission proposes to adopt this
presumption with respect to the following entities and their current
and future affiliates and subsidiaries--China Mobile USA, CTA, CUA,
Pacific Networks, and ComNet.\73\ In the China Mobile USA Order, China
Telecom Americas Order on Revocation and Termination, China Unicom
Americas Order on Revocation, and Pacific Networks and ComNet Order on
Revocation and Termination,\74\ the Commission found that these
entities are subject to exploitation, influence, and control by the
Chinese government, and that mitigation would not address the national
security and law enforcement concerns. Further, in the 2024 Open
internet Order (89 FR 45404, May 22, 2024), the Commission excluded
China Mobile USA, CTA, CUA, Pacific Networks, ComNet, and their current
and future affiliates and subsidiaries from grant of blanket section
214 authority for the provision of broadband internet access service
(BIAS). Consistent with the Commission's findings in those proceedings,
it believes that allowing entities whose authorizations have been
denied or revoked on national security and law enforcement grounds to
access critical communications infrastructure would present significant
and unacceptable risks.\75\ Furthermore, the Commission proposes to
adopt this presumption with respect to any entity whose application
(including an application for any authorization or license) is or was
previously denied or whose authorization or license is or was
previously revoked and/or terminated on national security or law
enforcement grounds, and its current and future affiliates and
subsidiaries.
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\72\ 47 CFR 2.903(c) (defining ``affiliate'' as ``an entity that
(directly or indirectly) owns or controls, is owned or controlled
by, or is under common ownership or control with, another entity;
for purposes of this paragraph, the term `own' means to have,
possess, or otherwise control an equity interest (or the equivalent
thereof) of more than 10 percent''); id. (defining ``subsidiary'' as
``any entity in which another entity directly or indirectly: (i)
Holds de facto control; or (ii) Owns or controls more than 50
percent of the outstanding voting stock'').
\73\ The Commission's proposed approach would not modify the
cable landing licenses currently held by affiliates of these
identified entities. The Commission retains the authority to revoke
a licensee's cable landing license when warranted.
\74\ See China Telecom Americas Order on Revocation and
Termination; China Unicom Americas Order on Revocation; Pacific
Networks and ComNet Order on Revocation and Termination.
\75\ 2024 Open Internet Order at *131, paras. 339-340; see also
id. at para. 32 (``There can be no question about the importance to
our national security of maintaining the integrity of [the
Commission's] critical infrastructure, including communications
networks . . . Disruptions of communications can easily have
significant cascading effects on other critical infrastructure
sectors that rely on communications.'').
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66. The Commission tentatively finds that its proposal to adopt a
presumption that these entities shall not be qualified to become a new
cable landing licensee is consistent with the Commission's statutory
authority to withhold cable landing licenses under the Cable Landing
License Act and Executive Order 10530. The Cable Landing License Act
sets forth, among other things, that the President ``may withhold or
revoke such license when he shall be satisfied after due notice and
hearing that such action . . . will promote the security of the United
States.'' \76\ The authority vested in the President is delegated to
the Commission pursuant to Executive Order 10530.\77\ The Commission
tentatively finds that it has authority to adopt this presumption with
respect to a class of entities, and to assign them the burden of
overcoming the presumption in any cable landing license application,
where it relates to the Commission's evaluation as to whether
withholding a cable landing license from such entities would ``promote
the security of the United States.'' The Commission seeks comment on
these tentative findings.
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\76\ 47 U.S.C. 35 (``The President may withhold or revoke such
license when he shall be satisfied after due notice and hearing that
such action will assist in securing rights for the landing or
operation of cables in foreign countries, or in maintaining the
rights or interests of the United States or of its citizens in
foreign countries, or will promote the security of the United States
. . . .'') (emphasis added).
\77\ Executive Order 10530, section 5(a) (The Federal
Communications Commission is hereby designated and empowered to
exercise, without the approval, ratification, or other action of the
President, all authority vested in the President by the act of May
27, 1921, ch. 12, 42 Stat. 8 (47 U.S.C. 34 to 39), including the
authority to issue, withhold, or revoke licenses to land or operate
submarine cables in the United States: Provided, That no such
license shall be granted or revoked by the Commission except after
obtaining approval of the Secretary of State and such advice from
any executive department or establishment of the Government as the
Commission may deem necessary. The Commission is authorized and
directed to receive all applications for the said licenses.).
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67. In the recent section 214 denial proceeding and revocation
proceedings, the Commission extensively evaluated national security and
law enforcement considerations raised by existing section 214
authorizations and determined, based on thorough record development,
that the present and future public interest, convenience, and necessity
was no longer served by those carriers' retention of their section 214
authority. The Commission believes the same national security and law
enforcement concerns identified in those proceedings equally exist with
respect to these entities seeking to land or operate a submarine cable
in the United States. The Commission therefore believes that its
determinations in those proceedings are directly relevant to the
determination as to whether grant of a new cable landing license to the
identified entities and their current and future affiliates and
subsidiaries would serve the public interest. The Commission seeks
comment on this proposal.
68. The Commission also proposes to presume that any entity whose
[[Page 12053]]
application for a Commission authorization is or was previously denied,
or whose license or authorization for any service is or was previously
revoked and/or terminated, for national security and/or law enforcement
reasons, and their current and future affiliates and subsidiaries, is
presumptively unqualified to hold a cable landing license. The
Commission notes this approach would supplement the Commission's
existing character qualifications policy, which looks to whether an
applicant has violated the Communications Act or Commission rules, has
been convicted of a felony, or has engaged in other specified types of
misconduct indicating that the applicant is not trustworthy or
reliable. The Commission also seeks comment on whether there are other
types of entities that also pose national security, law enforcement, or
other concerns and to which the Commission should apply a similar
presumption that such entities shall not be qualified to become cable
landing licensees and must overcome such a presumption in any cable
landing license application that they file with the Commission. What
factors or criteria should inform the Commission's determination of any
such types of entities and whether they pose national security, law
enforcement, and other concerns that warrant adoption of such a
presumption? The Commission also seeks comment on whether it should
apply a standard in assessing whether such entities have overcome this
presumption in any application that is filed for a new cable landing
license.
69. The Commission seeks comment on whether it should instead adopt
a categorical qualifying condition that would preclude grant of any
submarine cable application--including an application for a cable
landing license or the modification, assignment, transfer of control,
or renewal or extension of such license--filed by any applicant that is
directly and/or indirectly owned or controlled by, or subject to the
influence of, (1) a government organization of a ``foreign adversary''
country, and/or (2) an individual or entity that has a citizenship(s)
or place(s) of organization in a ``foreign adversary'' country, as
defined under 15 CFR 791.4. If so, what ownership threshold should the
Commission apply to any categorical condition precluding the grant of a
cable landing license application filed by applicants that are owned by
foreign interest holders associated with a foreign adversary country?
For example, should the Commission preclude grant of a cable landing
license application filed by any applicant that is directly and/or
indirectly majority-owned by such foreign interest holders? Or should
the Commission preclude grant of a cable landing license application
filed by any applicant that has a direct and/or indirect 10% or greater
foreign interest holder associated with a foreign adversary country? Is
10% the appropriate threshold, or should the Commission adopt a greater
or lesser threshold?
70. The Commission seeks comment on whether it should prohibit
cable landing licensees from entering into arrangements for IRUs or
leases for capacity on submarine cables landing in the United States,
with any entity that has a citizenship(s) or place(s) of organization
in a ``foreign adversary'' country, as defined under 15 CFR 791.4. The
Commission also seeks comment on whether it should prohibit cable
landing licensees from entering into such arrangements with any entity
that is directly and/or indirectly owned or controlled by, or subject
to the influence of, (1) a government organization of a foreign
adversary country, and/or (2) any individual or entity that has a
citizenship(s) or place(s) of organization in a ``foreign adversary''
country, as defined under 15 CFR 791.4. What ownership threshold should
the Commission apply to the extent it prohibits cable landing licensees
from entering into arrangements for IRUs or leases for capacity with
entities that are owned by foreign interest holders associated with a
foreign adversary country? For example, should the Commission prohibit
licensees from entering into such arrangements with any entity that is
directly and/or indirectly majority-owned by such foreign interest
holders? Or should the Commission prohibit licensees from entering into
such arrangements with any entity that has a direct and/or indirect 10%
or greater foreign interest holder associated with a foreign adversary
country? Is 10% the appropriate threshold, or should the Commission
adopt a greater or lesser threshold? Additionally, the Commission seeks
comment on whether to adopt rules that prohibit cable landing licensees
from landing a cable licensed by the Commission in certain locations,
such as landing points in a ``foreign adversary'' country, as defined
under 15 CFR 791.4.
3. Five (5) Percent Threshold for Reportable Interests
71. The Commission seeks comment on whether to lower the current
10% ownership reporting threshold to five percent (5%) or greater
direct and indirect equity and/or voting interests in the applicant(s)
and licensee(s). The 5% threshold would apply to initial applications
for cable landing licenses and applications for modification,
assignment, transfer of control, and renewal or extension of submarine
cable licenses. Currently, applicants for a submarine cable landing
license must submit the information required in Sec. 63.18(h) of the
rules, including identification of ``any individual or entity that
directly or indirectly owns ten percent or more of the equity interests
and/or voting interests, or a controlling interest, of the applicant,
and the percentage of equity and/or voting interest owned by each of
those entities (to the nearest one percent).''
72. The Commission believes that greater insight into the ownership
of applicants and licensees who own, control, and operate submarine
cable systems is crucial to responding to the evolving threat
environment, and that the current reporting threshold of 10% may not
capture all interests that may present national security and policy
concerns. When the Commission adopted the Standard Questions in the
2021 Standard Questions Order (86 FR 68428, December 2, 2021), it
incorporated input from the Committee staff recommending a 5% ownership
reporting threshold. The Commission noted the views of the Committee
staff that it was important because ``when ownership is widely held,
five percent can be a significant interest'' and ``a group of foreign
entities or persons, each owning nine percent and working together,
could easily reach a controlling interest in a company without having
to disclose any of their interests.''
73. Moreover, both the Commission and other Federal Government
entities use a 5% reporting threshold. The Commission notes that the
Commission uses a 5% ownership threshold in the broadcast context.\78\
Additionally, a reporting threshold of 5% applies to information that
U.S. public companies and their shareholders provide to the Securities
and Exchange Commission (SEC). The regulation at 17 CFR 240.13d-1
(Exchange Act Rule 13d-1) requires a person or ``group'' that becomes,
directly or indirectly, the
[[Page 12054]]
``beneficial owner'' of more than 5% of a class of equity securities
registered under section 12 of the Exchange Act to report the
acquisition to the SEC. The Commission notes that various SEC forms
filed by issuers, including their annual reports (or proxy statements)
and quarterly reports, require the issuer to include a beneficial
ownership table that contains, among other things, the name and address
of any individual or entity, or ``group,'' who is known to the issuer
to be the beneficial owner of more than 5% of any class of the issuer's
voting securities. A reporting threshold of 5% would also be consistent
with that required by the Committee on Foreign Investment in the United
States (CFIUS) \79\ from parties to a voluntary notice filed with
CFIUS. The 5% threshold thus appears to be a generally accepted
benchmark for understanding the investors in an entity. The Commission
also anticipates, based on this fact, that entities generally will or
should already know their 5% interest holders. Thus, the Commission
tentatively concludes that its proposal to adopt a reporting threshold
of 5% would be consistent with the reporting requirements of other
Federal agencies and would impose minimal burdens on applicants.
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\78\ 47 CFR 73.3555, n.2 (``[t]he sum of the interests other
than those held by or through `passive investors' is equal to or
exceeds 5 percent.''); FCC Form 323 Instruction for Ownership
Reports for Commercial Broadcast Stations, at 5 (``Each officer,
director, and owner of stock accounting for 5 percent or more of the
issued and outstanding voting stock of the Respondent is considered
the holder of an attributable interest, and must be reported.''),
https://www.fcc.gov/sites/default/files/323.pdf (last visited Oct.
22, 2024).
\79\ CFIUS is ``an interagency committee authorized to review
certain transactions involving foreign investment in the United
States and certain real estate transactions by foreign persons, in
order to determine the effect of such transactions on the national
security of the United States.''
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74. The Commission seeks comment on whether a reporting threshold
of 5% equity and/or voting interest adequately captures the
relationship, association, and/or extent of influence that an investor
may have in an applicant. Would a reporting threshold of 5% equity and/
or voting interests sufficiently account for powers held by
shareholders with less than 5% equity and/or voting interests but who
may hold other special privileges or powers in the corporate structure?
For instance, would the reporting threshold account for a situation
where a foreign government interest holder with a smaller ownership
and/or voting interest, below the 5% threshold, may wield a
disproportionately significant influence on the applicant through
``golden shares?'' \80\ Should the Commission require additional
information about an applicant's reportable interest holders? Should
the Commission expand the reportable interests beyond percentages of
equity and/or voting interests, for example, by requiring applicants to
identify other types of interests or interest holders, such as
management agreements? What other indicia of significant influence or
control should the Commission consider in order to fully identify
interest holders that are either foreign governments or foreign state-
owned entities? What additional information would fully inform and
assist the Commission's assessment of any national security, law
enforcement, foreign policy, and/or trade policy risks raised by such
interest holders?
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\80\ See, e.g., In re Franchise Services of North America, Inc.
v. U.S. Trustee, 891 F.3d 198, 205 (5th Cir. 2018) (``Generally
speaking, a `golden share' is `[a] share that controls more than
half of a corporation's voting rights and gives the shareholder veto
power over changes to the company's charter.' E.g., Golden Share,
Black's Law Dictionary (10th ed. 2014); see also Mariana Pargendler,
State Ownership and Corporate Governance, 80 Fordham L. Rev. 2917,
2967 (2012) (noting that in the context of formerly stated-owned
entities, `[g]olden shares are essentially a special class of stock
issued to the privatizing government that grants special voting and
veto rights that are disproportionate to, or even independent of,
its cash-flow rights in the company').''); see also Reuters,
Fretting about data security, China's government expands its use of
``golden shares'' (Dec. 15, 2021), https://www.reuters.com/article/china-regulationdata-idCAKBN2IU2B7 (``Seeking influence, Beijing
began taking golden shares in private online companies--usually
about 1% of a firm--some five years ago. The stakes are bought by
government-backed funds or companies which gain a board seat and/or
veto rights for key business decisions.'').
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75. The Commission seeks comment on what, if any, potential burdens
would be imposed on applicants if they were required to report direct
and indirect equity and/or voting interests at a 5% threshold. The
Commission also seeks comment on ways for the Commission to minimize
those burdens. While the Commission anticipates that most entities
should readily be able to identify their 5% interest holders given
other existing reporting requirements at that threshold, the Commission
seeks comment on this belief. The Commission likewise invites comment
on whether this lower reporting threshold will generally result in the
identification of a substantially, or only marginally, greater number
of interest holders.\81\
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\81\ To the extent that the lower reporting threshold results in
a substantial increase in the number of interest holders
identified--or as otherwise required by other proposals in the
NPRM--the Commission will make necessary changes to applicable
Privacy Act System of Records Notices (SORNs).
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76. Commenters should also address whether there are any privacy
concerns implicated by the lower reporting threshold, and whether this
information is ``financial information'' of a privileged and
confidential nature. Do licensees and interest holders view this
information as confidential? What, if any, privacy or other harms,
would result from disclosure of these interest holders? \82\ The
Commission tentatively concludes that the privacy interest of 5%
interest holders, if any, in not being identified in applications and
any interest in withholding privileged and confidential financial
information of this nature is outweighed by national security and other
public interest benefits from such reporting. Moreover, the Commission
believes that these interests can be otherwise protected. For instance,
if the Commission adopts a 5% reporting threshold, filers can seek
confidential treatment, as is the case under the Commission's current
reporting threshold. The Commission seeks comment on whether it should
instead treat the disclosure of certain ownership interests of 5% and
up to less than 10% as presumptively confidential,\83\ without
requiring the applicant to file a request for confidentiality. The
Commission notes that the ownership information must not be publicly
available elsewhere either in this country or another country for us to
treat it as presumptively confidential. Alternatively, should the
Commission require public disclosure of ownership interests of 5% and
up to less than 10% of only those interest holders that are citizens,
entities, or government organizations of foreign adversary countries,
as defined in the Department of Commerce's rule, 15 CFR 791.4?
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\82\ Commenters should identify any harms from disclosure that
would warrant the withholding of this information under the
Commission's rules and the Freedom of Information Act (FOIA).
\83\ Other Commission requirements, such as supply chain annual
reporting, provide for a checkbox certification and the submission
of information that is presumptively confidential. 2020 Protecting
Against National Security Threats Order, 86 FR 2904, January 13,
2021, 35 FCC Rcd at 14369-70, para. 214 (``We believe that the
public interest in knowing whether providers have covered equipment
and services in their networks outweighs any interest the carrier
may have in keeping such information confidential . . . . Other
information, such as location of the equipment and services; removal
or replacement plans that include sensitive information; the
specific type of equipment or service; and any other provider
specific information will be presumptively confidential.''). In
order to request confidential treatment of the Circuit Status Report
(the predecessor of the Circuit Capacity Report), a submitter simply
has to check a box that appears on the certification form
accompanying all submissions.
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4. Submarine Cable Infrastructure Information
77. Consistent with the Commission's goal of ensuring it has
sufficient information concerning this critical infrastructure, the
Commission proposes to require applicants \84\ for a cable
[[Page 12055]]
landing license or modification, assignment, transfer of control, and
renewal or extension of a license, and licensees seeking to submit
their periodic reports, to provide additional detailed information
concerning the submarine cable infrastructure. Currently, Sec.
1.767(a)(4) of the Commission's rules requires applicants for a cable
landing license to provide ``[a] description of the submarine cable,
including the type and number of channels and the capacity thereof[.]''
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\84\ For purposes of the information requirements proposed in
the NPRM, unless otherwise indicated, the Commission uses the terms
``applicant'' or ``applicants'' to refer to an applicant or licensee
that files an application or notification under Sec. 1.767 of the
Commission's rules, as well as the proposed rules for certain types
of applications: (1) applicants that file an initial application for
a cable landing license or an application for modification,
substantial assignment, substantial transfer of control, or renewal
or extension of a cable landing license; (2) cable landing licensees
that file a notification of pro forma assignment or transfer of
control of a cable landing license; and/or (3) applicants that file
a request for an STA related to the operation of a submarine cable.
47 CFR 63.24(e) (referring to ``substantial'' transactions); 47 CFR
63.24(d) (defining ``Pro forma assignments and transfers of
control''). Unless otherwise indicated, the Commission uses the term
``application'' or ``submarine cable application'' to refer to an
initial application for a cable landing license; an application for
modification, substantial assignment, substantial transfer of
control, or renewal or extension of a cable landing license; and a
pro forma assignment or transfer of control notification.
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78. The Commission proposes to also require that the detailed
information regarding the submarine cable system include (1) the
states, territories, or possessions in the United States and the
foreign countries where the cable will land; \85\ (2) the number of
segments in the submarine cable system and the designation of each
(e.g., Segment A, Main Trunk, A-B segment); (3) the length of the cable
by segment and in total; (4) the location, by segment, of branching
units; (5) the address and county or county equivalent of each U.S. and
non-U.S. cable landing station, (6) the number of optical fiber pairs,
by segment, of the submarine cable; (7) the design capacity, by
segment, of the cable system, and (8) anticipated time frame when the
applicant intends to place the submarine cable system into service. The
Commission also proposes to modify the requirement for applicants and
licensees to provide the geographic coordinates of cable landing
stations as well as beach manholes, to the extent they differ from
cable landing station coordinates.\86\ Under the Commission's proposal,
applicants would provide a specific description of the submarine cable
system, including a map and geographic data in generally accepted
Geographic Information Systems (GIS) formats or other formats. The
Commission seeks comment on the specific information and the file
formats and specific data fields that should be submitted. For example,
applicants could provide a specific description of the dry plants,
including geographic data in generally accepted GIS formats (e.g.,
GeoJSON, Shapefile, Geopackage, etc.) with a map that specifies the
location of (1) each beach manhole, (2) each cable landing station,
including locations of each PFE and each SLTE, and (3) each Network
Operations Center (NOC) \87\ providing remote access to the submarine
cable system. For example, the GIS data could include the routing of
the optical fiber cable from the beach manhole to the cable landing
station or like facility/facilities and location of the PFE, SLTE, and
NOC. The map could specify the geographic coordinates (longitude and
latitude) and street address, county and county equivalent, if
applicable, of each beach manhole and cable landing station or similar
facility. Should applicants provide maps and geographic coordinates of
the location of the dry plant components that are located at the U.S.
and foreign ends of the submarine cable system? The Commission proposes
to delegate authority to OIA, in coordination with the Office of
Economics and Analytics, to determine the file formats and specific
data fields in which data will ultimately be collected. The Commission
seeks comment on the proposals and approaches above.
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\85\ Section 1.767(a)(5) of the rules requires, among other
things, ``[a] specific description of the cable landing stations on
the shore of the United States and in foreign countries where the
cable will land.'' In addition to revisions to Sec. 1.767(a)(5) on
which the Commission seeks comment below, the Commission proposes to
specifically require that applicants must include in their
description of the submarine cable the states, territories, or
possessions in the United States and the foreign countries where the
cable will land.
\86\ The Commission seeks comment on whether it should modify
the part of that rule that states, ``[t]he applicant initially may
file a general geographic description of the landing points;
however, grant of the application will be conditioned on the
Commission's final approval of a more specific description of the
landing points, including all information required by this
paragraph, to be filed by the applicant no later than ninety (90)
days prior to construction. . . .'' The Commission proposes to
redesignate this part of Sec. 1.767(a)(5) under a new Sec.
1.70005(f)(1).
\87\ A NOC is a centralized location where information
technology administrators can continuously monitor the performance
of the wet and dry segments of the submarine cable system, either on
site or from a remote location. The role of a NOC is to ``provide
full visibility'' into the infrastructure and equipment. Id. (``From
a security perspective, the NOC functions as the first line of
defense that enables the organization to monitor network security
and recognize and address any attacks or disruptions to the
network.'').
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79. Route Position Lists. Relatedly, the Commission seeks comment
on whether it should require applicants for cable landing licenses and
cable landing licensees to file with the Commission route position
lists containing the geographic coordinates of the wet segment of the
submarine cable. The Commission notes that maps showing the exact
location of submarine cables are treated as presumptively confidential
under the Commission's rules.\88\ The Commission's rules require
applicants for cable landing licenses to submit ``a map showing
specific geographic coordinates . . . of each landing station'' and
``the coordinates of any beach joint where those coordinates differ
from the coordinates of the cable station.'' Should the Commission also
require applicants and licensees to submit the geographic coordinates
of the entire wet segment of the submarine cable (for example,
including the U.S. and foreign portions of the cable) and/or other
components of the cable? Would such data enhance the ability of the
Commission and other Federal agencies to identify, prevent, or mitigate
spatial conflicts affecting submarine cables and further ensure the
protection of this critical infrastructure?
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\88\ 47 CFR 0.457(c)(1)(i) (withholding from public inspection
``[m]aps showing the exact location of submarine cables'').
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80. Confidential Treatment of Submarine Cable Landing Geographic
Coordinates and Other Information. The Commission proposes to provide
confidential treatment for the exact addresses and specific geographic
coordinates of cable landing stations, beach manholes, and other
location information associated with a submarine cable system under the
Commission's rules. Given the risks associated with the public
availability of critical aspects of these cable systems, the Commission
believes the exact addresses and geographic coordinates and other
specific location information should be treated as presumptively
confidential. The Commission seeks comment on the extent to which, if
any, this information is treated as privileged and confidential, and
what impacts might the public availability of this information have on
the commercial interests of cable system owners and users.
81. Among the most sensitive parts of a submarine cable system are
the wet segment as it approaches the shore, the submarine cable as it
reaches the beach manhole, and the dry segment including the cable
landing station(s), such as where the SLTE is located. At present,
several applicants for initial cable landing licenses have requested
that such information should be confidential and filed under a request
for
[[Page 12056]]
confidential treatment.\89\ The Commission proposes to withhold the
exact location information from public inspection. The Commission
proposes to only release publicly more general location information,
such as the city, state/province/department, and country in which the
submarine cable system will land. The Commission seeks comment on
applicants' commercial interests in this information, the extent to
which such information is treated as confidential by the applicants,
and what harms would result to applicants' commercial interests if the
information were disclosed to the public. The Commission seeks comment
on how to treat such information if it is already publicly available
from another source.
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\89\ See, e.g., Letter from Craig J. Brown, Assistant General
Counsel, Lumen to Marlene H. Dortch, Secretary, Federal
Communications Commission at 1 (Feb. 15, 2023) (requesting
confidential treatment of coordinate information, citing security
risks to the cable) (on file in File No. SCL-LIC-20230222-00005);
Letter from Ulises R. Pin and Brett P. Ferenchak, Counsel for GU
Holdings, Inc., to Marlene H. Dortch, Secretary, Federal
Communications Commission at 1-2 (June 9, 2023) (requesting
confidential treatment of coordinate and address information, citing
security risks to the cable) (on file in File No. SCL-LIC-20230511-
00013); Letter from Ulises R. Pin and Brett P. Ferenchak, Counsel
for Starfish Infrastructure Inc., to Marlene H. Dortch, Secretary,
Federal Communications Commission at 1-2 (July 8, 2024) (requesting
confidential treatment of coordinate and address information, citing
security risks to the cable) (on file in File No. SCL-LIC-20240621-
00030).
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82. Sharing with Federal Agencies. To the extent confidential
treatment is requested for submarine cable infrastructure information,
any sharing of the information with other Federal agencies would be
subject to the procedures set out in Sec. 0.442 of the rules. Under
Sec. 0.442, the Commission may disclose to other Federal agencies,
upon the Commission's own motion or another agency's request, records
that have been submitted to the Commission in confidence, subject to
providing the filer notice of the proposed sharing and ten (10) days to
object. In general, under Federal law, the Commission may share
information it has collected pursuant to an information collection with
other Federal Government agencies. If it does, all provisions of law
that relate to the unlawful disclosure of information apply to the
employees of the agency to which the information is released ``to the
same extent and in the same manner'' as they do to employees of the
collecting agency. The Commission seeks comment on whether to adopt a
rule that would allow the Commission to share submarine cable landing
geographic coordinates, the route position lists, and other information
with relevant Federal agencies, including information for which
confidential treatment is requested, without the pre-notification
procedures of Sec. 0.442(d). The Commission notes that it is seeking
comment on this same process for sharing cybersecurity risk management
plans and annual circuit capacity data. The Commission seeks comment
generally on this process to ensure the Commission and other Federal
agencies have adequate information on submarine cable infrastructure to
assess for any national security, law enforcement, and other concerns.
5. Current and Future Service Offerings
83. The Commission proposes to require applicants for an initial
application for a cable landing license or an application for
modification, assignment, transfer of control, and renewal or extension
of such license to include in their application information about the
capacity services they currently provide or plan to provide through the
submarine cable system. This information includes the capacity they
currently own or lease, the amount of capacity they intend to sell or
lease, and the capacity management services they will provide. The
Commission also proposes to require applicants for a cable landing
license, licensees, assignees, and transferees (as appropriate) to
disclose current and expected future service offerings as part of their
application for a cable landing license or modification, assignment,
transfer of control, and renewal or extension of a submarine cable
landing license. Collecting such information will help the Commission
properly evaluate national security and other risks and the robustness
of submarine cable infrastructure on an ongoing basis. Such
requirements would bring the Commission's approach for submarine cable
landing licenses in line with proposals for international section 214
authorization holders in the Evolving Risks NPRM, and incorporate
insights from the executive branch agencies' efforts to obtain
information about services from applicants with reportable foreign
ownership.\90\
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\90\ See, e.g., 2021 Standard Questions Order, 36 FCC Rcd at
14912, Attach. C (stating in the Instructions for Standard Questions
for a Submarine Cable Landing License Application, ``[t]he questions
seek further details regarding the Applicant and its security-
related practices, and some questions are particularly directed at
identifying and assessing the complete scope of the equipment that
the Applicant will be operating and the services the Applicant will
be offering should the FCC grant those authorities'').
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84. Specifically, the Commission proposes to require applicants to
provide the following information regarding services that they
currently provide and/or will provide through the submarine cable
system: (1) identify and describe the capacity services and capacity
management services, including the amount of fiber, spectrum, or
capacity by selling, leasing, or swapping; (2) identify the types of
customers that currently are served and/or will be served, including
those with whom the applicant leases, sells, shares, or swaps fiber,
spectrum, or capacity and/or plans to lease, sell, share, or swap
fiber, spectrum, or capacity; (3) identify whether the applicant
currently owns or controls and/or will own or control the U.S. portion
of the submarine cable system, including the submarine cable landing
station(s), through an IRU or leasehold interest; (4) identify where
the applicant currently markets, offers, and provides services and/or
expects to market, offer, and provide services; and (5) identify the
general terms and conditions that currently apply and/or will apply to
the services, such as contract duration, minimum capacity/bandwidth
requirements, IRU requirements, termination clauses, security
requirements, delivery or Service Level Agreement (SLA) requirements,
dispute resolution, and other applicable provisions. This information
might be provided as service tiers, ranges, or other applicable frames
of reference. The Commission seeks comment on whether this information
should be considered presumptively confidential, similar to the
Commission's proposal with respect to the exact addresses and specific
geographic coordinates of certain sensitive components of a submarine
cable system, such as the cable landing stations and beach manholes,
among others. If so, what is the basis for why the information should
be treated as presumptively confidential under the Commission's rules
and the FOIA? \91\ In other words, to what extent does this information
constitute privileged or confidential trade secrets or commercial or
financial information? To what extent, if any, is this information
already publicly available?
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\91\ Commenters should identify any harms from disclosure that
would warrant the withholding of this information under the
Commission's rules and the FOIA.
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6. Regulatory Compliance Certifications
85. Given concerns about ensuring the security and integrity of
this critical infrastructure, the Commission proposes new
certifications to protect against national security, law enforcement,
and other risks. The Commission tentatively
[[Page 12057]]
concludes that such requirements would help mitigate national security,
economic security, law enforcement, and other concerns associated with
threats to the security of submarine cable infrastructure. The
Commission also expects that requiring applicants to provide these
certifications will help to expedite Commission review. The Commission
seeks comment on the proposals below.
86. Compliance with FCC Rules. The Commission proposes that all
applicants seeking a cable landing license or modification, assignment,
transfer of control, and renewal or extension of such license, and
licensees filing their three-year periodic reports, must certify in the
applications and the reports whether or not they are in compliance with
the Cable Landing License Act, the Communications Act, the Commission's
rules, and other laws. Specifically, the Commission proposes to require
each applicant to certify in its application whether or not the
applicant has violated the Cable Landing License Act, the
Communications Act, or Commission rules, including making false
statements or misrepresentations to the Commission; whether the
applicant has been convicted of a felony; and whether there is an
adjudicated determination that the applicant has violated U.S.
antitrust or other competition laws, has been found to have engaged in
fraudulent conduct before another government agency, or has engaged in
other non-FCC misconduct the Commission has found to be relevant in
assessing the character qualifications of a licensee or authorization
holder. The Commission seeks comment on these proposals. The Commission
also seeks comment on whether it should require applicants to disclose
any pending FCC investigations, including any pending Notice of
Apparent Liability, and any adjudicated findings of non-FCC misconduct.
In addition, the Commission seeks comment on whether it should require
applicants to disclose any violations of the Communications Act,
Commission rules, or U.S. antitrust or other competition law, or any
other non-FCC misconduct only where there has been adjudication or
notification of a violation by an agency or court.
87. Cybersecurity Certifications. The Commission proposes to
require all applicants for a cable landing license or modification,
assignment, transfer of control, and renewal or extension of a cable
landing license, and licensees filing their three-year periodic
reports, to certify in the application or report that they have
created, updated, and implemented cybersecurity risk management plans.
The Commission also proposes to require that existing licensees shall
certify to the same for the first time based on the prioritization
schedule set out in the NPRM. To facilitate the Commission's review of
existing cable landing licenses, the Commission proposes to require
that existing licensees provide this cybersecurity certification in
their respective periodic reports consistent with the categories and
deadlines to be established by OIA as proposed in the NPRM. The
Commission also proposes to require these applicants and licensees to
certify that they take reasonable measures to protect the
confidentiality, integrity, and availability of their systems and
services that could affect their provision of communications services.
In this regard, the Commission proposes that applicants' and licensees'
cybersecurity risk management plans must identify the cyber risks they
face, the controls they use or plan to use to mitigate those risks, and
how they ensure that these controls are applied effectively to their
operations. The plans would also describe how the applicant or licensee
employs its organizational resources and processes to ensure the
confidentiality, integrity, and availability of its systems and
services. The Commission seeks comment on these proposals.
88. Given the importance of cybersecurity, the Commission believes
that the operation of submarine cable systems should meet baseline
security requirements to safeguard systems against threats. The
Commission believes these proposals are consistent with the National
Cybersecurity Strategy and, in that connection, are in keeping with a
whole-of-government effort to ``establish cybersecurity requirements to
support national security and public safety.'' \92\ The Commission
expects that creating, updating, and implementing cybersecurity risk
management plans would help protect applicants' and licensees' systems
and services from serious threats to national security, public safety,
and the economy. These proposals would require specific actions to
protect communications networks and infrastructure and collaborating
with communications sector industry members to identify best practices.
The Commission seeks comment on these expectations and on any national
security, economic, or public safety benefits of effective
cybersecurity practices and cybersecurity risk management for
applicants and licensees.
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\92\ Other Federal agencies are likewise either requiring or
proposing to require their regulated entities to take cybersecurity
measures to protect their systems. For example, the Commodity
Futures Trading Commission (CFTC) requires registrants to establish
and maintain information security controls as part of their
mandatory system safeguards and to implement five types of security
testing through ongoing risk assessments and board oversight: (1)
vulnerability testing; (2) penetration testing; (3) controls
testing; (4) security incident response plan testing; and (5)
enterprise technology risk assessment. The SEC has proposed periodic
cybersecurity reporting requirements that include disclosing a
registrant's policies and procedures to identify and manage
cybersecurity risks. The SEC adopted cybersecurity reporting
requirements that include disclosing a registrant's policies and
procedures to identify and manage cybersecurity risks.
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89. The Commission proposes that each applicant or licensee have
flexibility to structure its cybersecurity risk management plan in a
manner that is tailored to its organization, provided that the plan
demonstrates that the applicant or licensee is taking affirmative steps
to analyze security risks and improve its security posture. While the
Commission believes there are many ways that applicants or licensees
may satisfy this requirement, the Commission proposes that they could
successfully demonstrate compliance with this proposed requirement by
following an established risk management framework, such as the
National Institute of Standards and Technology (NIST) Cybersecurity
Framework (CSF). The NIST CSF is designed to be scalable and adaptable
to the needs and capabilities of companies both large and small, is
well understood by industry, and is flexible. The Commission seeks
comment on this flexible approach, including whether it would reduce
the costs imposed on applicants and licensees. What other risk
management frameworks do applicants and licensees implement other than
the NIST CSF? To the extent commenters believe the Commission should
mandate a particular risk management framework or take a less flexible
approach, the Commission seeks comment on their proposed alternative,
as well as their rationale and why it would serve the public interest.
For example, should the Commission require applicants and licensees to
apply the NIST CSF, as the Commission has done in other proceedings?
\93\ The
[[Page 12058]]
Commission further seeks comment on how an applicant should demonstrate
that it has taken affirmative steps to analyze security risks and
improve its security posture after it has implemented a cybersecurity
risk management plan.
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\93\ See Connect America Fund: A National Broadband Plan for The
Commission's Future High-Cost Universal Service Support et al., WC
Docket No. 10-90 et al., Report and Order, Notice of Proposed
Rulemaking, and Notice of Inquiry, 38 FCC Rcd 7040, 7086-87 para.
111 (2023) (Enhanced A-CAM Order); (requiring Enhanced A-CAM support
recipients to implement cybersecurity risk management plans that
reflect the latest version of the NIST CSF as a condition of
receiving support); Establishing a 5G Fund for Rural America, GN
Docket No. 20-32, Second Report and Order, Order on Reconsideration,
and Second Further Notice of Proposed Rulemaking, FCC 24-89, at 64-
65, para. 122 (Aug. 14, 2024) (5G Fund Second Report and Order)
(requiring 5G Fund support recipients to implement cybersecurity
risk management plans that reflect the NIST CSF as a condition of
receiving 5G Fund support).
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90. The Commission proposes that an applicant's Chief Executive
Officer (CEO), Chief Financial Officer (CFO), Chief Technology Officer
(CTO), or a similarly situated senior officer responsible for
governance of the organization's security practices would be required
to sign the applicant's cybersecurity risk management plan. The
Commission believes that a signatory with visibility into the full
network and organization is essential to ensure the plan encompasses
all necessary elements and is executed throughout the organization. In
recommendations made to Microsoft after the Cyber Safety Review Board's
investigation of an incident resulting in compromise of Microsoft's
systems as a result of a threat actor associated with the Chinese
government, the Board noted the importance of ``rigorous risk
management'' and focus on security at the executive level. The
Commission seeks comment on this approach. Are there additional steps
that the Commission should take to ensure that cybersecurity is an
integral part of corporate governance for applicants and licensees?
91. The Commission seeks comment on whether to require applicants'
and licensees' cybersecurity risk management plans to include
provisions for identifying, assessing, and mitigating supply chain
cybersecurity threats. According to NIST, ``[g]iven the complex and
interconnected relationships in this ecosystem, supply chain risk
management . . . is critical for organizations.'' To what extent do
applicants' and licensees' cybersecurity risk management plans already
identify and mitigate supply chain cybersecurity risks? The Commission
notes that the Commission already requires participants in the Enhanced
A-CAM and 5G Fund programs to submit separate supply chain risk
management plans that incorporate best practices published by NIST,
such as those discussed in Key Practices in Cyber Supply Chain Risk
Management: Observations from Industry (NISTIR 8276), and Cybersecurity
Supply Chain Risk Management Practices for Systems and Organizations
(NIST 800-161), in addition to cybersecurity risk management plans.
Should the Commission require all applicants and licensees to certify
to having created, updated, and implemented cybersecurity supply chain
risk management plans, either as part of their cybersecurity risk
management plan or as a separate document?
92. The Commission proposes to require applicants and licensees to
describe in their risk management plans their implementation of
security controls sufficient to ensure the confidentiality, integrity,
and availability of all aspects of their communications systems and
services. While the Commission believes there are many ways for
applicants and licensees to satisfy this aspect of the requirement, the
Commission proposes that applicants and licensees will satisfy it if
they demonstrate they have successfully implemented an established set
of cybersecurity best practices, such as the Cybersecurity and
Infrastructure Security Agency's (CISA) Cross-Sector Cybersecurity
Performance Goals (CPGs) or the Center for internet Security Critical
Security Controls (CIS Controls).\94\ The Commission expects that
compliant cybersecurity risk management plans will not be limited to a
predetermined set of specific measures, but instead plans will vary
based on individual applicants' and licensees' needs and circumstances
sufficient to protect against cyber threats.\95\ The Commission seeks
comment on this proposal.
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\94\ See Center for internet Security, Critical Security
Controls Version 8, https://www.cisecurity.org/controls (last
visited Oct. 22, 2024) (providing security controls grouped by
priority and feasibility for different sizes and resources of
businesses in Implementation Groups).
\95\ The Commission notes that it has also sought comment on
whether applicants for international section 214 authority and
modification, assignment, transfer of control, and renewal of
international section 214 authority should be required to certify in
the application that they will undertake to implement and adhere to
baseline cybersecurity standards based on universally recognized
standards such as those provided by CISA or NIST. The Commission
seeks comment on this assessment.
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93. In conjunction with this proposal, the Commission seeks comment
on whether to require applicants and licensees to implement specific
security controls sufficient to protect the confidentiality, integrity,
and availability of their systems and services. In the Alerting
Security NPRM, the Commission proposed to require alerting participants
to implement the following six controls, among other measures: (1)
changing default passwords prior to operation; (2) installing security
updates in a timely manner; (3) securing equipment behind properly
configured firewalls or using other segmentation practices; (4)
requiring multifactor authentication, where applicable; (5) addressing
the replacement of end-of-life equipment; and (6) wiping, clearing, or
encrypting user information before disposing of old devices.\96\ These
six controls were drawn from CISA's common baseline of cybersecurity
controls. The Commission seeks comment on whether it should require the
implementation of these or some other subset of common security
controls to protect applicants' and licensees' systems and services.
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\96\ On August 22, 2022, PSHSB advised EAS participants to
promptly secure their equipment against potential internet-based
risks, emphasizing the importance of updating software, changing
default passwords, and implementing security measures to prevent
unauthorized access. The advisory addressed a vulnerability
identified by the Federal Emergency Management Agency and
underscored the responsibility of EAS participants to ensure proper
functioning during operational times to avoid enforcement
consequences. These requirements are grounded in the guidance
provided in that Public Notice.
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94. The Commission observes that applicants and licensees can
benefit from free and low-cost resources that are available to help
identify and implement best practices and improve their security over
time without requiring the hiring of outside experts. NIST publishes
guidance that could assist organizations with measuring their
safeguards, including how to address ransomware, malware, malicious
code, spyware, distributed denial of service (DDoS) attacks, phishing,
securing networks, and threats to mobile phones. CISA offers
vulnerability scanning at no cost for critical infrastructure, which
includes communications providers, and also provides CPG Assessment
Training with regional cybersecurity experts that will help
communications providers better understand CPGs and the cybersecurity
risk assessment process. The Commission assumes that these resources,
along with any number of other publicly available resources that the
Commission has not specifically identified or that may arise in the
future, will assist applicants' and licensees' employees and their
existing technical contractors in identifying and implementing
appropriate security controls without needing specialized cybersecurity
expertise. The Commission seeks comment on this assumption.
95. The Commission proposes that applicants and licensees submit
cybersecurity risk management plans to the Commission upon request. The
[[Page 12059]]
Commission proposes to delegate to OIA, in coordination with the Public
Safety and Homeland Security Bureau (PSHSB), the authority to request,
at its discretion, submission of such cybersecurity risk management
plans and to evaluate them for compliance against the rules that are
adopted under this proceeding. Access to applicants' and licensees'
cybersecurity risk management plans would allow the Commission to
confirm whether plans are being regularly updated, review a specific
plan as needed, or proactively review a sample of applicants' and
licensees' plans to confirm they identify the cybersecurity risks to
those applicants' and licensees' communications systems and services.
The Commission would treat the cybersecurity risk management plans as
presumptively confidential under the Commission's rules. The Commission
seeks comment on this approach, including the types of information
included in these plans that warrant confidential treatment and the
reasons why that information should be considered confidential. Do
providers treat this information as confidential when it is used in
other contexts? What harms could befall a provider if its plan was
publicly disclosed? In addition, the Commission seeks comment on
whether to adopt a rule that would allow the Commission to share the
plans with relevant Federal agencies, including information for which
confidential treatment is requested, without the pre-notification
procedures of Sec. 0.442(d). The Commission seeks comment on whether
the Commission should share the plans with Federal agencies, such as
CISA and other components of the Department of Homeland Security (DHS),
and give notice to the applicant or licensee. Under Sec. 0.442, the
Commission may disclose to other Federal agencies, upon the
Commission's own motion or another agency's request, records that have
been submitted to the Commission in confidence, subject to providing
the filer notice of the proposed sharing and ten (10) days to
object.\97\ The Commission believes that forgoing these pre-
notification procedures when sharing plans with relevant Federal
agencies would more rapidly facilitate the Federal Government's
response to cyber incidents affecting the communications sector. The
Commission seeks comment on this approach.
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\97\ In general, under Federal law, the Commission may share
information it has collected with other Federal Government agencies
information it has collected pursuant to an information collection
and, if it does, all provisions of law that relate to the unlawful
disclosure of information apply to the employees of the agency to
which the information is released ``to the same extent and in the
same manner'' as they do to employees of the collecting agency.
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96. The Commission also proposes that applicants and licensees must
preserve data and records related to their cybersecurity risk
management plans, including any information that is necessary to show
how the cybersecurity risk management plan is implemented, for two
years from the submission of the related risk management plan
certification to the Commission. The Commission seeks comment on this
approach. Should the Commission require applicants and licensees to
retain prior versions of their cybersecurity risk management plans for
a shorter or longer period of time? If so, why?
97. The Commission believes it would promote neither public safety
nor national security if applicants and licensees could escape
responsibility for the cybersecurity of their systems and services by
outsourcing the provision of those systems and services to third
parties. Accordingly, if an applicant relies on a third-party
contractor for provision of a communications system or service, the
Commission proposes to require the applicant's cybersecurity risk
management plan to cover the systems and services offered by the third-
party contractor. The Commission proposes to hold applicants and
licensees responsible for the acts, omissions, or failures of third-
party contractors that impact the cybersecurity of the applicant's
systems and services. In connection with the Commission's requirement
to take reasonable measures to protect the confidentiality, integrity,
and availability of its communications systems and services, if an
applicant relies on a third-party contractor to provide equipment or
services, and an unreasonable act or omission of that third-party
contractor results in the applicant's failure to protect the
confidentiality, integrity, or availability of its systems and
services, the Commission proposes to hold the applicant responsible for
that act or omission. The Commission seeks comment on this approach.
The Commission also seeks comment on the extent to which applicants and
licensees currently include minimum cybersecurity requirements in their
contracts with third parties.
98. ``Covered List'' Certification for Applicants. To protect U.S.
communications networks and the communications supply chain against
national security threats, the Commission proposes to require that
applicants, as a condition of the potential grant of their application,
certify that the submarine cable system will not use covered equipment
or services identified on the Commission's ``Covered List'' that the
Commission maintains pursuant to the Secure and Trusted Communications
Networks Act.\98\ Such equipment and services have been deemed to pose
an unacceptable risk to the national security of the United States or
the security and safety of United States persons. The Commission
proposes that this certification would apply to covered equipment or
services purchased, rented, leased, or otherwise obtained on or after
August 14, 2018 (in the case of Huawei, ZTE, Hikvision, Dahua, and
Hytera), or on or after 60 days after the date that any equipment or
service is placed on the Covered List. Given the national security and
law enforcement risks to submarine cable systems, the Commission also
proposes to adopt a rule prohibiting use of such equipment or services
in the submarine cable system. The Commission seeks comment on this
proposal, the financial burdens on applicants, and any alternatives to
this proposal.
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\98\ Pursuant to sections 2(a) and (d) of the Secure and Trusted
Communications Networks Act, and Sec. Sec. 1.50002 and 1.50003 of
the Commission's rules, PSHSB publishes a list of communications
equipment and services that have been determined by one of the
sources specified in that statute to pose an unacceptable risk to
the national security of the United States or the security and
safety of United States persons (``covered'' equipment).
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99. ``Covered List'' Certification for Licensees. Additionally, the
Commission proposes to require that licensees certify as to whether or
not they use, for the relevant submarine cable system, equipment or
services identified on the ``Covered List.'' The Commission also
proposes that this certification would apply to covered equipment or
services purchased, rented, leased, or otherwise obtained on or after
August 14, 2018 (in the case of Huawei, ZTE, Hikvision, Dahua, and
Hytera), or on or after 60 days after the date that any equipment or
service is placed on the Covered List. Further, the Commission proposes
requiring licensees to provide this certification within sixty (60)
days of the effective date of any rule adopted in this proceeding,
following approval by OMB.
100. In the event that existing licensees use such equipment or
services, the Commission seeks comment on whether it should require
those licensees to remove such equipment or services to ensure the
security and reliability of submarine
[[Page 12060]]
cable systems. Should the Commission require those licensees to develop
plans to address the removal of such equipment and services with
specified timelines? If so, should the Commission require licensees to
submit their plans with the Commission? Additionally, the Commission
seeks comment on whether the Commission should prohibit licensees from
purchasing, obtaining, maintaining, improving, modifying, or otherwise
supporting any equipment or services produced or provided by entities
on the Covered List. If so, what penalties would apply for non-
compliance? To what extent should the Commission's framework for
requiring the recipients of reimbursement funds under section 4 of the
Secure Networks Act and carriers receiving Universal Service Fund
support to remove and replace equipment and services that are included
on the ``Covered List'' from the submarine cable system inform the
Commission's approach here? What would be the Commission's source of
legal authority for applying a prohibition on covered equipment and
services on cable landing licensees? Are there scenarios in which
replacement of removed equipment and services is not necessary? Are
there networks in which there is sufficient redundancy that, if
removed, the covered equipment and services need not be replaced? The
Commission seeks comment on the timing and deadlines for removal of
covered equipment and services. The Commission specifically seeks
comment on the amount of time that may be necessary to remove covered
equipment and services and the financial cost to cable landing
licensees. The Commission also seeks comment on whether there are other
sources of information that the Commission should consider to inform
its decisions on removal timing and deadlines and to understand the
scope of the effort. The Commission seeks comment on these approaches
and generally on what other certifications the Commission should adopt
concerning the ``Covered List.''
101. The Commission seeks comment on whether it should rely solely
on the ``Covered List'' or consider other lists or sources of
information to identify equipment or services that should be
prohibited, including but not limited to the Department of Commerce's
Entity List and the Department of Defense's List of Chinese Military
Companies (1260H List).\99\ Are there gaps or limitations with the
``Covered List''? What alternative sources would reduce those gaps or
limitations? What information or guidelines would assist applicants and
licensees in providing certifications regarding the ``Covered List''?
Should applicants and licensees certify, in addition or as an
alternative to these proposed certifications, that they will not use
vendors for equipment or services from certain countries, such as any
foreign country that is a ``foreign adversary'' as defined in the
Department of Commerce's rule, 15 CFR 791.4? The Commission seeks
comment generally on how best to promote the security and integrity of
the communications supply chain with respect to submarine cable
systems.
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\99\ See Press Release, U.S. Department of Defense, DOD Releases
List of People's Republic of China (PRC) Military Companies in
Accordance With Section 1260H of the National Defense Authorization
Act for Fiscal Year 2021 (Jan. 31, 2024), https://www.defense.gov/News/Releases/Release/article/3661985/dod-releases-list-of-peoples-republic-of-china-prc-military-companies-in-accord/ (releasing an
update to the names of ``Chinese military companies'' operating
directly or indirectly in the United States in accordance with the
statutory requirement of section 1260H of the National Defense
Authorization Act for Fiscal Year 2021 and providing the list at
https://media.defense.gov/2024/Jan/31/2003384819/-1/-1/0/1260H-LIST.PDF).
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102. Interrupt Traffic on Submarine Cable System Certification.
Mitigation agreements associated with submarine cable landing licenses
typically include a provision requiring the licensee entering into the
agreement to have the ability to physically or logically interrupt, in
whole or in part, traffic to and from the United States on the
submarine cable system by disabling or disconnecting circuits at the
U.S. cable landing station or at other locations within the United
States and to configure all necessary systems to ensure the licensee
can suspend or interrupt the optical signal or all communications
functionality of the licensed submarine cable system. Given the
importance of submarine cables, the Commission seeks comment on whether
and how the Commission should incorporate this requirement into the
Commission's rules. Should the Commission incorporate this requirement
as a certification or a routine condition under the Commission's rules?
The Commission tentatively concludes that every submarine cable
application should include an assurance from the applicant(s) that,
upon any grant of the application, the licensee will be able to suspend
or interrupt the optical signal or all communications' functionality.
The Commission seeks comment on whether joint licensees may appoint one
party to be responsible for complying with this requirement.
7. Third-Party Access
103. National security and law enforcement risks can and do arise
with third-party access to a submarine cable system, whether that
access involves physical or logical access to the cable system. In this
regard, the Commission is concerned about the risks posed by non-
licensee individuals and entities with access to U.S.-licensed
submarine cable systems. This includes, but is not limited to, owners
of the buildings that house submarine cable systems, the cable landing
station, co-tenants of the submarine cable system's location,
contractors hired by the licensee to manage the cable system, including
MNSPs, and other third-party entities with access to the cable system's
NOC.
104. Physical Access to Submarine Cable Systems. The physical
security of a submarine cable system, including its sturdiness and
impenetrability and prevention of unauthorized access into the cable
landing station, is important to the safety of the cable system,\100\
and knowledge of who has physical access to a submarine cable system,
including the cable landing station, is important for determining
vulnerabilities. The Commission seeks comment on whether to require
basic information about an applicant's lessors of submarine cable
landing stations and/or data center housing hardware. Additionally, the
Commission seeks comment on the overlap between physical and logical
access to submarine cable systems. Are there aspects of the physical
operation of submarine cable systems that can be controlled or managed
remotely?
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\100\ Communications Security, Reliability, and Interoperability
Council, Working Group 4A Submarine Cable Resiliency, Final Report--
Clustering of Cables and Cable Landings at 5 (Aug. 2016), https://transition.fcc.gov/bureaus/pshs/advisory/csric5/WG4A_Final_091416.pdf (highlighting the importance of protecting a
cable landing station from physical threats such as ``intrusion,
ballistic, [and] surveillance.'').
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105. Logical Access to the Submarine Cable Systems. The Commission
is interested in understanding and addressing the vulnerabilities posed
by third-party individuals and entities with logical access to
submarine cable systems.\101\ The Commission seeks comment generally on
ways it can
[[Page 12061]]
address vulnerabilities associated with such logical access.
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\101\ United States Government Accountability Office,
CYBERSECURITY--Internet Architecture Is Considered Resilient, but
Federal Agencies Continue to Address Risks, Report to the Committee
on Armed Services, House of Representatives, GAO-22-104560 at 13
(Mar. 2022), https://www.gao.gov/assets/gao-22-104560.pdf
(identifying ``[m]alicious insider(s),'' defined as ``[a]n
individual or group with authorized access . . . that has the
potential to harm an information system or enterprise through
destruction, disclosure, modification of data, and/or denial of
service,'' as a threat to submarine cable systems.).
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106. Remote Access Services. The Commission understands submarine
cable landing licensees sometimes employ third parties' services to
remotely manage the submarine cable networks. Such access to a
submarine cable system can pose a vulnerability, not only from the
third-party itself but from any hostile actor that breaches the third-
party's remote management system. On September 30, 2021, the Commission
adopted the 2021 Standard Questions Order that requires certain
applicants and petitioners with reportable foreign ownership to provide
answers to a set of standardized national security and law enforcement
questions.\102\ The Standard Questions ask applicants about applicants'
capabilities to ``control or monitor operations . . . via Remote
Access'' and whether any ``third-party vendors, associated companies,
or Owners have Remote Access.'' The Commission seeks comment on the
challenges posed by submarine cable landing licensees' use of remote
service vendors and their services and steps the Commission could take
to mitigate those challenges.
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\102\ See 2021 Standard Questions Order, 36 FCC Rcd at 14920
(inquiring, ``[w]hat, if any, capability do Applicants have to
control or monitor operations over the network (e.g., audit
mechanisms, record access monitoring) via Remote Access'' and
``[w]ill any third-party vendors, associated companies, or Owners
have Remote Access/monitoring to the network, systems, or records to
provide Managed Services? If so, provide additional details, i.e.,
third party identifying information, role, and reason for their
access'').
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107. Foreign-Owned Managed Network Service Providers. The
Commission proposes to require all applicants/licensees, with or
without reportable foreign ownership, to report whether or not they use
and/or will use foreign-owned MNSPs in the operation of the submarine
cable. The Commission proposes to require this information in the
initial licensing application, in subsequent submarine cable
applications upon grant of a license, and as an ongoing requirement in
the three-year periodic reports. The Commission seeks comment on how
often to require such information in the event the Commission shortens
the license term. Below, the Commission proposes and seeks comment on
criteria for how the Commission proposes to define ``foreign-owned.''
The Commission proposes to define an MNSP as any entity other than the
applicant(s) or licensee(s) (i.e., third-party entity) with whom the
applicant(s) or licensee(s) contracts to provide, supplement, or
replace certain functions for the U.S. portion of the submarine cable
system (including any cable landing station and SLTE located in the
United States) that require or may require access to the network,
systems, or records of the applicant(s) or licensee(s). Such functions
could include, but are not limited to operations and management
support; network operations and service monitoring, including intrusion
testing; network performance, optimization, and reporting; installation
and testing; network audits, provisioning and development; and the
implementation of changes and upgrades.\103\
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\103\ This proposed definition is based on the definitions of
``Managed Network Service Provider'' articulated by the Departments
of Justice, Homeland Security, and Defense in recent National
Security Agreements with cable landing licensees.
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108. The Standard Questions adopted in the 2021 Standard Questions
Order \104\ define the term ``Managed Services'' (or ``Enterprise
Services'') as ``the provision of a complete, end-to-end communications
solutions to customers.'' Specifically, the Standard Questions
associated with submarine cable landing license applications require
applicants to respond whether any ``third-party vendors, associated
companies, or Owners will have Remote Access/monitoring of the network,
systems, or records to provide Managed Services,'' and if so, to
``provide additional details, i.e., third party identifying
information, role, and reason for their access.''
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\104\ In the 2021 Standard Questions Order, the Commission
adopted a set of standardized national security and law enforcement
questions (Standard Questions) that certain applicants and
petitioners with reportable foreign ownership will be required to
answer as part of the executive branch review process of their
applications and petitions.
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109. The Standard Questions require an applicant to submit answers
directly to the Committee, and applicants without reportable foreign
ownership are not routinely referred to the Committee or to other
relevant executive branch agencies. Applicants whose applications are
not referred to the Committee or to other executive branch agencies
nevertheless may reach contractual agreements or have other
arrangements with foreign-owned MNSPs, thereby providing the foreign-
owned MNSPs with access to the submarine cable system and potentially
allowing them to act in ways that are contrary to U.S. interests
without the Commission or Committee ever being informed.
110. The Commission proposes to require all applicants for
submarine cable landing licenses, regardless of reportable foreign
ownership, to report in their application whether or not they use and/
or will use foreign-owned MNSPs. The Commission also proposes to
require such disclosure of foreign-owned MNSP use in applications to
modify, assign, transfer control of, and renew or extend a submarine
cable license. The Commission notes that the Standard Questions
associated with applications for assignments and transfers of control
ask whether ``any third-party vendors, associated companies, or Owners
have Remote Access/monitoring to the network, systems, or records to
provide Managed Services.'' The Commission proposes to direct the
Office of International Affairs to draft, update as appropriate, and
make available on a publicly available website, a standardized set of
national security and law enforcement questions that elicit information
related to MNSPs (MNSP Standard Questions) in accordance with any new
rules adopted in this proceeding, following OMB approval. The
Commission proposes that any applicant/licensee that indicates in the
application that it uses and/or will use a foreign-owned MNSP will need
to answer the MNSP Standard Questions and those applications would be
routinely referred to the executive branch agencies, including the
Committee. The Commission seeks comment on whether all applicants,
regardless of reportable foreign ownership, should be required to
answer all of the existing Standard Questions, or only those existing
Standard Questions relating to MNSPs, or a new set of questions devised
by the Office of International Affairs.
111. The Commission proposes and seeks comment on the specific
criteria for considering an MNSP to be ``foreign-owned,'' such that an
applicant would have to report its use. The Commission proposes that an
MNSP be considered ``foreign-owned'' if it is majority-owned and/or
controlled (1) by a foreign individual or entity or (2) in the
aggregate by foreign individuals or entities. The Commission seeks
comment on whether it should require applicants to explain in detail
the foreign individuals' or entities' involvement and management roles
in the foreign-owned MNSP.\105\ In addition, the Commission seeks
comment on whether any MNSPs also possess physical access to the
submarine cable system. Relatedly, the Commission seeks comment on
which
[[Page 12062]]
functions of the submarine cable system can be controlled remotely.
Further, are there other functions of a submarine cable system that are
managed by third-party entities, including MNSPs, that the Commission
has not addressed in the NPRM but should consider? If submarine cables
use MNSPs, should the Commission work with providers to recommend
standards or best practices regarding the use of foreign-owned MNSPs to
help reduce risk? What should be included in any standards?
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\105\ 2021 Standard Questions Order, 36 FCC Rcd at 14920,
Attach. C (Requesting of applicants that they provide, for ``any
third-party vendors, associated companies, or Owners [that] have
Remote Access/monitoring to the network, systems, or records to
provide Managed Services,'' additional details such as ``third party
identifying information, role, and reason for their access.'').
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112. The Commission generally seeks comment on its proposed
definition of MNSP and the use of MNSPs and managed network services by
submarine cable operators. The Commission seeks information as to
whether its proposed identification of functions offered by an MNSP is
sufficiently comprehensive. Are there other vulnerabilities associated
with contracted services that the Commission should consider?
113. Network Operations Centers. The Commission is interested in
logical access to and control of NOCs, the locations and facilities
where network management, monitoring, maintenance, performance
measurement, or other operational functions are performed for the
submarine cable system. The Standard Questions require applicants with
reportable foreign ownership to provide ``a list of the anticipated
addresses or physical locations'' for ``[t]he NOC (and back-up NOC, if
any).'' The Commission proposes to require all applicants, regardless
of foreign ownership, to supply this information in generally accepted
GIS formats or other formats, on a presumptively confidential basis in
the initial application for a cable landing license and application for
modification, assignment, transfer of control, and renewal or extension
of a cable landing license, and in the periodic reports.\106\ The
Commission proposes to delegate authority to OIA, in consultation with
the Office of Economics and Analytics, to determine the file formats
and specific data fields in which data will ultimately be collected.
Should the requirement to report the locations of NOCs also encompass
other components of the submarine cable system, such as cable landing
stations and/or main distribution facilities? \107\ What is the basis
for why the information should be treated as presumptively confidential
under the Commission's rules and the FOIA? Is this information publicly
available, or is it treated as confidential information by the
submarine cable industry? To what extent, if any, does this information
constitute privileged or confidential trade secrets or commercial or
financial information? What harms to commercial interests could result
from public disclosure of this information?
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\106\ See 2021 Standard Questions Order, 36 FCC Rcd at 14932,
Attach. D. (requiring applicants to provide ``addresses or physical
locations'' for ``[t]he NOC (and back-up NOC, if any).'').
\107\ GU Holdings Firmina LOA at 5 (requiring disclosure of
network management information including ``locations and functions
of any NOCs, data centers, Points of Presence (PoPs) and main
distribution facilities'' ``[w]ithin 60 days of the execution of
[the] LOA, and, thereafter, within 30 days upon . . . request.'').
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114. The Commission also seeks comment on whether ownership of NOCs
by third parties may be encompassed by the Commission's proposed
definition of an MNSP and whether there are benefits or consequences to
including or excluding such third-party owners of NOCs from the
proposed definition of an MNSP.
8. Other Risks to Submarine Cable Infrastructure
115. The Commission seeks comment generally on how the Commission
can take action to strengthen the security and resilience of submarine
cable infrastructure, pursuant to its legal authority, including
activities in coordination with its Federal partners. In particular,
the Commission seeks comment on what actions it can take to mitigate
risks and strengthen the security and resilience of this critical
infrastructure, pursuant to its legal authority, including activities
in coordination with its Federal partners. Given the role of submarine
cables to the Nation's communications networks and other vital
infrastructure and assets, it is important to ensure the protection,
security, and resilience of this critical infrastructure. Accordingly,
damage to submarine cable infrastructure would affect other critical
infrastructure sectors that rely on communications and would have a
debilitating impact on the Nation's economic and national security. The
Commission's responsibilities in securing communications networks are
well established. Congress created the Commission, among other reasons,
``for the purpose of the national defense, [and] for the purpose of
promoting safety of life and property through the use of wire and radio
communication.'' Furthermore, the President's recent National Security
Memorandum, NSM-22, directs the Commission, among other things, to
``assess communications sector risks and work to mitigate those risks
by requiring, as appropriate, regulated entities to take specific
actions to protect communications networks and infrastructure'' and to
``collaborate with communications sector industry members, foreign
governments, international organizations, and other stakeholders to
identify best practices and impose corresponding regulations,'' to the
extent permitted by law and in coordination with DHS and other Federal
departments and agencies.\108\ As an initial matter, to further these
efforts, the Commission seeks comment on risks to submarine cable
infrastructure, including human and natural risks, and what steps the
Commission can take to mitigate such threats of damage and ensure the
protection of this critical infrastructure.
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\108\ NSM-22 at 33 (defining critical infrastructure as
``systems and assets, whether physical or virtual, so vital to the
United States that the incapacity or destruction of such systems and
assets would have a debilitating impact on national security,
national economic security, national public health or safety, or any
combination of those matters'').
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116. Malicious Threats. The Commission observes that NSM-22
addresses malicious threats to U.S. critical infrastructure, stating,
``[t]he United States also faces an era of strategic competition with
nation-state actors who target American critical infrastructure and
tolerate or enable malicious actions conducted by non-state actors.''
The Commission has reason to believe that adversaries and other
malicious actors may be targeting submarine cables landing and operated
in the United States and invite comments providing examples, details
about geography, extent, and frequency of such targeting. What measures
are implemented by the submarine cable industry to protect submarine
cable infrastructure against malicious threats? How can the Commission
facilitate information sharing between national security agencies and
industry, consistent with NSM-22? The Commission seeks comment on any
actions it can take to mitigate those threats pursuant to its legal
authority, including in coordination with its Federal partners. The
Commission also seeks comment on what measures are implemented by the
submarine cable industry to mitigate such risks.
117. Spatial Conflicts. The Commission seeks comment as to whether,
and to what extent, close spatial proximity between submarine cables
and other marine infrastructure and activities presents risks of damage
to submarine cables landing in the United States. In 2014, the
Communications, Security, Reliability, and Interoperability Council
(CSRIC) \109\ issued a report examining risks to
[[Page 12063]]
submarine cable infrastructure, including activities that ``pose direct
risks to submarine cables by threatening installed cables with
equipment, anchors, infrastructure installation and operation, and
resource exploration, exploitation, and transport.'' \110\ CSRIC
identified ``traditional risks'' including commercial fishing,\111\
anchoring,\112\ sand and gravel dredging and beach replenishment,\113\
and oil and gas development,\114\ among other things.\115\ CSRIC also
identified ``emerging risks'' such as offshore renewable energy
development--namely, offshore wind projects, marine and hydrokinetic
(MHK) projects, and ocean thermal energy conversion (OTEC) projects--
and deep-sea mining, while noting the risks remain uncertain.\116\
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\109\ The purpose of CSRIC, an advisory committee established
under the Federal Advisory Committee Act, is to provide
recommendations to the Commission regarding ways it can help to
ensure security, reliability, and interoperability of communications
systems.
\110\ CSRIC IV Report at 2 (``Although damage to submarine
cables is rare, it is most often caused by human activities such as
commercial fishing (in which trawl nets, clam dredges, and other
bottom-contact gear ensnare cables), vessel anchoring, dredging
related to sand and mineral extraction, petroleum extraction,
pipeline construction and maintenance, renewable energy construction
and maintenance, and other cable activity.''). CSRIC identified
``traditional risks'' including commercial fishing, anchoring, sand
and gravel dredging and beach replenishment, and oil and gas
development, among other things. CSRIC also identified ``emerging
risks'' such as offshore renewable energy development--namely,
offshore wind projects, marine and hydrokinetic (MHK) projects, and
ocean thermal energy conversion (OTEC) projects--and deep-sea
mining, while noting the risks remain uncertain.
\111\ While the CSRIC IV Report stated, ``[h]istorically,
commercial fishing has accounted for more than 40 percent of all
submarine cable faults worldwide,'' it also noted that ``it is
relatively rare in the U.S. territorial sea and [outer continental
shelf (OCS)], as the mitigation strategies pursued by submarine
cable operators have proved very effective in the United States.''
\112\ CSRIC IV Report at 32 (``Anchoring accounts for
approximately 15 percent of cable faults worldwide'').
\113\ See id. at 32 (``These practices can be highly
incompatible with submarine cables, which can be damaged by the
dredging process itself and by anchors used by vessels, barges, and
pipelines used to recover, transport, and pump dredged material back
onto shore.'').
\114\ See id. at 34 (``Although the submarine cable and offshore
oil and gas industries have a long history of working with each
other, the renewed focus on U.S. domestic energy production and
possible opening of the U.S. Atlantic OCS regions to oil and gas
development (in the event the current development moratorium expires
in 2017) will increase the risks to submarine cables.'').
\115\ See id. at 35-36 (addressing risks associated with
clustering of submarine cable systems, earthquakes and tsunamis, sea
floor geology, and weather conditions).
\116\ Id. at 36 (noting, ``[b]ecause offshore renewable energy
is an emerging industry, the risks remain uncertain. Consequently,
submarine cable operators, offshore renewable energy developers, and
regulators have yet to develop systematic risk minimization
strategies and consultation and coordination mechanisms, which has
resulted in some unresolved conflicts.''); id. at 41 (``At present,
deep-sea mining present a low risk to installed cables, as the
mining of particular marine minerals has not yet proved economic.
Nevertheless, it is very likely that improved (and cheaper
technologies) and increasing demand for particular minerals (and/or
a more stable supply thereof) will pose greater threats to installed
submarine cables and limit routes for future cables.''); CSRIC V
Report at 9 (stating, ``[i]t remains to be seen whether other marine
infrastructure, such as oil and gas exploration or marine renewable
energy will have a significant effect on the routing of submarine
cables or the selection of landing sites for those cables.'').
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118. Given the passage of time, the Commission seeks updated
information on any new facts or circumstances that can inform the
Commission's evaluation of the equities, risks of damage, and
mitigation measures associated with spatial relationships between
submarine cables and other marine infrastructure and activities. What,
if any, spatial conflicts today present the most significant risks of
damage to submarine cables landing in the United States? To the extent
other marine infrastructure and activities cross or are in close
proximity to submarine cables, what spatial distance is necessary to
reduce or eliminate the risk of damage to submarine cables? Are there
examples of how installation or maintenance of marine infrastructure
and activities near or over submarine cable infrastructure resulted in
damage to submarine cables landing in the United States, or affected
the maintenance or repair of such submarine cables? Where do such
incidents, if any, occur geographically? What is the extent and
frequency of any damage to submarine cables?
119. The Commission also seeks comment on what measures the
submarine cable industry has implemented/will implement to protect
submarine cable infrastructure in the event of any spatial conflicts
with wind farms, or electric or other infrastructure or activities that
may affect submarine cables. For example, do cable landing licensees
coordinate with other industries and establish crossing agreements to
mitigate risks of damage to each respective infrastructure? Do cable
landing licensees consult and address these risks with Federal agencies
that authorize other marine infrastructure and activities? If so, at
what stage of the permitting or licensing process or deployment of such
marine projects do cable landing licensees coordinate with other
industries or Federal agencies?
9. Interagency Coordination and Submarine Cable Protection
120. The Commission seeks comment on what actions it can take to
mitigate both the risks identified previously in the NPRM and any other
risks and strengthen the security and resilience of submarine cable
infrastructure, pursuant to its legal authority, including activities
in coordination with its Federal partners. Should the Commission play a
more active role in coordinating with other agencies that have
jurisdiction over other marine infrastructure that may impact submarine
cables, or other agencies that regulate or oversee the installation and
protection of submarine cables? In particular, the Commission has
previously recognized that ``interagency coordination is very important
to protect submarine cable infrastructure.'' \117\ With regard to
spatial conflicts, in addition to submarine cables, CSRIC addressed how
various Federal agencies regulate a number of other marine
infrastructure and activities, including offshore renewable energy
projects,\118\ oil and natural gas development,\119\ dredging and
coastal replenishment,\120\ and other matters.\121\ The Commission asks
[[Page 12064]]
commenters whether interagency consultation, information-sharing, and
other coordination could help to mitigate risks of damage to submarine
cable infrastructure that arise from its spatial relationship to other
marine infrastructure and activities. In addition, the Commission seeks
comment on whether coordination with states that regulate marine
infrastructure and activities could help to mitigate risks of damage to
submarine cable infrastructure. What are examples of how the Commission
could coordinate with relevant agencies to protect submarine cable
infrastructure while taking into consideration the U.S. government's
equities in other critical marine infrastructure and resources? For
example, do Federal statutes provide any source of authority for the
Commission to take regulatory and operational actions to mitigate or
reduce risks of damage to submarine cables in marine areas subject to
U.S. jurisdiction, including in coordination with other Federal or
state agencies? \122\
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\117\ 2016 Submarine Cable Outage Report and Order, 81 FR 52354
(August 8, 2016), 31 FCC at 7976, para. 80 (``To this end, the
International Bureau, in coordination with the Public Safety and
Homeland Security Bureau, will continue to lead interagency
coordination efforts to help increase transparency and information
sharing among the government agencies, cable licensees, and other
stakeholders and promote improved interagency coordination processes
to mitigate threats to undersea cables and facilitate new projects
to improve geographic diversity.'').
\118\ For example, the Federal Energy Regulatory Commission
(FERC), among other things, licenses non-Federal hydropower
projects, which includes marine and hydrokinetic (MHK) projects.
FERC, Hydrokinetic Projects (last updated Aug. 15, 2024), https://www.ferc.gov/licensing/hydrokinetic-projects (defining hydrokinetic
projects as ``[p]rojects that generate electricity from waves or
directly from the flow of water in ocean currents, tides, or inland
waterways''). The Outer Continental Shelf Lands Act of 1953, as
amended (OCSLA), authorizes the Bureau of Ocean Energy Management
(BOEM) to grant leases and prescribe regulations that govern mineral
and renewable energy development on the U.S. outer continental shelf
(OCS). BOEM, among other things, issues leases, easements and rights
of way on the OCS for projects that generate electricity from
offshore wind, wave and currents and for renewable energy
transmission projects.
\119\ For example, under the OCSLA, BOEM authorizes leases,
easements and rights of way for oil and natural gas development and
other marine minerals such as sand and gravel for coastal
restoration activity.
\120\ CSRIC IV Report at 32-33 (stating that ``[t]he Army Corps
of Engineers and the Bureau of Ocean Energy Management of the U.S.
Department of the Interior (`BOEM') frequently authorize sand and
gravel dredging in the U.S. territorial sea and OCS.'').
\121\ For example, the National Marine Sanctuaries Act allows
the National Oceanic and Atmospheric Administration (NOAA) to
identify, designate and protect areas of the marine and Great Lakes
environment with special national significance due to their
conservation, recreational, ecological, historical, scientific,
cultural, archaeological, educational, or aesthetic qualities as
national marine sanctuaries. If a submarine cable system will
traverse a national marine sanctuary, the cable owner must also
obtain a permit from NOAA's Office of National Marine Sanctuaries
under the National Marine Sanctuaries Act.
\122\ The Commission notes that the national laws of countries
such as Australia and New Zealand authorize the establishment of
submarine cable protection zones within specific geographic areas.
Telecommunications Act 1997, Schedule 3A--Protection of submarine
cables; Submarine Cables and Pipelines Protection Act 1996, Part 2--
Protection and enforcement, 12(1) (``Protected areas'').
Additionally, the national laws and regulations of some countries
establish minimum spatial distance requirements with regard to
submarine cables. See, e.g., CSRIC IV Report at 50-51 (identifying
``foreign governments [that] have established default or minimum
separation distances to protect submarine cables'').
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10. Streamlining Procedures To Expedite Cable Processing
121. The Commission seeks comment on ways to modify its
streamlining procedures to expedite submarine cable processing while
ensuring national security and law enforcement concerns are addressed.
The Commission seeks comment on actions or measures the Commission or
Committee can take to expedite the review and licensing process. The
Commission originally adopted streamlining procedures for processing
applications for submarine cable landing licenses in the 2001 Cable
Report and Order. The intent was to adopt rules that ``are designed to
facilitate the expansion of capacity and facilities-based competition
in the submarine cable market . . . [and] to enable submarine cable
applicants and licensees to respond to the demands of the market with
minimal regulatory oversight and delay, saving time and resources for
both industry and government, while preserving the Commission's ability
to guard against anti-competitive behavior.'' The Commission assessed
that this framework would result in a reduction of costs for deploying
submarine cables and ultimately benefit U.S. consumers. It created a
procedure and competitive safeguards that were aligned with those
adopted for section 214 authorizations, whereby applications qualifying
for streamlining generally would be acted on in a 45-day period. In
addition to adopting specific criteria for streamlining eligibility,
the Commission also sought to ensure that those entities having a
significant ability to affect the operation of a cable system would be
applicants for a cable landing license and thus would become licensees
upon any grant of an application so that they are subject to the
conditions and responsibilities that are associated with a cable
landing license, and otherwise provided that ``entities that do not own
or control a landing station in the United States or have a five
percent or greater interest in the proposed cable system generally will
not be required to become licensees.'' \123\ The Commission also
allowed for post-transaction notifications of pro forma assignments or
transfers of control in cable landing licenses. Over time, the
Commission modified these rules to address changes in Commission policy
and to assist in the expeditious review of applications.\124\
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\123\ See also 2001 Cable Report and Order, 16 FCC Rcd at 22194,
para. 54 (``Specifically, we conclude that only the following
entities must be required to be applicants for a cable landing
license: an entity that (1) owns or control a U.S. landing station
or (2) owns or controls a five percent or greater interest in the
cable system and will use the U.S. points of the cable system.'').
The 2001 proceeding focused on capacity expansion and facilities-
based competition and, although it adopted safeguards against anti-
competitive conduct associated with market power in foreign markets
where U.S.-licensed cable systems land and operate, to the detriment
of competition in U.S. markets, it did not otherwise address
specific national security concerns.
\124\ In 2014, the Commission adopted rules that eliminated the
effective competitive opportunities (ECO) test that was previously
adopted in 1995 ``as a condition to entry into the U.S.
international telecommunications services market by foreign carriers
that possess market power on the foreign end of a U.S.-international
route on which they seek to provide service pursuant to section 214
of the Communications Act of 1934, as amended[.]'' The Commission
determined that it was no longer necessary to apply the ECO test to
non-World Trade Organization (WTO) members, or otherwise, to protect
competition and found that a market based approach, where the
applicant or notification filer from a non-WTO Member country must
demonstrate whether or not it has market power in the country where
the cable lands, would reduce regulatory burdens and provide for an
expeditious review of foreign entry to benefit U.S. consumers.
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122. In 2020, the Commission adopted rules that sought to codify
the timeframes set forth under Executive Order 13913 and Commission
procedures for the referral of applications for cable landing licenses
or assignment or transfer of control of submarine cable landing
licenses, among other types of applications, to the executive branch
agencies including the Committee, for their feedback on any national
security, law enforcement, foreign policy, and/or trade policy issues
associated with the foreign ownership of applicants.\125\ The
Commission codified its policy that it would continue referring
applications to the executive branch agencies where the applicant has
reportable foreign ownership, i.e. ``when an applicant has a 10% or
greater direct or indirect foreign investor[.]'' The Commission further
noted that it ``retains discretion to determine which applications it
will refer to the [executive branch] agencies [including the Committee]
for review.''
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\125\ In the Executive Branch Review Report and Order, the
Commission adopted an additional requirement that entities seeking
streamlining must demonstrate eligibility by further certifying that
all ten percent or greater direct or indirect equity and/or voting
interests, or a controlling interest, in the applicant are U.S.
citizens or entities organized in the United States. The Commission
also adopted timeframes for the executive branch agencies to
complete their review consistent with Executive Order 13913.
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123. Eligibility for streamlining. Under the Commission's rules,
each applicant for a cable landing license seeking streamlining must
request such processing in its application, follow the procedure set
out under 47 CFR 1.767(i) and (j), and provide the following
information and certifications:
Certifying that it is not a foreign carrier and it is not
affiliated with a foreign carrier in any of the cable's destination
markets;
Demonstrating pursuant to Sec. 63.12(c)(1)(i) through
(iii) that any such foreign carrier or affiliated foreign carrier lacks
market power; or
Certifying that the destination market where the applicant
is, or has an affiliation with, a foreign carrier is a World Trade
Organization (WTO) Member and the applicant agrees to accept and abide
by the reporting requirements set out in Sec. 1.767(l). An application
that includes an applicant that is, or is affiliated with, a carrier
with market power in a cable's non-WTO Member destination country is
not eligible for streamlining.
Certifying that for applications for a license to
construct and operate a submarine cable system or to modify the
construction of a previously approved submarine cable system the
applicant is not required to submit a consistency certification to any
state pursuant to
[[Page 12065]]
section 1456(c)(3)(A) of the Coastal Zone Management Act (CZMA), 16
U.S.C. 1456.
Certifying that all ten percent or greater direct or
indirect equity and/or voting interests, or a controlling interest, in
the applicant are U.S. citizens or entities organized in the United
States.
124. The rules provide that, for applications that are eligible for
streamlined processing, the Commission will take action upon such
application within 45 days after release of the public notice
announcing the application was acceptable for filing and eligible for
streamlining. The Commission will publish a public notice indicating if
an application is ineligible for streamlined processing. The rules also
provide that the Commission will take action upon a non-streamlined
application within 90 days or provide public notice of additional time,
which may be further extended, if an application raises questions of
extraordinary complexity. Applications that involve foreign ownership
or control of the applicants and may present national security, law
enforcement, foreign policy, and/or trade policy issues are referred to
the executive branch agencies for their review and feedback. Since the
beginning of 2016, on average, more than 10 submarine cable
applications per year are referred to the executive branch agencies,
including the Committee, for review of national security, law
enforcement, foreign policy, and/or trade policy concerns.\126\ For the
five-year period from 2016 through June 2020, the pre-Committee
agencies took on average of 367 days to complete review after receiving
all answers to preliminary questions.\127\ From July 2020 to the
November 2024, the Committee has taken on average 237 days to complete
review of submarine cable applications.\128\ The average time for
review by the Committee once an application starts the review clock has
dropped significantly from the average time for review by the executive
branch agencies prior to the establishment of the Committee, but the
Commission understands that this process can be improved.
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\126\ Since the beginning of 2016 through the end of 2020, a
total of 84 submarine cable applications, including initial
applications for cable landing license and application for
modification, assignment, transfer of control, and renewals or
extension of a cable landing license were referred to the executive
branch agencies for review of national security, law enforcement,
foreign policy, and/or trade policy concerns.
\127\ From 2016 to June 2020, the Commission referred 52
submarine cable applications to the executive branch agencies.
\128\ From July 2020 to November 2024 the Commission has
referred 32 submarine cable applications to the executive branch
agencies.
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125. The Commission seeks comment on measures it can take to
provide a streamlining process that is effective and beneficial to both
industry and government, while ensuring national security review. The
Commission understands that applying for a cable landing license can be
a lengthy and complex process that requires considerable advanced
planning on the part of submarine cable owners and operators. The
Commission understands that submarine cable systems can take years to
plan, finance, license, construct, test, and prepare for operation. The
Commission seeks to identify mechanisms to reduce the time it takes to
review and take action on a submarine cable application in the current
environment in which hostile threats and malicious actors pose
significant risks to critical infrastructure. For example, if an
applicant for a cable landing license is a frequent filer with the
Commission because it has numerous submarine cable projects, are there
mechanisms the Commission can adopt to reduce the time it takes to
review and act on an application for a cable landing license from such
filer? What additional steps can the Commission take to streamline its
review of an application? Are there specific certifications or other
filings that applicants can provide to the Committee in order to
expedite the review of a referred application? Should the Commission
revisit the Standard Questions associated with submarine cable
applications? Should the Commission create a program that would
distinguish the review of applicants' ownership and cable management
qualifications, barring any significant changes in ownership as of its
prior review, from the investigation of specific risk factors
associated with each cable system's route, landing stations, and
equipment? How should the related risk factors associated with
resiliency, trusted supply chains, and national competitiveness be
assessed while minimizing the time it takes to review applications?
Should the Commission identify classes of risk (such as a nexus to a
country of concern)? In order to speed the deployment of submarine
cables that connect points solely within the United States and its
territories and possessions, should the Commission consider
streamlining review of applications that connect domestically unless
there is a nexus to a country of concern or foreign adversary? The
Commission seeks comment on this question as well as on other
mechanisms that may reduce the time it takes to process a submarine
cable application while providing for assessment of national security
and other risks and ensuring that any grant of an application is in the
public interest. Should the Commission work with applicants and
stakeholders to share risk information and threat alerts with trusted
providers on a regular basis, consistent with National Security
Memorandum 22? What would be the benefits of doing so?
11. Other Changes to Current Requirements
126. The Commission seeks to improve and formalize its current
application requirements set forth in Sec. 1.767(a) of the rules. The
Commission believes modifications to the rules would, among other
things, reduce uncertainty for applicants by clarifying application
requirements and address any gaps in the Commission's rules that impact
the national security of the United States. The Commission also
proposes to adopt new and updated information requirements and
certification requirements. The Commission proposes specific
requirements for other types of applications, including applications to
modify, assign, transfer control of, or renew or extend cable landing
licenses, requests for special temporary authority, and pro forma
assignment and transfer of control notifications, among other matters
as applicable. In this regard, and to further improve the clarity of
the rules, the Commission proposes to create a new subpart in part 1 of
the rules to address each type of application. The Commission seeks
comment generally on whether there are specific rules applicable to
submarine cable applications and notifications where the benefits do
not outweigh the burdens and whether the Commission should eliminate or
modify such rules.
127. Contact Information. The Commission's rules currently require
applicants for cable landing licenses and for assignments and transfers
of control of such licenses to provide ``[t]he name, address, and
telephone number(s) of the applicant'' and ``[t]he name, title, post
office address, and telephone number of the officer and any other
contact point'' in the applications. Additionally, the rules require
that, while an application is pending for purposes of Sec. 1.65 of the
rules, the applicant is responsible for the continuing accuracy and
completeness of all information submitted and that ``the applicant
agrees to inform the Commission and the Committee of any
[[Page 12066]]
substantial and significant changes while an application is pending.''
The rules also require that, after the application is no longer pending
for purposes of Sec. 1.65 of the rules, ``the applicant must notify
the Commission and the Committee of any changes in the . . . licensee
information and/or contact information promptly, and in any event
within thirty (30) days.'' The Commission proposes to amend the
submarine cable rules to expressly apply these requirements to
applications for modification and renewal or extension of cable landing
licenses. The Commission also proposes to require applicants for cable
landing licenses and for modification, assignment, transfer of control,
and renewal or extension of licenses to provide an email address on
behalf of the applicant and an email address on behalf of the officer
and any other contact point, to whom correspondence regarding the
application can be addressed.
128. Renewal Applications. To provide regulatory certainty, the
Commission proposes to adopt rules for cable landing licensees that
seek to renew or extend the term of their license. Under the
Commission's rules, a cable landing license expires ``twenty-five (25)
years from the in-service date, unless renewed or extended upon proper
application.'' Although Sec. 1.767(e) of the rules requires that an
application must be filed with respect to each submarine cable system
for which a renewal or extension of an existing license is
requested,\129\ the rules do not set out specific requirements for such
applications. In addition, the rules do not expressly address the
Commission's longstanding policy of considering national security, law
enforcement, foreign policy, and/or trade policy considerations in its
review of such applications.
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\129\ Section 1.767(e) of the rules states that ``[a] separate
application shall be filed with respect to each individual cable
system for which a license is requested or a modification of the
cable system, renewal, or extension of an existing license is
requested. Applicants for common carrier cable landing licenses
shall also separately file an international section 214
authorization for overseas cable construction.''
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129. The Commission proposes, as a baseline, to require applicants
seeking to renew or extend a cable landing license to provide in the
application the same information and certifications required in an
application for a new cable landing license under Sec. Sec. 1.767(a)
and 63.18(h), (o), (p), and (q) of the rules, as well as any new
requirements adopted in this proceeding. Specifically, the current
application rules for a new cable landing license require important
information and attestations concerning an applicant's contact
information, the submarine cable (including the landing locations), and
whether the cable will be operated on a common carrier or non-common
carrier basis, among other things. The Commission proposes to adopt
rules applying these provisions of Sec. Sec. 1.767(a) and 63.18(h),
(o), (p), and (q) to applications to renew or extend a cable landing
license (collectively, ``renewal applications''). To the extent the
Commission adopts any new or modified information and certification
requirements in this proceeding with respect to applications for a new
cable landing license, the Commission proposes to similarly apply those
requirements to renewal applications and thus harmonize the application
requirements. The Commission further proposes to codify the
Commission's longstanding practice that applicants must demonstrate how
grant of the renewal application will serve the public interest,
convenience, and necessity. The Commission seeks comment on these
approaches.
130. Renewal Streamlined Processing Procedures. The Commission
seeks comment on whether the Commission should adopt streamlined
processing for renewal applications in certain situations. For
instance, Sec. 1.767(i) of the rules provide that, ``[t]he Commission
will take action upon an application eligible for streamlined
processing, as specified in paragraph (k) of this section, within
forty-five (45) days after release of the public notice announcing the
application as acceptable for filing and eligible for streamlined
processing.'' In current practice, once filed, Commission staff review
the renewal application for compliance with the Commission's rules and
place the application on an Accepted for Filing public notice once it
is acceptable for filing. Should the Commission adopt similar
streamlined processing procedures for renewal applications in certain
situations, subject to the State Department's approval of any proposed
grant of a renewal application? Specifically, the Commission seeks
comment on whether the Commission should place a renewal application on
streamlined Accepted for Filing public notice and grant such
application within forty-five (45) days after release of the public
notice if: (1) the Commission does not refer the application to the
executive branch agencies because the applicant does not have
reportable foreign ownership and the application does not raise other
national security, law enforcement, or other considerations warranting
executive branch review; (2) the application does not raise other
public interest considerations, including regulatory compliance; (3)
the executive branch agencies do not separately request during the
comment period that the Commission defer action and remove the
application from streamlined processing; (4) no objections to the
application are timely raised by an opposing party; and (5) any
proposed grant of a renewal application is approved by the State
Department.
131. Licenses Pending Renewal. As with title III licensees pursuant
to section 307(c) of the Act, and consistent with the Administrative
Procedure Act, the Commission proposes to adopt a rule that an
applicant that has timely applied for renewal or extension of its cable
landing license may continue operating the submarine cable system while
its renewal application is pending review.\130\ The Commission proposes
that the Commission may deny the renewal application, for instance, if
an applicant fails to provide any information that is required by the
rules or is reasonably requested by staff in its review of the renewal
application. The Commission tentatively concludes that this proposal is
consistent with the Administrative Procedure Act, and seeks comment on
this tentative conclusion. The Commission also proposes to amend Sec.
1.767(g)(15) by providing that, upon expiration, all rights granted
under the license shall be terminated if the licensee has not timely
filed a renewal application.\131\ Should the Commission further amend
the rule by expressly requiring the filing of a renewal application
before the cable landing license expires? Alternatively, to the extent
a licensee fails to timely file a renewal application, should the
Commission allow the licensee to continue operating the submarine cable
following the expiration of a license if the licensee files a request
for an STA, either prior to or after such expiration and pending the
filing of an application to renew or extend the cable landing license?
Or should the Commission require the filing of a waiver demonstrating
good cause to allow a late
[[Page 12067]]
filing of a renewal application? In any instance where a licensee fails
to timely file a request for an STA or a renewal application and seeks
to continue operating the submarine cable, the Commission proposes that
it shall reserve the right to take enforcement action for unauthorized
operations following expiration of the license and the filing of a
request for an STA or renewal application. The Commission seeks comment
on these approaches.
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\130\ See 5 U.S.C. 558(c) (``When the licensee has made timely
and sufficient application for a renewal or a new license in
accordance with agency rules, a license with reference to an
activity of a continuing nature does not expire until the
application has been finally determined by the agency.''); id.
551(8) (``license'' defined to mean ``the whole or a part of an
agency permit, certificate, approval, registration, charter,
membership, statutory exemption or other form of permission'').
\131\ 47 CFR 1.767(g)(15) (stating that, ``[u]pon expiration,
all rights granted under the license shall be terminated'').
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132. Modification Applications. The Commission proposes to adopt
rules for cable landing licensees that seek to modify a cable landing
license. Additionally, the Commission seeks comment on whether it
should amend the rules by clarifying the types of facts and
circumstances that warrant the filing of an application to modify a
cable landing license. Section 1.767 of the rules addresses certain
cases where a modification application is required, including
situations where a licensee seeks to add a new licensee to the cable
landing license, or relinquish its interest in a cable landing license,
or add a new landing point that is not included in the grant of
authority for the submarine cable system.\132\ The Commission proposes
to codify the Commission's practice in a new paragraph of the rules
that will address requirements related to modifying a cable landing
license, including the current requirement that licensees must obtain
prior Commission approval of certain changes to a license such as the
addition or removal of a licensee and the addition of a new landing
point. The Commission also proposes that licensees must obtain prior
approval to remove or otherwise change the location of a landing point
previously authorized by the Commission. Further, the Commission
proposes that licenses must obtain prior approval to construct or add a
new connection, such as a segment or a branching unit, to an FCC-
licensed submarine cable system.
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\132\ See 47 CFR 1.767(a)(5) (``The applicant initially may file
a general geographic description of the landing points; however,
grant of the application will be conditioned on the Commission's
final approval of a more specific description of the landing points,
including all information required by this paragraph, to be filed by
the applicant no later than ninety (90) days prior to
construction.''); 47 CFR 1.767 (g)(8) (``Unless the licensee has
notified the Commission in the application of the precise locations
at which the cable will land, as required by paragraph (a)(5) of
this section, the licensee shall notify the Commission no later than
ninety (90) days prior to commencing construction at that landing
location.'').
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133. Additionally, the Commission proposes to codify its
longstanding practice by specifying in the rules the required contents
of a modification application. The Commission proposes to require that
applicants seeking to modify a cable landing license must include in
the application a narrative description of the modification(s) that is
being requested, including relevant facts and circumstances. The
Commission proposes to adopt application requirements and
certifications from Sec. Sec. 1.767(a) and 63.18(h), (o), (p), and (q)
of the rules that are tailored to the type of modification requested,
such as a modification to (1) add a cable landing station, a segment,
or other material change to the cable system; (2) add a new licensee to
the cable landing license; (3) remove a licensee from the cable landing
license; or (4) add, modify, or remove a condition on the cable landing
license. For instance, the Commission proposes that it would require
information about the change to the submarine cable system,
specifically the location of the new landing point, the ownership and
control of the landing point, and other information, whereas, for a
modification to add a licensee to a cable landing license, the
Commission would seek information about the applicant and its
ownership, among other information. What other information should the
Commission require from an applicant that seeks to modify a cable
landing license by adding or removing a licensee, adding or removing a
landing point, or adding, modifying, or removing a condition on a cable
landing license? To the extent the Commission adopts any new or
modified information and certification requirements in this proceeding
with respect to applications for a new cable landing license, the
Commission proposes to similarly apply those requirements to
modification applications. The Commission further proposes to codify
longstanding practice that applicants must demonstrate how grant of the
modification application will serve the public interest, convenience,
and necessity. The Commission seeks comment on these approaches.
134. Over the years, Commission staff have received questions as to
whether a modification application must be filed for the construction
or addition of new segments or branching units to FCC-licensed
submarine cable systems, which may not always involve the addition of
new landing points. The Commission understands that many cable systems
are constructed with branching units to allow new connections in the
future. These connections are often to new landings or sometimes to
other cable systems. The Commission proposes to adopt a specific rule
prescribing that if a new connection to a branching unit is to be made
after the Commission has issued a license, the licensee must file an
application to modify the license before constructing, landing, and
operating the new connection. The Commission sets forth two examples
where a modification application would be required of a licensee under
the Commission's proposed rule.
135. Adding a Segment Connecting Two FCC-Licensed Cables. In this
example, there are two separately owned and FCC-licensed submarine
cable systems that connect two separate points in the United States to
two separate foreign countries. The licensees of the cable systems
(Company A and Company B, respectively) both seek to install a new
segment in the deep waters that will connect to each other's cable via
a branching unit. There would be no new landing points in the United
States, no new foreign landing points, and no change in the ownership
of either cable. Company A would hold capacity, through an IRU, on
Company B's cable to reach Company B's U.S. landing point (via the new
segment), but would not have access to Company B's foreign landing
point. Company B would not have access to Company A's U.S. or foreign
landing points. Under the Commission's proposed rule, the licensees
would be required to obtain prior approval for the new connection by
such segment of the two separately owned and FCC-licensed submarine
cable systems in deep waters by filing a modification application with
the Commission.
136. Adding a New Foreign Landing Point. In this example, Company D
is the licensee of an FCC-licensed submarine cable system that connects
a U.S. landing point to a foreign landing point in Country D. A portion
of the cable system is deployed in waters near another foreign country,
Country C. Company C from Country C has constructed a cable landing
station on its shores and deployed a submarine cable with the intent to
connect its cable to Company D's cable system through a branching unit.
Company D will not own any portion of Company C's cable system and will
not use Company C's landing point in Country C. In turn, Company C will
not own any portion of Company D's cable system, including the portion
connecting a U.S. landing point to the landing point in Country D.
Company C plans to purchase from Company D capacity on the portion of
Company D's cable system from the new branching unit (i.e., located in
the waters near Country C) to the landing point in Country D. Under the
[[Page 12068]]
Commission's proposed rule, Company D, as the FCC licensee, would be
required to obtain prior approval for the new connection of its cable
to Company C's cable system by such branching unit by filing a
modification application with the Commission.
137. Assignment and Transfer of Control Applications. The
Commission proposes to amend Sec. 1.767(a)(11) of the rules to
incorporate changes consistent with the approach the Commission
proposes in the NPRM. The rules currently require, as a condition of a
cable landing license, that the license and rights granted in the
license shall not be transferred or assigned without prior approval by
the Commission.\133\ Applicants seeking authority to assign or transfer
control of an interest in a submarine cable system are required to file
an application that contains information in accordance with Sec.
1.767(a)(11) of the rules.\134\ As an initial matter, the Commission
proposes to amend Sec. 1.767(a)(11)(i) of the rules to clarify that
applicants seeking to assign or transfer control of a cable landing
license must include the percentage of voting and ownership interests
being assigned or transferred ``including in the U.S. portion of the
cable system, which includes all U.S. cable landing station(s).''
Currently, Sec. 1.767(a)(11)(i) refers more narrowly to ``a U.S. cable
landing station'' by stating that applicants must provide, on a segment
specific basis, ``the percentage of voting and ownership interests
being transferred or assigned in the cable system, including in a U.S.
cable landing station.'' The Commission believes its proposed change to
expressly state ``including in the U.S. portion of the cable system
(which includes all U.S. cable landing station(s))'' (emphasis added)
would improve the clarity of the rule and is also consistent with the
approaches on which the Commission seeks comment in the NPRM, including
a definition of a submarine cable system and the Commission's proposed
amendments to the application requirements for new cable landing
licenses. Additionally, the Commission proposes to amend Sec.
1.767(a)(11)(i) to codify the long-standing requirement that applicants
must demonstrate that grant of the transaction will serve the public
interest, convenience, and necessity. To the extent the Commission
adopts any new or modified information and certification requirements
in this proceeding with respect to applications for a new cable landing
license, the Commission proposes to similarly apply those requirements
to assignment and transfer of control applications. The Commission
seeks comment on these approaches and whether it should adopt other
changes to the rules to improve clarity or ensure consistency with the
Commission's overall objectives in this proceeding.
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\133\ A pro forma assignee or person or company that is the
subject of a pro forma transfer of control of a cable landing
license is not required to seek prior approval for the pro forma
transaction to the extent the cable landing license was granted on
or after March 15, 2002, or modified to incorporate Sec.
1.767(g)(7) of the routine conditions. 47 CFR 1.767(g) (``Except as
otherwise ordered by the Commission, the following rules apply to
each licensee of a cable landing license granted on or after March
15, 2002 . . . .''). A pro forma assignee or person or company that
is the subject of a pro forma transfer of control must notify the
Commission no later than thirty (30) days after the assignment or
transfer of control is consummated.
\134\ See 47 CFR 1.767(a)(11)(i).
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138. Pro Forma Assignment and Transfer of Control Post-Transaction
Notifications. The Commission proposes to amend the rules applicable to
pro forma assignments and transfers of control of cable landing
licenses by clarifying what information must be provided in such
notifications. To improve the organization and clarity of the rules
applicable to pro forma assignment and transfer of control
notifications, the Commission proposes to create a new paragraph that
would address the specific requirements. The Commission proposes to
eliminate the distinction in Sec. 1.767(g) that applies the routine
conditions--including the pro forma condition under Sec. 1.767(g)(7)--
only ``to each licensee of a cable landing license granted on or after
March 15, 2002,'' \135\ and to apply the routine conditions to all
cable landing licensees.\136\ Section 1.767(g)(7) of the rules
requires, as a condition of a cable landing license, that ``[a] pro
forma assignee or person or company that is the subject of a pro forma
transfer of control must notify the Commission no later than thirty
(30) days after the assignment or transfer of control is consummated,''
and such notification ``must certify that the assignment or transfer of
control was pro forma, as defined in Sec. 63.24 of this chapter and,
together with all previous pro forma transactions, does not result in a
change of the licensee's ultimate control.'' As part of the
Commission's proposed reorganization of the rules, the Commission
proposes to move the text of Sec. 1.767(g)(7) that specifically
addresses the information requirements of pro forma assignment and
transfer of control notifications into the new paragraph.\137\ With
respect to Sec. 1.767(g)(7), the Commission proposes to retain the
outstanding text of the routine condition, while adding a statement
that the pro forma assignment and transfer of control notifications
must be filed in accordance with the requirements set forth in the new
paragraph applicable to pro forma transactions. The Commission proposes
to incorporate into this new paragraph the text of Sec. 63.24(d), to
which Sec. 1.767(g)(7) currently refers, and further clarify
references contained therein to other parts of the Commission's
rules.\138\
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\135\ 47 CFR 1.767(g) (``Routine conditions. Except as otherwise
ordered by the Commission, the following rules apply to each
licensee of a cable landing license granted on or after March 15,
2002 . . . .'').
\136\ In the 2001 Cable Report and Order, the Commission
determined that ``[t]he rules we adopt today carve out a limited
exception to this condition for pro forma transactions for all cable
landing licenses that the Commission grants after the effective date
of this Report and Order,'' and ``[f]or cable landing licenses
granted prior to the effective date of this Report and Order, a
licensee may file an application with the Commission seeking a
modification of its license to incorporate this limited exception to
the prior approval requirement currently set forth in the applicable
license condition.'' As discussed below, the Commission believes
this distinction in Sec. 1.767(g) between cable landing licenses
granted prior to and on or after March 15, 2002 is no longer
meaningful given that licenses granted prior to March 15, 2002,
including those that have not been modified to incorporate the
exception to Sec. 1.767(g)(6) as applied to pro forma transactions,
either have expired or are nearing the expiration of their 25-year
term. Where a renewal of a cable landing license is granted, it is
Commission practice to apply the routine conditions of Sec.
1.767(g)(6) to the terms of the new license.
\137\ Specifically, the Commission proposes to move to the new
paragraph the text of Sec. 1.767(g)(7) that states the notification
must certify that the assignment or transfer of control was pro
forma, as defined in 47 CFR 63.24, and, together with all previous
pro forma transactions, does not result in a change of the
licensee's ultimate control. The licensee may file a single
notification for an assignment or transfer of control of multiple
licenses issued in the name of the licensee if each license is
identified by the file number under which it was granted.
\138\ See 47 CFR 63.24(d) (providing that transfers of control
or assignments that do not result in a change in the actual
controlling party are considered non-substantial or pro forma.
Whether there has been a change in the actual controlling party must
be determined on a case-by-case basis with reference to the factors
listed in note 1 to Sec. 63.24(d). The types of transactions listed
in note 2 to Sec. 63.24(d) shall be considered presumptively pro
forma and prior approval from the Commission need not be sought.).
By incorporating the text of Sec. 63.24(d) into a new Sec.
1.767(a), the Commission proposes to specify that ``note 1 to this
paragraph (d)'' and ``note 2 to this paragraph (d)'' refer to those
respective notes in Sec. 63.24(d) of the rules. The Commission's
proposed approach is limited to the new paragraph that it proposes
to adopt in Sec. 1.767(a). The Commission does not propose
amendments to Sec. 63.24(d) in the NPRM. In the Evolving Risks
NPRM, the Commission proposed, among other administrative changes,
the conversion of certain Notes into respective paragraphs for
consistency with the Office of Federal Register requirements,
including notes 1 and 2 of Sec. 63.24(d).
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139. Upon receiving a pro forma assignment or transfer of control
notification, Commission practice involves reviewing the notification
for
[[Page 12069]]
compliance with the rules, including whether it contains information
required under Sec. 1.767(a)(11)(i) and whether the assignment or
transfer of control was in fact pro forma and, accordingly, issuing an
``Actions Taken'' public notice. To reduce regulatory uncertainty, the
Commission proposes to codify existing Commission practice by
clarifying that the requirements under Sec. 1.767(a)(11)(i) are not
only applicable to substantial assignments and transfers of control,
but also apply to pro forma assignment and transfer of control
notifications. Therefore, a pro forma assignee or person or company
that is the subject of a pro forma transfer of control must also submit
information consistent with such requirements.\139\ Accordingly, the
Commission proposes that the new aforementioned paragraph will
incorporate the requirements set out in Sec. 1.767(a)(11)(i) by
requiring that pro forma assignment and transfer of control
notifications shall (1) provide information as required under Sec.
1.767(a)(1) through (3) of the rules for both the assignor/transferor
and the assignee/transferee; (2) provide information as required under
Sec. 1.767(a)(8) and (9) of the rules for only the assignee/
transferee; (3) include both the pre-transaction and post-transaction
ownership diagram of the licensee as required under Sec.
1.767(a)(8)(i) of the rules; (4) include a narrative describing the
means by which the pro forma assignment or transfer of control
occurred, and (5) specify, on a segment specific basis, the percentage
of voting and ownership interests that were assigned or transferred in
the cable system, including in the U.S. portion of the cable system
(which includes all U.S. cable landing station(s)). The Commission
reserves the right to request additional information concerning the
transaction to aid it in making its public interest determination.
Additionally, the Commission proposes to make administrative changes to
Sec. 1.767(a)(11) by changing ``transferor/assignor'' and
``transferee/assignee'' to instead reflect ``assignor/transferor'' and
``assignee/transferee,'' consistent with the overall structure of Sec.
1.767(a)(11). The Commission tentatively finds that these approaches
are consistent with the Commission's longstanding practice. The
Commission seeks comment on these proposals and whether there are
additional ways that the Commission should clarify the rules applicable
to pro forma assignment and transfer of control notifications.
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\139\ 47 CFR 1.767(a)(11)(i).
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140. Requests for an STA. To provide clarity in the rules and
reduce regulatory uncertainty, the Commission proposes to adopt a
framework for applicants requesting an STA to allow, at the applicant's
own risk, the construction, testing, or operation of a submarine cable.
Generally, the Commission may receive requests for an STA from
applicants: (1) seeking to commence construction of or commercial
service on a cable system while the cable landing license application
is pending Commission approval; (2) seeking to continue operating a
cable system following the expiration of a license and pending the
filing of an application to renew or extend the cable landing license;
(3) who are operating a cable system without first obtaining a license;
(4) that consummated a transaction without prior Commission consent; or
(5) seeking to provide emergency service arising from a need occasioned
by conditions unforeseen by, and beyond the control of, the
licensee(s), among other examples. It is the Commission's current
practice to place a request for an STA on Accepted for Filing public
notice and to send a courtesy copy of such public notice to the
Committee for STA requests where the applicant has reportable foreign
ownership. The Commission may consult with the Committee on a
particular request for an STA, where appropriate, prior to releasing
the public notice. Any grant of a request for an STA does not prejudice
action by the Commission on any underlying application, including
enforcement action, as is set forth in public notices issued in
association with the request.\140\
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\140\ See, e.g., File No. SCL-STA-20220318-00011, Non-
Streamlined Submarine Cable Landing License Applications Accepted
for Filing, Public Notice, Report No. SCL-00371NS (IB Apr. 22, 2022)
(releasing an ``Accepted for Filing'' public notice and stating that
the applicant ``acknowledges that grant of such STA will not
prejudice action by the Commission on the underlying application,
and that the STA is subject to cancellation or modification upon
notice without a hearing''); File No. SCL-STA-20220318-00011,
Actions Taken Under Cable Landing License Act, Public Notice, Report
No. SCL-00374, 37 FCC Rcd 6065 (IB 2022) (granting the request for
an STA and stating that the applicant ``acknowledges that grant of
the STA will not prejudice action by the Commission on the
underlying application and that the STA is subject to cancellation
or modification upon notice without a hearing.'').
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141. The Commission proposes to adopt rules based on its current
practice. The Commission proposes to require that any person or entity
seeking an STA with respect to the construction, testing, or operation
of a submarine cable must expeditiously file all requisite applications
related to the request for an STA--including any application(s) for a
cable landing license or modification, assignment, transfer of control,
or renewal or extension of such license--before or immediately upon
submitting the request for an STA. The Commission proposes to require
that applicants requesting an STA must identify the file number(s) of
any pending application(s) associated with the request for an STA. The
Commission seeks comment on whether it should impose any other
requirements related to filing a request for an STA.
142. The Commission proposes to adopt rules requiring that
applicants requesting an STA related to the construction, testing, or
operation of a submarine cable must provide the following information
in its request: (1) applicant and contact information as required under
Sec. 1.767(a)(1) through (3) of the rules; (2) a description of the
request for an STA, the reason why applicants seek an STA, and the
justification for such request; (3) the name of the cable system for
which applicants request an STA; (4) the name(s) and citizenship(s) or
place(s) of organization of each applicant requesting an STA with
respect to the submarine cable, including the licensees that jointly
hold a cable landing license; (5) a statement as to whether or not any
individual or entity directly or indirectly owns 5% or more of the
equity interests and/or voting interests, or a controlling interest, of
any applicant requesting an STA (or 10% or more to the extent the
Commission retain the current ownership reporting threshold); (6) the
type of request for an STA, such as a new request for an STA, a request
to extend or renew an STA, or other type; (7) whether or not the
request for an STA is associated with an application(s) pending with
the Commission, and if so, identification of the related file
number(s); (8) the date by which applicants seek grant of the request
for an STA; (9) the duration for which applicants seek an STA.
143. In addition to these proposed requirements, the Commission
seeks comment on whether it should require applicants requesting an STA
to provide any information required by Sec. 63.25 of the Commission's
rules. While Sec. 63.25 addresses requirements relating to temporary
or emergency service by international carriers, it has been the
Commission's long-standing practice to rely on Sec. 63.25 to review
and act on requests for STAs involving submarine cables.\141\ The
Commission seeks
[[Page 12070]]
comment on whether it should continue to rely on Sec. 63.25 instead of
adopting new rules specifically for submarine cables. To the extent the
Commission integrates the provisions of Sec. 63.25 into the proposed
framework, should the Commission require applicants to comply with the
requirements set out in Sec. 63.25 to the extent they are applicable?
The Commission seeks comment on whether certain requirements in Sec.
63.25 are inapplicable in the submarine cable context.\142\
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\141\ Section 63.25(a)(1) defines ``[t]emporary service'' as ``a
period not exceeding 6 months.'' Section 63.25(a)(2) defines
``[e]mergency service'' as ``service for which there is an immediate
need occasioned by conditions unforeseen by, and beyond the control
of, the carrier.'' Section 63.25(c) provides that an application may
be filed to request continuing authority to provide temporary or
emergency service.
\142\ See, e.g., 47 CFR 63.25(c) (providing that any carrier may
request continuing authority ``to provide temporary or emergency
service by the construction or installation of facilities where the
estimated construction, installation, and acquisition costs do not
exceed $35,000 or an annual rental of not more than $7,000 provided
that such project does not involve a major action under the
Commission's environmental rules''); id. (requiring that any carrier
to which continuing authority has been granted must file, following
the end of each 6-month period covered by such authority, certain
information with the Commission, including ``[t]he type of facility
constructed, installed, or leased,'' ``[t]he route kilometers
thereof (excluding leased facilities),'' ``[t]he terminal
communities served and the airline kilometers between terminal
communities in the proposed project,'' ``[t]he cost thereof,
including construction, installation, or lease,'' and ``[w]here
appropriate, the name of the lessor company, and the dates of
commencement and termination of the lease'').
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144. The Commission also proposes to require applicants requesting
an STA related to the construction, testing, or operation of a
submarine cable to provide certain certifications in such request.
Specifically, the Commission proposes to adopt in the Commission's
rules the following certification requirements: (1) applicants must
provide the same certifications required in an application for a new
cable landing license, including the certification required in Sec.
63.18(o) of the rules,\143\ as well as any new certification
requirements adopted in this proceeding; (2) applicants must
acknowledge that any grant of the request for an STA does not prejudice
action by the Commission on any underlying application(s); (3)
applicants must acknowledge that any grant of the request for an STA is
subject to revocation/cancellation or modification by the Commission on
its own motion without a hearing; and (4) applicants must acknowledge
that any grant of the request for an STA does not preclude enforcement
action for non-compliance with the Cable Landing License Act, the
Communications Act, or the Commission's rules. In addition, the
Commission proposes to codify the Commission's long-standing practice
of requiring applicants requesting an STA to demonstrate that grant of
such request would serve the public interest, convenience, and
necessity. The Commission seeks comment on these proposed requirements.
Should the Commission require applicants requesting an STA to provide
additional information or certifications for the Commission's
assessment?
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\143\ See 47 CFR 63.18(o) (requiring ``[a] certification
pursuant to Sec. Sec. 1.2001 through 1.2003 of this chapter that no
party to the application is subject to a denial of Federal benefits
pursuant to Section 5301 of the Anti-Drug Abuse Act of 1988. See 21
U.S.C. 853a.''); see 47 CFR 1.2002(b) (explaining the meaning of
``party to the application'' for purposes of this section); Id.
1.2002(c) (``The provisions of paragraphs (a) and (b) of this
section are not applicable to the Amateur Radio Service, the
Citizens Band Radio Service, the Radio Control Radio Service, to
users in the Public Mobile Services and the Private Radio Services
that are not individually licensed by the Commission, or to Federal,
State or local governmental entities or subdivisions thereof.'').
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145. Amendments. The Commission proposes to codify the Commission's
longstanding practice to set forth in the rules that any submarine
cable application may be amended as a matter of right prior to the date
of any final action taken by the Commission or designation for hearing.
The Commission also proposes to require that amendments to applications
shall be signed and submitted in the same manner as was the original
application. Further, the Commission proposes to require that if a
petition to deny or other formal objection has been filed in response
to the application, the amendment shall be served on the parties.
12. Routine Conditions Applicable to All Licensees
146. Below, the Commission proposes to amend the routine conditions
that are attached to cable landing licenses under Sec. 1.767(g) of the
rules, which provide a set of public, standard requirements and
procedures to ensure that licensees consistently certify that they will
comply with the conditions imposed on the license following grant of an
application. The routine conditions provide the Commission with
important information about licensee status and updated points of
contact for the submarine cables licensed by the Commission, and other
updated information for purposes of assessing any national security,
law enforcement, and other concerns.
147. Eliminate 2002 Distinction. The Commission proposes to
eliminate the distinction in Sec. 1.767(g) that applies the routine
conditions only ``to each licensee of a cable landing license granted
on or after March 15, 2002.'' \144\ The Commission believes that this
distinction is no longer meaningful given that cable landing licenses
granted prior to March 15, 2002, either have expired or are nearing the
expiration of their 25-year term. Further, to the extent the Commission
grants applications to renew the license of a submarine cable, the
Commission's current practice is to issue a new cable landing license
based on the rules that were effective as of March 15, 2002, instead of
renewing the terms of the license that were in effect prior to this
date. Therefore, the Commission proposes to amend Sec. 1.767(g) by
eliminating the text ``granted on or after March 15, 2002'' and to
apply the routine conditions, as they may be amended in this
proceeding, ``to each licensee of a cable landing license''
irrespective of the date of grant. The Commission seeks comment on this
proposal.
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\144\ 47 CFR 1.767(g) (``Routine conditions. Except as otherwise
ordered by the Commission, the following rules apply to each
licensee of a cable landing license granted on or after March 15,
2002 . . . .'').
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148. Points of Contact. The Commission proposes to amend its rules
by adding a new routine condition requiring cable landing licensees to
notify the Commission of any changes to their contact information
within thirty (30) days of such change, consistent with the information
requirements on which the Commission seeks comment in this proceeding.
It is essential for the Commission to maintain updated contact
information for the appropriate points of contact to whom any matters
concerning a licensed submarine cable may be addressed. Specifically,
the Commission proposes that cable landing licensees must inform the
Commission of any changes to the contact information provided in their
most recent submarine cable application--including the application for
a new cable landing license or any modification, assignment, transfer
of control, or renewal or extension of the license--and the most recent
three-year periodic report. The Commission seeks comment on this
proposal.
149. Notification of Changes to the Name of the Licensee or
Submarine Cable System. The Commission proposes to amend its rules by
adding a new routine condition requiring licensees to notify the
Commission of any changes to the name of the licensee (including the
name under which it is doing business) or the name of its submarine
cable within thirty (30) days of such change. If there are multiple
licensees of the submarine cable, the Commission proposes that the lead
[[Page 12071]]
licensee must file the notification with the Commission within the 30-
day timeframe. It is important for the Commission to maintain updated
information that is critical to identifying the licensees and the
licensed submarine cable system. The Commission seeks comment on this
proposal.
150. Covered List Equipment. The Commission proposes to amend its
rules by adding a new routine condition prohibiting licensees from
using, for the relevant submarine cable system, equipment or services
identified on the ``Covered List.'' The Commission also proposes that
this prohibition would apply to covered equipment or services
purchased, rented, leased, or otherwise obtained on or after August 14,
2018 (in the case of Huawei, ZTE, Hikvision, Dahua, and Hytera), or on
or after 60 days after the date that any equipment or service is placed
on the Covered List.
151. Commencement of Service Requirement. Currently, an entity can
obtain a cable landing license and then not construct, land, or operate
the cable pursuant to the license. This may occur because business
plans change or the entity goes out of business, and it has resulted in
the retention of cable landing licenses in the Commission's records
where the license likely was not used to construct or operate the
cable. Section 1.767(g)(15) of the rules requires that ``the licensee
must notify the Commission within thirty (30) of the date the cable is
placed into service.'' In addition, Sec. 1.767(g)(15) sets forth that
``[t]he cable landing license shall expire twenty-five (25) years from
the in-service date, unless renewed or extended upon proper
application.'' However, there currently is no rule requiring licensees
to notify the Commission that they have not utilized the licenses and,
as a result, there are a few licenses associated with submarine cable
systems that likely were not built, but are reflected as current
licenses in ICFS. The Commission notes that it has requirements for
other licensees of regulated services where the licensee must begin
providing service within a set period of time or its license is
cancelled.\145\ The Commission proposes to adopt similar requirements
for cable landing licensees. This proposed requirement would provide
the Commission with more accurate information as to which license
grants were not utilized to construct and operate submarine cables and
improve the administration of the Commission's rules.
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\145\ 47 CFR 1.946(c) (requiring, with regard to a licensee in
the Wireless Radio Services, ``[i]f a licensee fails to commence
service or operations by the expiration of its construction period
or to meet its coverage or substantial service obligations by the
expiration of its coverage period, its authorization terminates
automatically (in whole or in part as set forth in the service
rules), without specific Commission action, on the date the
construction or coverage period expires''); see also 47 CFR
1.955(a)(2) (``Authorizations automatically terminate (in whole or
in part as set forth in the service rules), without specific
Commission action, if the licensee fails to meet applicable
construction or coverage requirements.'').
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152. The Commission tentatively concludes that cable landing
licensees should retain their license only if they construct and
operate the submarine cable under that license. Consequently, the
Commission proposes to adopt a rule requiring a cable landing licensee
to commence commercial service on the cable under its license within
three years following the grant. The Commission proposes that if a
cable landing licensee seeks a request for a waiver of the three-year
time period, the licensee must identify the projected in-service date
and reasons for the delay and demonstrate good cause for grant of a
waiver.\146\ The Commission also seeks comment on whether the
Commission should instead allow a licensee to request an extension of
the three-year time period rather than requesting a waiver. The
Commission proposes that if a cable landing licensee does not notify
the Commission of the commencement of service or file a request for a
waiver within three years following the grant of the license, such
failure to meet this condition will result in automatic cancellation of
the license. Other Commission rules have similar automatic
cancellations. The Commission seeks comment on this proposal, including
whether three years after license grant is sufficient time to commence
commercial operation or if another time period may be appropriate. The
Commission's records in ICFS indicate that most licensees of operating
submarine cables commenced service within this timeframe.
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\146\ Under the ``good cause'' standard, waiver is appropriate
only if both (1) special circumstances warrant a deviation from the
general rule, and (2) such deviation better serves the public
interest. See also WAIT Radio v. FCC, 418 F.2d 1153, 1157 (D.C. Cir.
1969) (``An applicant for waiver faces a high hurdle even at the
starting gate.'').
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13. Foreign Carrier Affiliation Notifications
153. The Commission proposes to amend Sec. 1.768(e)(4) of the
rules to require that licensees must include in a notification of a
foreign carrier affiliation voting interests, in addition to the equity
interests, and a diagram of individuals or entities with a 10% or
greater direct or indirect ownership in the licensee. Currently, a
licensee is required to include, among other things, in a foreign
carrier affiliation notification ``[t]he name, address, citizenship,
and principal business of any person or entity that directly or
indirectly owns at least ten percent (10%) of the equity of the
licensee, and the percentage of equity owned by each of those entities
(to the nearest one percent (1%)).'' The Commission proposes revisions
to Sec. 1.768(e)(4) that would be consistent with the ownership
reporting requirements of other submarine cable applications and
notifications. Specifically, the Commission proposes to amend Sec.
1.768(e)(4) to require that licensees must provide the name, address,
citizenship, and principal businesses of any individual or entity that
directly or indirectly owns 10% or more of the equity interests and/or
voting interests, or a controlling interest, of the licensee, and the
percentage of equity and/or voting interest owned by each of those
entities (to the nearest one percent). Where no individual or entity
directly or indirectly owns ten percent or more of the equity interests
and/or voting interests, or a controlling interest, of the licensee,
the Commission proposes that the license must provide a statement to
that effect. The Commission further proposes to amend Sec. 1.768(e)(4)
by integrating the provisions set out in Sec. 63.18(h)(1)(i) and (ii)
of the rules, which address calculation of indirect equity interests
and voting interests, respectively, and are applicable to other
submarine cable applications and notifications.
154. Additionally, the Commission proposes to amend Sec. 1.768(e)
by requiring that licensees must provide an ownership diagram that
illustrates the licensee's vertical ownership structure, including
individuals or entities with a 10% or greater direct or indirect
ownership (equity and voting) interests, or a controlling interest, in
the licensee. To the extent the Commission adopts a 5% ownership
reporting threshold as a requirement of applications for a cable
landing license and modification, assignment, transfer of control, and
renewal or extension of the license, as discussed above, the Commission
proposes that it amend Sec. 1.768(e)(4) by similarly adopting a 5%
ownership reporting threshold and thus harmonize the requirements. The
Commission seeks comment on this proposal.
14. Other Changes to the Rules
155. The Commission proposes to amend Sec. 1.767 of the rules by
eliminating certain provisions that the Commission tentatively
concludes are
[[Page 12072]]
no longer applicable or consistent with its current rules or practice.
Specifically, the Commission proposes to eliminate Sec. 1.767(c),
which states that original files relating to submarine cable landing
licenses and applications for licenses since June 30, 1934, are kept by
the Commission. Such applications for licenses (including all documents
and exhibits filed with and made a part thereof, with the exception of
any maps showing the exact location of the submarine cable or cables to
be licensed) and the licenses issued pursuant thereto, with the
exception of such maps, shall, unless otherwise ordered by the
Commission, be open to public inspection in the offices of the
Commission in Washington, DC. Additionally, the Commission proposes to
eliminate Sec. 1.767(d), which states that original files relating to
licenses and applications for licenses for the landing operation of
cables prior to June 30, 1934, were kept by the Department of State,
and such files prior to 1930 have been transferred to the Executive and
Foreign Affairs Branch of the General Records Office of the National
Archives. Requests for inspection of these files should, however, be
addressed to the Federal Communications Commission, Washington, DC
20554; and the Commission will obtain such files for a temporary period
in order to permit inspection at the offices of the Commission. The
Commission notes that the requirements set forth in Sec. 1.767(c) and
(d) are not required under the Cable Landing License Act or section 5
of Executive Order 10530. Furthermore, the Commission does not
implement these recordkeeping practices with respect to other
Commission records. The Commission tentatively finds that it should
maintain consistent recordkeeping practices with respect to its
records, including records relating to cable landing licenses and
applications for cable landing licenses. In addition, the Commission
tentatively concludes that the requirements under Sec. 1.767(c) and
(d) are inconsistent with the electronic filing requirements set out in
Sec. 1.767(n)(1) of the rules, which states that, ``[w]ith the
exception of submarine cable outage reports, and subject to the
availability of electronic forms, all applications and notifications
described in this section must be filed electronically through the
International Communications Filing System (ICFS).'' The Commission
seeks comment on these proposals.
156. The Commission also proposes to eliminate Sec. 1.767(f),
which requires that ``[a]pplicants shall disclose to any interested
member of the public, upon written request, accurate information
concerning the location and timing for the construction of a submarine
cable system authorized under this section. This disclosure shall be
made within 30 days of receipt of the request.'' The Commission
tentatively finds that this requirement under Sec. 1.767(f) is
inconsistent with Sec. 0.457(c)(1)(i) of the rules, which provides
that ``[m]aps showing the exact location of submarine cables'' should
be withheld from public inspection. Further, this requirement is
inconsistent with the Commission's proposal in the NPRM to provide
confidential treatment for the exact addresses and specific geographic
coordinates of cable landing stations, beach manholes, and other
sensitive locations associated with a submarine cable system. The
Commission seeks comment on this proposal.
15. Other Administrative Modifications
157. New Subpart FF. The Commission proposes to reorganize the
submarine cable rules codified in Sec. Sec. 1.767 and 1.768 by
relocating those rules from subpart E of part 1 to a new subpart in
part 1. Specifically, the Commission proposes to redesignate those
rules under a new subpart FF. Currently, subpart E addresses
``Complaints, Applications, Tariffs, and Reports Involving Common
Carriers'' and the submarine cables are identified in that subpart as a
specific type of application under title II of the Communications Act.
In light of changes in the submarine cable industry, the Commission
believes this designation of submarine cable applications is no longer
applicable. Additionally, the Commission tentatively concludes that
reorganizing the submarine cable rules into a separate subpart will
provide clarity for applicants seeking to file any type of submarine
application with the Commission. To the extent the Commission amends
any rule provisions currently set forth under Sec. Sec. 1.767 and
1.768, the Commission proposes to codify such changes under subpart FF.
Further, the Commission proposes to improve the clarity and structure
of Sec. 1.767 by reorganizing existing rules and implementing any new
rules adopted in this proceeding into specific paragraphs by topic.
158. Other Administrative Changes. Throughout the proposed rules,
the Commission has proposed various ministerial, non-substantive
changes not individually discussed in the NPRM. These changes include,
among other things, the conversion of Notes into respective paragraphs
for consistency with the Office of Federal Register requirements. The
Commission seeks comment on whether to require applicants file a copy
of a submarine cable application with CISA, DHS. The Commission also
seeks comment on whether it should add certain existing requirements in
the submarine cable subpart rather than a cross reference to other
rules.
C. Three-Year Periodic Reporting Requirement
159. Below, the Commission discusses the information it proposes to
require that all licensees to file in the three-year periodic reports.
The Commission proposes to codify, as a routine condition a requirement
that all cable landing licensees must provide to the Commission updated
information about their ownership, points of contact, description of
the submarine cable system, and other critical information every three
years.\147\ Specifically, the Commission proposes that all licensees
must provide in their periodic reports updated information and
certifications identical to what is required in an application,
including new information and certification requirements that the
Commission may adopt in this proceeding. The Commission also seeks
comment on whether to require additional information as part of the
periodic reporting requirement. The Commission seeks comment on the
nature and extent of the potential burdens of this proposed reporting
requirement.
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\147\ As needed, the Commission proposes that Commission staff
may require licensees to submit information required as part of the
periodic filing prior to the three-year reporting deadline.
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160. Reports Must Provide Current Information. The Commission
generally proposes to require cable landing licensees to provide in the
periodic reports updates every three years. The information will be
updated from the time they submitted their application for the cable
landing license or any modification, assignment, transfer of control,
or renewal or extension of the license or the last periodic report,
whichever is most recent, consistent with the application requirements.
The Commission proposes that these periodic reports must contain
information that is current as of thirty (30) days prior to the date of
the submission. To the extent that certain information has not changed
since last filed in an application for the cable landing license or the
modification, substantial assignment, transfer of control, and renewal
or extension of the license or last periodic report, should the
Commission allow the cable landing
[[Page 12073]]
licensee to include a certification attesting that its current
information is identical to the information contained in such
application?
161. Submarine Cable Infrastructure Information. The Commission
proposes to require licensees to provide additional detailed
information concerning the submarine cable infrastructure in their
periodic reports. The Commission proposes among other things that
licensees must provide updated submarine cable system information
including the length of the cable by segment and in total, the location
of branching units, the location, address, and county or county
equivalent of U.S. and non-U.S. cable landing points, the number of
optical fiber pairs in the cable, and the design capacity of the
system. The Commission also proposes to modify requirement for
applicants and licensees to provide the geographic coordinates of cable
landing stations as well as beach manholes, to the extent they differ
from cable landing station coordinates.
162. Current and Future Service Offerings. The Commission proposes
to require licensees to submit as part of the periodic report
information about the capacity services they currently offer or plan to
offer through the submarine cable system. The service includes the
capacity it currently owns, the amount of capacity it intends to sell
and the capacity management services. The Commission also proposes to
require applicants, licensees, transferees, and assignees (as
appropriate) to disclose current and expected future service offerings
as part of their applications for modification, assignment, transfer of
control, and renewal or extension of submarine cable landing licenses.
163. Regulatory Compliance Certifications. The Commission proposes
to require cable landing licensees to certify in the report whether or
not they are in compliance with the Cable Landing License Act, the
Communications Act, the Commission's rules, and other laws.
Specifically, the Commission proposes to require each licensee to
certify in its report whether or not the licensee has violated the
Cable Landing License Act of 1921, the Communications Act of 1934, or
Commission rules, including making false statements or
misrepresentations to the Commission; whether the applicant has been
convicted of a felony; and whether there is an adjudicated
determination that the applicant has violated U.S. antitrust or other
competition laws, has been found to have engaged in fraudulent conduct
before another government agency, or has engaged in other non-FCC
misconduct the Commission has found to be relevant in assessing the
character qualifications of a licensee or authorization holder. The
Commission also seeks comment on whether the Commission should require
cable landing licensees to disclose any pending FCC investigations,
including any pending Notice of Apparent Liability, and any adjudicated
findings of non-FCC misconduct. In addition, the Commission seeks
comment on whether the Commission should require cable landing
licensees to disclose any violations of the Communications Act,
Commission rules, or U.S. antitrust or other competition law, or any
other non-FCC misconduct only where there has been adjudication or
notification of a violation by an agency or court.
164. Cybersecurity Certifications. The Commission proposes to
require cable landing licensees to provide in the report cybersecurity
certifications. Among other things, the Commission proposes that
licensees certify in the report that they have created, updated, and
implemented cybersecurity risk management plans. The Commission also
proposes to require these applicants and licensees to certify that they
take reasonable measures to protect the confidentiality, integrity, and
availability of their systems and services that could affect their
provision of communications services.
165. ``Covered List'' Certification. The Commission proposes to
require cable landing licensees to make the ``covered list''
certifications described above. The Commission proposes to require that
licensees, in their periodic reports, certify that they have not
purchased and/or used, and will not purchase and/or use, equipment or
services produced or provided by entities (and their subsidiaries and
affiliates) identified on the Commission's ``Covered List'' deemed
pursuant to the Secure and Trusted Communications Networks Act \148\ to
pose an unacceptable risk to the national security of the United States
or the security and safety of United States persons. The Commission
proposes that this certification would apply to covered equipment or
services purchased, rented, leased, or otherwise obtained on or after
August 14, 2018 (in the case of Huawei, ZTE, Hikvision, Dahua, and
Hytera), or on or after 60 days after the date that any equipment or
service is placed on the Covered List. This periodic reporting
certification would ensure licensees continue to comply with the rule
and the licensees' routine condition that protects against national
security, law enforcement, and other risks.
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\148\ Pursuant to sections 2(a) and (d) of the Secure and
Trusted Communications Networks Act, and Sec. Sec. 1.50002 and
1.50003 of the Commission's rules, PSHSB publishes a list of
communications equipment and services that have been determined by
one of the sources specified in that statute to pose an unacceptable
risk to the national security of the United States or the security
and safety of United States persons (``covered'' equipment).
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166. Foreign-Owned MNSPs. The Commission proposes to require cable
landing licensees, with or without reportable foreign ownership, to
report whether or not they use and/or will use foreign-owned MNSPs in
the operation of the submarine cable, as described above.
167. Licensee Information and Points of Contact. The Commission
proposes to require cable landing licensees to include in their
periodic reports updated information concerning: (1) the name, address,
telephone number, and email address of the licensee, and (2) the name,
title, address, telephone number, email address, of the officer and any
other contact point, such as legal counsel, to whom correspondence
concerning the cable landing license is to be addressed. The Commission
further proposes to require cable landing licensees to provide any
updated information concerning the Government, State, or Territory
under the laws of which the licensee is organized.
168. In addition to the proposals above, the Commission seeks
comment on whether to require other information as part of the periodic
reporting requirement. The Commission also seeks comment on the nature
and extent of the potential burdens of this proposed reporting
requirement.
169. Ownership of the Submarine Cable System. The Commission seeks
comment on whether, as part of the periodic reporting requirement, the
cable landing licensee should provide information identifying any
individuals or entities that hold an ownership interest in the
submarine cable system that does not meet the threshold eligibility
requirements requiring them to be licensees of the cable, including the
proposed eligibility requirements on which the Commission seeks comment
in this proceeding. To the extent the Commission requires this
information, should the Commission also require the cable landing
licensee to provide additional information about those other owners of
the submarine cable, such as (1) their citizenship(s) and place(s) of
organization and (2) identification of any individuals and entities
that hold a certain threshold of direct and/or indirect equity and/or
voting interests (e.g., 10% or greater), or a controlling interest, in
those other owners of the
[[Page 12074]]
submarine cable? Would information concerning other owners of the
submarine cable system that are not licensees better ensure that the
Commission can more fully account for evolving national security, law
enforcement, foreign policy, and/or trade policy risks to submarine
cable infrastructure? Should the criteria for identification of any
individuals and entities that hold a certain threshold of direct and/or
indirect equity and/or voting interests in those other owners of the
submarine cable be set at 5% or greater instead? Should the Commission
inquire about U.S. citizens' other non-U.S. citizenships, as in other
Commission proceedings?
170. Ownership of Licensees. The Commission seeks comment on
whether the cable landing licensee should provide updated ownership
information. For example, if the Commission adopts a 5% reportable
ownership threshold, licensees would be required to provide updated
ownership as required by the rules. The Commission seeks comment on
whether an ongoing reporting requirement every three years should be
broader and include additional information about ownership, control,
and/or influence by foreign governments or foreign state-owned
entities. If so, how should the Commission define ``influence''?
171. Other Information. The Commission seeks comment on what other
information it should require generally in the periodic reports so that
the Commission can address evolving national security, law enforcement,
foreign policy, and/or trade policy risks. The Commission seeks comment
on the types of ongoing information that the Commission should refer to
the executive branch agencies for review. For example, should the
Commission require cable landing licensees to periodically notify the
Commission of any criminal convictions involving the licensee? The
Commission notes that a similar requirement applies to broadcast
licensees.\149\
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\149\ See 47 CFR 1.65(c) (``All broadcast permittees and
licensees must report annually to the Commission any adverse finding
or adverse final action taken by any court or administrative body
that involves conduct bearing on the permittee's or licensee's
character qualifications and that would be reportable in connection
with an application for renewal as reflected in the renewal form . .
. .''); see Policy Regarding Character Qualifications in Broadcast
Licensing, Amendment of Part 1, the Rules of Practice and Procedure,
Relating to Written Responses to Commission Inquiries and the Making
of Misrepresentations to the Commission by Applicants, Permittees,
and Licensees, and the Report of Information Regarding Character
Qualifications, MD Docket No. 81-500, Policy Statement and Order, 5
FCC Rcd 3252, para. 4 (1990) (``[E]vidence of any conviction for
misconduct constituting a felony will be relevant to [the
Commission's] evaluation of an applicant's or licensee's
character.'').
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172. Application Fees. The Commission seeks comment on whether to
require cable landing licensees to pay a fee when submitting the three-
year periodic reports that the Commission proposes in the NPRM. Section
8(a) of the Communications Act states that ``[t]he Commission shall
assess and collect application fees at such rates as the Commission
shall establish in a schedule of application fees to recover the costs
of the Commission to process applications.'' \150\ The Commission has
adopted a schedule of fees based on the cost of processing
applications, with cost determined based on direct labor costs.\151\
The Commission uses time and staff compensation estimates to establish
the direct labor costs of application fees, which are, in turn, based
on applications processed by Commission staff found to be typical in
terms of the amount of time spent on processing each type of
application. The Commission has broadly construed the term
``applications'' to apply to a wide range of submissions for which
filing fees are required. For example, the Commission notes that the
Commission applies an application fee for the Biennial Ownership Report
as applied to Full Power TV Stations, Commercial AM Radio Stations, and
Commercial FM Radio Stations.\152\
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\150\ The Commission has the authority to assess application
fees under section 8 of the Communications Act and has assessed
application fees since 1986. In 2018, Congress revised the
Commission's application fee authority by amending section 8 and
adding section 9A to the Communications Act. In doing so, Congress
modified section 8 of the Communications Act to change the
application fee program from a statutory schedule of application
fees to a requirement that the Commission update and amend the
existing schedule of application fees by rule to recover its costs
to process applications. Section 8(c) of the Act also requires the
Commission to, by rule, amend the application fee schedule if the
Commission determines that the schedule requires amendment to ensure
that: (1) such fees reflect increases or decreases in the costs of
processing applications at the Commission or (2) such schedule
reflects the consolidation or addition of new categories of
applications. In order to implement the RAY BAUM'S Act, the
Commission sought comment on and adopted a new streamlined schedule
of application fees that aligns with the types of applications
received by the Commission in 2020. Amendment of the Schedule of
Application Fees Set Forth in Sections 1.1102 through 1.1109 of the
Commission's Rules, MD Docket No. 20-270, Report and Order, 86 FR
15026 (March 19, 2021), 35 FCC Rcd 15089 (2020) (2020 Application
Fee Report and Order) (the 2020 Notice of Proposed Rulemaking (85 FR
65566, October 15, 2000) and the 2020 Application Fee Report and
Order collectively explain the statutory changes and the methodology
for adopting and maintaining the new schedule of application fees
and discussing how it will be maintained) (collectively 2020
Application Fee Proceeding).
\151\ In reviewing any particular methodology, it is important
to note that the agency is not required to calculate its costs with
``scientific precision.'' Instead, reasonable approximations will
suffice.
\152\ The fee is calculated based on the number of stations for
which the report is filed. It is currently $95 per station.
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173. The Commission anticipates that staff review of the periodic
reports will require a significant investment of labor hours. The
Commission also envisions a substantive filing comprising not only
certifications but substantive updates of the infrastructure used in
the cable system including locations of dry plants, the services being
offered by the licensees, ownership of the cable and ownership of the
licensees. Such submissions must be carefully reviewed by Commission
staff to determine if they are complete and provide the required
information, including specific descriptions of the cable system and
services. The review will also need to determine the significance of
any changes to the information previously filed with the Commission and
whether the changes had been properly and timely reported to the
Commission and appropriately sought approval when necessary, such as
changes in ownership. The review will also require a determination as
to whether the information provided in the report provides a basis for
referring the license to the Committee for review for national security
or law enforcement concerns. Such review would require staff resources,
including analysts to review each filing, attorneys to perform
compliance assessments, specialists to process the GIS location data
and to review the cybersecurity certifications, and a supervisory
attorney to oversee the process and coordinate the referral to the
Committee, other Federal agencies or other bureaus and offices within
the Commission. The total amount of staff hours could be approximately
two hours of review by an analyst, two hours of review by a GIS
specialist, 20 hours of review by an attorney and 5 hours of
supervisory attorney review. The Commission therefore seeks comment on
adding a new category of fees in Sec. 1.1107 of the rules, and to set
that application fee based on the Commission's final cost estimate.
174. The Commission seeks comment on whether any fee adopted for
the periodic reports should be consistent with the fee for applications
for a renewal of a cable landing license because the periodic report,
similar to a renewal application, will require the licensee(s) to
update information about
[[Page 12075]]
the cable system.\153\ The Commission seeks comment on whether the new
fee should be added to the established fee category of ``International
Service'' and follow the fee calculation methodology adopted by the
Commission in the 2020 Application Fee Report and Order.\154\
Currently, the fee for an application for a renewal of cable landing
license is $2,725.\155\ The Commission seeks comment on whether a fee
of $2,725 is appropriate for review of the periodic reports. The
Commission seeks comment on whether there are other filings that
commenters consider analogous to the proposed periodic report. And if
so, would the Commission's processes for those filings suggests that
the Commission adopt a different fee here? The Commission generally
seeks comment on what fee calculation methodology should be adopted to
determine a fee amount, if any, for the three-year periodic reports for
cable landing licensees. In so doing, the Commission reminds commenters
that fees collected pursuant to its section 8 authority are deposited
in the general fund of the U.S. Treasury. Thus, while the determination
of the fee amount will be based on cost, the collected fees are not
used to fund Commission activities. In crafting comments, the
Commission asks that commenters explain whether their proposals are
supported by the statute.
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\153\ Section 8(c)(2) of the Act does not mandate that the
Commission update its fee schedule to reflect ``the consolidation or
addition of new categories of applications'' within any particular
timeframe. Rather, the Commission has determined that if the
application fee schedule may require an amendment pursuant to
section 8(c), the Commission will initiate a rulemaking to seek
comment on any proposed amendment(s) to the application fee
schedule. The Commission does so here.
\154\ 2020 Application Fee Report and Order, 35 FCC Rcd 15089,
15092, para. 11 (adopting the methodology proposed in the 2020
Application Fee Notice of Proposed Rulemaking to ``base the
application fees on an estimate of direct labor costs where
possible,'' as modified therein); id. at 15132, para. 137 (``We
adopt the proposed cost-based cable landing license fees in the
[2020 Application Fee Notice of Proposed Rulemaking] with one change
to reduce the cost of a pro forma assignment or transfer of
control.''); 2020 Application Fee Notice of Proposed Rulemaking, 36
FCC Rcd 1618, 1654-55, para. 140.
\155\ This fee rate became effective on March 2, 2023.
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D. Improving the Quality of the Circuit Capacity Data
175. The Commission receives two types of annual circuit capacity
reports regarding U.S.-international submarine cables.\156\ First,
licensees of a submarine cable between the United States and any
foreign point must report the capacity of the submarine cable as of
December 31 of the reporting period (i.e., available capacity) and two
years from the reporting period (i.e., planned capacity). Second, cable
landing licensees and common carriers must report their capacity on
submarine cables between the United States and any foreign point as of
December 31 of the reporting period.\157\ The Commission has found that
the data from the circuit capacity reports are necessary for the
Commission to fulfill its statutory obligations and serve a vital
public interest role for other Federal agencies.\158\ The Committee
regularly requests this data for its work on national security and law
enforcement issues,\159\ as has DHS for its national security and
homeland security functions.\160\ The Commission has honored these
requests for access to the data that has been filed on a business
confidential basis after giving the filers an opportunity to comment.
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\156\ The requirement to file submarine cable circuit capacity
data dates back to the 1970s when it was included as a condition in
many of the international section 214 authorizations granted by the
Commission. R The requirement was subsequently incorporated into the
Commission's rules and extended to all facilities-based
international common carriers and to cable landing licensees.
Pursuant to Sec. 43.82 of the rules, authority is delegated to the
Chief of the Office of International Affairs to prepare instructions
and reporting requirements for the filing of these reports prepared
and published as a Filing Manual.
\157\ Any U.S. international common carrier or cable landing
licensee that owned or leased capacity on a submarine cable between
the United States and any foreign point on December 31 of the
reporting period is required to file capacity amounts for the
following categories: (1) owned capacity; (2) net indefeasible
rights-of-use (IRUs); (3) net inter-carrier leaseholds (ICLs); (4)
net capacity held (i.e., the total of categories (1) through (3));
(5) activated capacity; and (6) non-activated capacity.
\158\ 2017 Part 43.62 Report and Order, 82 FR 55323 (November
21, 2017), 32 FCC Rcd at 8118, para. 5 (``The circuit capacity data
provide information on ownership of submarine cable capacity that is
used for national security and public safety purposes.'').
\159\ See, e.g., Letter from David Plotinsky, Acting Chief,
Foreign Investment Review Section, National Security Division, U.S.
Department of Justice, to Denise Coca, Chief, Telecommunications and
Analysis Division, International Bureau, FCC (Jul. 19, 2021) (on
file in IB Docket No. 21-439) (requesting access to circuit capacity
data for the 2015 to 2020 reporting periods, including data for
which confidential treatment has been requested).
\160\ See Letter from Bryan S. Ware, Assistant Director,
Cybersecurity Division, Cybersecurity and Infrastructure Security
Agency, DHS, and Scott Glabe, Assistant Secretary for Trade and
Economic Security Office of Strategy, Policy, and Plans, DHS, to
Denise Coca, Chief, Telecommunications and Analysis Division,
International Bureau, FCC (Mar. 5, 2020) at 1 (DHS March 5, 2020
Letter) (on file in IB Docket No. 19-32) (requesting access to
circuit capacity data for the 2015 to 2019 reporting periods,
including data for which confidential treatment has been requested).
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176. In light of the Commission's goal in this proceeding to
strengthen the Commission's ability to assess national security, law
enforcement, and other concerns relating to submarine cable
infrastructure and its ownership and operation, the Commission seeks
comment on how the Commission could improve the collection of circuit
capacity data. The Commission also seeks comment on streamlining the
process for sharing the confidential data provided in the reports with
other Federal agencies for national security, law enforcement, and
emergency preparedness purposes. Below the Commission discusses and
seeks comment on how to improve the quality and usefulness of the data
and provide greater clarity on the reporting requirements to Filing
Entities.\161\
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\161\ For purposes of this section, the Commission uses the term
``Filing Entities'' to refer to a person or entity that is required
to file information with the Commission pursuant to Sec. 43.82.
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1. Cable Operators Report
a. Who Should File a Cable Operator Report
177. Section 43.82 of the Commission's rules requires the licensee
or licensees to report the available and planned capacity of the cable.
The current Filing Manual requires that, ``[w]here there are multiple
licensees for a cable, only one cable landing licensee may file the
Cable Operator Report for that cable. The licensees shall determine
which licensee will file the capacity data for that submarine cable.''
This requirement is based on a rule that the Commission initially
adopted in the 2013 Part 43 Second Report and Order (78 FR 15615, March
12, 2013).\162\ Subsequently, in the 2017 Part 43.62 Report and Order,
the Commission removed this requirement from the rules, noting the
concerns raised in the proceeding ``that allowing only one licensee to
file the Cable Capacity Report for a consortium cable requires
licensees to share information about their capacity and planned
upgrades that may be competitively sensitive.'' The Commission directed
the International Bureau ``to consult with stakeholders on appropriate
changes to the Filing Manual to allow for more than one licensee to
file a cable operator report for a submarine cable if appropriate.''
\163\
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\162\ 2013 Part 43 Second Report and Order, 28 FCC Rcd at 629-
630, Appx. C, para. 5 (adopting a requirement under Sec. 43.62 of
the rules that ``[o]nly one cable landing licensee shall file the
capacity data for each submarine cable. For cables with more than
one licensee, the licensees shall determine which licensee will file
the reports'').
\163\ 2017 Part 43.62 Report and Order, 32 FCC Rcd at 8132,
para. 34 (``We agree that the consortium cable reporting requirement
raises issues requiring modification of the Commission's rules'').
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[[Page 12076]]
178. The Commission seeks comment on whether the Filing Manual
should be revised to allow more than one licensee of a submarine cable
to file a cable operator report for a submarine cable that has multiple
licensees. The Commission seeks comment on whether and how it can
retain the single-filer requirement set out in the Filing Manual while
addressing any cable landing licensee concerns about sharing of
competitively sensitive information with other joint licensees. As the
Commission has previously stated, the data are critical for analyzing
international transport markets and for national security, defense, and
public safety responsibilities.\164\ The Commission also notes that it
has found there are no alternative reliable third party commercial
sources for the reported data.\165\ The Commission contemplates that
requiring each joint licensee to submit a cable operator report
capturing its own available capacity and planned capacity on the cable
may not produce reliable information about the overall cable capacity
given that joint licensees may report their data inconsistently. Such
an approach may also be duplicative of how those licensees report their
owned capacity on that cable in the capacity holder report.\166\ Given
the important public interest benefits of the cable operator reports,
is it in the public interest to retain the current requirement in the
Filing Manual that only one licensee of a submarine cable may file the
cable operator report for that cable?
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\164\ See also id. at 8130, para. 29, n.111 (stating, among
other things, ``[t]he data on submarine cable capacity by region
that the Commission collects and makes available provide potential
entrants or new investors with an accurate industry overview showing
where cable capacity connecting the United States to foreign points
is presently deployed [and] provide potential new entrants,
investors, and other small business entities with business planning
data for assessing potential market demand'').
\165\ In the 2017 Part 43.62 Report and Order, the Commission
stated, ``[a]lthough certain cable capacity data may be available
through other sources, those sources are not as reliable as
information that has been submitted to a federal agency and verified
by officials in the company.'' Id., 32 FCC Rcd at para. 29 (``For
example, TeleGeography's submarine cable reports include capacity
information, but the data are not verified by company officials.'').
\166\ Moreover, discrepancies in the data indicate that
aggregation of data from the capacity holder reports, such as
aggregation of owned capacity by cable, would not be an adequate or
reliable substitute for the available capacity data that are
collected in the cable operator reports.
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179. To the extent commenters propose alternative methods, the
Commission requests detailed explanation of how such methods would
ensure the dataset fully accounts for the available capacity and
planned capacity of each submarine cable. Are there alternative methods
that would enable the Commission and the Committee to obtain reliable
and accurate data about the capacity of submarine cables, while
responding to any concerns of joint licensees about sharing
competitively sensitive information? Should the Commission allow joint
licensees of a submarine cable to separately report the available and
planned capacity of fiber pairs if they each own and operate their own
fiber pair on the cable? Should the Commission also require each
licensee to identify in the report all other licensees, if any, on
whose behalf it submits the capacity information for the cable? \167\
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\167\ The Filing Manual currently advises that ``[i]f a Filing
Entity is filing a Cable Operator Report on behalf of other cable
landing licensees on the cable, the Filing Entity should email the
International Bureau with the list of licensees for which it is
filing data.''
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b. What Data Should Be Reported in a Cable Operator Report
180. Section 43.82 requires licensees to report ``the capacity of
the submarine cable'' and ``the planned capacity of the submarine
cable.'' While Sec. 43.82 does not define the term ``capacity of the
submarine cable,'' in the 2013 Part 43 Second Report and Order, the
Commission explained that cable landing licensees will be required to
report the ``available capacity'' and ``planned capacity'' of an
international submarine cable. The Commission stated that ``[a]vailable
capacity is all of the capacity currently available on the cable using
equipment currently used on the cable'' and that ``[p]lanned capacity
is the intended capacity of the international submarine cable two years
out from the reporting date (December 31 of the reporting period plus
two years) based on the plans of the cable operators for upgrades to
the technology used with the cable.'' On December 28, 2018, the
International Bureau released a revised Filing Manual which, among
other things, clarified the definition of ``available capacity'' to
ensure that the cable operator reports capture all of the capacity of
the cable.\168\ Specifically, the revised Filing Manual defined the
term ``available capacity'' as ``also known as design capacity,''
noting that ``[a]vailable capacity, also known as design capacity, is
all of the capacity (both lit and unlit capacity) on the cable as of
the reporting date (December 31 of the reporting period).'' \169\
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\168\ In 2017, the Commission streamlined the international
reporting requirements and eliminated the traffic and revenue
reports and the requirement to file terrestrial and satellite
circuit data, but retained the requirement to file submarine cable
operator and capacity holder reports under a newly codified Sec.
43.82. The rule changes went into effect in April 2018. By Public
Notice, the International Bureau released a revised Filing Manual
that included only the instructions for filing the Sec. 43.82
circuit capacity reports, in light of the elimination of the traffic
and revenue reports and terrestrial and satellite data, and also
stated, ``[b]ased on questions received from Filing Entities this
year, the revised Filing Manual also clarifies the definition of
`available capacity' in the submarine cable operator reports.''
\169\ The current Filing Manual contains this definition of
``available capacity'' for purposes of the cable operator report.
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181. Based on Commission staff review of the annual cable operator
data and questions that staff receive from Filing Entities, the
Commission believes that clarifying the term ``available capacity''
would improve the consistency of data submitted in the cable operator
reports. The Commission seeks comment on whether the Commission should
use a different definition of ``available capacity'' than set out in
the Filing Manual. If so, how should the Commission define ``available
capacity''? Should the definition be codified in the rules or is it
appropriate to define the term in the Filing Manual? Would adopting a
definition in the rule rather than the Filing Manual better ensure that
Filing Entities use a consistent method of reporting the capacity of a
submarine cable?
182. The Commission seeks comment on whether it should continue to
use the definition in the Filing Manual, where ``available capacity''
of a submarine cable is also referred to as ``design capacity.''
Alternatively, the Commission seeks comment on whether to distinguish
between ``available capacity'' and ``design capacity'' to the extent
this distinction is consistent with current developments in the
submarine cable market and technology. The Commission seeks comment on
whether the ``design capacity'' of a submarine cable is more
appropriately understood as the maximum theoretical capacity based on
equipment currently used on the cable, or as the maximum theoretical
capacity based on the current plans of a cable operator to upgrade the
technology used with the cable.
183. The Commission assesses regulatory fees on submarine cables
based on the lit capacity of the cable.\170\ The Commission seeks
comment on whether the Commission should collect information though the
circuit capacity reports on the lit capacity of each
[[Page 12077]]
licensed and operating cable system that can be used to determine tiers
for assessing regulatory fees for submarine cable operators and the fee
amount for each tier.\171\
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\170\ See 2024 Regulatory Fee Second Report and Order at para.
87(7) (regulatory fees for submarine cable are assessed on a per
cable landing license basis based on lit circuit capacity as of
December 31 of the relevant fiscal year).
\171\ The Commission uses ``lit capacity'' for assessing
regulatory fees because ``that is the amount of capacity that
submarine cable operators are able to provide services over and the
regulatory fee is in part recovering the costs related to the
regulation and oversight of such services.''
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184. The Commission seeks comment as to how Filing Entities are
measuring available capacity, given that the current and potential
capacity of fiber optic submarine cables depends on the equipment
currently used on a submarine cable and developments in the latest
technology. The capacity of fiber optic submarine cables in the current
market can change significantly (e.g., by orders of magnitude) and
quickly (e.g., in a matter of days), depending on the latest technology
and the equipment that is attached on those cables. The Commission
seeks comment on whether it needs to update its circuit capacity rules
and reporting requirements to reflect the current dynamics of the
submarine cable market.
185. The Commission also seeks comment on how and to what degree
the initial design capacity of a submarine cable is subject to change
over time due to planned upgrades. How frequently do cable operators
upgrade or plan to upgrade equipment on a submarine cable, such as
SLTEs, and how does this implementation affect assessment of current
and future capacity on the cable? Should the Commission reconsider the
definition in the Filing Manual and instead define ``available
capacity'' of a submarine cable as all of the capacity (both lit and
unlit capacity) on the cable based on equipment currently used on the
cable? If so, should the Commission include an additional category in
the cable operator report for reporting ``design capacity,'' separate
from reporting ``available capacity'' and ``planned capacity''? Or
should the Commission require Filing Entities to report ``design
capacity,'' ``current equipped capacity,'' and ``planned capacity'' in
the cable operator report? The Commission also seeks comment on whether
the concept of ``design capacity'' is similar to or distinct from the
``planned capacity'' data collected by the Commission.\172\ The
Commission asks commenters to provide detailed comments, including any
relevant facts and circumstances related to the technology, the market,
or other factors, that can inform these proposed definitions and the
assessment of whether to revise the reporting methodology in the cable
operator report.
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\172\ The Filing Manual states that ``[p]lanned capacity is the
entire intended capacity (both lit and unlit capacity) of the cable
two years out from the reporting date (December 31 of the reporting
period plus two years) based on current plans to upgrade the
capacity of the cable.''
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2. Capacity Holders Report
a. Who Should File a Capacity Holder Report
186. Section 43.82 requires cable landing licensees and common
carriers to report their capacity on international cables. Because this
reporting requirement only applies to licensees and common carriers,
there exists a gap in the Commission's knowledge of the entities that
hold capacity on a particular cable as other entities that hold
capacity on that cable are not required to report their capacity. This
is borne out by the Commission's circuit capacity data. According to
the annual capacity holder data, there is substantial capacity leased
or purchased from cable landing licensees and common carriers that is
not accounted for in the data.\173\ The Commission seeks comment on the
scope of this issue, whether this raises national security concerns,
and whether the Commission should and under what authority require
other entities to report their capacity.
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\173\ For example, the capacity holder data for the 2022
reporting period reflect total net IRUs of -315,566.7 Gbps and total
net ICLs of -120,988.1 Gbps, including net IRUs of -92,977.3 Gbps
and net ICLs of -45,232.2 Gbps in the Americas region, net IRUs of -
192,593.3 Gbps and net ICLs of -63,050.1 Gbps in the Atlantic
region, and net IRUs of -29,996.1 Gbps and net ICLs of -12,705.8
Gbps in the Pacific region. In addition, the capacity holder data
for the 2021 reporting period reflect total net IRUs of -248,551.6
Gbps and total net ICLs of -120,477.4 Gbps, including net IRUs of -
78,865.1 Gbps and net ICLs of -38,099.7 Gbps in the Americas region,
net IRUs of -161,244.7 Gbps and net ICLs of -54,614.6 Gbps in the
Atlantic region, and net IRUs of -8,441.8 Gbps and net ICLs of -
27,763.1 Gbps in the Pacific region.
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187. The Commission seeks comment on whether it should require all
entities that hold capacity on cables landing in the United States to
file capacity holder reports. Would requiring the filing of circuit
capacity data by all entities that hold capacity on submarine cables--
including capacity held through ownership in a cable, an IRU, an ICL,
or on a fiber or spectrum basis--reduce the gap in the data and provide
the Commission and its Federal partners with greater insight into the
ownership and use of capacity on submarine cables? Are there certain
entities, such as the U.S. Government, that should be exempt from
reporting their capacity holdings? If the Commission requires other
entities to report their capacity, should there be a threshold for the
reporting requirement (e.g., 1 Gbps)? Alternatively, or in addition to
requiring all holders of capacity on submarine cables landing in the
United States to annually file data regarding their capacity holdings,
the Commission seeks comment on whether it should require cable landing
licensees and common carriers to include in their annual capacity
holder reports a list of customers to whom they sold or leased capacity
as of December 31 of the reporting period. To the extent the Commission
adopts these approaches, the Commission proposes to share with its
Federal partners the information that is collected pursuant to such
requirements, including any information for which confidential
treatment is requested, through the procedures the Commission proposes
in the NPRM with respect to sharing annual circuit capacity data with
the Committee and DHS. The Commission seeks comment on these approaches
and on the potential burdens on affected entities. The Commission seeks
comment as to which of these approaches would be less burdensome, and
whether any such information requirements could be designed to minimize
the burdens on potential new filers, including small entities. The
Commission also seeks comment generally on the potential benefits
associated with any collection of information under these approaches.
188. The Commission seeks comment on whether the Commission has
legal authority pursuant to the Cable Landing License Act, the
Communications Act, or any other sources of authority, to require
capacity holders not already subject to Sec. 43.82, to submit data
regarding their capacity on submarine cables landing in the United
States. The Commission has long determined that it has authority to
require the filing of circuit capacity data from cable landing
licensees and common carriers pursuant to the Cable Landing License Act
and Executive Order 10530 and section 214 of the Communications
Act.\174\ While the Commission adopted the circuit capacity reporting
requirements for a specific class of non-common carriers in the 2013
Part 43 Second Report and Order, the Commission noted that the
provisions of the Cable Landing License Act ``do not distinguish
between common carriage and non-common carriage of services over
licensed cables.'' The Commission seeks comment on whether the
Commission's authority to require the filing of circuit
[[Page 12078]]
capacity data extends to any and all entities--beyond cable landing
licensees and title II common carriers--holding capacity on submarine
cables landing in the United States.\175\ The Commission seeks comment
on whether this information is necessary for the Commission to make
informed decisions on matters within its jurisdiction and to carry out
its statutory duties. This includes, for example, assessing whether to
grant or deny applications for cable landing licenses or revoke
licenses in the interest of national security or competition. Further,
the Commission seeks comment on whether the Commission could rely on
ancillary authority in conjunction with other primary sources of legal
authority in adopting such a requirement.\176\
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\174\ See 2017 Part 43.62 Report and Order, 32 FCC Rcd at 8130,
para. 30; 2013 Part 43 Second Report and Order, 28 FCC Rcd at 606,
para. 104.
\175\ In this document, the Commission addresses separately
whether to apply the circuit capacity reporting requirements to
entities that provide only broadband internet access service (BIAS).
\176\ To exercise ancillary authority ``two conditions [must be]
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.''
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189. BIAS Providers. In the 2024 Open internet Order, the
Commission reclassified BIAS as a telecommunications service under
title II of the Communications Act. In that Order, the Commission
waived the current rules implementing section 214(a) through (d) of the
Communications Act with respect to BIAS to the extent they are
otherwise applicable, including Sec. 43.82,\177\ stating that it
``expects to release a Further Notice of Proposed Rulemaking at a
future time to examine whether any section 214 rules specifically
tailored to BIAS, including for small providers, are warranted.''
Although the 2024 Open internet Order was stayed by the Sixth Circuit
pending judicial review, the Commission seeks comment on whether and to
what extent the Commission should depart from the regulatory framework
contemplated by that Order insofar as the Order becomes operative after
judicial review. Given that all title II common carriers are required
to file annual circuit capacity reports under Sec. 43.82(a)(2) of the
rules, the Commission seeks comment generally on whether the Commission
should consider retaining or removing the waiver of Sec. 43.82 of the
rules as applied to BIAS providers, subject to judicial review of that
Order. Do the important public interest benefits of the circuit
capacity data collection warrant the collection of capacity holder data
from entities providing only BIAS? The Commission seeks comment, for
example, on whether such information would provide the Commission and
its Federal partners important insight into the ownership and use of
submarine cable capacity for national security and public safety
purposes.
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\177\ 2024 Open internet Order at *133, para. 344 (``We find
that the public interest is served by this waiver as it will ensure
that consumers can continue to receive the broadband internet access
services to which they presently subscribe and avoid any disruption
to, or uncertainty for, BIAS consumers and BIAS providers'').
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190. Further, if the Commission were to eliminate the waiver,
should the Commission adopt the same requirements applicable to all
other reporting entities or tailored requirements as applied to
entities providing only BIAS? For example, should a transition period
be provided for entities providing only BIAS to submit an initial
capacity holder report? What potential burdens, if any, would be
imposed on such BIAS providers if they were required to file data
regarding their submarine cable capacity, including capacity held
through ownership in a cable, an IRU, an inter-carrier lease (ICL), or
on a fiber or spectrum basis? To the extent the Commission adopts any
changes to Sec. 43.82 of the rules and the current reporting
requirements as addressed in the NPRM, the Commission seeks comment on
whether those changes should similarly be applied to entities providing
only BIAS as well as the potential burdens, if any, that would be
imposed upon such BIAS providers.
b. What Data Should Be Filed in a Capacity Holder Report
191. Section 43.82 does not specify the data to be reported in the
capacity holder report. The Commission, however, stated in the 2013
Part 43 Second Report and Order that cable landing licensees and common
carriers should report their available capacity on a cable ``by the
type of ownership interest they have in the capacity--ownership in the
cable, an indefeasible right of use (IRU) or an inter-carrier lease
(ICL).'' The Commission further explained that available capacity
consists of the sum of (1) capacity that a Filing Entity owns; (2) the
net of IRUs leased from other capacity holders less IRUs leased to
other capacity holders; and (3) the net of ICLs leased from other
capacity holders less ICLs leased to other capacity holders. These
requirements are reflected in the Filing Manual.\178\
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\178\ Each Filing Entity is required to calculate its available
capacity as the sum of (1) cable ownership; (2) the net of IRUs
leased from other entities less IRUs leased to other entities; and
(3) the net of ICLs leased from other entities less ICLs leased to
other entities.
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192. As discussed above in the context of cable operator reports,
the Commission seeks comment on how the Commission should define
``available capacity.'' The Commission also seeks comment on whether it
should require Filing Entities to use the same definition of
``available capacity'' when reporting their owned capacity in their
capacity holder reports. To assess the accuracy of reported data, the
Commission's current practice is to compare the total available
capacity reported in the cable operator reports with the total owned
capacity reported in the capacity holder reports by region.\179\ Should
the Commission ensure that these data continue to be consistent and
comparable for purposes of the Commission's assessment and use of the
data for national security and public safety purposes? \180\ The
Commission also seeks comment on whether any approach the Commission
may adopt with regard to defining the ``available capacity'' of a
submarine cable should similarly be applied to other data submitted in
the capacity holder report, including the net amount of IRUs,\181\ net
amount of ICLs,\182\ and net capacity, and whether the net capacity is
activated (i.e., lit) or non-activated (i.e., unlit). Overall, would
requiring Filing Entities to apply the approach used to define
``available
[[Page 12079]]
capacity'' of a submarine cable to similarly report their capacity
holdings assist the Commission's efforts to verify the accuracy and
consistency of the data reported in the cable operator reports and
capacity holder reports?
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\179\ Ideally, the Commission expects that the total available
capacity reported in the cable operator report for a given cable
(filed on behalf of the licensee or joint licensees) should match
the aggregated owned capacity reported in all of the capacity holder
reports on that cable. Thus, the Commission expects that the total
available capacity and the total owned capacity by region should
also match, though there may be discrepancies between these figures.
For example, some amount of capacity may be owned by non-reporting
entities, such as entities that own capacity on a cable through an
ownership interest in the submarine cable system but are not
required to be a licensee under Sec. 1.767(h) of the Commission's
rules and are otherwise not common carriers.
\180\ For instance, if the Commission adopts a definition in the
rules that ``[a]vailable capacity, also known as design capacity, is
all of the capacity (both lit and unlit capacity) on the cable as of
the reporting date (December 31 of the reporting period),'' should
the Commission clarify that Filing Entities must report their owned
capacity using a similar methodology? On the other hand, if the
Commission distinguishes between ``available capacity'' and ``design
capacity'' and create separate categories for reporting these data
in the cable operator report, how should Filing Entities report
their owned capacity on a submarine cable in the capacity holder
report?
\181\ See Filing Manual at 11 (``Indefeasible Right of Use (IRU)
refers to an arrangement in which the holder has made an upfront
payment for the full length of the lease, such as 5, 10, 20 years,
or the remaining useful life of the asset.'').
\182\ See id. at 11 (``Inter-Carrier Lease (ICL), for Sec.
43.82 reporting purposes, refers to a lease of bare capacity between
one entity and another.'').
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193. The Commission seeks comment on whether the capacity holder
report should be revised to capture new developments in the
provisioning of capacity in the submarine cable market. In the 2017
Part 43.62 Report and Order, the Commission noted the comments raised
in the proceeding, ``that in addition to sales through IRUs and ICLs,
capacity is now sold on a fiber pair or spectrum basis.'' \183\ The
Commission seeks detailed comments on any new facts or circumstances
which may inform the Commission's understanding of how capacity is
owned, sold, or leased in the submarine cable market, and how to
capture this information in the capacity holder report if appropriate.
In particular, information about capacity held on a submarine cable is
relevant to Commission and other Federal Government agency assessments
of the impact on communications during national security or public
safety emergencies, including where a cable is rendered inoperable, and
to factor the information into emergency response efforts. Currently,
to what extent is submarine cable capacity sold or leased through IRUs,
short-term leases, or other means such as on a fiber pair or spectrum
basis? How is submarine cable capacity sold or leased by fiber pair or
spectrum? Does the licensee of a submarine cable sell or lease capacity
by fiber pair or spectrum to other entities, or do entities other than
the licensee of a cable also sell or lease capacity by fiber pair or
spectrum? Where a cable landing licensee sells or leases capacity by
fiber pair to other entities, how does the licensee maintain de jure
and de facto control of the U.S. portion of the submarine cable system
as required by the Commission's rules? Is there additional information
related to these and other types of capacity holdings that would
enhance the Commission's understanding of the ownership and use of
capacity or assist the Commission in the protection, restoration, and
resiliency of submarine cable infrastructure during national security
or public safety emergencies?
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\183\ The Commission directed the International Bureau ``to
consult with stakeholders and to review and revise as needed the
categories of ownership interests reported in the cable capacity
holder reports to reflect changes in industry's provisioning of
capacity, while ensuring that the capacity holder data are
accurately captured by the Commission's reporting requirements.''
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194. To the extent the Commission revises the capacity holder
report to include additional categories of capacity holdings, how
should such information be reported? For instance, if the Commission
includes additional categories for reporting capacity that is sold,
purchased, or leased by fiber pair or spectrum, how should Filing
Entities calculate the net capacity they hold on the submarine cable?
\184\ Should Filing Entities report those capacity holdings as an
amount in Gbps? Should the Commission require Filing Entities to
annually report all whole fiber pairs that they own (including for
their own use or which they have leased out) or manage on submarine
cables landing in the United States? Do national security, law
enforcement, or other concerns warrant that the Commission obtain
updated information each year confirming who currently owns and/or
manages the fiber pairs on such submarine cables, especially if the
entity that manages the fiber pair of a particular cable is not the
licensee whose original application was subject to review by the
Committee? The Commission also seeks comment on what it means for an
entity to ``manage'' a fiber pair to the extent the role and
capabilities differ from solely having ownership of a fiber pair. To
the extent the manager of a fiber pair is neither a cable landing
licensee nor a common carrier subject to Sec. 43.82 of the rules,
should the Commission require that the licensee of a submarine cable
landing in the United States identify the entities that own and/or
manage each fiber pair on the cable? Should the Commission require
Filing Entities to identify the U.S. and foreign landing points of any
fiber pair that they sell or lease to other entities for use of
capacity? Should any or all of this information be provided in the
cable operator report, capacity holder report, or a separate report?
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\184\ In this document, the Commission also seeks comment on
whether holding capacity on the cable system should be defined to
include the leasing, purchasing, selling, buying, or swapping of a
fiber (spectrum, capacity, partial fiber pair, or a full fiber pair,
among others) for transmission of voice, data, and internet over the
cable system to interconnect with a U.S. terrestrial network.
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3. Reporting of Capacity on Domestic Cables
195. The requirement to file circuit capacity reports applies only
to U.S-international cables, and not to domestic cables (cables that do
not connect the United States with foreign points).\185\ However, the
national security environment has changed significantly since the
Commission adopted this approach in 2013. In light of evolving national
security, law enforcement, and other risks, the Commission seeks
comment on whether the distinction between U.S.-international submarine
cables and domestic submarine cables for purposes of reporting circuit
capacity information is justified. The Commission seeks comment on
whether the lack of information on domestic cables creates a critical
gap in the Commission's insight into the ownership and use of capacity
on submarine cables regulated by the Commission. For example, would
collecting capacity information regarding domestic submarine cables
allow the Commission and the Committee to identify whether any entities
associated with a ``foreign adversary'' country, as defined in the
Department of Commerce's rule, hold capacity on those cables? Would
this information enhance the Commission's ability to use the circuit
capacity data to assist in the protection, restoration, and resiliency
of submarine cable infrastructure during national security or public
safety emergencies, even where there is no foreign ownership,
especially given the role that domestic submarine cables also have in
providing connectivity among the continental United States and Alaska,
Hawaii, Guam, American Samoa, the Northern Mariana Islands, Puerto
Rico, and the U.S. Virgin Islands?
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\185\ Licensees and common carriers are not required to file a
cable operator report or capacity holder report with respect to
submarine cables that only connect points within the United States,
such as cables connecting the Hawaiian Islands or Alaska to the
conterminous United States.
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196. If the Commission finds that circuit capacity reports should
be filed for domestic cables, the Commission seeks comment on whether
it should require Filing Entities to include in the cable operator
report and the capacity holder report the same capacity information
that the Commission collects for U.S.-international submarine cables,
with respect to submarine cables that do not have a foreign landing
point and connect (1) Alaska, Hawaii, or the U.S. territories or
possessions with the continental United States or with each other, and
(2) points within the continental United States, Alaska, Hawaii, or a
territory or possession in which the cable is laid within international
waters. Alternatively, should Filing Entities be required to provide
more limited or tailored capacity information relating to domestic
submarine cables in a separate report? The Commission seeks comment on
these approaches and on potential
[[Page 12080]]
burdens on licensees and common carriers if the Commission requires
that they include capacity data for domestic submarine cables in cable
operator reports and capacity holder reports.
4. Other Issues With Reporting of Circuit Capacity Data
a. Reporting of Submarine Line Terminal Equipment
197. As discussed above, the SLTE is among the most important
equipment associated with the submarine cable system for national
security and law enforcement purposes. Given the importance of this
equipment and who controls and operate the SLTE, the Commission seeks
comment on whether the Commission should require all Filing Entities to
identify in the annual capacity holder report whether they control or
operate their own SLTE on any of the U.S. or foreign ends of a
submarine cable landing in the United States. In addition, should the
Commission require all Filing Entities to file a notification of any
installation of their own SLTE on the U.S. or foreign ends of a
submarine cable landing in the United States, within a certain time
period following such installation (such as 30 days)? If the Commission
were to extend the circuit capacity reporting requirements to new
entities not currently subject to Sec. 43.82, as addressed herein,
should the Commission require such entities to similarly identify in
the annual capacity holder report, or in a separate report, whether
they control or operate their own SLTE and to provide notification of
any installation of their own SLTE within a certain time period (such
as 30 days)? To the extent the Commission adopts these approaches, the
Commission proposes to share with its Federal partners the information
that is collected pursuant to such requirements, including any
information for which confidential treatment is requested, through the
procedures. The Commission seeks comment on these approaches and what
potential burdens, if any would be imposed by requiring such
information.
b. Which Corporate Entity May File Reports
198. The Filing Manual requires affiliated entities to file
separate circuit capacity reports to the extent that they are
considered to be separate legal entities, unless the Commission has
authorized such affiliated entities to submit a consolidated FCC Form
499-A filing.\186\ The Commission chose to use this standard for
administrative convenience because common carriers are familiar with
this requirement. This requirement originated when the Filing Manual
covered not only the Circuit Capacity Reports but also the
International Traffic and Revenue Reports, which were filed by common
carriers and interconnected Voice over internet Protocol (VoIP)
providers, which also had to file FCC Form 499 reports. The Filing
Manual retained this requirement even after the Commission eliminated
the International Traffic and Revenue Reports and the Filing Manual now
only covers the circuit capacity reports.\187\
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\186\ The Filing Manual states that affiliated companies ``must
file separate section 43.82 reports to the extent that they are
considered to be separate legal entities where they have separate
articles of incorporation, articles of formation, or similar legal
documents,'' but where the Commission has authorized them ``to make
a consolidated FCC Form 499-A filing, the affiliated companies
similarly shall make a consolidated section 43.82 filing.''
\187\ Previously, any person or entity that holds an
international section 214 authorization to provide International
Telecommunications Services (ITS) and/or any person or entity that
is engaged in the provision of Interconnected Voice over internet
Protocol (VoIP) Services through the Public Switched Telephone
Network (PSTN) between the United States and any foreign point was
required to file an annual Traffic and Revenue Report.
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199. The Commission seeks comment on whether to allow any
subsidiary, parent entity, or affiliate of a Filing Entity to file the
annual circuit capacity reports on behalf of the Filing Entity, so long
as the subsidiary, parent entity, or affiliate identifies the Filing
Entity in the reports. Specifically, should the Filing Manual be
revised to allow any subsidiary, parent entity, or affiliate to file
the annual circuit capacity reports on behalf of a Filing Entity? Is
there any reason to parallel the filing procedure applicable to FCC
Form 499-A filings? To what extent do current Filing Entities comprise
of telecommunications carriers or other providers that are required to
submit FCC Form 499-A filings? \188\
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\188\ The Communications Act requires that the Commission
establish mechanisms to fund universal service, interstate
telecommunications relay services, the administration of the North
American Numbering Plan, and the shared costs of local number
portability administration. To accomplish these congressionally-
directed objectives, the Commission requires telecommunications
carriers and certain other providers of telecommunications
(including Voice over internet Protocol (VoIP) service providers) to
report each year on the FCC Form 499-A the revenues they receive
from offering service.
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200. The Commission seeks comment generally on whether it is common
practice for cable landing licensees and common carriers to maintain,
track, or consolidate their capacity information with affiliated
entities in the ordinary course of business. In such cases, the
Commission seeks comment on what potential burdens, if any, would be
imposed upon Filing Entities if the Commission were to require all
affiliated entities to file their own annual circuit capacity reports
instead of submitting consolidated reports. If a subsidiary, parent
entity, or affiliate files the annual circuit capacity reports on
behalf of a Filing Entity, how can the Commission improve the
efficiency of its current practice, which involves informal inquiries
by Commission staff, to confirm whether the Filing Entity has complied
with its reporting obligations? \189\ To the extent a subsidiary,
parent entity, or affiliate of a Filing Entity submits the circuit
capacity reports on the of a Filing Entity's behalf, the Commission
tentatively concludes that the Filing Entity shall be held accountable
for any defects in the certification as to the accuracy and
completeness of information filed in the circuit capacity reports.\190\
Should the Commission codify such a requirement in the rules? Should
the Commission also codify the requirement in the Filing Manual that an
officer of the Filing Entity must certify the accuracy and completeness
of the Filing Entity's Sec. 43.82 information? If a subsidiary, parent
entity, or affiliate files the annual circuit capacity reports on
behalf of a Filing Entity, should an officer of the Filing Entity
submit a separate attachment certifying that the information in the
reports is accurate and complete? The Commission seeks comment on
whether and why an alternative approach may be more desirable, and how
the Commission could implement any alternative approach while retaining
the ability to enforce compliance against a Filing Entity.
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\189\ The Filing Manual advises that ``[i]f a Filing Entity is
filing a consolidated section 43.82 report or filing on behalf of an
affiliated entity or entities, we ask the Filing Entity to email the
International Bureau with the list of entities for which it is
filing data.'' The Commission seeks comment on any alternative, more
efficient methods that it can use to confirm that an entity has
complied with its reporting obligations.
\190\ Filing Manual at 5, para. 21 (``Filing Entities must
certify on the Registration Form the accuracy and completeness of
the data filed in the accompanying Circuit Capacity Report.'').
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c. Compliance
201. The Commission proposes to set forth in the rules that filing
false or inaccurate certifications or failure to file timely and
complete annual circuit capacity reports in accordance with the
Commission's rules and the Filing Manual shall constitute grounds for
enforcement action, including but not limited to a forfeiture,
revocation, or termination of the cable landing license
[[Page 12081]]
or international section 214 authorization, pursuant to the
Communications Act and any other applicable law. Although the Filing
Manual addresses consequences for failure to file timely Sec. 43.82
reports \191\ or submission of inaccurate or untruthful
information,\192\ the Commission tentatively concludes that addressing
the issue of compliance in the rules would ensure greater compliance
overall with the reporting requirements. The Commission seeks comment
on this proposal. The Commission also seeks comment on whether to allow
any exceptions to the reporting requirements of Sec. 43.82 and whether
the Commission should revise the rules or the Filing Manual
accordingly. For example, should the Commission revise Sec.
43.82(a)(2) of the rules or the Filing Manual to set out an exception
to the reporting requirements where a licensee that holds no capacity
in its licensed submarine cable--for example, where a joint licensee
only owns and/or controls a landing station(s) in the United States and
holds no capacity at the landing station(s) or other portion of the
cable--or any other cables landing in the United States need not file a
capacity holder report? Should the Commission require such licensees to
file an annual certification attesting to the continuing applicability
of such an exception?
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\191\ Id. at 3, para. 10 (``Failure to file the Circuit Capacity
Report on time is a violation of the Commission's rules and could
result in the imposition of forfeitures or other penalties.'').
\192\ Id. (``Inaccurate or untruthful information contained in
section 43.82 reports may lead to prosecution under section 220(e)
of the Communications Act or the criminal provisions of Title 18 of
the United States Code.'').
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5. Sharing the Circuit Capacity Data With Federal Agencies
202. The Commission seeks comment on adopting a rule which would
allow the Commission to share with other Federal Government agencies
the circuit capacity data filed on a confidential basis without the
pre-notification requirements of Sec. 0.442(d) of the Commission's
rules. Since 2019, the Commission has annually issued a public notice
to announce its intent to share the annual circuit capacity data with
DHS and subsequently the Committee pursuant to the procedures set out
in Sec. 0.442 of the Commission's rules, and no party has opposed such
disclosure of the circuit capacity data for which confidential
treatment was requested.\193\ Under this approach, the Commission would
be able to share the confidential data with Federal agencies that have
a legitimate need for the data consistent with their functions without
the delay attendant to providing parties an opportunity to object to
the sharing. The sharing of confidential circuit capacity data would,
however, continue to be subject to the requirement that each of the
other Federal agencies comply with the confidentiality protections
applicable both to the Commission and the other agency's relating to
the unlawful disclosure of information, and the Commission would
provide notice to the parties whose information is being shared.
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\193\ See also Letter from Ulises R. Pin, Counsel to ARCOS-1 USA
Inc. et al, Morgan, Lewis & Bockius LLP, to Marlene H. Dortch,
Secretary, FCC (Jul. 2, 2020) (on file in IB Docket No. 20-194)
(stating, ``[b]ecause the purpose of the disclosure is national
security, law enforcement and emergency response, the Commission
should only share confidential information contained in C&W
Networks' circuit capacity reports with DHS and other federal
agencies charged with national security, law enforcement and
emergency response, including those agencies forming part of the new
Committee for the Assessment of Foreign Participation in the United
States Telecommunications Services Sector. The Commission, however,
should not share this information other agencies that fall outside
of that scope.'').
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203. Federal Agencies' Need for the Information. The Commission may
share information that has been submitted to it in confidence with
other Federal agencies when they have a legitimate need for the
information and the public interest will be served by sharing the
information. The Commission has found that the data provided in the
Circuit Capacity Reports ``are essential for [the Commission's]
national security and public safety responsibilities in regulating
communications'' submarine cables and that ``circuit capacity data are
important for the Commission's contributions to the national security
and defense of the United States.'' The data are also useful for
Federal agencies in fulfilling their other duties and responsibilities.
The Commission contemplates that such sharing would include cable
operator data, capacity holder data, and the names and contact
information (including addresses, email addresses, telephone numbers,
and fax numbers) of individual points of contact identified in the
circuit capacity reports, as well as any additional information that is
collected pursuant to any new requirements adopted in this proceeding
or in a revised Filing Manual.\194\ The Commission seeks comment on
whether to make clear in Sec. 43.82 that sharing of the annual circuit
capacity data with other Federal Government agencies is subject to the
requirements of the confidentiality protections contained in the
Commission's regulations \195\ and 44 U.S.C. 3510, and, in the case of
the Committee, section 8 of Executive Order 13913 \196\ that require
the Committee to keep the information confidential.
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\194\ To the extent required, the Commission will ensure that
any new disclosures are fully covered by applicable Privacy Act
SORNs. Cf. IB-1, 86 FR 43238 (``Information filed with a request for
confidentiality may be disclosed to other Federal government
agencies pursuant to 47 CFR 0.442.'').
\195\ The Commission's regulations provide that confidential
proprietary and commercially sensitive information will be withheld
from public disclosure, subject to the public's right to seek
disclosure under the Freedom of Information Act and implementing
regulations.
\196\ Executive Order 13913, section 8.
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204. In addition, the Commission tentatively finds that several
agencies have a special need for the information contained in the
Circuit Capacity Reports. First, the Commission tentatively finds that
Executive Order 13913 provides a basis to share annual circuit capacity
data with the Committee by establishing that the members and advisors
of the Committee have a legitimate need for such information.\197\ The
policy of Executive Order 13913 is to ensure the ``[t]he security,
integrity, and availability of the United States telecommunications
networks [that] are vital to United States national security and law
enforcement interests.'' \198\ Further, in this regard, Executive Order
13913 authorizes the Committee to review not only license applications
but also existing licenses. The Department of Justice (DOJ), in its
capacity as Chair of the Committee, has stated in formal requests for
access to the annual circuit capacity data that this information ``will
enhance and improve the Committee's ability to execute its mission to
assess risk to the national security and law enforcement interests of
the United States.'' \199\ In the context of reviews within the scope
of Executive Order 13913, the Committee's important role in reviewing
applications and licenses for risks to national security and law
enforcement interests
[[Page 12082]]
establishes its legitimate need for the information. The Commission
seeks comment on this tentative conclusion.
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\197\ See 47 CFR 0.442(b)(2) (``Information submitted to the
Commission in confidence pursuant to Sec. 0.457(c)(2) and (3), (d)
and (g) or Sec. 0.459, or any other statute, rule or order, may be
disclosed to other agencies of the Federal government upon request
or upon the Commission's own motion, provided . . . The other agency
has established a legitimate need for the information . . . .'').
\198\ Under section 8 of Executive Order 13913, the Committee
``may seek information from applicants, licensees, and any other
entity as needed'' in furtherance of its reviews and assessments of
applications and licenses.
\199\ DOJ has explained that having circuit capacity information
``provides a clearer picture of how [submarine cables] are being
used, which better enables the Committee to evaluate international
data flows on various cables (and related issues such as internet
topography)'' and that ``[w]ith this data, the Committee has another
tool to assess data-security risk . . . [thus providing] additional
context to the Committee's risk-based analyses.''
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205. The Commission's established policy in the 2017 Part 43.62
Report and Order also provides a basis to share annual circuit capacity
data with DHS by establishing that DHS has a legitimate need for such
information. In that Report and Order, the Commission specifically
noted that DHS ``finds this information to be critical to its national
and homeland security functions'' and ``[DHS] states that this
information, when combined with other data sources, is used to protect
and preserve national security and for its emergency response
purposes.'' DHS has stated in formal requests for access to the annual
circuit capacity data that ``[t]his information, when combined with
other data sources, will be used to protect and preserve national
security and for the Department's emergency response purposes.'' DHS
has also stated that the data will ``enhance its efforts and inform its
analysis and decision-making that protect the resilience of the
Nation's critical infrastructure.''
206. Finally, the Commission tentatively finds that Executive Order
10530 provides a basis for the Commission to share annual circuit
capacity data with the State Department. Executive Order 10530, which
delegates the President's authority to license submarine cables to the
Commission, requires the Commission to obtain approval from the State
Department for any such action.\200\ The Commission's approach
contemplates sharing the annual circuit capacity data with the State
Department in light of the agency's legitimate need for the information
in furtherance of its functions related to approving (or disapproving)
Commission actions on submarine cable licenses. The Commission seeks
comment on this tentative conclusion.
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\200\ Executive Order 10530, section 5(a) (``Provided, That no
such license shall be granted or revoked by the Commission except
after obtaining approval of the Secretary of State . . . .'').
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E. Costs and Benefits
207. The Commission seeks comment on the potential benefits and
costs of the proposals discussed throughout the NPRM. The rule changes
identified in the NPRM would advance U.S. national security, law
enforcement, foreign policy, and trade policy interests. These
proposals are designed to update and formalize the submarine cable
rules and to enable the Commission to better identify and address
national security and law enforcement risks.
208. Among the proposals, in the NPRM, the Commission proposes to
codify the Commission's rules and legal requirements under the Cable
Landing License Act, adopt a process to withhold or revoke a cable
landing license, and adopt a three-year periodic review process for
cable landing licenses for national security and law enforcement
concerns. The Commission also seeks comment on shortening current 25-
year submarine cable license term or adopting a shorter license term in
combination with periodic reporting. The Commission proposes to adopt a
presumption that certain entities and their current and future
affiliates and subsidiaries shall not be qualified to become a new
submarine cable landing licensee if their international section 214
authority was previously denied or revoked on national security or law
enforcement grounds. The Commission proposes several certifications,
including a certification that applicants have created, updated, and
implemented cybersecurity risk management plans and that the submarine
cable system will not use covered equipment or services identified on
the Commission's ``Covered List'' that the Commission maintains
pursuant to the Secure and Trusted Communications Networks Act. The
Commission also proposes that all submarine cable landing licensees
certify as to whether or not they use, for the relevant submarine cable
system, equipment or services identified on the ``Covered List'' within
sixty (60) days of the effective date of any rule adopted in this
proceeding. The Commission proposes, among other things, to require (1)
applicants/licensees, with or without reportable foreign ownership, to
report whether or not they use and/or will use foreign-owned MNSPs and
(2) any applicant/licensee that indicates it uses and/or will use a
foreign-owned MNSP will answer the Standard Questions and those
applications would be routinely referred to the relevant executive
branch agencies. The Commission also proposes to adopt a rule allowing
the sharing of critical submarine cable data filed in the applications
and confidential circuit capacity data with Federal agencies without
undertaking the procedures required under Sec. 0.442 of the rules.
209. The benefits of the proposed rules will ensure the Commission
fulfills its national security and public interest responsibilities
under the Cable Landing License Act. Similar to the Commission's work
in other related proceedings, the Commission expects that the resulting
changes would improve the Commission's oversight of submarine cable
licenses and ensure that a submarine cable license and the licensees
continue to serve the public interest, as the Act intended. As the
Commission stated there, ``[t]hese benefits cannot be achieved with ad
hoc reviews alone.'' By adopting a periodic reporting requirement for
submarine cable licenses, this process will help ensure that the
Commission and the executive branch agencies review submarine cable
licenses on a continuing basis and have the necessary information to
address evolving national security, law enforcement, foreign policy,
and/or trade policy risks. While the Commission tentatively finds that
a three-year periodic reporting requirement is a critical component of
protecting U.S. national security, law enforcement, foreign policy, and
trade policy interests against evolving threats, the Commission
acknowledges that such a process or other proposals in the NPRM may
create economic burdens for submarine cable landing licensees.
210. Broadly, concerning benefits, the Commission seeks to ensure
the safety and reliability of the submarine cable systems while
adopting processes to expedite and streamline the Commission's rules.
Submarine cables carry an estimated 99% of intercontinental data
traffic \201\ and the Commission's efforts will enable the industry to
continue to deploy submarine cables ensuring reliable communications in
a competitive marketplace, fulfilling its public interest duties.
Importantly, the Commission has previously found that ``a foreign
adversary's access to American communications networks could result in
hostile actions to disrupt and surveil the Commission's communications
networks, impacting [the] nation's economy generally and online
commerce specifically, and result in the breach of confidential data.''
Given that the Commission's national gross domestic product was over
$26 trillion in 2023, the digital economy accounted for $3.7 trillion
of the Commission's economy in 2021, and the volume of international
trade for the United States (exports and imports) was $6.9 trillion in
2023, even a temporary disruption in international submarine cable
communications could cause billions of dollars in economic losses. The
harms would be significant, causing disruption
[[Page 12083]]
to business import and export trade, multinational corporation
operations, international financial flows, online commerce, residential
and government communications, and online access to information,
including emergency services. A 2012 report by the Asia-Pacific
Economic Cooperation (APEC) stated that submarine cables carried over
$10 trillion in financial transactions globally each day. Assuming the
United States' share is approximately equal to its share of global
gross domestic product (GDP), it would account for nearly $2.6 trillion
per day. The Commission seeks comment on the expected benefits of the
proposals in the NPRM.
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\201\ According to a report by the Congressional Research
Service, ``undersea telecommunication cable network carries about
95% of intercontinental global internet traffic, and 99% of
transoceanic digital communications.'' According to an article on
TeleGeography's website, submarine cables account for over 99% of
intercontinental data traffic.
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211. The Commission's estimate of costs should include all the
expected ongoing costs that would be incurred as a result of the rules
proposed in the NPRM. The Commission notes that the annual aggregate
cost of the proposed rules described above could vary, depending on the
rules adopted and whether applications and license reviews are referred
to the Committee. The Commission tentatively concludes that the
benefits of establishing the proposed licensing process--which include
the safety and reliability of the submarine cable systems and the
protection of national security and law enforcement interests--will be
in excess of these costs.
212. The Commission bases its cost estimate on the Commission's
records, as described above, that indicate there are currently 84
submarine cable systems owned by approximately 145 unique licensees.
Furthermore, the Commission estimates that every year, there are
approximately eight (8) cable landing license applications for new
cables.\202\ The Commission also estimates that there are approximately
23 applications every year for modification, assignment, transfer, or
control.\203\ Based on these groups, the Commission estimates that 35
applications are submitted annually.\204\
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\202\ Based on internal staff analysis, there were 24 cable
landing license applications for new cables between January 1, 2022,
and October 20, 2024, which produces an annual average of eight
cable landing license applications.
\203\ Based on internal staff analysis, there were 67
applications for modification, assignment, or transfer of control
between January 1, 2022, and October 20, 2024, which produces an
annual average of approximately 23 applications. The Commission
conservatively assumes that the cost for an application for
modification, assignment, transfer, or control is equivalent to the
cost for a new application.
\204\ For the purposes of renewal of existing licenses, the
Commission assumes a uniform distribution of license renewal
applications over the entirety of the 25-year license term, thereby
projecting that there will be 4 applications submitted annually for
existing submarine cable systems (84 / 25 = 3.36 rounded up to 4
applications per year). Annual number of applications submitted
would therefore be approximately 35 (23 + 8 + 4).
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213. The Commission's cost estimate assumes that approximately 105
licensees will undergo the application process each year for the
estimated 35 cable systems. The Commission bases this on the
conservative assumption that each submarine cable landing license
application will have an average of three licensees.\205\ The
Commission estimates that the costs to applicants related to applying
for licenses would include, among other tasks, providing responses to
standard questions, reporting on current and future service offerings,
reporting on the use of foreign-owned MNSPs, providing information on
the submarine cable infrastructure, and providing information
pertaining to reportable foreign ownership. In addition to the
requirements, the Commission estimates that applicants will incur an
additional cost associated with the Commission's proposal to certify
compliance to baseline cybersecurity standards, including implementing
the cybersecurity risk management plans. The Commission expects that
the amount of work associated with preparing a new license application
likely will be similar to the work associated with preparing a renewal
application.\206\ Additionally, the licensees would be required to
provide the Commission with updated information every three years.
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\205\ Based on the Commission's records, there are 237 total
licensees for 84 cable systems, which produces an average of 2.8
licensees per application, which the Commission conservatively
rounds up to 3 licensees per cable system.
\206\ This is based on the Commission's proposal to require
applicants seeking to renew or extend a cable landing license to
provide in the application the same information and certifications
required in an application for a new cable landing license.
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214. The Commission has estimated that the preparation of a new or
renewal application for each submarine cable system by an average of
three licensees will require 80 hours of work by attorneys \207\ and 80
hours of work by support staff, at a cost of $27,200 per
application.\208\ To this cost, the Commission adds the cost of
cybersecurity certification required for all new and renewal
application, and which the Commission estimate to be $9,100.\209\ The
Commission also estimates that the 3-year periodic reporting review
will require twelve hours of attorney and twelve hours of support staff
time, at a cost of $4,100, which the Commission multiplies by one-third
to calculate the annual estimated cost of $1,370.\210\ The Commission
then multiplies the sum of these costs by 35 to produce a total
estimate of approximately $1.32 million per year for the 25-year
period, as a baseline estimate of the annual application and license
review costs.\211\ The Commission anticipates that later rounds of the
three-year periodic reporting review will cause significantly lower
costs, since much of the information will not have changed between
reviews.
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\207\ The Commission's cost data on wages for attorneys are
based on the Commission's estimates of labor costs as represented in
previous Paperwork Reduction Act (PRA) statements.
\208\ Consistent with the Commission's calculations in the PRA
statements, the Commission estimates the median hourly wage for
attorneys as $300 for outside counsel. The Commission assumes that
this wage reasonably represents an average for all attorney labor,
across a range of authorization holders with different sizes and
business models, used to comply with the rules proposed in the NPRM.
Also, consistent with the Commission's calculations in PRA
statements, the Commission estimates the median hourly wage for
support staff (paralegals and legal assistants) as $40. Thus, 80
hours of work by attorneys would cost $24,000 and 80 hours of work
by support staff would cost $3,200, for a total of $27,200 per
application.
\209\ Previously, the Commission had estimated a cost of
drafting a cybersecurity risk management plan and submitting a
certification as $820. Specifically, the Commission estimated that
compliance would take 10 hours of labor from a General and
Operations Manager compensated at $82 per hour ($820 = $82 x 10).
The Commission updates this estimate to account for a baseline
increase in compensation for General and Operations Managers from
$55 to approximately $62.18 per hour, which when accounting for a
benefits estimate of 45% becomes $90.16 (= $62.18 x 1.45). Several
commenters in that proceeding argued that the proposed cost of
creating, updating, implementing and certifying cybersecurity risk
management plans is too low. For example, NPR estimates that the
Commission's estimate is ``off by a factor of 10 or more.'' In light
of this record, the Commission updates the Commission's estimate to
$9,100 to be consistent with the record in that proceeding (= (100
hours per applicant) x ($62.18 mean hourly wage) x (1 + 45% benefit
mark-up), which the Commission rounds up to $9,100). To account for
benefits, the Commission marks up wages by 45%, which results in
total hourly compensation of $62.18 x 145% = $90.16. According to
the Bureau of Labor Statistics, as of June 2023, civilian wages and
salaries averaged $29.86/hour and benefits averaged $13.39/hour.
Total compensation therefore averaged $29.86 + $13.39, rounded to
$43.26. Using these figures, benefits constitute a markup of $13.39/
$29.86 ~ 45%.
\210\ Twelve hours of work by attorneys would cost $3,600 (12
hours x $300 per hour) and twelve hours of work by support staff
would cost $480 (12 hours x $40 per hour), which sums to $4,080,
which the Commission rounds up to $4,100. The Commission then
calculates the annual cost by dividing the three-year cost by 3 to
produce an estimate of $1,370 ($4,100/3 = $1,366.67, rounded up to
$1,370).
\211\ $27,200 + $9,100 + $1,370 = $37,670. Multiplying by 35
applications per year, the Commission has, $1,318,450 (= $37,670 x
35), which the Commission rounds up to $1,319,000 per year.
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215. The Commission seeks comment on the estimates provided here,
which are based on the Commission's
[[Page 12084]]
experience and calculations of the likely costs of past submarine cable
application processing and cybersecurity reviews. The Commission seeks
comment on the additional costs that applicants will incur from the new
reporting requirements detailed above. The Commission also seeks
comment on the expected costs incurred by applicants, licensees, and
Government agencies for applications and periodic reporting reviews
that are referred to the Committee for additional review. The
Commission seeks comment on the potential burdens on licensees,
including on small entities.\212\ The Commission notes that some
proposals may lower industry costs by streamlining or simplifying the
application process. Also, some national security requirements might
financially benefit companies that had not yet fully secured their
networks from harm and thus were vulnerable to costly disruptions.
Indeed, some of these requirements could be considered the minimum
security needed in today's communications environment, and thus should
already have been implemented by all submarine cables operators. Do the
Commission's assumptions represent a reasonable estimate of total costs
of the proposals in the NPRM? Any suggestions for alternative
approaches should include clear explanations of the cost estimates, as
well as estimates as to whether the benefits under any proposed
alternatives would increase or decrease compared to the benefits
described above.
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\212\ For example, the Commission seeks comment on the costs and
benefits of requiring all applicants, including those without
reportable foreign ownership, to provide information on foreign-
owned MNSPs.
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F. Digital Equity and Inclusion
216. Finally, the Commission, as part of its continuing effort to
advance digital equity for all,\213\ including people of color, persons
with disabilities, persons who live in rural or Tribal areas, and
others who are or have been historically underserved, marginalized, or
adversely affected by persistent poverty or inequality, invites comment
on any equity-related considerations \214\ and benefits (if any) that
may be associated with the proposals and issues discussed herein.
Specifically, the Commission seeks comment on how its proposals may
promote or inhibit advances in diversity, equity, inclusion, and
accessibility, as well as the scope of the Commission's relevant legal
authority.
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\213\ Section 1 of the Communications Act of 1934 as amended
provides that the FCC ``regulat[es] interstate and foreign commerce
in communication by wire and radio so as to make [such service]
available, so far as possible, to all the people of the United
States, without discrimination on the basis of race, color,
religion, national origin, or sex.''
\214\ The term ``equity'' is used here consistent with Executive
Order 13985 as the consistent and systematic fair, just, and
impartial treatment of all individuals, including individuals who
belong to underserved communities that have been denied such
treatment, such as Black, Latino, and Indigenous and Native American
persons, Asian Americans and Pacific Islanders and other persons of
color; members of religious minorities; lesbian, gay, bisexual,
transgender, and queer (LGBTQ+) persons; persons with disabilities;
persons who live in rural areas; and persons otherwise adversely
affected by persistent poverty or inequality.
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II. Procedural Issues
217. Ex Parte Rules. This proceeding 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 rule Sec. 1.1206(b). In proceedings governed
by rule Sec. 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.
218. Regulatory Flexibility Act. The Regulatory Flexibility Act of
1980, as amended (RFA), requires that an agency prepare a regulatory
flexibility analysis for notice and comment rulemakings, unless the
agency certifies that ``the rule will not, if promulgated, have a
significant economic impact on a substantial number of small
entities.'' Accordingly, the Commission has prepared an Initial
Regulatory Flexibility Analysis (IRFA) concerning the potential impact
of rule and policy changes in the NPRM on small entities. Written
public comments are requested on the IRFA. Comments must be filed by
the deadlines for comments in the DATES section of this document and
must have a separate and distinct heading designating them as responses
to IRFA.
Technical Appendix
219. This technical appendix provides additional information about
submarine cable systems, including definitions and an image that
depicts the key parts of a submarine cable system.
220. Submarine Cable System. A submarine cable is an electrically
powered cable that is laid beneath water and establishes communication
transmission links between two or more land-based terminal cable
landing stations. The cable consists of a wet (underwater) segment, a
dry (not submerged under water) segment, and ancillary equipment
required to support the operation and maintenance of the cable.
221. Wet Segment. The wet (underwater) segment of a submarine cable
system typically extends from a beach manhole on one landmass to a
beach manhole on another landmass. The underwater portion of the cable
can consist of one or several segments, and is equipped with
amplification devices (repeaters, etc.) and branching units built into
the cable that allow interconnection to more than one destination
country.
222. Wet Segment Ancillary Components. The repeaters (technically
amplifiers), which are tied into the cable, amplify the optical signal
to ensure it remains powerful enough for detection at the receiving or
terminal landing station. The branching unit (BU) is used to split off
the optical signal from the main cable segment(s) and send traffic to
another location or country via a cable that connects the BU to a cable
landing station.
223. Dry Segment. The dry (not submerged under water) segment of a
submarine cable system typically extends from the beach manhole to
[[Page 12085]]
cable landing station(s) that contain the Power Feed Equipment (PFE)
and equipment (such as the Submarine Line Terminal Equipment (SLTE)) to
convert submarine signals to terrestrial signals, and may include
ancillary equipment or infrastructure such as equipment to operate or
maintain the cable system.
224. Dry Segment Ancillary Components. The dry segment includes the
optical fiber and power land cables that are separated at and extend
from the beach manhole, a structure buried on the beach where the
submarine cable first lands, and are then routed to the terminal cable
landing station that may be located near the coast where the submarine
cable reaches the shore, or may be located further inland.\215\ The
submarine cable landing station houses equipment to terminate cable
traffic and equipment to power the submarine cable. The equipment used
to convert submarine signals to terrestrial signals and interconnect
with the U.S. terrestrial network is the SLTE, and the equipment used
to power the cable, the PFE, is either located in or close to the
terminal landing station. There might be multiple SLTEs within a cable
landing station for a given submarine cable system.\216\ A data center
can serve as a cable landing station, and PoPs and IXPs \217\ can be
located within a cable landing station or data center.
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\215\ Traditionally, cable landing stations ``have been
historically close to network hubs to facilitate efficient
connectivity to population centers, but now the focus is on being
close to hyperscale data centers'' that might be located farther
inland and require substantial backhaul facilities to interconnect
to the data station. PoPs and/or Internet Exchange Points (IXPs) can
be, and are typically located in data centers or other facilities
with the necessary infrastructure to support internet traffic
exchange. This infrastructure may include routers, switches, and
other networking equipment, as well as power and cooling systems.
\216\ Over the last decade, technological changes and the manner
in which the dry segment submarine cable components are sold has
permitted ``multiple cable systems owners to use different SLTE on
their own fiber pairs.''
\217\ What is an internet exchange point? [verbar] How do IXPs
work?, Cloudflare, https://www.cloudflare.com/learning/cdn/glossary/internet-exchange-point-ixp/ (last visited, Oct. 4, 2024), (``An
internet exchange point (IXP) is a physical location through which
internet infrastructure companies such as Internet Service Providers
(ISPs) and [Content Delivery Networks or] CDNs connect with each
other.'').
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225. For illustrative purposes, the image below depicts the key
parts of a submarine cable system and depicts, in a basic manner, a
submarine cable system. The Commission understand that not every
submarine cable system may replicate the image below. For example,
there may be numerous cable landing stations located further inland
from the coastal landing submarine cable station.\218\
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\218\ Although not reflected in the graphic, the CRS Report
recognizes that submarine terminal facilities could be ``hundreds of
miles from the seashore'' with cable operators often using a longer
fiber link with repeaters to connect to the cable landing station.
[GRAPHIC] [TIFF OMITTED] TP13MR25.000
Initial Regulatory Flexibility Analysis
226. As required by the Regulatory Flexibility Act of 1980, as
amended (RFA), the Federal Communications Commission (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 this IRFA. Comments must be identified as
responses to the IRFA and must be filed by the deadlines for comments
specified on the first page of the NPRM. The Commission will send a
copy of the NPRM, including this IRFA, to the Chief Counsel for
Advocacy of the Small Business Administration (SBA). In addition, the
NPRM and IRFA (or summaries thereof) will be published in the Federal
Register.
A. Need for, and Objective of, the Proposed Rules
227. In the NPRM, the Commission undertakes the first major
comprehensive review of its submarine cable rules since it last adopted
submarine cable rules in 2001. Over the last two decades, there have
been
[[Page 12086]]
substantial changes in technology, consumer expectations, international
submarine cable traffic patterns, and investment in and construction of
submarine cable infrastructure as well as significant evolution in
national security and law enforcement threat environments. The proposed
rules on which the Commission seeks comment in this proceeding are
intended for the Commission to determine how best to improve and
streamline the submarine cable rules to facilitate deployment of
submarine cables while at the same time ensuring the security,
resilience, and protection of this critical infrastructure.
228. Specifically, in the NPRM, the Commission takes a number of
actions to (1) codify the Commission's legal jurisdiction and other
legal requirements in the Commission's rules to provide regulatory
certainty to submarine cable owners and operators; (2) improve the
Commission's oversight of submarine cable landing licensees and
information regarding a submarine cable system and its licensees during
the 25-year license term; (3) update application requirements for
national security purposes and ensuring the Commission has targeted and
granular information regarding the ownership, control, and use of a
submarine cable system; (4) adopt new compliance certifications to
protect against national security, law enforcement, and other risks;
(5) protect submarine cable infrastructure, including activities in
coordination with its Federal partners; (6) update submarine cable
rules and certain targeted requirements to protect submarine cable
systems from national security and law enforcement risks; (7)
streamline procedures to expedite the submarine cable review processes;
and (8) improve the quality of the Circuit Capacity data and
facilitating the sharing of such information with other Federal
agencies. The Commission believes its proposed actions in this
proceeding will improve Commission review and oversight of submarine
cable landing licenses and ensure each licensee continues to serve the
public interest in an evolving national security and law enforcement
landscape.
B. Legal Basis
229. The proposed action is authorized pursuant to sections 1,
4(i), 4(j), 201-255, 303(r), 403, and 413 of the Communications Act of
1934, as amended, 47 U.S.C. 151, 154(i), 154(j), 201-255, 303(r), 403,
and 413, and the Cable Landing License Act of 1921, 47 U.S.C. 34-39,
and Executive Order 10530, section 5(a) (May 12, 1954), reprinted as
amended in 3 U.S.C. 301.
C. Description and Estimate of the Number of Small Entities to Which
the Proposed Rules Will Apply
230. The RFA directs agencies to provide a description of, and
where feasible, an estimate of the number of small entities that may 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. A ``small business concern'' is one which: (1) is independently
owned and operated; (2) is not dominant in its field of operation; and
(3) satisfies any additional criteria established by the Small Business
Administration (SBA).
231. Wired Telecommunications Carriers. The U.S. Census Bureau
defines this industry as establishments ``primarily engaged in
operating and/or providing access to transmission facilities and
infrastructure that they own and/or lease for the transmission of
voice, data, text, sound, and video using wired telecommunications
networks.'' Transmission facilities may be based on a single technology
or a combination of technologies. Establishments in this industry use
the wired telecommunications network facilities that they operate to
provide a variety of services, such as ``wired telephony services,
including VoIP services, wired (cable) audio and video programming
distribution, and wired broadband internet services.'' By exception,
establishments providing satellite television distribution services
using facilities and infrastructure that they operate are included in
this industry. Wired Telecommunications Carriers are also referred to
as wireline carriers or fixed local service providers.
232. The SBA small business size standard for Wired
Telecommunications Carriers classifies firms having 1,500 or fewer
employees as small. U.S. Census Bureau data for 2017 show that there
were 3,054 firms that operated in this industry for the entire year. Of
this number, 2,964 firms operated with fewer than 250 employees.
Additionally, based on Commission data in the 2022 Universal Service
Monitoring Report, as of December 31, 2021, there were 4,590 providers
that reported they were engaged in the provision of fixed local
services. Consequently, using the SBA's small business size standard,
most of these providers can be considered small entities.
233. Competitive Local Exchange Carriers (CLECs). Neither the
Commission nor the SBA has developed a size standard for small
businesses specifically applicable to local exchange services.
Providers of these services include several types of competitive local
exchange service providers. Wired Telecommunications Carriers is the
closest industry with an SBA small business size standard. The SBA
small business size standard for Wired Telecommunications Carriers
classifies firms having 1,500 or fewer employees as small. U.S. Census
Bureau data for 2017 show that there were 3,054 firms that operated in
this industry for the entire year. Of this number, 2,964 firms operated
with fewer than 250 employees. Additionally, based on Commission data
in the 2022 Universal Service Monitoring Report, as of December 31,
2021, there were 3,378 providers that reported they were competitive
local service providers. Of these providers, the Commission estimates
that 3,230 providers have 1,500 or fewer employees. Consequently, using
the SBA's small business size standard, most of these providers can be
considered small entities.
234. Interexchange Carriers (IXCs). Neither the Commission nor the
SBA have developed a small business size standard specifically for
Interexchange Carriers. Wired Telecommunications Carriers is the
closest industry with an SBA small business size standard. The SBA
small business size standard for Wired Telecommunications Carriers
classifies firms having 1,500 or fewer employees as small. U.S. Census
Bureau data for 2017 show that there were 3,054 firms that operated in
this industry for the entire year. Of this number, 2,964 firms operated
with fewer than 250 employees. Additionally, based on Commission data
in the 2022 Universal Service Monitoring Report, as of December 31,
2021, there were 127 providers that reported they were engaged in the
provision of interexchange services. Of these providers, the Commission
estimates that 109 providers have 1,500 or fewer employees.
Consequently, using the SBA's small business size standard, the
Commission estimates that the majority of providers in this industry
can be considered small entities.
235. Wired Broadband Internet Access Service Providers (Wired
ISPs). Providers of wired broadband internet access service include
various types of providers except dial-up internet access providers.
Wireline service that terminates at an end user location or mobile
device and enables the end user
[[Page 12087]]
to receive information from and/or send information to the internet at
information transfer rates exceeding 200 kilobits per second (kbps) in
at least one direction is classified as a broadband connection under
the Commission's rules. Wired broadband internet services fall in the
Wired Telecommunications Carriers industry. The SBA small business size
standard for this industry classifies firms having 1,500 or fewer
employees as small. U.S. Census Bureau data for 2017 show that there
were 3,054 firms that operated in this industry for the entire year. Of
this number, 2,964 firms operated with fewer than 250 employees.
236. Internet Service Providers (Non-Broadband). Internet Access
Service Providers using client-supplied telecommunications connections
(e.g., dial-up ISPs) as well as VoIP service providers using client-
supplied telecommunications connections fall in the industry
classification of All Other Telecommunications. The SBA small business
size standard for this industry classifies firms with annual receipts
of $40 million or less as small. For this industry, U.S. Census Bureau
data for 2017 show that there were 1,079 firms in this industry that
operated for the entire year. Of those firms, 1,039 had revenue of less
than $25 million. Consequently, under the SBA size standard a majority
of firms in this industry can be considered small.
237. Small Businesses, Small Organizations, Small Governmental
Jurisdictions. The Commission's actions, over time, may affect small
entities that are not easily categorized at present. The Commission
therefore describes, at the outset, three broad groups of small
entities that could be directly affected herein. First, while there are
industry specific size standards for small businesses that are used in
the regulatory flexibility analysis, according to data from SBA's
Office of Advocacy, in general a small business is an independent
business having fewer than 500 employees. These types of small
businesses represent 99.9% of all businesses in the United States,
which translates to 33.2 million businesses.
238. Next, the type of small entity described as a ``small
organization'' is generally ``any not-for-profit enterprise which is
independently owned and operated and is not dominant in its field.''
The Internal Revenue Service (IRS) uses a revenue benchmark of $50,000
or less to delineate its annual electronic filing requirements for
small exempt organizations. Nationwide, for tax year 2022, there were
approximately 530,109 small exempt organizations in the U.S. reporting
revenues of $50,000 or less according to the registration and tax data
for exempt organizations available from the IRS.
239. Finally, the small entity described as a ``small governmental
jurisdiction'' is defined generally as ``governments of cities,
counties, towns, townships, villages, school districts, or special
districts, with a population of less than fifty thousand.'' U.S. Census
Bureau data from the 2022 Census of Governments indicate there were
90,837 local governmental jurisdictions consisting of general purpose
governments and special purpose governments in the United States. Of
this number, there were 36,845 general purpose governments (county,
municipal, and town or township) with populations of less than 50,000
and 11,879 special purpose governments (independent school districts)
with enrollment populations of less than 50,000. Accordingly, based on
the 2022 U.S. Census of Governments data, the Commission estimates that
at least 48,724 entities fall into the category of ``small governmental
jurisdictions.''
240. Additionally, according to Commission data on internet access
services as of June 30, 2019, nationwide there were approximately 2,747
providers of connections over 200 kbps in at least one direction using
various wireline technologies. The Commission does not collect data on
the number of employees for providers of these services, therefore, at
this time the Commission is not able to estimate the number of
providers that would qualify as small under the SBA's small business
size standard. However, in light of the general data on fixed
technology service providers in the Commission's 2022 Communications
Marketplace Report, the Commission believes that the majority of
wireline internet access service providers can be considered small
entities.\219\
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\219\ See Communications Marketplace Report, GN Docket No. 22-
203, 2022 WL 18110553 at 10, paras. 26-27, Figs. II.A.5-7. (2022)
(2022 Communications Marketplace Report).
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241. All Other Telecommunications. This industry is comprised of
establishments primarily engaged in providing specialized
telecommunications services, such as satellite tracking, communications
telemetry, and radar station operation. This industry also includes
establishments primarily engaged in providing satellite terminal
stations and associated facilities connected with one or more
terrestrial systems and capable of transmitting telecommunications to,
and receiving telecommunications from, satellite systems. Providers of
internet services (e.g. dial-up ISPs) or VoIP services, via client-
supplied telecommunications connections are also included in this
industry. The SBA small business size standard for this industry
classifies firms with annual receipts of $40 million or less as small.
U.S. Census Bureau data for 2017 show that there were 1,079 firms in
this industry that operated for the entire year. Of those firms, 1,039
had revenue of less than $25 million. Based on this data, the
Commission estimates that the majority of ``All Other
Telecommunications'' firms can be considered small.
242. Internet Publishing and Broadcasting and Web Search Portals.
This industry comprises establishments primarily engaged in (1)
publishing and/or broadcasting content on the internet exclusively or
(2) operating websites that use a search engine to generate and
maintain extensive databases of internet addresses and content in an
easily searchable format (and known as web search portals). The
publishing and broadcasting establishments in this industry do not
provide traditional (non-internet) versions of the content that they
publish or broadcast. They provide textual, audio, and/or video content
of general or specific interest on the internet exclusively.
Establishments known as web search portals often provide additional
internet services, such as email, connections to other websites,
auctions, news, and other limited content, and serve as a home base for
internet users. The SBA small business size standard for this industry
classifies firms having 1,000 or fewer employees as small. U.S. Census
Bureau data for 2017 show that there were firms that 5,117 operated for
the entire year. Of this total, 5,002 firms operated with fewer than
250 employees. Thus, under this size standard the majority of firms in
this industry can be considered small.
243. Computer Infrastructure Providers, Data Processing, Web
Hosting, and Related Services. This industry comprises establishments
primarily engaged in providing computing infrastructure, data
processing services, web hosting services (except software publishing),
and related services, including streaming support services (except
streaming distribution services). Cloud storage services, computer data
storage services, computing platform infrastructure provision,
Infrastructure as a service (IaaS), optical scanning services, and
Platform as a service (PaaS) are included in this industry. Data
processing establishments provide complete processing and specialized
[[Page 12088]]
reports from data supplied by clients or provide automated data
processing and data entry services. The SBA small business size
standard for this industry classifies firms with annual receipts of $40
million or less as small. U.S. Census Bureau data for 2017 indicate
that 9,058 firms in this industry were operational for the entire year.
Of this total, 8,345 firms had revenue of less than $25 million. Thus,
under the SBA size standard the majority of firms in this industry are
small.
244. Neither the Commission nor the SBA has developed a size
standard specifically for applicants or licensees of submarine cable
systems under the Cable Landing License Act. The proposals outlined in
the NPRM apply to entities applying for an initial cable landing
license; applicants/cable landing licensees for modification,
assignment, transfer of control, and renewal or extension of such
license; cable landing licensees that will be required to submit
periodic reports; and cable landing licensees and common carriers that
are required to annually report their capacity on international cables
pursuant to Sec. 43.82 of the rules. The proposals, however, may
affect other entities as well, including users of submarine cable
service such as Internet Service Providers (ISPs) that lease capacity
or purchase indefeasible rights of use (IRUs) on submarine cable
systems. The Commission, therefore, encourages these entities to
comment on the proposals in the NPRM.
245. The proposals are intended to improve and streamline the
submarine cable rules to facilitate efficient deployment of submarine
cables while at the same time ensuring the security, resilience, and
protection of this critical infrastructure. The Commission is not
certain, however, as to the number of small entities that will be
affected by the proposals. The Commission bases its cost estimate on
the Commission's records, as described below, that indicate there are
currently 84 submarine cable systems owned by approximately 145
licensees. In 2022, of all entities that filed Sec. 43.82 Circuit
Capacity Reports, 43 were Submarine Cable Operator Reports and 102 were
Submarine Cable Capacity Holder Reports. Based on this information, the
Commission estimates that there could be 50 or fewer applicants that
might be a small entity.
D. Description of Projected Reporting, Recordkeeping and Other
Compliance Requirements for Small Entities
246. In the NPRM, the rules that the Commission proposes would
impose new and/or additional reporting, recordkeeping, and other
compliance obligations on small and other entities. The Commission's
comprehensive review of its submarine cable rules identified a need to
update the existing rules to advance U.S. national security, law
enforcement, foreign policy, and trade policy interests. These
proposals are designed to update and formalize the submarine cable
rules to better protect submarine cables and provide the Commission
with important information on a more regular and timely basis for the
Commission to better identify and address national security, law
enforcement, and other risks.
247. The scope of the proposals in the NPRM is broad and wide
ranging. The Commission proposes to codify in the rules the
Commission's longstanding practices and legal requirements under the
Cable Landing License Act that are applicable to small and other
applicants seeking a submarine cable landing license or modification,
assignment, transfer of control, or renewal or extension of their
license, including proposed rules that would require these applicants,
among other things, to comply with a general license requirement, to
demonstrate how grant of an application will serve the public interest,
convenience and necessity, and to certify whether or not they are in
compliance with the Cable Landing License Act, the Communications Act,
the Commission's rules, and other laws. The Commission proposes and
seeks comment on adopting a procedural framework that the Commission
may use to consider whether withholding a grant of a cable landing
license or revocation of a cable landing license is warranted. The
Commission also proposes to adopt a three-year periodic reporting
requirement for cable landing licenses, which would require small and
other licensees to provide certain information to the Commission every
three years. The Commission seeks comment on shortening the current 25-
year submarine cable license term or adopting a shorter license term in
combination with periodic reporting.
248. The Commission's proposed three-year periodic reporting
requirement would require licensees to provide updated information,
including (1) information that is current as of thirty (30) days prior
to the date of the submission of the report; (2) information concerning
the submarine cable infrastructure; (3) information about the capacity
services they currently offer or plan to offer through the submarine
cable system; (4) certification as to whether or not they are in
compliance with the Cable Landing License Act, the Communications Act,
the Commission's rules, and other laws; (5) cybersecurity
certifications, including a certification that they have created,
updated, and implemented cybersecurity risk management plans; (6)
certification that they have not purchased and/or used, and will not
purchase and/or use, equipment or services produced or provided by
entities (and their subsidiaries and affiliates) identified on the
Commission's ``Covered List''; (7) whether or not they use and/or will
use foreign-owned MNSPs in the operation of the submarine cable; and
(8) updated licensee information and points of contact. The Commission
seeks comment on whether, as part of the periodic reporting
requirement, cable landing licensees should provide (1) information
identifying any individuals or entities that hold an ownership interest
in the submarine cable system that does not meet the threshold
eligibility requirements requiring them to be licensees of the cable;
(2) updated ownership information; and (3) other information.
249. As part of the licensing application process, the Commission
proposes several new compliance certifications for small and other
applicants that would trigger reporting and recordkeeping requirements,
including (1) certification that an applicant is in compliance with the
Commission's rules and regulations, the Communications Act of 1934, as
amended (the Act), and all other applicable laws; (2) certification
that an applicant has created, updated, and implemented cybersecurity
risk management plans as well as certification that the applicant take
reasonable measures to protect the confidentiality, integrity, and
availability of their systems and services that could affect their
provision of communications services; and (3) as a condition of the
potential grant of their application, a certification that the
submarine cable system will not use covered equipment or services
identified on the Commission's ``Covered List'' that the Commission
maintains pursuant to the Secure and Trusted Communications Networks
Act. The Commission also proposes that all submarine cable landing
licensees certify as to whether or not they use, for the relevant
submarine cable system, equipment or services identified on the
``Covered List'' within 60 days of the release of any Report and Order
in this proceeding. Additionally, the Commission proposes to amend its
rules by adding a new routine condition and a certification requirement
in the
[[Page 12089]]
proposed periodic reports prohibiting licensees from using, for the
relevant submarine cable system, equipment or services identified on
the ``Covered List.'' The Commission also seeks comment on whether to
require a certification by all applicants/licensees that they have the
ability to promptly and effectively interrupt, in whole or in part,
traffic to and from the United States on the submarine cable system.
The Commission proposes to require applicants and licensees to certify
in the applications and the periodic reports whether or not they are in
compliance with the Cable Landing License Act, the Communications Act,
the Commission's rules, and other laws.
250. The cybersecurity certification will require small and other
applicants and licensees to describe how the applicant or licensee
employs its organizational resources and processes to ensure the
confidentiality, integrity, and availability of its systems and
services, and must be signed by an applicant's Chief Executive Officer
(CEO), Chief Financial Officer (CFO), Chief Technology Officer (CTO),
or a similarly situated senior officer responsible for governance of
the organization's security practices. Small and other applicants and
licensees will be allowed to structure their cybersecurity risk
management plan in a manner that best fits its organization, as long as
the plan demonstrates that the applicant and licensee is taking
affirmative steps to analyze security risks and improve its security
posture. Further, small and other applicants and licensees will not be
required to submit their cybersecurity risk management plans but
instead, if adopted, must maintain data and records related to their
cybersecurity risk management plans for two years from the submission
of the related risk management plan certification to the Commission,
including any information that is necessary to show how the
cybersecurity risk management plan is implemented. However, upon
Commission request, small and other licensees must file their
cybersecurity risk management plan with the Commission.
251. Other reporting requirements in the NPRM the Commission
targets to protect submarine cable systems from national security and
law enforcement risks includes the Commission's (1) proposal whether to
require applicants to disclose their use of foreign-owned MNSPs and if
so, it will answer the Standard Questions and those applications would
be routinely referred to the relevant executive branch agencies; (2)
proposal to require all applicants to provide a list of the anticipated
addresses or physical locations for the Network Operations Center (NOC)
on a presumptively confidential basis in their applications and
periodic reports; and (3) the Commission's request for comments on
whether to require applicants to submit basic information about an
applicant's lessors of submarine cable landing stations and/or data
centers housing hardware. The Commission also proposes to adopt a
presumption that any entity whose application for international section
214 authority that was previously denied or whose domestic or
international section 214 authority was previously revoked in view of
national security and law enforcement concerns, and its current and
future affiliates and subsidiaries, shall not be qualified to become a
new submarine cable landing licensee. Additionally, the Commission
proposes to expand the information reporting requirements under Sec.
1.767(a)(4) of the Commission's rules to require small and other
applicants for a cable landing license or modification, assignment,
transfer of control, or renewal or extension of a license to provide
additional detailed information concerning the submarine cable
infrastructure.
252. One of the Commission's goals in this proceeding is also to
improve the collection of circuit capacity data which includes data
from cable landing licensees and common carriers who must report their
capacity on submarine cables between the United States and any foreign
point as of December 31 of the current reporting period. The
Commission's annual capacity holder data indicates that there is
substantial capacity leased or purchased from cable landing licensees
and common carriers that is not accounted for in the circuit capacity
data collected by the Commission, because entities that hold capacity
on a particular cable in such arrangements are not required to report
their capacity. To address this information gap, the Commission seeks
comments on whether to require all entities that hold capacity on
cables landing in the United States to file capacity holder reports,
and in the alternative, or additionally, should cable landing licensees
and common carriers be required to include in their annual capacity
holder reports a list of customers to whom they sold or leased capacity
as of December 31 of the reporting period. Given that all title II
common carriers are required to file annual circuit capacity reports
under Sec. 43.82(a)(2) of the rules, the Commission seeks comment
generally on whether the Commission should consider retaining or
removing the waiver of Sec. 43.82 of the rules as applied to BIAS
providers, subject to judicial review of that 2024 Open Internet Order.
253. The Commission includes cost estimates in the NPRM that
estimate of all of the expected ongoing costs the industry would incur
if the proposed rules were adopted. Annually, the Commission estimates
the annual aggregate cost of implementation of the proposed rules
should not exceed approximately $1.32 million for the 84 submarine
cable systems currently owned by approximately 145 licensees. At this
time however, the record does not include sufficient cost information
to allow the Commission to quantify the costs of compliance for small
entities, including whether it will be necessary for small entities to
hire professionals to comply with the proposed rules if adopted.
254. The Commission also estimates that every year, there are
approximately 8 cable landing license applications for new cables, and
23 applications every year for modification, assignment, transfer, or
control. The Commission therefore estimates that 35 applications are
submitted annually. The Commission's cost estimate assumes that
approximately 105 licensees will undergo the application process each
year for the estimated 35 cable systems. The Commission bases this on
the conservative assumption that each submarine cable landing license
application will have an average of three licensees. The Commission
calculates that the costs to applicants related to applying for
licenses would include, among other tasks, providing responses to
standard questions, reports on current and future service offerings,
reports on foreign-owned MNSPs and information pertaining to reportable
foreign ownership. Additionally, the Commission calculates applicants
will incur additional costs associated with the Commission's proposal
for them to certify compliance to baseline cybersecurity standards,
including implementing the cybersecurity risk management plans. The
Commission anticipates the amount of work associated with preparing a
new license application likely will be similar to the work associated
with preparing a renewal application. Licensees would also be required
to provide updated information to the Commission every three years.
255. Preparation of a new or renewal application for each submarine
cable system by an average of three licensees
[[Page 12090]]
will require 80 hours of work by attorneys and 80 hours of work by
support staff, at a total cost of $27,200 per application. To this cost
the Commission adds the cost of the cybersecurity certification
required for all new and renewal application, and which the Commission
estimates to be $9,100. The Commission also estimates that the 3-year
periodic reporting will require twelve hours of attorney and twelve
hours of support staff time, at a cost of $4,100, which the Commission
multiplies by one-third to calculate the annual estimated cost of
$1,370. The Commission then multiplies the sum of these costs by 35
resulting in a total estimate of approximately $1.32 million per year
for the 25-year licensing period, as a baseline estimate of the annual
application and license review costs. The Commission anticipates that
later rounds of the three-year periodic reporting review will cause
significantly lower costs, since much of the information will not have
changed between reviews. The Commission seeks comment on these cost
estimates in the NPRM, and in particular on the costs (and burdens)
that may be incurred by small entities. Small entities are encouraged
to bring to the Commission's attention any specific concerns they may
have with the cost estimate and the proposals outlined in the NPRM. In
addition, the Commission seeks comment on the Commission's tentative
conclusion that the benefits of the proposed update and modernization
of the submarine cable licensing and oversight process which includes
the safety and reliability of the submarine cable infrastructure, and
the protection of national security and law enforcement interests--will
far exceed these estimated costs.
256. The Commission is especially interested in estimates that
address alternative means to provide the same benefits, in terms of
advancing national security, law enforcement, foreign policy, and trade
policy interests, at lower costs. The Commission expects the
information it receives in comments including, where requested, cost
and benefit analyses, to help identify and evaluate relevant compliance
matters for small entities, including compliance costs and other
burdens that may result if the proposals and associated requirements
discussed in the NPRM are adopted.
E. Steps Taken To Minimize the Significant Economic Impact on Small
Entities and Significant Alternatives Considered
257. The RFA requires an agency to describe any significant,
specifically small business, 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 and
reporting requirements under the rules for such 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 such small
entities.''
258. As described in the NPRM, the Commission considers and seeks
comment on the potential impact and burdens the proposed rules would
generally have on submarine cable applicants, licensees, and common
carriers that hold capacity on U.S.-international cables, some of whom
may be small entities. As part of the Commission's proposals, the
Commission discusses alternative options that could potentially reduce
the impacts and burdens with respect to small entities and more
generally for entities subject to the Commission's submarine cable
rules.
259. Notably, the Commission proposes to require licensees to
provide in periodic reports certain information to the Commission every
three years. In discussing this proposal, the Commission expressly
solicits information on the impact of the Commission's proposed three-
year periodic reporting requirement on small entities, and the
Commission considers and discusses alternatives. To decrease some of
the administrative burden of this requirement for such entities, the
Commission proposes that any new periodic report would reflect only
updated information since the last report three years prior or other
substantive filing, which may be the initial license application, a
modification, a transfer of control, or an assignment. If there have
not been any changes since a licensee's last periodic report or other
substantive filing, the Commission asks whether the Commission should
only require a licensee provide a periodic statement that its license
remains in compliance with the Commission's rules and with its most
recent periodic report, or other substantive filing. The Commission
also proposes that each periodic report would be submitted through a
filing in the Commission's existing International Communications Filing
System (ICFS), or any successor system, minimizing administrative
burdens associated with paper filings. Along these lines, the
Commission proposes to adopt a schedule that prioritizes the filing and
review of reports based on whether the cable's licensee(s) currently
have reportable foreign ownership and the length of the time since the
Commission's most recent review of the authorization. The proposal
structures the timing of the submission of periodic reports to minimize
burdens on licensees, the Commission and the executive branch staff
while ensuring that the Commission receives the information it needs to
protect this critical infrastructure. Submarine cable systems would be
assigned to one of four categories with each category having a
different submission deadline--submission deadlines for each category
would be separated by six months.
260. The Commission also considers the burdens on small entities in
seeking comment on whether shortening the current 25-year submarine
cable license term or adopting a shorter license term in combination
with periodic reporting would similarly account for evolving national
security, law enforcement, and other risks. In this regard, to ensure
the Commission addresses burdens on licensees, including small
entities, the Commission seeks comment on an appropriate time frame to
better account for evolving risks while minimizing burdens on
licensees, recognizing the significant capital expenditures and long
lead times in planning and constructing submarine cable systems. The
Commission also seeks comment on the economic impact of shortening the
25-year license term. The Commission asks whether a 5-year or 10-year
license term would alter investment incentives in new submarine cable
infrastructure and if a shortened license terms would impact the
upgradation and maintenance of existing submarine cable systems. The
Commission identifies various licensing term alternatives based on
approaches it has adopted for other industry licensees. For example,
for Miscellaneous Wireless Communications Services (WCS), the license
term varies according to spectrum band, resulting in different license
periods such as 10, 12, or 15 years. In the satellite industry the
Commission's licensing terms likewise vary. Space stations licensed
under part 25 of the Commission's rules have a 15-year license term,
small satellites have a 6-year license term, and certain SDARS and DBS
space stations have an 8-year license term. In the broadcasting
industry, each license granted for the operation of a broadcasting
station is limited to a term not to exceed eight
[[Page 12091]]
years. Additionally, more recently in the Evolving Risks NPRM, the
Commission tentatively concluded that a 10-year timeframe is reasonable
under the proposed renewal framework for structuring a formalized and
systemic reassessment of carriers' international section 214 authority.
The Commission specifically requests that commenters address the
burdens that will be placed on the licensees based on the length of the
license term and identify the costs/benefits overall and impact, if
any, on small businesses.
261. The Commission also discussed the potential impact on small
entities with regard to the Commission's consideration of who must
become a submarine cable applicant and licensee. In the NPRM, the
Commission seeks comment on whether it should retain the requirement
that an entity that owns or controls a 5% or greater interest in the
cable and uses the U.S. points of the cable system must become an
applicant and licensee should be retained or changed. The Commission
explained that the 5% ownership threshold was created in part to not
unduly burden small carriers or investors that lacked the ability to
significantly affect the operation of a cable system, among others. In
this regard, the Commission asks whether the 5% threshold is reasonable
in today's national security environment. The Commission further seeks
comment on whether it should instead require any entity that owns any
interest in the cable to become a licensee. The Commission also
considers and seeks comment generally on whether to include any entity
that has capacity on the submarine cable as an applicant/licensee, and
how such a requirement would affect small entities. Relatedly, the
Commission seeks comment on whether holding capacity on the cable
system should be defined to include the leasing, purchasing, selling,
buying, or swapping of a fiber (spectrum, capacity, partial fiber pair,
or a full fiber pair, among others) for transmission of voice, data,
and internet over the cable system to interconnect with a U.S.
terrestrial network.
262. Consistent with the Commission's overarching goal to promote
and protect the security of the submarine cable network and
infrastructure, the Commission proposes to require all applicants for
cable landing licenses and modification, assignment, transfer of
control, renewal, and licensees filing their three-year periodic
reports to certify in the application or report that they have created,
updated, and implemented cybersecurity risk management plans.
Recognizing the importance of cybersecurity generally and the potential
impact of cybersecurity related requirements on small entities, the
Commission proposes that each applicant or licensee have flexibility to
structure their cybersecurity risk management plan that is tailored to
its organization, provided that the plan demonstrates that the
applicant or licensee is taking affirmative steps to analyze security
risks and improve its security posture. This flexibility should reduce
costs for small entities. Further, the Commission states that while it
believes there are many ways that an applicant or licensee may satisfy
this requirement, the Commission proposes that they could successfully
demonstrate compliance with this proposed requirement by following an
established risk management framework, such as the National Institute
of Standards and Technology (NIST) Cybersecurity Framework (CSF).\306\
The NIST CSF is designed to be scalable and adaptable to the needs and
capabilities of companies both large and small, is well understood by
industry, and is flexible.
263. The Commission also proposes not to require small and other
entities to submit or file their cybersecurity risk management plans at
a designated time each year. Instead, the Commission proposes that
applicants and licensees submit cybersecurity management plans to the
Commission upon request. Additionally, the Commission proposes that
applicants and licensees must preserve data and records related to
their cybersecurity risk management plans, including any information
that is necessary to show how the cybersecurity risk management plan is
implemented, for two years from the submission of the related risk
management plan certification to the Commission.
264. In addition, the Commission highlights the availability of
many free and low-cost resources to help small entities identify and
implement best practices and improve their security over time without
requiring small entities to hire outside experts. NIST publishes
guidance that could assist organizations with measuring their
safeguards, including how to address ransomware, malware, malicious
code, spyware, distributed denial of service (DDoS) attacks, phishing,
securing networks, and threats to mobile phones. CISA offers
vulnerability scanning at no cost for critical infrastructure, which
includes communications providers, and also provides CPG Assessment
Training with regional cybersecurity experts that will help
communications providers better understand CPGs and the cybersecurity
risk assessment process. The Commission assumes that these resources,
along with any number of other publicly available resources that the
Commission has not specifically identified or that may arise in the
future, will assist applicants' and licensees' employees and their
existing technical contractors in identifying and implementing
appropriate security controls without needing specialized cybersecurity
expertise. Thus, the Commission believes its proposals to the submarine
cable rules to protect national security and law enforcement interests
as well as the Commission's streamlining proposals can be implemented
by small entities without being overly burdensome.
265. To assist in the Commission's evaluation of the economic
impact on small entities, as a result of actions that have been
proposed in the NPRM, and to better explore options and alternatives,
the Commission has sought comment from all interested parties. In
particular, the Commission seeks comment on whether, and how, any of
the burdens associated the filing, recordkeeping and reporting
requirements described above and in the NPRM can be minimized for small
entities. Additionally, the Commission seeks comment on whether the
costs associated with the Commission's proposed requirements can be
alleviated for small entities. The Commission expects to more fully
consider the economic impact and alternatives for small entities
following the review of comments filed in response to the NPRM.
F. Federal Rules That May Duplicate, Overlap, or Conflict With the
Proposed Rules
266. None.
Three-Year Periodic Reporting Prioritization Schedule
----------------------------------------------------------------------------------------------------------------
Category Submarine cable name Current license No.
----------------------------------------------------------------------------------------------------------------
1............................. Americas-1 Cable System........................... SCL-LIC-20190326-00009
1............................. Asia America Gateway (AAG)........................ SCL-LIC-20070824-00015
[[Page 12092]]
1............................. FASTER Cable System............................... SCL-LIC-20150626-00015
1............................. Japan-U.S. Cable Network.......................... SCL-MOD-20130227-00002
1............................. JUPITER........................................... SCL-LIC-20180517-00012
1............................. New Cross-Pacific (NCP)........................... SCL-LIC-20151104-00029
1............................. PPC-1............................................. SCL-MOD-20180803-00030
1............................. Trans-Pacific Express (TPE) Cable Network......... SCL-MOD-20080714-00012
2............................. AmeriCan-1........................................ SCL-MOD-19990901-00016
2............................. Apollo Cable...................................... SCL-MOD-20020412-00031
2............................. Atisa............................................. SCL-LIC-20160314-00008
2............................. Australia-Japan Cable............................. SCL-MOD-20020415-00050
2............................. Bahamas Internet Cable System (BICS).............. SCL-MOD-20020925-00094
2............................. CFX-1 Cable System (CFX-1)........................ SCL-LIC-20070516-00008
2............................. Crosslake Fibre................................... SCL-LIC-20180216-00002
2............................. Gemini Bermuda System............................. SCL-LIC-20070925-00017
2............................. Global Caribbean Network (GCN).................... SCL-MOD-20140923-00009
2............................. Japan-Guam-Australia (JGA) North System (JGA SCL-LIC-20181106-00035
North).
2............................. Japan-Guam-Australia (JGA) South System (JGA SCL-LIC-20190502-00016
South).
2............................. Honotua Cable System.............................. SCL-MOD-20180410-00007
2............................. Monet Cable System................................ SCL-LIC-20150408-00008
2............................. Samoa American Samoa Cable System................. SCL-LIC-20080814-00016
2............................. Seabras-1......................................... SCL-LIC-20160115-00002
2............................. SMPR-1............................................ SCL-LIC-20031209-00033
2............................. Southern Cross NEXT............................... SCL-LIC-20190809-00026
2............................. Telstra Endeavour................................. SCL-LIC-20070621-00009
2............................. TGN Atlantic...................................... SCL-MOD-20060111-00001
2............................. TGN Pacific....................................... SCL-MOD-20060111-00002
2............................. Unity Cable System................................ SCL-LIC-20080516-00010
3............................. AEConnect-1 Cable System.......................... SCL-MOD-20210105-00001
3............................. Am[eacute]rica M[oacute]vil Submarine Cable System SCL-LIC-20120330-00002
(AMX1).
3............................. Americas II....................................... SCL-MOD-20191202-00038
3............................. Amiti[eacute]..................................... SCL-LIC-20200807-00036
3............................. Antilles Crossing................................. SCL-LIC-20031125-00032
3............................. ARCOS-1........................................... SCL-MOD-20020701-00056
3............................. Atlantic Crossing 1 (AC-1)........................ SCL-LIC-20230222-00005
3............................. BAHAMAS II........................................ SCL-LIC-20220422-00016
3............................. BRUSA............................................. SCL-LIC-20160330-00011
3............................. Columbus II....................................... SCL-MOD-20210702-00030
3............................. Carnival Submarine Networks-1 (CSN-1)............. SCL-LIC-20230921-00026
3............................. FLAG Atlantic-1................................... SCL-MOD-20040211-00006
3............................. GlobeNet.......................................... SCL-MOD-20121003-00012
3............................. GTT Atlantic Cable System......................... SCL-MOD-20020412-00023
3............................. Gulf of Mexico.................................... SCL-LIC-20061115-00010
3............................. Havfrue........................................... SCL-LIC-20180511-00010
3............................. Hawaii Interisland Cable System (HICS)............ SCL-LIC-20240320-00009
3............................. Hawaii Island Fiber Network (HIFN)................ SCL-LIC-20220111-00003
3............................. Hawaiki Cable System.............................. SCL-LIC-20160906-00019
3............................. JUNO.............................................. SCL-LIC-20221208-00037
3............................. MAREA............................................. SCL-LIC-20160525-00012
3............................. Maya-1............................................ SCL-MOD-20110928-00028
3............................. Mid-Atlantic Crossing (MAC)....................... SCL-MOD-20020415-00035
3............................. MTC Interisland (MICS)............................ SCL-LIC-20211013-00048
3............................. Neutral Networks Laredo Cable..................... SCL-LIC-20210930-00042
3............................. Pacific Caribbean Cable System (PCCS)............. SCL-LIC-20130122-00001
3............................. Pacific Crossing-1 (PC-1)......................... SCL-MOD-20020807-00086
3............................. Pan American Crossing (PAC)....................... SCL-MOD-20110524-00020
3............................. Paniolo Cable System.............................. SCL-LIC-20070223-00003
3............................. Quintillion....................................... SCL-LIC-20160325-00009
3............................. South America-1 (SAm-1)........................... SCL-MOD-20190826-00028
3............................. South American Crossing (SAC)..................... SCL-MOD-20150129-00002
3............................. Southeast Asia-US (SEA-US)........................ SCL-LIC-20150626-00016
3............................. Southern Cross 1&2................................ SCL-LIC-20231117-00038
3............................. Taino-Carib Cable System.......................... SCL-LIC-20180702-00019
3............................. Yellow............................................ SCL-MOD-20020415-00026
4............................. AKORN............................................. SCL-LIC-20071025-00018
4............................. Airraq............................................ SCL-MOD-20240515-00013
4............................. Alaska United Southeast (AU-SE)................... SCL-MOD-20200708-00025
4............................. Alaska United West................................ SCL-LIC-20020522-00047
4............................. AU-Aleutian....................................... SCL-MOD-20230803-00022
4............................. Cook Inlet Segment of TERRA-SW.................... SCL-LIC-20100914-00021
4............................. Curie............................................. SCL-MOD-20191223-00039
4............................. Dunant............................................ SCL-LIC-20190410-00015
4............................. Echo.............................................. SCL-LIC-20210329-00020
[[Page 12093]]
4............................. Firmina........................................... SCL-LIC-20220422-00015
4............................. GOKI Cable Network................................ SCL-LIC-20110329-00009
4............................. Grace Hopper...................................... SCL-LIC-20210225-00014
4............................. HANTRU1........................................... SCL-LIC-20090302-00005
4............................. KetchCan1 Submarine Fiber Cable System............ SCL-LIC-20190718-00020
4............................. Kodiak-Kenai Fiber Link........................... SCL-LIC-20060413-00004
4............................. Pacific Light Cable Network (PLCN)................ SCL-LIC-20200827-00038
4............................. St. Thomas-St. Croix.............................. SCL-LIC-20220114-00004
4............................. St. Thomas-St. Croix Submarine Cable System....... SCL-LIC-20121221-00015
4............................. VILink Cable...................................... SCL-LIC-20180417-00008
----------------------------------------------------------------------------------------------------------------
List of Subjects
47 CFR Part 0
Authority delegations (Government agencies), Communications,
Communications common carriers, Freedom of information, Organization
and functions (Government agencies), Reporting and recordkeeping
requirements, Telecommunications.
47 CFR Part 1
Administrative practice and procedure, Authority delegations
(Government agencies), Communications, Communications common carriers,
Communications equipment, internet, Organization and function
(Government agencies), Penalties, Reporting and recordkeeping
requirements, Security measures, Telecommunications.
47 CFR Part 43
Administrative practice and procedure, Authority delegations
(Government agencies), Communications common carriers, Penalties,
Reporting and recordkeeping requirements.
Federal Communications Commission.
Marlene Dortch,
Secretary.
Proposed Rules
For the reasons discussed in the preamble, the Federal
Communications Commission proposes to amend 47 CFR parts 0, 1, and 43
as follows:
PART 0--COMMISSION ORGANIZATION
0
1. The authority citation of part 0 continues to read as follows:
Authority: 47 U.S.C. 151, 154(i), 154(j), 155, 225, 409, and
1754, unless otherwise noted.
0
2. Amend Sec. 0.457 by adding paragraph (c)(1)(iv) to read as follows:
Sec. 0.457 Records not routinely available for public inspection.
* * * * *
(c) * * *
(1) * * *
(iv) The exact addresses and the specific geographic coordinates of
cable landing stations, beach manholes, and other location information
associated with submarine cables.
* * * * *
PART 1--PRACTICE AND PROCEDURE
0
3. The authority citation of part 1 continues to read as follows:
Authority: 47 U.S.C. chs. 2, 5, 9, 13; 28 U.S.C. 2461 note; 47
U.S.C. 1754, unless otherwise noted.
Sec. Sec. 1.767 and 1.768 [Removed]
0
4. Remove Sec. Sec. 1.767 and 1.768.
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5. Add subpart FF, consisting of Sec. Sec. 1.70000 through 1.70019, to
read as follows:
Subpart FF--Submarine Cable Landing Licenses
Sec.
1.70000 Purpose.
1.70001 Definitions.
1.70002 General requirements.
1.70003 Applicant/licensee requirements.
1.70004 Presumption of entities not qualified to become a new
submarine cable landing licensee.
1.70005 Initial application for a submarine cable landing license.
1.70006 Certifications.
1.70007 Routine conditions.
1.70008 Requests for special temporary authority.
1.70009 Notification by and prior approval for submarine cable
landing licensees that are or propose to become affiliated with a
foreign carrier.
1.70010 Amendment of applications.
1.70011 Modification applications.
1.70012 Substantial assignment or transfer of control applications.
1.70013 Pro forma assignment and transfer of control notifications.
1.70014 Processing of applications and requests for streamlining.
1.70015 Quarterly reports.
1.70016 Three-year periodic reporting.
1.70017 Renewal applications.
1.70018 Electronic filing.
1.70019 Denial, revocation, and termination.
Sec. 1.70000 Purpose.
The provisions contained in this subpart implement the Cable
Landing License Act of 1921, codified at 47 U.S.C. 34-39, as amended,
and section 5(a) of Executive Order 10530, dated May 10, 1954, and
provide requirements for initial applications for a submarine cable
landing license; certifications; routine conditions; requests for
special temporary authority; foreign carrier affiliation notifications;
amendment of applications; modification applications; substantial
assignment and transfer of control of a submarine cable landing
license; pro forma assignment and transfer of control notifications;
requests for streamlining of applications; quarterly reports; three-
year periodic reports; renewal applications; public viewing of
applications; electronic filing; and denial, revocation, and
termination of submarine cable landing license applications or
licenses.
Sec. 1.70001 Definitions.
(a) Affiliated. The term affiliated as used in this subpart is
defined as in Sec. 63.09 of this chapter.
(b) Country. The term country as used in this subpart refers to the
foreign points identified in the U.S. Department of State's list of
Independent States of the World and its list of Dependencies and Areas
of Special Sovereignty. See https://www.state.gov.
(c) Foreign carrier. The term foreign carrier as used in this
subpart is defined as in Sec. 63.09 of this chapter except that the
term foreign carrier shall also include any entity that owns or
controls a cable landing station in a foreign market.
(d) Managed network service provider. For purposes of this subpart,
a managed network service provider (MNSP) is defined as any entity
other than the applicant(s) or licensee(s) (i.e., third party entity)
with whom the applicant(s) or licensee(s) contracts to provide,
supplement, or replace certain functions
[[Page 12094]]
for the U.S. portion of the submarine cable system (including any cable
landing station and submarine line terminal equipment (SLTE) located in
the United States) that require or may require access to the network,
systems, or records of the applicant(s) or licensee(s).
Sec. 1.70002 General requirements.
(a) Submarine cable landing license requirements. A submarine cable
landing license must be obtained prior to landing a submarine cable
that connects:
(1) The continental United States with any foreign country;
(2) Alaska, Hawaii, or the U.S. Territories or possessions with a:
(i) Foreign country;
(ii) The continental United States; or
(iii) With each other; or
(3) Points within the continental United States, Alaska, Hawaii, or
a Territory or possession in which the cable is laid in international
waters.
(b) Public interest standard. An applicant seeking a submarine
cable landing license or modification, assignment, transfer of control,
or renewal or extension of a submarine cable landing license shall
include in the application information demonstrating how the grant of
the application will serve the public interest, convenience, and
necessity.
(c) Character qualifications. An applicant seeking a submarine
cable landing license or modification, assignment, transfer of control,
or renewal or extension of a submarine cable landing license shall
certify in the application that the applicant has the requisite
character qualifications, including whether the applicant has violated
the Cable Landing License Act of 1921, the Communications Act of 1934,
or rules in this chapter, including making false statements or
misrepresentations to the Commission; whether the applicant has been
convicted of a felony; and whether there is an adjudicated
determination that the applicant has violated U.S. antitrust or other
competition laws, has been found to have engaged in fraudulent conduct
before another government agency, or has engaged in other non-FCC
misconduct the Commission has found to be relevant in assessing the
character qualifications of a licensee or authorization holder.
(d) State Department coordination. Submarine cable licenses shall
be granted or revoked by the Commission after obtaining the approval of
the Secretary of State and such assistance from any executive
department or establishment of the Government as the Commission may
deem necessary. See section 5(a) of Executive Order 10530, dated May
10, 1954.
Sec. 1.70003 Applicant/licensee requirements.
Except as otherwise required by the Commission, the following
entities, at a minimum, shall be applicants for, and licensees on, a
cable landing license:
(a) Any entity that owns or controls a cable landing station in the
United States; and
(b) All other entities owning or controlling a five percent (5%) or
greater interest in the cable system and using the U.S. points of the
cable system.
Sec. 1.70004 Presumption of entities not qualified to become a new
submarine cable landing licensee.
The following entities shall be presumed to be unqualified to
become a new submarine cable landing licensee.
(a) Any entity whose application for international authority
pursuant to section 214 of the Communications Act of 1934, as amended
(international section 214 authority), was previously denied or whose
domestic or international section 214 authority was previously revoked,
as identified in the Report and Order in IB Docket No. 23-119 [Federal
Register publication date TBD], shall be presumed to be unqualified to
become a new cable landing licensee.
(b) Any entity whose application (including an application for any
authorization or license) is or was previously denied or whose
authorization or license is or was previously revoked and/or terminated
on national security and/or law enforcement grounds shall be presumed
to be unqualified to become a new cable landing licensee.
(c) Current and future affiliates and subsidiaries, as defined in
Sec. 2.903(c) of this chapter, of identified entities pursuant to
paragraphs (a) and (b) of this section.
Sec. 1.70005 Initial application for a submarine cable landing
license.
An applicant must demonstrate in the initial application for a
submarine cable landing license that they meet the requirements under
Sec. 1.70002(b) through (c), and the initial application must contain:
(a) The name, address, email address(es), and telephone number(s)
of each applicant.
(b) The Government, State, or Territory under the laws of which
each corporate or partnership applicant is organized.
(c) The name, title, address, email address(es), and telephone
number of the officer and any other contact point, such as legal
counsel, of each applicant to whom correspondence concerning the
application is to be addressed.
(d) The name of the submarine cable system.
(e) A description of the submarine cable, including:
(1) The States, Territories, or possessions in the United States
and the foreign countries where the cable will land;
(2) The number of segments in the submarine cable system and the
designation of each (e.g., Segment A, Main Trunk, A-B segment);
(3) The length of the submarine cable by segment and in total;
(4) The location, by segment, of any branching units;
(5) The address and county or county equivalent of each U.S. and
non-U.S. cable landing station;
(6) The number of optical fiber pairs, by segment, of the submarine
cable;
(7) The design capacity, by segment, of the submarine cable; and
(8) Anticipated time frame when the applicant(s) intends to place
the submarine cable system into service).
(f)(1) A specific description of the submarine cable system,
including a map and geographic data in generally accepted Geographic
Information Systems (GIS) formats or other formats. The Office of
International Affairs (OIA), in coordination with the Office of
Economics and Analytics (OEA), shall determine the file formats and
specific data fields in which data will ultimately be collected.
(2) The applicant initially may file a general geographic
description of the landing points; however, grant of the application
will be conditioned on the Commission's final approval of a more
specific description of the landing points, including all information
required by this paragraph, to be filed by the applicant no later than
ninety (90) days prior to construction. The Commission will give public
notice of the filing of this description, and grant of the license will
be considered final if the Commission does not notify the applicant
otherwise in writing no later than sixty (60) days after receipt of the
specific description of the landing points, unless the Commission
designates a different time period.
(g) A statement disclosing whether the applicant uses and/or will
use foreign-owned MNSPs in the cable system. Such functions may
include, but are not limited to: operations and management support;
network operations and service monitoring, including intrusion testing;
network performance, optimization, and reporting; installation and
testing;
[[Page 12095]]
network audits, provisioning and development; and the implementation of
changes and upgrades.
(h) A statement as to whether the cable will be operated on a
common carrier or non-common carrier basis. Applicants for common
carrier cable landing licenses shall also separately file an
application for an international authorization pursuant to section 214
of the Communications Act of 1934, as amended, for overseas cable
construction under Sec. 63.18 of this chapter.
(i) A list of all of the proposed owners of the cable system
including those owners that are not applicants, their respective equity
and/or voting interests in the cable system as a whole, their
respective equity and/or voting interests in each U.S. cable landing
station including submarine line terminal equipment, and their
respective equity and/or voting interests by segment of the cable.
(j) For each applicant:
(1) The information and certifications required in Sec. 63.18(h),
(o), and (q) of this chapter.
(2) A certification as to whether or not the applicant is, or is
affiliated with, a foreign carrier, including an entity that owns or
controls a cable landing station, in any foreign country. The
certification shall state with specificity each such country.
(3) A certification as to whether or not the applicant seeks to
land and operate a submarine cable connecting the United States to any
country for which any of the following is true. The certification shall
state with specificity the foreign carriers and each country:
(i) The applicant is a foreign carrier in that country; or
(ii) The applicant controls a foreign carrier in that country; or
(iii) There exists any entity that owns more than 25 percent of the
applicant, or controls the applicant, or controls a foreign carrier in
that country.
(iv) Two or more foreign carriers (or parties that control foreign
carriers) own, in the aggregate, more than 25 percent of the applicant
and are parties to, or the beneficiaries of, a contractual relation
(e.g., a joint venture or market alliance) affecting the provision or
marketing of arrangements for the terms of acquisition, sale, lease,
transfer and use of capacity on the cable in the United States.
(4) For any country that the applicant has listed in response to
paragraph (j)(3) of this section that is not a member of the World
Trade Organization, a demonstration as to whether the foreign carrier
lacks market power with reference to the criteria in Sec. 63.10(a) of
this chapter.
(5) Under Sec. 63.10(a) of this chapter, the Commission presumes,
subject to rebuttal, that a foreign carrier lacks market power in a
particular foreign country if the applicant demonstrates that the
foreign carrier lacks 50 percent market share in international
transport facilities or services, including cable landing station
access and backhaul facilities, intercity facilities or services, and
local access facilities or services on the foreign end of a particular
route.
(k) The certifications in Sec. 1.70006, including a certification
that the applicant accepts and will abide by the routine conditions
specified in Sec. 1.70007(a);
(l) Each applicant shall provide the following information with
respect to services it expects to provide through the submarine cable
system:
(1) Identify and describe the capacity services and capacity
management services, including the amount of fiber, spectrum, or
capacity, by selling, leasing, or swapping;
(2) Identify the types of customers that will be served, including
those with whom the applicant will lease, sell, share, or swap fiber,
spectrum, or capacity;
(3) Identify whether the applicant will own or control the U.S.
portion of the submarine cable system, including the cable landing
station(s), through an Indefeasible Right of Use (IRU) or leasehold
interest;
(4) Identify where the applicant expects to market, offer, and/or
provide services; and
(5) Identify the general terms and conditions that will apply to
the services, such as contact duration, minimum capacity/bandwidth
requirements, IRU requirements, termination clauses, security
requirements, delivery or Service Level Agreements (SLA) requirements,
dispute resolution, and other applicable provisions.
(m) Each applicant shall demonstrate that it has successfully
implemented an established set of cybersecurity best practices
consistent with Sec. 1.70006(c). The information provided under this
paragraph (m) shall be treated as presumptively confidential.
Applicants and licensees shall submit cybersecurity risk management
plans to the Commission upon request. OIA, in coordination with the
Public Safety and Homeland Security Bureau, may request, at its
discretion, submission of such cybersecurity risk management plans and
to evaluate them for compliance with the Commission's rules in this
subpart.
(n) Any other information that may be necessary to enable the
Commission to act on the application.
(o) Applicants for cable landing licenses may be subject to the
consistency certification requirements of the Coastal Zone Management
Act (CZMA), 16 U.S.C. 1456, if they propose to conduct activities, in
or outside of a coastal zone of a state with a federally-approved
management plan, affecting any land or water use or natural resource of
that state's coastal zone.
(1) Before filing their applications for a license to construct and
operate a submarine cable system or to modify the construction of a
previously approved submarine cable system, applicants must determine
whether they are required to certify that their proposed activities
will comply with the enforceable policies of a coastal state's approved
management program. In order to make this determination, applicants
should consult National Oceanic Atmospheric Administration (NOAA)
regulations, 15 CFR part 930, subpart D, and review the approved
management programs of coastal states in the vicinity of the proposed
landing station to verify that this type of application is not a listed
Federal license activity requiring review.
(2) After the application is filed, applicants should follow the
procedures specified in 15 CFR 930.54 to determine whether any
potentially affected state has sought or received NOAA approval to
review the application as an unlisted activity. If it is determined
that any certification is required, applicants shall consult the
affected coastal state(s) (or designated state agency(ies)) in
determining the contents of any required consistency certification(s).
Applicants may also consult the Office of Ocean and Coastal Management
(OCRM) within NOAA for guidance.
(3) The cable landing license application filed with the Commission
shall include any consistency certification required by 16 U.S.C.
1456(c)(3)(A) for any affected coastal state(s) that lists this type of
application in its NOAA-approved coastal management program and shall
be updated pursuant to Sec. 1.65, to include any subsequently required
consistency certification with respect to any state that has received
NOAA approval to review the application as an unlisted Federal license
activity. Upon documentation from the applicant--or notification from
each coastal state entitled to review the license application for
consistency with a federally approved coastal management program--that
the state has either concurred, or by its inaction, is
[[Page 12096]]
conclusively presumed to have concurred with the applicant's
consistency certification, the Commission may take action on the
application.
Sec. 1.70006 Certifications.
All applicants for a submarine cable landing license, all licensees
seeking modification of their license under Sec. 1.70011, all
licensees seeking renewal or extension of their license under Sec.
1.70017, all assignees or transferees in transactions under Sec.
1.70012 or Sec. 1.70013, and all licensees providing periodic
reporting under Sec. 1.70016 must certify to the following:
(a) That the applicant/licensee accepts and will abide by the
routine conditions specified in Sec. 1.70007.
(b) That the applicant/licensee has the requisite character
qualifications, including whether or not the applicant/licensee has
violated the Cable Landing License Act of 1921, the Communications Act
of 1934, or the rules in this chapter, including making false
statements or misrepresentations to the Commission; whether the
applicant/licensee has been convicted of a felony; and whether there is
an adjudicated determination that the applicant/licensee has violated
U.S. antitrust or other competition laws, has been found to have
engaged in fraudulent conduct before another Government agency, or has
engaged in other non-FCC misconduct the Commission has found to be
relevant in assessing the character qualifications of a licensee or
authorization holder.
(c) That the applicant/licensee has created, updated, and
implemented cybersecurity risk management plans, and:
(1) That these plans identify the cybersecurity risks they face,
the controls they use or plan to use to mitigate those risks, and how
to ensure these controls are applied effectively to their
organizations;
(2) That they will take reasonable measures to protect the
confidentiality, integrity, and availability of their systems and
services that could affect the provision of communications services,
describing in the cybersecurity risk management plan how they will
employ their organizational resources and processes to ensure this;
(3) That the cybersecurity risk management plan has been signed by
the entity's Chief Executive Officer, Chief Financial Officer, Chief
Technology Officer, or similarly situated senior officer responsible
for governance of the organization's security practices;
(4) That they will submit cybersecurity risk management plans to
the Commission upon request; and
(5) That they will preserve data and records related to their
cybersecurity risk management plans for two years from submission of
the risk management plan certification.
(d) That the applicant/licensee will not use covered equipment or
services identified on the Commission's ``Covered List'' that the
Commission maintains pursuant to the Secure and Trusted Communications
Networks Act of 2019, 47 U.S.C. 1601-1609.
Sec. 1.70007 Routine conditions.
Except as otherwise ordered by the Commission, the following rules
apply to each licensee of a cable landing license.
(a) Grant of the cable landing license is subject to:
(1) All rules and regulations of the Federal Communications
Commission in this chapter;
(2) Any treaties or conventions relating to communications to which
the United States is or may hereafter become a party; and
(3) Any action by the Commission or the Congress of the United
States rescinding, changing, modifying or amending any rights accruing
to any person by grant of the license.
(b) The location of the cable system within the territorial waters
of the United States of America, its Territories and possessions, and
upon its shores shall be in conformity with plans approved by the
Secretary of the Army. The cable shall be moved or shifted by the
licensee at its expense upon request of the Secretary of the Army,
whenever he or she considers such course necessary in the public
interest, for reasons of national defense, or for the maintenance and
improvement of harbors for navigational purposes.
(c) The licensee shall at all times comply with any requirements of
United States Government authorities regarding the location and
concealment of the cable facilities, buildings, and apparatus for the
purpose of protecting and safeguarding the cables from injury or
destruction by enemies of the United States of America.
(d) The licensee, or any person or company controlling it,
controlled by it, or under direct or indirect common control with it,
does not enjoy and shall not acquire any right to handle traffic to or
from the United States, its Territories or its possessions unless such
service is authorized by the Commission pursuant to section 214 of the
Communications Act, as amended.
(e)(1) The licensee shall be prohibited from agreeing to accept
special concessions directly or indirectly from any foreign carrier,
including any entity that owns or controls a foreign cable landing
station, where the foreign carrier possesses sufficient market power on
the foreign end of the route to affect competition adversely in the
U.S. market, and from agreeing to accept special concessions in the
future.
(2) For purposes of this section, a special concession is defined
as an exclusive arrangement involving services, facilities, or
functions on the foreign end of a U.S. international route that are
necessary to land, connect, or operate submarine cables, where the
arrangement is not offered to similarly situated U.S. submarine cable
owners, indefeasible-right-of-user holders, or lessors, and includes
arrangements for the terms for acquisition, resale, lease, transfer and
use of capacity on the cable; access to collocation space; the
opportunity to provide or obtain backhaul capacity; access to technical
network information; and interconnection to the public switched
telecommunications network.
(f) The cable landing license and rights granted in the license
shall not be transferred, assigned, or disposed of, or disposed of
indirectly by transfer of control of the licensee, except in compliance
with the requirements set out in Sec. Sec. 1.70012 and 1.70013.
(g) Entities that are parties to a pro forma assignment or transfer
of control notification must notify the Commission no later than thirty
(30) days after the assignment or transfer of control is consummated,
and the notification must include information and certifications
required under Sec. 1.70013.
(h) Unless the licensee has notified the Commission in the
application of the precise locations at which the cable will land, as
required by Sec. 1.70005(f), the licensee shall notify the Commission
no later than ninety (90) days prior to commencing construction at that
landing location. The Commission will give public notice of the filing
of each description, and grant of the cable landing license will be
considered final with respect to that landing location unless the
Commission issues a notice to the contrary no later than sixty (60)
days after receipt of the specific description. See Sec. 1.70005(f).
(i) The Commission reserves the right to require the licensee to
file an environmental assessment should it determine that the landing
of the cable at the specific locations and construction of necessary
cable landing stations may significantly affect the environment within
the meaning of
[[Page 12097]]
Sec. 1.1307, implementing the National Environmental Policy Act of
1969. See Sec. 1.1307(a) and (b). The cable landing license is subject
to modification by the Commission under its review of any environmental
assessment or environmental impact statement that it may require
pursuant to its rules. See also note 1 to Sec. 1.1306 and Sec.
1.1307(c) and (d).
(j) The Commission reserves the right, pursuant to section 2 of the
Cable Landing License Act, 47 U.S.C. 35, Executive Order 10530 as
amended, and section 214 of the Communications Act of 1934, as amended,
47 U.S.C. 214, to impose common carrier regulation or other regulation
consistent with the Cable Landing License Act on the operations of the
cable system if it finds that the public interest so requires.
(k) The licensee, or in the case of multiple licensees, the
licensees collectively, shall maintain de jure and de facto control of
the U.S. portion of the cable system, including the cable landing
stations in the United States, sufficient to comply with the
requirements of the Commission's rules and any specific conditions of
the license.
(l) The licensee shall comply with the requirements of Sec.
1.70009.
(m) The licensee shall file annual international circuit capacity
reports as required by Sec. 43.82 of this chapter.
(n) The cable landing license is revocable or subject to
termination by the Commission after due notice and opportunity for
hearing for reasons set forth in section 2 of the Cable Landing License
Act, 47 U.S.C. 35, or for failure to comply with the terms of the
license or with this chapter.
(o) The cable landing license shall expire twenty-five (25) years
from the in-service date, unless renewed or extended upon proper
application. Upon expiration, all rights granted under the license
shall be terminated.
(p) The licensee(s) must commence service provided under its
license within three years following the grant of its license.
(1) The licensee must notify the Commission within thirty (30) days
of the date the cable is placed into service.
(2) Failure to notify the Commission of commencement of service
within three years following the grant of the license shall result in
automatic cancellation of the license, unless the licensee can show
good cause why it is unable to commence commercial service on the
cable.
(q) Licensees shall file submarine cable outage reports as required
in part 4 of this chapter.
(r) Each licensee shall notify the Commission of any changes to the
following within thirty (30) days:
(1) The contact information of the licensee provided under Sec.
1.70005(a) and (c); and,
(2) The name of the licensee (including the name under which the
licensee is doing business) (a change in the form of the business,
e.g., from a corporation to limited liability company, is a pro forma
assignment and the Commission should be notified of such change
pursuant to Sec. 1.70013).
(s) The licensee(s) shall notify the Commission of any changes to
the following within thirty (30) days the name of the licensed
submarine cable system. Joint licensees may appoint one party to act as
proxy for purposes of complying with this paragraph (s).
(t) The licensee(s) will not use covered equipment or services
identified on the Commission's ``Covered List'' that the Commission
maintains pursuant to the Secure and Trusted Communications Networks
Act of 2019, 47 U.S.C. 1601-1609.
(u) The licensee(s) shall submit periodic reports every three years
consistent with the requirements under Sec. 1.70016. Joint licensees
may appoint one party to act as proxy for purposes of complying with
this paragraph (u).
Sec. 1.70008 Requests for special temporary authority.
(a) Special temporary authority may be used for construction,
testing, or operation of a submarine cable service for a term up to and
including 180 days.
(b) Applicants seeking special temporary authority must file all
requisite applications related to the request for special temporary
authority. Applicants must identify the file number(s) of any pending
application(s) associated with the request for special temporary
authority.
(c) An application for special temporary authority must include:
(1) A narrative describing the request for a special temporary
authority including the type of request (e.g., new request, extension
or renewal of previous request, or other), purpose for the special
temporary authority (construction, testing, operating, or other), and
the justification for such request;
(2) Information required by Sec. 1.70005(a) through (c), (d), (g);
(3) Whether or not the request for special temporary authority is
associated with an application(s) pending with the Commission, and if
so, identification of the related file number(s);
(4) The date by which applicants seek grant of the request for
special temporary authority; and
(5) Any other information that may be necessary to enable the
Commission to act on the application.
Sec. 1.70009 Notification by and prior approval for submarine cable
landing licensees that are or propose to become affiliated with a
foreign carrier.
Any entity that is licensed by the Commission (``licensee'') to
land or operate a submarine cable landing in a particular foreign
destination market that becomes, or seeks to become, affiliated with a
foreign carrier that is authorized to operate in that market, including
an entity that owns or controls a cable landing station in that market,
shall notify the Commission of that affiliation.
(a) Affiliations requiring prior notification. Except as provided
in paragraph (b) of this section, the licensee must notify the
Commission, pursuant to this section, forty-five (45) days before
consummation of either of the following types of transactions:
(1) Acquisition by the licensee, or by any entity that controls the
licensee, or by any entity that directly or indirectly owns more than
twenty-five percent (25%) of the capital stock of the licensee, of a
controlling interest in a foreign carrier that is authorized to operate
in a market where the cable lands; or
(2) Acquisition of a direct or indirect interest greater than
twenty-five percent (25%), or of a controlling interest, in the capital
stock of the licensee by a foreign carrier that is authorized to
operate in a market where the cable lands, or by an entity that
controls such a foreign carrier.
(b) Exceptions. (1) Notwithstanding paragraph (a) of this section,
the notification required by this section need not be filed before
consummation, and may instead by filed pursuant to paragraph (c) of
this section, if either of the following is true with respect to the
named foreign carrier, regardless of whether the destination market
where the cable lands is a World Trade Organization (WTO) or non-WTO
Member:
(i) The Commission has previously determined in an adjudication
that the foreign carrier lacks market power in that destination market
(for example, in an application for international authority pursuant to
section 214 of the Communications Act of 1934 or a declaratory ruling
proceeding); or
(ii) The foreign carrier owns no facilities in that destination
market. For this purpose, a carrier is said to own
[[Page 12098]]
facilities if it holds an ownership, indefeasible-right-of-user, or
leasehold interest in a cable landing station or in bare capacity in
international or domestic telecommunications facilities (excluding
switches).
(2) In the event paragraph (b)(1) of this section cannot be
satisfied, notwithstanding paragraph (a) of this section, the
notification required by this section need not be filed before
consummation, and may instead be filed pursuant to paragraph (c) of
this section, if the licensee certifies that the destination market
where the cable lands is a WTO Member and provides certification to
satisfy either of the following:
(i) The licensee demonstrates that its foreign carrier affiliate
lacks market power in the cable's destination market pursuant to Sec.
63.10(a)(3) of this chapter (see Sec. 63.10(a)(3) of this chapter); or
(ii) The licensee agrees to comply with the reporting requirements
contained in Sec. 1.70015 effective upon the acquisition of the
affiliation. See Sec. 1.70015.
(c) Notification after consummation. Any licensee that becomes
affiliated with a foreign carrier and has not previously notified the
Commission pursuant to the requirements of this section shall notify
the Commission within thirty (30) days after consummation of the
acquisition.
Example 1 to paragraph (c). Acquisition by a licensee (or by any
entity that directly or indirectly controls, is controlled by, or is
under direct or indirect common control with the licensee) of a direct
or indirect interest in a foreign carrier that is greater than twenty-
five percent (25%) but not controlling is subject to paragraph (c) of
this section but not to paragraph (a) of this section.
Example 2 to paragraph (c). Notification of an acquisition by a
licensee of a hundred percent (100%) interest in a foreign carrier may
be made after consummation, pursuant to paragraph (c) of this section,
if the foreign carrier operates only as a resale carrier.
Example 3 to paragraph (c). Notification of an acquisition by a
foreign carrier from a WTO Member of a greater than twenty-five percent
(25%) interest in the capital stock of the licensee may be made after
consummation, pursuant to paragraph (c) of this section, if the
licensee demonstrates in the post-notification that the foreign carrier
lacks market power in the cable's destination market or the licensee
agrees to comply with the reporting requirements contained in Sec.
1.767(l) effective upon the acquisition of the affiliation.
(d) Cross-reference. In the event a transaction requiring a foreign
carrier notification pursuant to this section also requires a transfer
of control or assignment application pursuant to the requirements of
the license granted under Sec. 1.70007(f) through (g), Sec. 1.70012,
or Sec. 1.70013, the foreign carrier notification shall reference in
the notification the transfer of control or assignment application and
the date of its filing. See Sec. 1.70007.
(e) Contents of notification. The notification shall certify the
following information:
(1) The name of the newly affiliated foreign carrier and the
country or countries at the foreign end of the cable in which it is
authorized to provide telecommunications services to the public or
where it owns or controls a cable landing station.
(2) Which, if any, of those countries is a Member of the World
Trade Organization.
(3) The name of the cable system that is the subject of the
notification, and the FCC file number(s) under which the license was
granted.
(4) The name, address, citizenship, and principal business of any
person or entity that directly or indirectly owns ten percent or more
of the equity interests and/or voting interests, or a controlling
interest, of the licensee, and the percentage of equity and/or voting
interest owned by each of those entities (to the nearest one percent).
Where no individual or entity directly or indirectly owns ten percent
or more of the equity interests and/or voting interests, or a
controlling interest, of the licensee, a statement to that effect.
(i) Calculation of equity interests held indirectly in the
licensee. Equity interests that are held by an individual or entity
indirectly through one or more intervening entities shall be calculated
by successive multiplication of the equity percentages for each link in
the vertical ownership chain, regardless of whether any particular link
in the chain represents a controlling interest in the company
positioned in the next lower tier. Example: An entity holds a non-
controlling 30 percent equity and voting interest in Corporation A
which, in turn, holds a non-controlling 40 percent equity and voting
interest in the licensee. The entity's equity interest in the licensee
would be calculated by multiplying the individual's equity interest in
Corporation A by that entity's equity interest in the licensee. The
entity's equity interest in the licensee would be calculated as 12
percent (30% x 40% = 12%). The result would be the same even if
Corporation A held a de facto controlling interest in the licensee.
(ii) Calculation of voting interests held indirectly in the
licensee. Voting interests that are held through one or more
intervening entities shall be calculated by successive multiplication
of the voting percentages for each link in the vertical ownership
chain, except that wherever the voting interest for any link in the
chain is equal to or exceeds 50 percent or represents actual control,
it shall be treated as if it were a 100 percent interest. A general
partner shall be deemed to hold the same voting interest as the
partnership holds in the company situated in the next lower tier of the
vertical ownership chain. A partner of a limited partnership (other
than a general partner) shall be deemed to hold a voting interest in
the partnership that is equal to the partner's equity interest.
Example: An entity holds a non-controlling 30 percent equity and voting
interest in Corporation A which, in turn, holds a controlling 70
percent equity and voting interest in the licensee. Because Corporation
A's 70 percent voting interest in the licensee constitutes a
controlling interest, it is treated as a 100 percent interest. The
entity's 30 percent voting interest in Corporation A would flow through
in its entirety to the licensee and thus be calculated as 30 percent
(30% x 100% = 30%).
(5) An ownership diagram that illustrates the licensee's vertical
ownership structure, including the direct and indirect ownership
(equity and voting) interests held by the individuals and entities
named in response to paragraph (e)(4) of this section. Every individual
or entity with ownership shall be depicted and all controlling
interests must be identified.
(6) The name of any interlocking directorates, as defined in Sec.
63.09(g) of this chapter, with each foreign carrier named in the
notification. See Sec. 63.09(g) of this chapter.
(7) With respect to each foreign carrier named in the notification,
a statement as to whether the notification is subject to paragraph (a)
or (c) of this section. In the case of a notification subject to
paragraph (a) of this section, the licensee shall include the projected
date of closing. In the case of a notification subject to paragraph (c)
of this section, the licensee shall include the actual date of closing.
(8) If a licensee relies on an exception in paragraph (b) of this
section, then a certification as to which exception the foreign carrier
satisfies and a citation to any adjudication upon which the licensee is
relying. Licensees relying upon the exceptions in paragraph (b)(2)
[[Page 12099]]
of this section must make the required certified demonstration in
paragraph (b)(2)(i) of this section or the certified commitment to
comply with the reporting requirements in paragraph (b)(2)(ii) of this
section in the notification required by paragraph (c) of this section.
(f) Exemptions. If the licensee seeks exemption from the reporting
requirements contained in Sec. 1.70015, the licensee should
demonstrate that each foreign carrier affiliate named in the
notification lacks market power pursuant to Sec. 63.10(a)(3) of this
chapter. See Sec. 63.10(a)(3) of this chapter.
(g) Procedure. After the Commission issues a public notice of the
submissions made under this section, interested parties may file
comments within fourteen (14) days of the public notice.
(1) If the Commission deems it necessary at any time before or
after the deadline for submission of public comments, the Commission
may impose reporting requirements on the licensee based on the
provisions of Sec. 1.70015. See Sec. 1.70015.
(2) In the case of a prior notification filed pursuant to paragraph
(a) of this section, the authorized U.S. licensee must demonstrate that
it continues to serve the public interest for it to retain its interest
in the cable landing license for that segment of the cable that lands
in the non-WTO destination market. Such a showing shall include a
demonstration as to whether the foreign carrier lacks market power in
the non-WTO destination market with reference to the criteria in Sec.
63.10(a) of this chapter. In addition, upon request of the Commission,
the licensee shall provide the information specified in Sec.
1.70005(j). If the licensee is unable to make the required showing or
is notified by the Commission that the affiliation may otherwise harm
the public interest pursuant to the Commission's policies and rules
under 47 U.S.C. 34 through 39 and Executive Order 10530, dated May 10,
1954, then the Commission may impose conditions necessary to address
any public interest harms or may proceed to an immediate authorization
revocation hearing.
(3) Under Sec. 63.10(a) of this chapter, the Commission presumes,
subject to rebuttal, that a foreign carrier lacks market power in a
particular foreign country if the applicant demonstrates that the
foreign carrier lacks 50 percent market share in international
transport facilities or services, including cable landing station
access and backhaul facilities, intercity facilities or services, and
local access facilities or services on the foreign end of a particular
route.
(h) Continuing accuracy. All licensees are responsible for the
continuing accuracy of information provided pursuant to this section
for a period of forty-five (45) days after filing. During this period
if the information furnished is no longer accurate, the licensee shall
as promptly as possible, and in any event within ten (10) days, unless
good cause is shown, file with the Commission a corrected notification
referencing the FCC file numbers under which the original notification
was provided.
(i) Confidential treatment. A licensee that files a prior
notification pursuant to paragraph (a) of this section may request
confidential treatment of its filing, pursuant to Sec. 0.459 of this
chapter, for the first twenty (20) days after filing.
(j) Electronic filing. Subject to the availability of electronic
forms, all notifications described in this section must be filed
electronically through the International Communications Filing System
(ICFS). A list of forms that are available for electronic filing can be
found on the ICFS homepage. For information on electronic filing
requirements, see Sec. Sec. 1.1000 through 1.10018 and the ICFS
homepage at https://www.fcc.gov/icfs. See also Sec. Sec. 63.20 and
63.53 of this chapter.
Sec. 1.70010 Amendment of applications.
Any application may be amended as a matter of right prior to the
date of any final action taken by the Commission or designation for
hearing. Amendments to applications shall be signed and submitted in
the same manner as was the original application. If a petition to deny
or other formal objection has been filed in response to the
application, the amendment shall be served on the parties.
Sec. 1.70011 Modification applications.
A separate application shall be filed with respect to each
individual cable system for which a licensee(s) seeks to modify the
cable landing license. Each modification application shall include a
narrative description of the proposed modification including relevant
facts and circumstances leading to the request. Each modification
application must contain a demonstration that the applicant meets the
requirements under Sec. 1.70002(b) through (c). Requirements for
specific types of modification requests are set out in paragraphs (a)
through (e) of this section. For other situations, the licensee(s)
should contact Commission staff regarding the required information for
the modification application.
(a) A modification application to add a landing station(s),
segment(s), or other like material changes to a submarine cable system
must also include the following:
(1) Information as required by Sec. 1.70005(a) through (i), (k),
and (m), as it relates to the modified portion of the cable system.
(2) Each applicant shall provide the following information with
respect to services it currently provides and/or expects to provide
through the submarine cable system:
(i) Identify and describe the capacity services and capacity
management services, including the amount of fiber, spectrum, or
capacity by selling, leasing, or swapping;
(ii) Identify the types of customers that currently are and/or will
be served, including those with whom the applicant leases, sells,
shares, or swaps fiber, spectrum, or capacity and/or plans to lease,
sell, share, or swap fiber, spectrum, or capacity;
(iii) Identify whether the applicant currently owns or controls
and/or will own or control the U.S. portion of the submarine cable
system, including the cable landing station(s), through an Indefeasible
Right of Use (IRU) or leasehold interest;
(iv) Identify where the applicant currently markets, offers, and
provides services and/or expects to market, offer, and provide
services; and
(v) Identify the general terms and conditions that currently apply
and/or will apply to the services, such as contact duration, minimum
capacity/bandwidth requirements, IRU requirements, termination clauses,
security requirements, delivery or Service Level Agreement (SLA)
requirements, dispute resolution, and other applicable provisions.
(3) Certifications set forth under Sec. 1.70006.
(4) Any other information that may be necessary to enable the
Commission to act on the application.
(5) Signatures by each licensee. Joint licensees may appoint one
party to act as proxy for purposes of complying with this paragraph
(a)(5).
(b) A modification application to remove a landing station(s),
segment(s), or other like material changes to a submarine cable system
must also include the following:
(1) A description of which elements will be removed from the cable
system and the timing for the removal or that element(s).
(2) Information as required by Sec. 1.70005(a) through (i), (k),
and (m).
(3) Each applicant shall provide the following information with
respect to services it currently provides and/or
[[Page 12100]]
expects to provide through the submarine cable system:
(i) Identify and describe the capacity services and capacity
management services, including the amount of fiber, spectrum, or
capacity by selling, leasing, or swapping;
(ii) Identify the types of customers that currently are and/or will
be served, including those with whom the applicant leases, sells,
shares, or swaps fiber, spectrum, or capacity and/or plans to lease,
sell, share, or swap fiber, spectrum, or capacity;
(iii) Identify whether the applicant currently owns or controls
and/or will own or control the U.S. portion of the submarine cable
system, including the cable landing station(s), through an IRU or
leasehold interest;
(iv) Identify where the applicant currently markets, offers, and
provides services and/or expects to market, offer, and provide
services; and
(v) Identify the general terms and conditions that currently apply
and/or will apply to the services, such as contact duration, minimum
capacity/bandwidth requirements, IRU requirements, termination clauses,
security requirements, delivery or SLA requirements, dispute
resolution, and other applicable provisions.
(4) Certifications set forth under Sec. 1.70006.
(5) Any other information that may be necessary to enable the
Commission to act on the application.
(6) Signatures by each licensee. Joint licensees may appoint one
party to act as proxy for purposes of complying with this paragraph
(b)(6).
(c) A modification application to add an applicant as a licensee
for an existing cable landing license must also include the following:
(1) Information required by Sec. 1.70005(a) through (c), (g), (j),
(k), and (m) for the proposed new licensee.
(2) Information required by Sec. 1.70005(d) through (f).
(3) The proposed new licensee shall provide the following
information with respect to services it currently provides and/or
expects to provide through the submarine cable system:
(i) Identify and describe the capacity services and capacity
management services, including the amount of fiber, spectrum, or
capacity by selling, leasing, or swapping;
(ii) Identify the types of customers that currently are and/or will
be served, including those with whom the applicant leases, sells,
shares, or swaps fiber, spectrum, or capacity and/or plans to lease,
sell, share, or swap fiber, spectrum, or capacity;
(iii) Identify whether the applicant currently owns or controls
and/or will own or control the U.S. portion of the submarine cable
system, including the cable landing station(s), through an IRU or
leasehold interest;
(iv) Identify where the applicant currently markets, offers, and
provides services and/or expects to market, offer, and provide
services; and
(v) Identify the general terms and conditions that currently apply
and/or will apply to the services, such as contact duration, minimum
capacity/bandwidth requirements, IRU requirements, termination clauses,
security requirements, delivery or SLA requirements, dispute
resolution, and other applicable provisions.
(2) Certifications set forth under Sec. 1.70006 for the proposed
new licensee.
(3) Any other information that may be necessary to enable the
Commission to act on the application.
(4) Signatures by the proposed licensee and each current licensee.
Joint licensees may appoint one party to act as proxy for purposes of
complying with this paragraph (c)(4).
(d) A modification application for a licensee that seeks to
relinquish its interest in a cable landing license must also include:
(1) Information required by Sec. 1.70005(a) through (c) for the
licensee that seeks to relinquish its interest;
(2) A demonstration that the entity is not required to be a
licensee under Sec. 1.70003 and that the remaining licensee(s) will
retain collectively de jure and de facto control of the U.S. portion of
the cable system sufficient to comply with the requirements of the
Commission's rules and any specific conditions of the license;
(3) A signature from the licensee that seeks to relinquish its
interest;
(4) Any other information that may be necessary to enable the
Commission to act on the application; and
(5) Such application must be served on each other licensee of the
cable system.
(e) A modification application to add, remove, or change a
condition on an existing cable landing license must also include the
following:
(1) Information required by Sec. 1.70005(a) through (c), (g), (j),
(k), and (m) for the licensee(s) that seeks to add, remove, or change a
condition.
(2) Information required by Sec. 1.70005(d) through (f).
(3) Each applicant shall provide the following information with
respect to services it currently provides and/or expects to provide
through the submarine cable system:
(i) Identify and describe the capacity services and capacity
management services, including the amount of fiber, spectrum, or
capacity by selling, leasing, or swapping;
(ii) Identify the types of customers that currently are and/or will
be served, including those with whom the applicant leases, sells,
shares, or swaps fiber, spectrum, or capacity and/or plans to lease,
sell, share, or swap fiber, spectrum, or capacity;
(iii) Identify whether the applicant currently owns or controls
and/or will own or control the U.S. portion of the submarine cable
system, including the cable landing station(s), through an IRU or
leasehold interest;
(iv) Identify where the applicant currently markets, offers, and
provides services and/or expects to market, offer, and provide
services; and
(v) Identify the general terms and conditions that currently apply
and/or will apply to the services, such as contact duration, minimum
capacity/bandwidth requirements, IRU requirements, termination clauses,
security requirements, delivery or SLA requirements, dispute
resolution, and other applicable provisions.
(4) Certifications set forth under Sec. 1.70006.
(5) A signature from the licensee that seeks to add, remove, or
change a condition.
(6) Any other information that may be necessary to enable the
Commission to act on the application.
Sec. 1.70012 Substantial assignment or transfer of control
applications.
(a) Each application for authority to assign or transfer control of
an interest in a cable system shall contain a demonstration that the
requirements under Sec. 1.70002(b) through (c) are met.
(b) An application for authority to assign or transfer control of
an interest in a cable system shall contain a narrative description of
the proposed transaction, including relevant facts and circumstances,
and that the applicant meets the requirements of Sec. 1.70002(b)
through (c). The application shall also include the following
information:
(1) The information requested in Sec. 1.70005(a) through (c) for
both the assignor/transferor and the assignee/transferee.
(2) The information requested in Sec. 1.70005(j) and (k) for the
assignee/transferee.
(3) The pre-transaction and post-transaction ownership diagram of
the licensee as required under Sec. 1.70005(j)(1).
(4) A narrative describing the means by which the assignment or
transfer of control will take place.
(5) The information required in Sec. 1.70005(e) through (f).
[[Page 12101]]
(6) The application shall also specify, on a segment specific
basis, the percentage of voting and ownership interests being assigned
or transferred in the cable system, including in the U.S. portion of
the cable system (which includes all U.S. cable landing station(s)).
(7) Each assignee or licensee that is the subject of a transfer of
control shall provide the following information with respect to
services it currently provides and/or expects to provide through the
submarine cable system:
(i) Identify and describe the capacity services and capacity
management services, including the amount of fiber, spectrum, or
capacity by selling, leasing, or swapping;
(ii) Identify the types of customers that currently are and/or will
be served, including those with whom the applicant leases, sells,
shares, or swaps fiber, spectrum, or capacity and/or plans to lease,
sell, share, or swap fiber, spectrum, or capacity;
(iii) Identify whether the applicant currently owns or controls
and/or will own or control the U.S. portion of the submarine cable
system, including the cable landing station(s), through an Indefeasible
Right of Use (IRU) or leasehold interest;
(iv) Identify where the applicant currently markets, offers, and
provides services and/or expects to market, offer, and provide
services; and
(v) Identify the general terms and conditions that currently apply
and/or will apply to the services, such as contact duration, minimum
capacity/bandwidth requirements, IRU requirements, termination clauses,
security requirements, delivery or Service Level Agreement (SLA)
requirements, dispute resolution, and other applicable provisions.
(8) Information as required by Sec. 1.70005(g) and (m) for each
assignee or licensee that is the subject of a transfer of control.
(9) In the event the transaction requiring an assignment or
transfer of control application also requires the filing of a foreign
carrier affiliation notification pursuant to Sec. 1.70009, the
application shall reference the foreign carrier affiliation
notification and the date of its filing. See Sec. 1.70009.
(10) The Commission reserves the right to request additional
information concerning the transaction to aid it in making its public
interest determination.
(11) An assignee or transferee must notify the Commission no later
than thirty (30) days after either consummation of the assignment or
transfer or a decision not to consummate the assignment or transfer.
The notification shall identify the file numbers under which the
initial license and the authorization of the assignment or transfer
were granted.
(12) Certifications set forth under Sec. 1.70006.
Sec. 1.70013 Pro forma assignment and transfer of control
notifications.
(a) A pro forma assignee or a licensee that is the subject of a pro
forma transfer of control of a cable landing license is not required to
seek prior approval for the pro forma transaction. A pro forma assignee
or licensee that is the subject of a pro forma transfer of control must
notify the Commission no later than thirty (30) days after the
assignment or transfer of control is consummated.
(b) Assignments or transfers of control that do not result in a
change in the actual controlling party are considered non-substantial
or pro forma. Whether there has been a change in the actual controlling
party must be determined on a case-by-case basis with reference to the
factors listed in note 1 to Sec. 63.24(d) of this chapter. The types
of transactions listed in note 2 to Sec. 63.24(d) of this chapter
shall be considered presumptively pro forma and prior approval from the
Commission need not be sought. A notification of a pro forma assignment
or transfer of control shall include the following information:
(1) The information requested in Sec. 1.70005(a) through (c) for
both the assignor/transferor and the assignee/transferee.
(2) The information requested in Sec. 1.70005(j) and (k) for the
assignee/transferee.
(3) The pre-transaction and post-transaction ownership diagram of
the licensee as required under Sec. 1.70005(j).
(4) A narrative describing the means by which the assignment or
transfer of control occurred.
(5) The information required in Sec. 1.70005(e) through (f).
(6) The application shall also specify, on a segment specific
basis, the percentage of voting and ownership interests being assigned
or transferred in the cable system, including in the U.S. portion of
the cable system (which includes all U.S. cable landing station(s)).
(7) The notification must certify that the assignment or transfer
of control was pro forma, as defined in paragraph (a) of this section,
and, together with all previous pro forma transactions, does not result
in a change of the licensee's ultimate control.
(8) Each assignee or licensee that is the subject of a transfer of
control shall provide the following information with respect to
services it currently provides and/or expects to provide through the
submarine cable system:
(i) Identify and describe the capacity services and capacity
management services, including the amount of fiber, spectrum, or
capacity by selling, leasing, or swapping;
(ii) Identify the types of customers that currently are and/or will
be served, including those with whom the applicant leases, sells,
shares, or swaps fiber, spectrum, or capacity and/or plans to lease,
sell, share, or swap fiber, spectrum, or capacity;
(iii) Identify whether the applicant currently owns or controls
and/or will own or control the U.S. portion of the submarine cable
system, including the cable landing station(s), through an Indefeasible
Right of Use (IRU) or leasehold interest;
(iv) Identify where the applicant currently markets, offers, and
provides services and/or expects to market, offer, and provide
services; and
(v) Identify the general terms and conditions that currently apply
and/or will apply to the services, such as contact duration, minimum
capacity/bandwidth requirements, IRU requirements, termination clauses,
security requirements, delivery or Service Level Agreement (SLA)
requirements, dispute resolution, and other applicable provisions.
(9) Information as required by Sec. 1.70005(g) and (m) for each
assignee or licensee that is the subject of a transfer of control.
(10) The licensee may file a single notification for an assignment
or transfer of control of multiple licenses issued in the name of the
licensee if each license is identified by the file number under which
it was granted.
(11) The Commission reserves the right to request additional
information concerning the transaction to aid it in making its public
interest determination.
(12) Certifications set forth under Sec. 1.70006.
Sec. 1.70014 Processing of applications and requests for
streamlining.
(a) Processing of submarine cable applications. The Commission will
take action upon an application eligible for streamlined processing, as
specified in paragraph (c) of this section, within forty-five (45) days
after release of the public notice announcing the application as
acceptable for filing and eligible for streamlined processing. If the
Commission deems an application seeking streamlined processing
acceptable for filing but ineligible for streamlined processing, or if
an
[[Page 12102]]
applicant does not seek streamlined processing, the Commission will
issue public notice indicating that the application is ineligible for
streamlined processing. Within ninety (90) days of the public notice,
the Commission will take action upon the application or provide public
notice that, because the application raises questions of extraordinary
complexity, an additional 90-day period for review is needed. Each
successive 90-day period may be so extended.
(b) Submission of application to executive branch agencies. On the
date of filing with the Commission, the applicant shall also send a
complete copy of the application, or any major amendments or other
material filings regarding the application, to: U.S. Coordinator, EB/
CIP, U.S. Department of State, 2201 C Street NW, Washington, DC 20520-
5818; Office of Chief Counsel/NTIA, U.S. Department of Commerce, 14th
St. and Constitution Ave. NW, Washington, DC 20230; and Defense
Information Systems Agency, ATTN: GC/DO1, 6910 Cooper Avenue, Fort
Meade, MD 20755-7088, and shall certify such service on a service list
attached to the application or other filing.
(c) Eligibility for streamlining. Each applicant must demonstrate
eligibility for streamlining by:
(1) Certifying that it is not a foreign carrier and it is not
affiliated with a foreign carrier in any of the cable's destination
markets;
(2) Demonstrating pursuant to Sec. 63.12(c)(l)(i) through (iii) of
this chapter that any such foreign carrier or affiliated foreign
carrier lacks market power; or
(3) Certifying that the destination market where the applicant is,
or has an affiliation with, a foreign carrier is a World Trade
Organization (WTO) Member and the applicant agrees to accept and abide
by the reporting requirements set out in Sec. 1.70015. An application
that includes an applicant that is, or is affiliated with, a carrier
with market power in a cable's non-WTO Member destination country is
not eligible for streamlining.
(4) Certifying that for applications for a license to construct and
operate a submarine cable system or to modify the construction of a
previously approved submarine cable system the applicant is not
required to submit a consistency certification to any state pursuant to
section 1456(c)(3)(A) of the Coastal Zone Management Act (CZMA), 16
U.S.C. 1456.
(5) Certifying that all individuals or entities that hold a five
percent or greater direct or indirect equity and/or voting interests,
or a controlling interest, in the applicant are U.S. citizens or
entities organized in the United States.
(d) Applicability. Streamlining of cable landing license
applications will be limited to those applications where all
potentially affected states, having constructive notice that the
application was filed with the Commission, have waived, or are deemed
to have waived, any right under section 1456(c)(3)(A) of the CZMA to
review the application within the thirty-day period prescribed by 15
CFR 930.54.
Sec. 1.70015 Quarterly reports.
Reporting requirements applicable to licensees affiliated with a
carrier with market power in a cable's destination market. Any licensee
that is, or is affiliated with, a carrier with market power in any of
the cable's destination countries must comply with the following
requirements:
(a) File quarterly reports summarizing the provisioning and
maintenance of all network facilities and services procured from the
licensee's affiliate in that destination market, within ninety (90)
days from the end of each calendar quarter. These reports shall contain
the following:
(1) The types of facilities and services provided (for example, a
lease of wet link capacity in the cable, collocation of licensee's
equipment in the cable station with the ability to provide backhaul, or
cable station and backhaul services provided to the licensee);
(2) For provisioned facilities and services, the volume or quantity
provisioned, and the time interval between order and delivery; and
(3) The number of outages and intervals between fault report and
facility or service restoration; and
(b) File quarterly, within 90 days from the end of each calendar
quarter, a report of its active and idle 64 kbps or equivalent circuits
by facility (terrestrial, satellite and submarine cable).
Sec. 1.70016 Three-year periodic reporting.
(a) Periodic reporting. Licensees shall file every three years a
periodic report in the relevant File Number in the Commission's
International Communications Filing System (ICFS), or any successor
system. Joint licensees of a particular submarine cable system must
submit one joint periodic reporting filing per submarine cable system.
(b) Contents. The periodic report shall include all information
that has changed since an application for the cable landing license or
any modification, assignment, transfer of control, or renewal or
extension of the license or the last periodic report, whichever is most
recent, filed with the Commission. Licensees shall include information
that is current as of thirty (30) days prior to the filing deadline, as
follows:
(1) The information as required by in Sec. 1.70005(a) through (g)
and (m).
(2) Each licensee shall provide the following information with
respect to services it currently provides and/or expects to provide
through the submarine cable system:
(i) Identify and describe the capacity services and capacity
management services, including the amount of fiber, spectrum, or
capacity by selling, leasing, or swapping;
(ii) Identify the types of customers that currently are and/or will
be served, including those with whom the licensee leases, sells,
shares, or swaps fiber, spectrum, or capacity and/or plans to lease,
sell, share, or swap fiber, spectrum, or capacity;
(iii) Identify whether the licensee currently owns or controls and/
or will own or control the U.S. portion of the submarine cable system,
including the cable landing station(s), through an Indefeasible Right
of Use (IRU) or leasehold interest;
(iv) Identify where the licensee currently markets, offers, and
provides services and/or expects to market, offer, and provide
services; and
(v) Identify the general terms and conditions that currently apply
and/or will apply to the services, such as contact duration, minimum
capacity/bandwidth requirements, IRU requirements, termination clauses,
security requirements, delivery or Service Level Agreement (SLA)
requirements, dispute resolution, and other applicable provisions.
(3) Certifications as set forth under Sec. 1.70006.
(c) Filing schedule. Authority is delegated to the Office of
International Affairs (OIA) to establish and modify, as appropriate,
the filing categories and associated deadlines for the periodic
reports. OIA may, if needed, consult with the relevant executive branch
agencies concerning the filing categories and associated deadlines for
the periodic reports. Licensees shall file the periodic reports
pursuant to the deadlines.
(d) Filing with the Committee for the Assessment of Foreign
Participation in the United States Telecommunications Services Sector
(Committee). Licensees that have reportable foreign ownership as
defined in Sec. 1.40001(d) as of thirty (30) days prior to the date of
the submission or that have a mitigation agreement with the Committee
or other executive branch agencies shall also file
[[Page 12103]]
a copy of the report directly with the Committee.
Sec. 1.70017 Renewal applications.
(a) Licensees seeking to renew or extend a cable landing license
shall file an application six months prior to the expiration of the
license. The application must include the information and
certifications required in Sec. Sec. 1.70002(b) through (c), 1.70005,
and 1.70006.
(b) Licensees that timely file an application to renew or extend a
cable landing license may continue operating the submarine cable system
while the application is pending before the Commission.
Sec. 1.70018 Electronic filing.
(a) With the exception of submarine cable outage reports, and
subject to the availability of electronic forms, all applications and
notifications described in this subpart must be filed electronically
through the International Communications Filing System (ICFS). A list
of forms that are available for electronic filing can be found on the
ICFS homepage. For information on electronic filing requirements, see
subpart Y of this part, and the ICFS homepage at https://www.fcc.gov/icfs.
(b) Submarine cable outage reports must be filed as set forth in
part 4 of this title.
Sec. 1.70019 Denial, revocation, and termination.
The Office of International Affairs shall implement procedures for
denial of an application or revocation and/or termination of a cable
landing license in light of the relevant facts and circumstances.
PART 43--REPORTS OF COMMUNICATION COMMON CARRIERS, PROVIDERS OF
INTERNATIONAL SERVICES AND CERTAIN AFFILIATES
0
6. The authority citation of part 43 continues to read as follows:
Authority: 47 U.S.C. 35-39, 154, 211, 219, 220; sec.
402(b)(2)(B), (c), Pub. L. 104-104, 110 Stat. 129.
0
7. Revise Sec. 43.82 to read as follows:
Sec. 43.82 Circuit capacity reports.
(a) International submarine cable capacity. Not later than March 31
of each year:
(1) Cable Operator Report. The licensee(s) of a submarine cable
between the United States and any foreign point shall file a report
showing the capacity of the submarine cable as of December 31 of the
preceding calendar year. The licensee(s) shall also file a report
showing the planned capacity of the submarine cable (the intended
capacity of the submarine cable two years from December 31 of the
preceding calendar year).
(2) Capacity Holder Report. Each cable landing licensee and common
carrier shall file a report showing its capacity on submarine cables
between the United States and any foreign point as of December 31 of
the preceding calendar year.
(3) United States. United States is defined in section 3 of the
Communications Act of 1934, as amended, 47 U.S.C. 153.
(b) Registration Form. A Registration Form, containing information
about the filer, such as address, phone number, email address, etc.,
shall be filed with each report. The Registration Form shall include a
certification enabling the filer to check a box to indicate that the
filer requests that its circuit capacity data be treated as
confidential consistent with Sec. 0.459(a)(4) of this chapter.
(c) Filing Manual. Authority is delegated to the Chief of the
Office of International Affairs to prepare instructions and reporting
requirements for the filing of these reports prepared and published as
a Filing Manual. The information required under this section shall be
filed electronically in conformance with the instructions and reporting
requirements in the Filing Manual.
(d) Compliance. Submission of false or inaccurate certifications or
failure to file timely and complete annual circuit capacity reports in
accordance with the Commission's rules in this chapter and the Filing
Manual shall constitute grounds for enforcement action, including but
not limited to a forfeiture or cancellation of the cable landing
license or international authorization pursuant to section 214 of the
Communications Act of 1934, as amended, and any other applicable law.
[FR Doc. 2025-03718 Filed 3-12-25; 8:45 am]
BILLING CODE 6712-01-P