Court Denies Motion to Stay Access Arbitrage Order
US Court of Appeals for the District of Columbia issued an order denying motion for stay of the FCC's Access Arbitrage order. That order adopted rules aimed at eliminating the financial incentives to engage in access stimulation. Under the new rules, a CLEC will be considered an access stimulator if it has an interstate terminating-to-originating traffic ratio of at least 6:1 in an end office in a calendar month. If a CLEC is engaged in access stimulation it may not bill an IXC for terminating switched access tandem switching or terminating switched access transport for any traffic between its terminating end office (or equivalent) and the associated access tandem switch. Instead, it must designate an intermediate access provider to provide these services and assume financial responsibility for all the charges for such services. Different ratios apply to access stimulating rate-of-return LECS. See the Regulatory Mix dated 9/26/19. Inteserra Briefing Service subscribers see Briefing dated 10/24/19.
The Regulatory Mix Today: Court Denies Motion to Stay Access Arbitrage Order, FCC Debarment and Suspension Rules, FCC Equipment Posing National Security Threats
FCC Debarment and Suspension Rules
At its Open Meeting last week the FCC voted to begin a rulemaking to would adopt new procedures to protect federal funds from misuse. The proposal would align FCC rules with the Office of Management and Budget’s Guidelines to Agencies on Government Debarment and Suspension. Among other things, the proposed rules would require program participants to verify that they themselves are not excluded from participating in federal programs and that they will not enter into new transactions with excluded third parties. They would also allow the FCC to participate in a government-wide mechanism through which suspension or debarment by the FCC would apply to other federal agencies and vice versa.
The new rules would apply to programs supported by the FCC’s Universal Service Fund and TRS Fund. The covered USF-supported programs include (1) Lifeline, which helps make communications services more affordable for low-income consumers; (2) the High Cost program, which provides subsidies for rural broadband and voice service; (3) E-rate, which supports connectivity both to and within schools and libraries to the Internet; and (4) the Rural Health Care program, which subsidizes connectivity for rural health care facilities.
FCC Equipment Posing National Security Threats
At its Open Meeting last week, the FCC voted to bar use of its $8.5 billion a year Universal Service Fund (USF) to purchase equipment and services from companies that pose a national security threat. The Order initially designates Huawei Technologies Company and ZTE Corp. as companies covered by this rule and establishes a process for designating additional covered companies in the future. It also establishes a certification and audit regime to enforce the new rule. The rule barring purchase of equipment and services from covered companies will take effect immediately upon publication in the Federal Register.
In an accompanying Further Notice of Proposed Rulemaking, the FCC proposes to require carriers receiving USF funds to remove and replace existing equipment and services from covered companies. It seeks comment on how to pay for such removal and replacement. To aid in the design of a removal and replacement program, the FCC will conduct an information collection to determine the extent to which carriers receiving USF funds s have equipment from Huawei and ZTE in their networks and the costs associated with removing and replacing such equipment.
The Regulatory Mix will be on holiday in observance of Thanksgiving 11/27/19 to 12/1/19. We will return on Monday, 12/2/19.
The Regulatory Mix, Inteserra’s blog of telecom related regulatory activities, is a snapshot of PUC, FCC, legislative, and occasionally court issues that our regulatory monitoring team uncovers each day. Depending on their significance, some items may be the subject of an Inteserra Briefing.