Federal Communications Commission FCC 07-202

Before the

Federal Communications Commission

Washington, D.C. 20554

In the Matter of
Petition to Establish Procedural
Requirements to Govern Proceedings for
Forbearance Under Section 10 of the
Communications Act of 1934, as Amended / )
)
)
)
)
) / WC Docket No. 07-267

Notice of proposed rulemaking

Adopted: November 27, 2007 Released: November 30, 2007

Comment Date: [30 days after publication in the Federal Register]

Reply Comment Date: [45 days after publication in the Federal Register]

By the Commission: Commissioners Copps, Adelstein, Tate, and McDowell issuing separate statements.

I.INTRODUCTION

  1. In this Notice of Proposed Rulemaking (Notice) we address thePetition filed by Covad Communications Group, NuVox Communications, XO Communications, LLC, Cavalier Telephone Corp., and McLeod USA Telecommunications Services, Inc. (Petitioners or Covad, et al.).[1] The Petition asks the Commission to consider the adoption of procedural rules to govern the Commission’s consideration of petitions for forbearance pursuant to the Communications Act of 1934, as amended (Act).[2]

II.Background

  1. Pursuant to section 10 of the Act, the Commission is required to forbear from any statutory provision or regulation if it determines that: (1) enforcement of the regulation is not necessary to ensure that the telecommunications carrier’s charges, practices, classifications, or regulations are just, reasonable, and not unjustly or unreasonably discriminatory; (2) enforcement of the regulation is not necessary to protect consumers; and (3) forbearance from applying such provision or regulation is consistent with the public interest.[3] In determining whether forbearance is consistent with the public interest, the Commission also must consider “whether forbearance from enforcing the provision or regulation will promote competitive market conditions.”[4]
  2. In addition, section 332(c)(1)(A) of the Act authorizes the Commission to “forbear” from applying the provisions of Title II to commercial mobile radio service (CMRS) providers, except for sections 201, 202, and 208, if certain criteria are satisfied.[5] In particular, the Commission may exercise its forbearance authority pursuant to section 332 if it determines that: (1) enforcement of the requirement is unnecessary to ensure that rates are just, reasonable, and non-discriminatory; (2) the requirement is not needed to protect consumers; and (3) forbearance is consistent with the public interest.[6] The Commission also must consider whether any proposed forbearance from the requirements of Title II“will enhance competition among [CMRS] providers . . . .”[7]
  3. On September 19, 2007, the Petitioners filed the Petition requesting that the Commission adopt procedural rules to govern its consideration of petitions for forbearance pursuant to section 10.[8] While Petitioners claim that we can adopt procedural rules without conducting a rulemaking proceeding, we are seeking comment on the issues raised in their Petition, rather than immediately adopting rules, in order to receive the benefit of the public’s input on these critical issues. We acknowledge Petitioners’ argument that the pendancy of numerous forbearance petitions creates an urgency to consider adoption of procedural rules, and we therefore are seeking comment on a relatively short pleading cycle.[9]

III.Discussion

  1. We seek comment in general on the need for procedural rules to govern the Commission’s consideration of petitions for forbearance pursuant to section 10 and/or section 332 (collectively, forbearance petitions), and with respect to the issues raised and rules proposed by the Petitioners in particular.[10] For example, the Petitioners cite the need to applyAdministrative Procedure Act (APA) notice-and-comment rules to forbearance petitions.[11] The Petitioners statethat “[t]o date, the Commission’s practice has been to provide interested parties with the opportunity to comment on a forbearance petition.”[12] Petitioners argue, however, that “the Commission should institutionalize this practice to ensure that potentially-affected parties have a well-defined right to have their views taken into account.”[13] We seek comment both on the Petitioners’ specific proposal and, more generally, on how the Commission should provide notice and an opportunity to comment in forbearance proceedings.
  2. The Petitioners also request the adoption of “[r]ules governing the format and content of forbearance petitions, including . . . a complete-as-filed requirement.”[14] In particular, the Petitioners contend that a “complete-as-filed” rule “would facilitate Commission review and would help ensure that all interested parties have a full and fair opportunity to present their views to the Commission.”[15] The Petitioners note that the Commission has adopted similar requirements in other circumstances, such as section 271 proceedings and formal complaint proceedings subject to statutory deadlines.[16] We seek comment on the Petitioners’ specific proposal for “complete-as-filed” requirements, including whether the Commission should specify certain information necessary for a prima facie showing that forbearance is warranted as the Petitioners recommend.[17] We also seek comment on the Petitioners’ proposal for a rule specifying that the forbearance petitioner has the burden of proof.[18] We also seek comment on whether there are other particular rules governing the form and content of forbearance petitions that the Commission should consider.
  3. In addition, the Petitioners propose that the Commission require “a petitioner to separately demonstrate how it has satisfied each component of the forbearance standard.”[19] They assert that such a requirement “is consistent with the Commission’s pleading requirements in other contexts.”[20] The Petitioners contend that “[i]n past practice, petitioners have failed to address each element of the Section 10 standard individually, instead generally asserting that the forbearance criteria are satisfied with respect to all of the regulations and statutory provisions from which they are seeking forbearance.”[21] We seek comment on the Petitioners’ specific proposal, including its relationship to the section 10 or section 332 forbearance standard and the Commission’s forbearance analysis set forth in prior orders.
  4. We also seek comment on the Petitioners’ request that the Commission adopt particular rules addressing the scope and interpretation of protective orders in forbearance proceedings.[22] The Petitioners suggest rules governing the timing of adoption of protective orders and the terms of access to, and use of, documents and information submitted pursuant to those protective orders.[23] For example, the Petitioners suggest that all interested parties should be permitted to obtain copies of confidential and highly confidential documents. In addition, the Petitioners recommend that parties be allowed to use information submitted pursuant to protective order in one forbearance proceeding “in other Commission forbearance proceedings in which a petitioning party seeks relief from the same rules and/or statutory provisions” and that states be “permitted to use documents designated as Confidential and Highly Confidential in related state proceedings.”[24] We seek comment on the Petitioners’ specific proposals, as well as any other comments regarding the submission of, access to, and use of documents and information covered by protective orders in forbearance proceedings. We also seek comment specifically on the relationship between the rules proposed by Petitioners or other commenters and the Commission’s rules and precedent regarding information withheld from public inspection.[25]
  5. The Petitioners further seek rules establishing a timetable for Commission proceedings addressing forbearance petitions, which, among other things, “incorporates a limited period for a petitioning party to cure minor defects in its petition without having to re-start the statutory clock, provides a specific vehicle for state commission input in the forbearance process, addresses motions to dismiss, and establishes a standard comment cycle,” as well as “a time limit on substantive ex parte submissions” and other requirements.[26] We seek comment on each of the proposals suggested by the Petitioners, as well as their general recommendation for the adoption of specific timetables for the Commission’s review of forbearance petitions. We also seek comment on other proposals for steps the Commission could take to facilitate the participation of state commissions, as well as other parties, in forbearance proceedings.
  6. The Petitioners propose that the Commission adopt additional requirements for petitions seeking forbearance from sections 251 and/or 271 of the Act.[27] For example, the Petitioners propose that petitioners seeking forbearance from sections 251 or 271 must provide supporting data at the wire center level.[28] The Petitioners further propose that the Commission “adopt [] a rule inviting states to report to the Commission on the potential effects of Sections 251 and/or 271 forbearance in their states.”[29] To what extent is such an approach warranted and consistent with the statutory framework and Commission precedent?
  7. The Petitioners also suggest certain procedural requirements governing the resolution of forbearance petitions, including a proposal that the Commission adopt a rule “requir[ing] the issuance of a written order on all forbearance petitions, including those petitions that previously have been ‘deemed granted.’”[30] We seek comment on that proposal.
  8. To the extent that the Commission adopts procedural rules to govern forbearance petitions, the Petitioners request that those rules apply both to forbearance petitions filed in the future, as well as forbearance petitions already pending before the Commission.[31] We seek comment on the extent of the Commission’s authority to adopt procedural rules governing both future forbearance petitions as well as those that already are pending before the Commission, particularly with respect to the procedural rules proposed by the Petitioners. We also seek comment on the propriety, as a policy matter, of extending particular procedural rules in such manner.
  9. In recent years, the Commission has witnessed a significant increase in the number of petitions seeking forbearance submitted by telecommunications carriers that the Commission oversees. These petitions have had different results, such as petitions being approved, denied, withdrawn or deemed granted. In the course of Congressional oversight, some Members of Congress have raised concerns with how forbearance is used. Some companies have indicated serious concerns with the forbearance process, while others argue that it is an important tool for the Commission to eliminate rules, consistent with the public interest. The Commission therefore seeks comment on whether forbearance is an effective means for the Commission to make changes to its regulations. We also seek comment on whether forbearance is being utilized for the purposes intended by Congress. Are there unintended consequences of forbearance, such as a focus on these petitions at the expense of other industry-wide proceedings? What are the burdens on stakeholders from forbearance proceedings, including administrative and financial costs? Are there additional burdens placed on stakeholders due to the fact that there is a statutory deadline on the completion of forbearance petitions? What are the effects of having a company-specific petition drive agency decisions, rather than the Commission deciding to take industry-wide actions?
  10. Finally, we seek comment on any other aspects of the Petition, as well as any other comments regarding the need for any other procedural rules to govern the Commission’s consideration of forbearance petitions. We also invite comment on the possible effect on small entities from adopting any of the Petitioners’ proposed rules, or variations of those proposals set forth above. To the extent that the Commission were to adopt any procedural rules governing forbearance petitions proposed by the Petitioners or otherwise justified in the record, what is the appropriate remedy for a violation of those rules?[32]

IV.PROCEDURAL MATTERS

A.Ex Parte Presentations

  1. The rulemaking this Notice initiates shall be treated as a “permit-but-disclose” proceeding in accordance with the Commission’s ex parte rules.[33] Persons making oral ex parte presentations are reminded that memoranda summarizing the presentations must contain summaries of the substance of the presentations and not merely a listing of the subjects discussed. More than a one or two sentence description of the views and arguments presented generally is required.[34] Other requirements pertaining to oral and written presentations are set forth in section 1.1206(b) of the Commission’s rules.[35]

B.Comment Filing Procedures

  1. Pursuant to sections 1.415 and 1.419 of the Commission’s rules,[36] interested parties may file comments and reply comments regarding the Notice on or before the dates indicated on the first page of this document. All filings related to this Notice of Proposed Rulemaking should refer to WC Docket No. 07-267. Comments may be filed using: (1)the Commission’s Electronic Comment Filing System (ECFS), (2) the Federal Government’s eRulemaking Portal, or (3) by filing paper copies. See Electronic Filing of Documents in Rulemaking Proceedings, 63 FR 24121 (1998).
  • Electronic Filers: Comments may be filed electronically using the Internet by accessing the ECFS: or the Federal eRulemaking Portal: Filers should follow the instructions provided on the website for submitting comments.
  • ECFS filers must transmit one electronic copy of the comments for WC Docket No. 07267. In completing the transmittal screen, filers should include their full name, U.S. Postal Service mailing address, and the applicable docket number. Parties may also submit an electronic comment by Internet e-mail. To get filing instructions, filers should send an e-mail to , and include the following words in the body of the message, “get form.” A sample form and directions will be sent in response.
  • Paper Filers: Parties who choose to file by paper must file an original and four copies of each filing. Filings can be sent by hand or messenger delivery, by commercial overnight courier, or by first-class or overnight U.S. Postal Service mail (although we continue to experience delays in receiving U.S. Postal Service mail). All filings must be addressed to the Commission’s Secretary, Marlene H. Dortch, Office of the Secretary, Federal Communications Commission, 445 12th Street, S.W., Washington, D.C. 20554.
  • The Commission’s contractor will receive hand-delivered or messenger-delivered paper filings for the Commission’s Secretary at 236 Massachusetts Avenue, N.E., Suite 110, Washington, D.C. 20002. The filing hours at this location are 8:00 a.m. to 7:00 p.m. All hand deliveries must be held together with rubber bands or fasteners. Any envelopes must be disposed of before entering the building.
  • Commercial overnight mail (other than U.S. Postal Service Express Mail and Priority Mail) must be sent to 9300 East Hampton Drive, Capitol Heights, MD 20743.
  • U.S. Postal Service first-class, Express, and Priority mail should be addressed to 445 12th Street, S.W., Washington D.C. 20554.
  1. Parties should send a copy of their filings to the Competition Policy Division, Wireline Competition Bureau, Federal Communications Commission, Room 5-C140, 445 12th Street, S.W., Washington, D.C. 20554, or by e-mail . Parties shall also serve one copy with the Commission’s copy contractor, Best Copy and Printing, Inc. (BCPI), Portals II, 445 12th Street, S.W., Room CY-B402, Washington, D.C. 20554, (202) 488-5300, or via e-mail to .
  2. Documents in WC Docket No. 07-267 will be available for public inspection and copying during business hours at the FCC Reference Information Center, Portals II, 445 12th Street S.W., Room CY-A257, Washington, D.C. 20554. The documents may also be purchased from BCPI, telephone (202) 488-5300, facsimile (202) 488-5563, TTY (202) 488-5562, e-mail .

C.Initial Regulatory Flexibility Analysis

  1. As required by the Regulatory Flexibility Act of 1980, see 5 U.S.C. § 603, the Commission has prepared an Initial Regulatory Flexibility Analysis (IRFA) of the possible significant economic impact on small entities of the policies and rules addressed in this document. The IRFA is set forth in the Appendix. 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 on the Notice provided below in the Appendix.

D.Paperwork Reduction Act

  1. This document contains proposed new or modified 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. In addition, pursuant to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C. 3506(c)(4), we seek specific comment on how we might “further reduce the information collection burden for small business concerns with fewer than 25 employees.”

E.Accessible Formats

  1. To request materials in accessible formats for people with disabilities (Braille, large print, electronic files, audio format), send an e-mail to or call the Consumer & Governmental Affairs Bureau at 202-418-0530 (voice) or 202-418-0432 (TTY). Contact the FCC to request reasonable accommodations for filing comments (accessible format documents, sign language interpreters, CART, etc.) by email: ; phone: 202-418-0530 or TTY: 202-418-0432.

V.Ordering Clauses

  1. Accordingly, IT IS ORDERED that pursuant to sections 1, 4(i), 4(j), 10, 303, 332 and 403 of the Communications Act of 1934, as amended, 47 U.S.C. §§ 151, 154(i)-(j), 160, 303, 332, 403, this Notice of Proposed Rulemaking in WC Docket No. 07-267 IS ADOPTED.
  2. IT IS FURTHER ORDERED that theCovad, et al. Petition to Establish Procedural Requirements to Govern Proceedings for Forbearance Under Section 10 of the Communications Act of 1934, as Amended, WC Docket No. 07-267 (filed Sept. 19, 2007), IS GRANTED to the extent indicated herein and otherwise IS DENIED.
  3. IT IS FURTHER ORDERED that the Commission’s Consumer and Governmental Affairs Bureau, Reference Information Center, SHALL SEND a copy of this Notice, including the Initial Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the Small Business Administration.

FEDERAL COMMUNICATIONS COMMISSION

Marlene H. Dortch

Secretary

1

Federal Communications Commission FCC 07-202

APPENDIX

Initial Regulatory Flexibility Analysis

  1. As required by the Regulatory Flexibility Act of 1980, as amended (RFA),[37] the Commission has prepared the present Initial Regulatory Flexibility Analysis (IRFA) of the possible significant economic impact on small entities that might result from this Notice of Proposed Rulemaking (Notice). 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 on the Notice provided above. The Commission will send a copy of the Notice, including this IRFA, to the Chief Counsel for Advocacy of the Small Business Administration.[38] In addition, the Notice and the IRFA (or summaries thereof) will be published in the Federal Register.[39]
  1. Need for, and Objectives of, the Proposed Rules
  1. In this Notice, we seek comment on whether the Commission should adopt procedural rules governing its consideration of petitions for forbearance pursuant to section 10 or section 332 of the Act.