2000 Biennial Regulatory Review, Separate Affiliate Requirements of the Commission's Rules, 35191-35195 [2013-13976]

Download as PDF Federal Register / Vol. 78, No. 113 / Wednesday, June 12, 2013 / Proposed Rules regulatory policies that have tribal implications.’’ ‘‘Policies that have tribal implications’’ is defined in the Executive order to include regulations that have ‘‘substantial direct effects on one or more Indian tribes, on the relationship between the Federal Government and the Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes.’’ This proposed rule will not have substantial direct effects on tribal governments, on the relationship between the Federal Government and Indian tribes, or on the distribution of power and responsibilities between the Federal Government and Indian tribes, as specified in Executive Order 13175. Thus, Executive Order 13175 does not apply to this proposed rule. List of Subjects in 40 CFR Part 180 Environmental protection, Administrative practice and procedure, Agricultural commodities, Pesticides and pests, Reporting and recordkeeping requirements. Parts per million Commodity Hog, kidney (of which no more than 0.05 ppm is tetrachlorvinphos per se) .......... Hog, liver (of which no more than 0.05 ppm is tetrachlorvinphos per se) ....................................... Hog, meat (of which no more than 2.0 ppm is tetrachlorvinphos per se) ....................................... Hog, meat byproducts, except kidney and liver ............................. Milk, fat (reflecting negligible residues in whole milk and of which no more than 0.05 ppm is tetrachlorvinphos per se) .......... Poultry, fat (of which no more than 7.0 ppm is tetrachlorvinphos per se) .......... Poultry, liver (of which no more than 0.05 ppm is tetrachlorvinphos per se) .......... Poultry, meat (of which no more than 3.0 ppm is tetrachlorvinphos per se) .......... Poultry, meat byproducts, except liver ............................................ * * * * 1.0 0.5 2.0 1.0 0.05 7.0 2.0 3.0 2.0 * Dated: June 5, 2013. Lois Rossi, Director, Registration Division, Office of Pesticide Programs. [FR Doc. 2013–13818 Filed 6–11–13; 8:45 am] Therefore, it is proposed that 40 CFR chapter I be amended as follows: FEDERAL COMMUNICATIONS COMMISSION PART 180—[AMENDED] 47 CFR Part 64 1. The authority citation for part 180 continues to read as follows: [CC Docket No. 00–175, FCC 13–69] BILLING CODE 6560–50–P ■ Authority: 21 U.S.C. 321(q), 346a and 371. 2. In § 180.252, revise the table in paragraph (a) to read as follows: ■ (a) * * * Parts per million ehiers on DSK2VPTVN1PROD with PROPOSALS-1 Cattle, fat (of which no more than 0.1 ppm is tetrachlorvinphos per se) ....................................... Cattle, kidney (of which no more than 0.05 ppm is tetrachlorvinphos per se) .......... Cattle, liver (of which no more than 0.05 ppm is tetrachlorvinphos per se) .......... Cattle, meat (of which no more than 2.0 ppm is tetrachlorvinphos per se) .......... Cattle, meat byproducts, except kidney and liver ......................... Egg (of which no more than 0.05 ppm is tetrachlorvinphos per se) ............................................. Hog, fat (of which no more than 0.1 ppm is tetrachlorvinphos per se) ....................................... VerDate Mar<15>2010 14:54 Jun 11, 2013 Jkt 229001 Federal Communications Commission. ACTION: Notice of proposed rulemaking. AGENCY: § 180.252 Tetrachlorvinphos; tolerances for residues. Commodity 2000 Biennial Regulatory Review, Separate Affiliate Requirements of the Commission’s Rules 0.2 1.0 0.5 2.0 SUMMARY: In this document, the Commission seeks comment on the structural separation requirements of the Commission’s rules, as they apply to rate-of-return carriers providing facilities-based in-region, interexchange, interstate long distance services. Specifically, the Commission seeks comment on the costs and benefits of continuing to apply requirements to rate-of-return carriers, and whether such carriers continue to have the ability and incentive to engage in anticompetitive behavior. Comments are due on or before July 12, 2013 and reply comments are due on or before August 12, 2013. 0.2 ADDRESSES: Interested parties may submit comments, identified by CC Docket No. 00–175, by any of the 0.2 following methods: DATES: 1.0 PO 00000 Frm 00037 Fmt 4702 Sfmt 4702 35191 • Federal eRulemaking Portal: https:// www.regulations.gov. Follow the instructions for submitting comments. • Federal Communications Commission’s Web site: https:// fjallfoss.fcc.gov/ecfs2/. Follow the instructions for submitting comments. • People with Disabilities: Contact the FCC to request reasonable accommodations (accessible format documents, sign language interpreters, CART, etc.) by email: FCC504@fcc.gov or phone: (202) 418–0530 or TTY: (202) 418–0432. For detailed instructions for submitting comments and additional information on the rulemaking process, see the SUPPLEMENTARY INFORMATION section of this document. FOR FURTHER INFORMATION CONTACT: Gregory Kwan, Attorney Advisor, at 202–418–1191, Competition Policy Division, Wireline Competition Bureau. SUPPLEMENTARY INFORMATION: This is a summary of the Commission’s Second Notice of Proposed Rulemaking (Second FNPRM) in CC Docket No. 00–175, released on May 17, 2013. The full text of this document, which is part of the Commission’s Memorandum Opinion and Order and Report and Order and Further Notice of Proposed Rulemaking and Second Further Notice of Proposed Rulemaking, is available for public inspection during regular business hours in the FCC Reference Center, Room CY–A257, 445 12th Street SW., Washington, DC 20554, and may also be purchased from the Commission’s copy contractor, BCPI, Inc., Portals II, 445 Twelfth Street SW., Room CY–B402, Washington, DC 20554. Customers may contact BCPI, Inc. via their Web site, https://www.bcpi.com, or call 1–800– 378–3160. This document is available in alternative formats (computer diskette, large print, audio record, and Braille). Persons with disabilities who need documents in these formats may contact the FCC by email: FCC504@fcc.gov or phone: 202–418–0530 or TTY: 202–418– 0432. Pursuant to sections 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 on the first page of this document. All pleadings are to reference CC Docket No. 00–175. Comments may be filed using the Commission’s Electronic Comment Filing System (ECFS). 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: https:// fjallfoss.fcc.gov/ecfs2/. E:\FR\FM\12JNP1.SGM 12JNP1 35192 Federal Register / Vol. 78, No. 113 / Wednesday, June 12, 2013 / Proposed Rules • Paper Filers: Parties who choose to file by paper must file an original and one copy of each filing. If more than one docket or rulemaking number appears in the caption of this proceeding, filers must submit two additional copies for each additional docket or rulemaking number. • Filings can be sent by hand or messenger delivery, by commercial overnight courier, or by first-class or overnight U.S. Postal Service mail. All filings must be addressed to the Commission’s Secretary, Office of the Secretary, Federal Communications Commission. • All hand-delivered or messengerdelivered paper filings for the Commission’s Secretary must be delivered to FCC Headquarters at 445 12th St., SW., Room TW–A325, Washington, DC 20554. The filing hours are 8:00 a.m. to 7:00 p.m. 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 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 must be addressed to 445 12th Street SW., 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 fcc504@fcc.gov or call the Consumer & Governmental Affairs Bureau at 202–418–0530 (voice), 202– 418–0432 (tty). ehiers on DSK2VPTVN1PROD with PROPOSALS-1 Synopsis of Second Further Notice of Proposed Rulemaking 1. In furtherance of our commitment to revisit rules that may be outmoded, ineffective, insufficient, or excessively burdensome, while continuing to promote competition and consumer protection consistent with the Act, we evaluate in this Second FNPRM the structural separation requirements of section 64.1903 of the Commission’s rules, as they apply to rate-of-return carriers providing facilities-based inregion, interexchange, interstate long distance services (in-region long distance services). Through this proceeding, we intend to modernize our rules to reflect the competitive and marketplace realities for long distance service—at one time an expensive service, today one frequently offered on an unlimited basis by numerous facilities-based providers. VerDate Mar<15>2010 14:54 Jun 11, 2013 Jkt 229001 2. Section 64.1903, as written, requires independent ILECs providing long distance services using their own facilities to do so through a separate corporate subsidiary that does not jointly own transmission or switching equipment with the local exchange company. The Commission promulgated section 64.1903 against a regulatory backdrop in which local telephone service, interstate long distance, and intrastate long distance were distinct services, for which consumers often chose separate providers. Since the codification of section 64.1903 more than fifteen years ago, we have seen transformative marketplace and regulatory changes, calling into question whether the current rule is the least burdensome way to ensure that our goals of competition and consumer protection are met. The Commission has acknowledged these changes, and in 2007 granted relief to the Bell Operating Companies (BOCs) from a regulatory framework with similar structural separation requirements as section 64.1903. 3. Today, the Commission adopts the USTelecom Forbearance Order, which, among other things, grants the request of the United States Telecom Association (USTelecom) for forbearance from section 64.1903 as it applies to price cap carriers that comply with certain conditions. Based on the record in that proceeding, however, the USTelecom Forbearance Order denies similar relief to independent ILECs subject to rate-ofreturn regulation ‘‘due to the continuing potential for cost misallocation.’’ In this Second FNPRM, we take the next steps toward modernizing our rules for the non-BOC ILECs. Considering developments in today’s marketplace, we seek comment on the costs and benefits of continuing to apply section 64.1903 to rate-of-return carriers, and whether such carriers continue to have the ability and incentive to engage in anticompetitive behavior. 4. The Commission adopted section 64.1903 based on the findings in the LEC Classification Order emphasizing the need to protect against the exercise of exclusionary market power by independent ILECs—the ability to raise rivals’ costs of providing competitive services, including the misallocation of costs (for example misallocating costs from nonregulated to regulated services), non-price discrimination (for example, lower quality wholesale services provided to a competitor), and a price squeeze based on inputs that long distance competitors need, such as access services (for example, raising prices for access services, including both switched and special access, or PO 00000 Frm 00038 Fmt 4702 Sfmt 4702 reducing prices for retail services). In light of the market changes described above, we consider whether the rule continues to offer benefits and whether the benefits justify the regulatory burdens and costs of compliance for rate-of-return ILECs. We also recognize that market conditions alone might justify eliminating the separate affiliate requirement, at least for some independent ILECs subject to rate-ofreturn regulation, and seek comment on the relevant market characteristics and how they should affect our evaluation of the continued need for the separate affiliate rule. 5. Analyzing Potential for Cost Miscalculation. The USTelecom Forbearance Order granted forbearance from section 64.1903 to independent ILECs subject to price cap regulation but denied this relief to such carriers subject to rate-of-return regulation, including both independent ILECs subject to average schedules and cost companies. Rate-of-return regulation, which preceded price cap regulation, focuses on an ILEC’s costs and fixes the profits an ILEC may earn based on those costs. A rate-of-return ILEC may recover only its costs plus a prescribed return on investment. Unlike price cap carriers, rate-of-return carriers are typically small, rural telephone companies concentrated in one area. Also unlike price cap carriers, non-average schedule rate-of-return independent ILEC has the ability and incentive to over allocate costs to common line and special access services because its interstate compensation for those services remains based directly on company-specific costs. We seek comment on this view. The Commission’s 2011 reforms to intercarrier compensation rules cap and/or reduce interstate switched access charges, but allow increases in common line and special access rates. Thus, we believe that these changes in the access charge rules reduce, but may not eliminate, incentives for cost misallocation and potential access charge rate increases. We seek comment on this view and on the interplay between section 64.1903 and our intercarrier compensation and universal service reforms. We seek comment on whether we could address concerns about cost misallocation equally well, and in a less burdensome manner, in ways other than requiring that service be provided through a separate affiliate. 6. The Commission has previously recognized that concerns about cost misallocation are strongest when carriers provide long distance services in whole or in part through their own switching or transmission facilities. When these carriers provide long E:\FR\FM\12JNP1.SGM 12JNP1 ehiers on DSK2VPTVN1PROD with PROPOSALS-1 Federal Register / Vol. 78, No. 113 / Wednesday, June 12, 2013 / Proposed Rules distance service exclusively through resale, the risk of cost misallocation is reduced, and they operate pursuant to a lesser safeguard—a separate corporate division rather than a separate subsidiary. We seek comment on the extent to which rate-of-return independent ILECs provide long distance service using their own facilities. Could we deter and detect cost misallocation by requiring that independent ILECs offering long distance over their own facilities provide those services through a separate corporate division? 7. We also seek comment on whether we can reduce the burdens on average schedule carriers. Average schedule carriers are a subset of rate-of-return carriers that receive access compensation and universal service support through the use of ‘‘average schedules’’ to avoid the difficulties and expenses involved with conducting company-specific cost studies. Average schedule companies appear to have limited incentives to misallocate costs as long as they continue to use the average schedules for access compensation. However, these companies are permitted to convert to cost-based regulation without Commission approval. Thus, an average schedule company could, in theory, provide in-region long distance service without a separate affiliate, and then convert to cost-based regulation. We seek comment on how we could grant relief from the separate affiliate requirement for average schedule companies and also prevent them from misallocating costs in the future. We could condition relief from section 64.1903 on a commitment not to convert to rate-of-return regulation, or require them to reinstitute a separate affiliate if they do so. We seek comment on these and alternative suggestions. How should the Commission treat cost companies participating in NECA pools? Do these companies possess the ability and incentive to misallocate costs because disbursements from the NECA pools are based on participating companies’ costs? In the USTelecom Forbearance Order, we grant relief to price cap carriers if they: (1) submit and obtain Bureau approval of special access performance metrics, and (2) satisfy imputation requirements, including the submission of an imputation plan for review and approval from the Bureau. Will such nonstructural safeguards obviate the need for section 64.1903, while imposing fewer costs and burdens, for rate-of-return carriers? How should our analysis for rate-of-return VerDate Mar<15>2010 14:54 Jun 11, 2013 Jkt 229001 carriers differ, if any, from our analysis for price cap carriers? 8. Analyzing Potential for Unlawful Non-Price Discrimination and Price Squeezes. Section 64.1903 was intended to prevent unlawful non-price discrimination and price squeezes. Do these concerns remain relevant in light of changes in the market, including the prevalence of bundled local, intrastate long distance, and interstate long distance services? Is the separate affiliate requirement an effective, costeffective way to prevent these anticompetitive practices? Could the Commission effectively address these concerns through ex-post facto investigations, such as under a section 208 complaint process? Are existing statutory and regulatory safeguards sufficient to deter these anticompetitive practices? 9. Costs and Benefits of the Separate Affiliate Requirements of Section 64.1903. How many independent ILECs use separate affiliates pursuant to section 64.1903? What costs, if any, would be saved if we eliminate section 64.1903 for independent ILECs subject to rate-of-return regulation? Would the same savings be realized if the independent ILEC were required instead to provide long distance services through a separate division? For example, what incremental costs does an independent ILEC incur in maintaining separate books of account for its long distance services, as opposed to including those costs and revenues in the accounts for its LEC operations? How does that differ depending on whether the separate books of account are for a separate division versus a separate corporation? We particularly seek empirical data on costs and burdens from independent ILECs that have experience providing long distance service through a separate corporate affiliate or a separate division so that we can analyze the differences between these structures. 10. What effect, if any, does the prohibition against joint ownership of switching and transmission equipment have on an independent ILEC’s operational efficiency and ability to offer innovative services? Does that prohibition significantly limit the independent ILEC’s opportunities to take advantage of economies of scope and scale associated with integrated operations? Does the prohibition make it more difficult for an independent ILEC to transform its network from a traditional Time-Division Multiplexing (TDM) network to an all-Internet Protocol (all IP) network? If so, how? Does section 64.1903 reduce independent ILECs’ ability to increase PO 00000 Frm 00039 Fmt 4702 Sfmt 4702 35193 telephone subscribership or extend broadband services to additional areas? If ILECs transition to offering only VoIP services, should section 64.1903 continue to apply? Finally, we seek comment on whether complying with nonstructural safeguards such as special access performance metrics and imputation requirements adequately address issues of non-price discrimination and/or price squeezes. We ask commenters to provide detailed information on the overall costs and burdens of the section 64.1903 requirements on independent ILECs and their customers. Paperwork Reduction Act 11. This NPRM seeks comment on a potential new or revised information collection requirement. If the Commission adopts any new or revised information collection requirement, the Commission will publish a separate notice in the Federal Register inviting the public to comment on the requirement, as required by the Paperwork Reduction Act of 1995, Public Law 104–13 (44 U.S.C. 3501– 3520). 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 it might ‘‘further reduce the information collection burden for small business concerns with fewer than 25 employees.’’ Initial Regulatory Flexibility Analysis 12. As required by the Regulatory Flexibility Act of 1980, as amended (RFA), the Commission has prepared this Supplemental Initial Regulatory Flexibility Analysis (Supplemental IRFA) of the possible significant economic impact on a substantial number of small entities by the policies proposed in this Second NPRM. Written comments are requested on this Supplemental IRFA. Comments must be identified as responses to the Supplemental IRFA and must be filed by the deadlines for comments on the Second FNPRM. The Commission will send a copy of the Second FNPRM, including this Supplemental IRFA, to the Chief Counsel for Advocacy of the Small Business Administration (SBA). In addition, the Second FNPRM and Supplemental IRFA (or summaries thereof) will be published in the Federal Register. 13. Purpose of the Proposed Rules. In the Second FNPRM, we explore the costs and benefits of continuing to apply the structural separation requirements contained in section 64.1903 of the Commission’s rules, 47 CFR 64.1903, to E:\FR\FM\12JNP1.SGM 12JNP1 ehiers on DSK2VPTVN1PROD with PROPOSALS-1 35194 Federal Register / Vol. 78, No. 113 / Wednesday, June 12, 2013 / Proposed Rules independent incumbent local exchange carriers (ILECs) subject to rate-of-return regulation and providing in-region, interexchange, interstate long distance services (in-region long distance services) in today’s marketplace. 14. In the Second FNPRM, we seek comments addressing marketplace changes such as the decline of standalone long distance services, the rise of facilities-based ‘‘all-distance services’’ competition from cable and wireless, and the role of bundles in today’s long distance market. We therefore seek comment addressing whether incentives for anticompetitive behavior exist for independent ILECs subject to rate-ofreturn regulation, and whether granting relief from section 64.1903 is appropriate. 15. Legal Basis. The legal basis for any action that may be taken pursuant to the Second FNPRM is contained in sections 4(i), 4(j), 10, 201 through 204, 214, 220(a), and 303(r) of the Communications Act of 1934, as amended, 47 U.S.C. 154(i), 154(j), 160, 201 through 204, 214, 220(a), and 303(r). 16. Description and Estimate of the Number of Small Entities to Which the Proposed Rules Will Apply. 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 SBA. 17. Small Businesses. Nationwide, there are a total of approximately 27.5 million small businesses, according to the SBA. 18. Wired Telecommunications Carriers. The SBA has developed a small business size standard for Wired Telecommunications Carriers, which consists of all such companies having 1,500 or fewer employees. According to Census Bureau data for 2007, there were 3,188 firms in this category, total, that operated for the entire year. Of this total, 3144 firms had employment of 999 or fewer employees, and 44 firms had employment of 1000 employees or more. Thus, under this size standard, the majority of firms can be considered small. VerDate Mar<15>2010 14:54 Jun 11, 2013 Jkt 229001 19. Incumbent Local Exchange Carriers (ILECs). Neither the Commission nor the SBA has developed a size standard for small businesses specifically applicable to incumbent local exchange services. The closest applicable size standard under SBA rules is for Wired Telecommunications Carriers. Under that size standard, such a business is small if it has 1,500 or fewer employees. According to Commission data, 1,307 carriers reported that they were incumbent local exchange service providers. Of these 1,307 carriers, an estimated 1,006 have 1,500 or fewer employees and 301 have more than 1,500 employees. Consequently, the Commission estimates that most providers of incumbent local exchange service are small businesses that may be affected by rules adopted pursuant to the Second FNPRM. 20. We have included small incumbent LECs in this present RFA analysis. As noted above, a ‘‘small business’’ under the RFA is one that, inter alia, meets the pertinent small business size standard (e.g., a telephone communications business having 1,500 or fewer employees), and ‘‘is not dominant in its field of operation.’’ The SBA’s Office of Advocacy contends that, for RFA purposes, small incumbent LECs are not dominant in their field of operation because any such dominance is not ‘‘national’’ in scope. We have therefore included small incumbent LECs in this RFA analysis, although we emphasize that this RFA action has no effect on Commission analyses and determinations in other, non-RFA contexts. 21. Interexchange Carriers (IXCs). Neither the Commission nor the SBA has developed a size standard for small businesses specifically applicable to interexchange services. The closest applicable size standard under SBA rules is for Wired Telecommunications Carriers. Under that size standard, such a business is small if it has 1,500 or fewer employees. According to Commission data, 359 companies reported that their primary telecommunications service activity was the provision of interexchange services. Of these 359 companies, an estimated 317 have 1,500 or fewer employees and 42 have more than 1,500 employees. Consequently, the Commission estimates that the majority of interexchange service providers are small entities that may be affected by rules adopted pursuant to the Order. 22. Description of Projected Reporting, Recordkeeping, and Other Compliance Requirements for Small Entities. In this Second FNPRM, the PO 00000 Frm 00040 Fmt 4702 Sfmt 4702 Commission proposes additional or modified information collections that would impose reporting and recordkeeping on current independent ILECs subject to rate-of-return regulation, including small entities. Specifically, the Second FNPRM invites comment on whether the Commission should replace its legacy framework for the provision of in-region, interstate long distance services provided by independent ILECs subject to rate-ofreturn regulation with a framework more closely tailored to the needs of consumers and competitors in today’s marketplace. The central feature of this proposal is to amend or eliminate the application of section 64.1903 to independent ILECs subject to rate-ofreturn regulation. 23. Based on these questions, the Commission anticipates that a record will be developed concerning actual burdens and alternative ways in which the Commission could lessen the burdens on small entities subject to these requirements throughout the nation. 24. Steps Taken to Minimize the Significant Economic Impact on Small Entities, and Significant Alternatives Considered. 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.’’ 25. The overall objective of this proceeding is to reduce regulatory burdens on independent ILECs to the extent consistent with the public interest, and is part of the Commission’s ongoing efforts under Executive Order 13,579 to revisit ‘‘rules that may be outmoded, ineffective, insufficient, or excessively burdensome, and to modify, streamline, expand, or repeal them in accordance with what has been learned.’’ The Second FNPRM seeks specific proposals as to which existing regulations might be removed or streamlined in their application to provision of in-region, interstate and international interexchange services by independent ILECs subject to rate-ofreturn regulation absent current safeguards, and asks parties to comment E:\FR\FM\12JNP1.SGM 12JNP1 Federal Register / Vol. 78, No. 113 / Wednesday, June 12, 2013 / Proposed Rules ehiers on DSK2VPTVN1PROD with PROPOSALS-1 on whether such independent ILECs should continue to be classified as nondominant in the provision of such services if section 64.1903 is repealed. The Second FNPRM also asks parties to discuss whether, and to what extent, dominant carrier regulation is aptly suited to achieving the Commission’s objectives to promote competition and to deter anticompetitive behavior by independent ILECs subject to rate-ofreturn regulation. The Second FNPRM seeks comment on these matters, especially as they might affect small entities subject to the rules. 26. Federal Rules that May Duplicate, Overlap, or Conflict with the Proposed Rules. None. Ex Parte Presentations 27. 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 section 1.1206(b). In proceedings governed by section 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 VerDate Mar<15>2010 18:04 Jun 11, 2013 Jkt 229001 themselves with the Commission’s ex parte rules. Ordering Clauses 28. Accordingly, it is ordered that, pursuant to Sections 1, 2, 4(i), 4(j), 201 through 205, 220(a), 251, 272, and 303(r) of the Communications Act of 1934, as amended, 47 U.S.C. 151, 152, 154(i), 154(j), 201 through 205, 220(a), 251, 272, and 303(r) this Second Further Notice of Proposed of Rulemaking in CC Docket No. 00–175 is adopted. 29. It is further ordered that the Commission’s Consumer and Governmental Affairs Bureau, Reference Information Center, shall send a copy of this Second Further Notice of Proposed Rulemaking in CC Docket No. 00–175, including the Initial Regulatory Flexibility Certifications, to the Chief Counsel for Advocacy of the Small Business Administration. 35195 FOR FURTHER INFORMATION CONTACT: Lawrence Butler, (202) 287–1945 or lawrence.butler@hq.doe.gov. SUPPLEMENTARY INFORMATION: DEPARTMENT OF ENERGY I. Executive Summary A. Purpose and Legal Authority B. Summary of Major Provisions 1. Part 925—Foreign Acquisition 2. Part 952—Solicitation Provisions and Contract Clauses 3. Part 970—DOE Management and Operating Contracts II. Summaries of Export Control Laws III. Procedural Requirements A. Review Under Executive Order 12866 B. Review Under Executive Order 12988 C. Review Under the Regulatory Flexibility Act D. Review Under the Paperwork Reduction Act E. Review Under the National Environmental Policy Act F. Review Under Executive Order 13132 G. Review Under the Unfunded Mandates Reform Act of 1995 H. Review Under the Treasury and General Government Appropriations Act, 1999 I. Review Under Executive Order 13211 J. Review Under the Treasury and General Government Appropriations Act, 2001 K. Review Under Executive Order 13609 L. Approval by the Office of the Secretary of Energy 48 CFR Parts 925, 952, and 970 I. Executive Summary RIN 1991–AB99 A. Purpose and Legal Authority Federal Communications Commission. Marlene H. Dortch, Secretary. [FR Doc. 2013–13976 Filed 6–11–13; 8:45 am] BILLING CODE 6712–01–P Acquisition Regulations: Export Control Department of Energy. Notice of proposed rulemaking. AGENCY: ACTION: SUMMARY: The Department of Energy (DOE) is proposing to amend the Department of Energy Acquisition Regulation (DEAR) to add export control requirements applicable to the performance of DOE contracts. DATES: Written comments on this proposed rulemaking must be received on or before close of business July 12, 2013 ADDRESSES: You may submit comments, identified by ‘‘DEAR: Export Control and RIN 1991–AB99,’’ by any of the following methods: • Federal eRulemaking Portal: https:// www.regulations.gov. Follow the instructions for submitting comments. • Email to: DEARrulemaking@hq.doe.gov. Include DEAR: Export Control and RIN 1991– AB99 in the subject line of the message. • Mail to: U.S. Department of Energy, Office of Acquisition and Project Management, MA–611, 1000 Independence Avenue SW., Washington, DC 20585. Comments by email are encouraged. PO 00000 Frm 00041 Fmt 4702 Sfmt 4702 The purpose of this rulemaking is to add new DEAR subparts 925.71 and 970.2571 to set forth requirements concerning compliance with export control laws, regulations and directives applicable to the performance of DOE contracts. Export control laws, regulations and directives that may apply to a contract in effect on the date of the contract award and as amended subsequently include, but are not limited to: the Atomic Energy Act of 1954, as amended; the Arms Export Control Act (22 U.S.C. 2751 et seq.); the Export Administration Act of 1979 (50 U.S.C. app. 2401 et seq.), as continued under the International Emergency Economic Powers Act (Title II of Pub. L. 95–223, 91 Stat. 1626, October 28, 1977); Trading with the Enemy Act (50 U.S.C. App. 5(b) as amended by the Foreign Assistance Act of 1961); Assistance to Foreign Atomic Energy Activities (10 Code of Federal Regulations (CFR) part 810); Export Administration Regulations (15 CFR parts 730 through 774); International Traffic in Arms Regulations (22 CFR parts 120 through 130); Export and Import of Nuclear Equipment and Material (10 CFR part 110); regulations administered by the Office of Foreign Assets Control (31 CFR E:\FR\FM\12JNP1.SGM 12JNP1

Agencies

[Federal Register Volume 78, Number 113 (Wednesday, June 12, 2013)]
[Proposed Rules]
[Pages 35191-35195]
From the Federal Register Online via the Government Printing Office [www.gpo.gov]
[FR Doc No: 2013-13976]


=======================================================================
-----------------------------------------------------------------------

FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 64

[CC Docket No. 00-175, FCC 13-69]


2000 Biennial Regulatory Review, Separate Affiliate Requirements 
of the Commission's Rules

AGENCY: Federal Communications Commission.

ACTION: Notice of proposed rulemaking.

-----------------------------------------------------------------------

SUMMARY: In this document, the Commission seeks comment on the 
structural separation requirements of the Commission's rules, as they 
apply to rate-of-return carriers providing facilities-based in-region, 
interexchange, interstate long distance services. Specifically, the 
Commission seeks comment on the costs and benefits of continuing to 
apply requirements to rate-of-return carriers, and whether such 
carriers continue to have the ability and incentive to engage in 
anticompetitive behavior.

DATES: Comments are due on or before July 12, 2013 and reply comments 
are due on or before August 12, 2013.

ADDRESSES: Interested parties may submit comments, identified by CC 
Docket No. 00-175, by any of the following methods:
     Federal eRulemaking Portal: https://www.regulations.gov. 
Follow the instructions for submitting comments.
     Federal Communications Commission's Web site: https://fjallfoss.fcc.gov/ecfs2/. Follow the instructions for submitting 
comments.
     People with Disabilities: Contact the FCC to request 
reasonable accommodations (accessible format documents, sign language 
interpreters, CART, etc.) by email: FCC504@fcc.gov or phone: (202) 418-
0530 or TTY: (202) 418-0432.

For detailed instructions for submitting comments and additional 
information on the rulemaking process, see the SUPPLEMENTARY 
INFORMATION section of this document.

FOR FURTHER INFORMATION CONTACT: Gregory Kwan, Attorney Advisor, at 
202-418-1191, Competition Policy Division, Wireline Competition Bureau.

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Second 
Notice of Proposed Rulemaking (Second FNPRM) in CC Docket No. 00-175, 
released on May 17, 2013. The full text of this document, which is part 
of the Commission's Memorandum Opinion and Order and Report and Order 
and Further Notice of Proposed Rulemaking and Second Further Notice of 
Proposed Rulemaking, is available for public inspection during regular 
business hours in the FCC Reference Center, Room CY-A257, 445 12th 
Street SW., Washington, DC 20554, and may also be purchased from the 
Commission's copy contractor, BCPI, Inc., Portals II, 445 Twelfth 
Street SW., Room CY-B402, Washington, DC 20554. Customers may contact 
BCPI, Inc. via their Web site, https://www.bcpi.com, or call 1-800-378-
3160. This document is available in alternative formats (computer 
diskette, large print, audio record, and Braille). Persons with 
disabilities who need documents in these formats may contact the FCC by 
email: FCC504@fcc.gov or phone: 202-418-0530 or TTY: 202-418-0432. 
Pursuant to sections 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 on the first page of this document. 
All pleadings are to reference CC Docket No. 00-175. Comments may be 
filed using the Commission's Electronic Comment Filing System (ECFS). 
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: https://fjallfoss.fcc.gov/ecfs2/.

[[Page 35192]]

     Paper Filers: Parties who choose to file by paper must 
file an original and one copy of each filing. If more than one docket 
or rulemaking number appears in the caption of this proceeding, filers 
must submit two additional copies for each additional docket or 
rulemaking number.
     Filings can be sent by hand or messenger delivery, by 
commercial overnight courier, or by first-class or overnight U.S. 
Postal Service mail. All filings must be addressed to the Commission's 
Secretary, Office of the Secretary, Federal Communications Commission.
     All hand-delivered or messenger-delivered paper filings 
for the Commission's Secretary must be delivered to FCC Headquarters at 
445 12th St., SW., Room TW-A325, Washington, DC 20554. The filing hours 
are 8:00 a.m. to 7:00 p.m. 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 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 must be addressed to 445 12th Street SW., 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 fcc504@fcc.gov or 
call the Consumer & Governmental Affairs Bureau at 202-418-0530 
(voice), 202-418-0432 (tty).

Synopsis of Second Further Notice of Proposed Rulemaking

    1. In furtherance of our commitment to revisit rules that may be 
outmoded, ineffective, insufficient, or excessively burdensome, while 
continuing to promote competition and consumer protection consistent 
with the Act, we evaluate in this Second FNPRM the structural 
separation requirements of section 64.1903 of the Commission's rules, 
as they apply to rate-of-return carriers providing facilities-based in-
region, interexchange, interstate long distance services (in-region 
long distance services). Through this proceeding, we intend to 
modernize our rules to reflect the competitive and marketplace 
realities for long distance service--at one time an expensive service, 
today one frequently offered on an unlimited basis by numerous 
facilities-based providers.
    2. Section 64.1903, as written, requires independent ILECs 
providing long distance services using their own facilities to do so 
through a separate corporate subsidiary that does not jointly own 
transmission or switching equipment with the local exchange company. 
The Commission promulgated section 64.1903 against a regulatory 
backdrop in which local telephone service, interstate long distance, 
and intrastate long distance were distinct services, for which 
consumers often chose separate providers. Since the codification of 
section 64.1903 more than fifteen years ago, we have seen 
transformative marketplace and regulatory changes, calling into 
question whether the current rule is the least burdensome way to ensure 
that our goals of competition and consumer protection are met. The 
Commission has acknowledged these changes, and in 2007 granted relief 
to the Bell Operating Companies (BOCs) from a regulatory framework with 
similar structural separation requirements as section 64.1903.
    3. Today, the Commission adopts the USTelecom Forbearance Order, 
which, among other things, grants the request of the United States 
Telecom Association (USTelecom) for forbearance from section 64.1903 as 
it applies to price cap carriers that comply with certain conditions. 
Based on the record in that proceeding, however, the USTelecom 
Forbearance Order denies similar relief to independent ILECs subject to 
rate-of-return regulation ``due to the continuing potential for cost 
misallocation.'' In this Second FNPRM, we take the next steps toward 
modernizing our rules for the non-BOC ILECs. Considering developments 
in today's marketplace, we seek comment on the costs and benefits of 
continuing to apply section 64.1903 to rate-of-return carriers, and 
whether such carriers continue to have the ability and incentive to 
engage in anticompetitive behavior.
    4. The Commission adopted section 64.1903 based on the findings in 
the LEC Classification Order emphasizing the need to protect against 
the exercise of exclusionary market power by independent ILECs--the 
ability to raise rivals' costs of providing competitive services, 
including the misallocation of costs (for example misallocating costs 
from nonregulated to regulated services), non-price discrimination (for 
example, lower quality wholesale services provided to a competitor), 
and a price squeeze based on inputs that long distance competitors 
need, such as access services (for example, raising prices for access 
services, including both switched and special access, or reducing 
prices for retail services). In light of the market changes described 
above, we consider whether the rule continues to offer benefits and 
whether the benefits justify the regulatory burdens and costs of 
compliance for rate-of-return ILECs. We also recognize that market 
conditions alone might justify eliminating the separate affiliate 
requirement, at least for some independent ILECs subject to rate-of-
return regulation, and seek comment on the relevant market 
characteristics and how they should affect our evaluation of the 
continued need for the separate affiliate rule.
    5. Analyzing Potential for Cost Miscalculation. The USTelecom 
Forbearance Order granted forbearance from section 64.1903 to 
independent ILECs subject to price cap regulation but denied this 
relief to such carriers subject to rate-of-return regulation, including 
both independent ILECs subject to average schedules and cost companies. 
Rate-of-return regulation, which preceded price cap regulation, focuses 
on an ILEC's costs and fixes the profits an ILEC may earn based on 
those costs. A rate-of-return ILEC may recover only its costs plus a 
prescribed return on investment. Unlike price cap carriers, rate-of-
return carriers are typically small, rural telephone companies 
concentrated in one area. Also unlike price cap carriers, non-average 
schedule rate-of-return independent ILEC has the ability and incentive 
to over allocate costs to common line and special access services 
because its interstate compensation for those services remains based 
directly on company-specific costs. We seek comment on this view. The 
Commission's 2011 reforms to intercarrier compensation rules cap and/or 
reduce interstate switched access charges, but allow increases in 
common line and special access rates. Thus, we believe that these 
changes in the access charge rules reduce, but may not eliminate, 
incentives for cost misallocation and potential access charge rate 
increases. We seek comment on this view and on the interplay between 
section 64.1903 and our intercarrier compensation and universal service 
reforms. We seek comment on whether we could address concerns about 
cost misallocation equally well, and in a less burdensome manner, in 
ways other than requiring that service be provided through a separate 
affiliate.
    6. The Commission has previously recognized that concerns about 
cost misallocation are strongest when carriers provide long distance 
services in whole or in part through their own switching or 
transmission facilities. When these carriers provide long

[[Page 35193]]

distance service exclusively through resale, the risk of cost 
misallocation is reduced, and they operate pursuant to a lesser 
safeguard--a separate corporate division rather than a separate 
subsidiary. We seek comment on the extent to which rate-of-return 
independent ILECs provide long distance service using their own 
facilities. Could we deter and detect cost misallocation by requiring 
that independent ILECs offering long distance over their own facilities 
provide those services through a separate corporate division?
    7. We also seek comment on whether we can reduce the burdens on 
average schedule carriers. Average schedule carriers are a subset of 
rate-of-return carriers that receive access compensation and universal 
service support through the use of ``average schedules'' to avoid the 
difficulties and expenses involved with conducting company-specific 
cost studies. Average schedule companies appear to have limited 
incentives to misallocate costs as long as they continue to use the 
average schedules for access compensation. However, these companies are 
permitted to convert to cost-based regulation without Commission 
approval. Thus, an average schedule company could, in theory, provide 
in-region long distance service without a separate affiliate, and then 
convert to cost-based regulation. We seek comment on how we could grant 
relief from the separate affiliate requirement for average schedule 
companies and also prevent them from misallocating costs in the future. 
We could condition relief from section 64.1903 on a commitment not to 
convert to rate-of-return regulation, or require them to reinstitute a 
separate affiliate if they do so. We seek comment on these and 
alternative suggestions. How should the Commission treat cost companies 
participating in NECA pools? Do these companies possess the ability and 
incentive to misallocate costs because disbursements from the NECA 
pools are based on participating companies' costs? In the USTelecom 
Forbearance Order, we grant relief to price cap carriers if they: (1) 
submit and obtain Bureau approval of special access performance 
metrics, and (2) satisfy imputation requirements, including the 
submission of an imputation plan for review and approval from the 
Bureau. Will such nonstructural safeguards obviate the need for section 
64.1903, while imposing fewer costs and burdens, for rate-of-return 
carriers? How should our analysis for rate-of-return carriers differ, 
if any, from our analysis for price cap carriers?
    8. Analyzing Potential for Unlawful Non-Price Discrimination and 
Price Squeezes. Section 64.1903 was intended to prevent unlawful non-
price discrimination and price squeezes. Do these concerns remain 
relevant in light of changes in the market, including the prevalence of 
bundled local, intrastate long distance, and interstate long distance 
services? Is the separate affiliate requirement an effective, cost-
effective way to prevent these anticompetitive practices? Could the 
Commission effectively address these concerns through ex-post facto 
investigations, such as under a section 208 complaint process? Are 
existing statutory and regulatory safeguards sufficient to deter these 
anticompetitive practices?
    9. Costs and Benefits of the Separate Affiliate Requirements of 
Section 64.1903. How many independent ILECs use separate affiliates 
pursuant to section 64.1903? What costs, if any, would be saved if we 
eliminate section 64.1903 for independent ILECs subject to rate-of-
return regulation? Would the same savings be realized if the 
independent ILEC were required instead to provide long distance 
services through a separate division? For example, what incremental 
costs does an independent ILEC incur in maintaining separate books of 
account for its long distance services, as opposed to including those 
costs and revenues in the accounts for its LEC operations? How does 
that differ depending on whether the separate books of account are for 
a separate division versus a separate corporation? We particularly seek 
empirical data on costs and burdens from independent ILECs that have 
experience providing long distance service through a separate corporate 
affiliate or a separate division so that we can analyze the differences 
between these structures.
    10. What effect, if any, does the prohibition against joint 
ownership of switching and transmission equipment have on an 
independent ILEC's operational efficiency and ability to offer 
innovative services? Does that prohibition significantly limit the 
independent ILEC's opportunities to take advantage of economies of 
scope and scale associated with integrated operations? Does the 
prohibition make it more difficult for an independent ILEC to transform 
its network from a traditional Time-Division Multiplexing (TDM) network 
to an all-Internet Protocol (all IP) network? If so, how? Does section 
64.1903 reduce independent ILECs' ability to increase telephone 
subscribership or extend broadband services to additional areas? If 
ILECs transition to offering only VoIP services, should section 64.1903 
continue to apply? Finally, we seek comment on whether complying with 
nonstructural safeguards such as special access performance metrics and 
imputation requirements adequately address issues of non-price 
discrimination and/or price squeezes. We ask commenters to provide 
detailed information on the overall costs and burdens of the section 
64.1903 requirements on independent ILECs and their customers.

Paperwork Reduction Act

    11. This NPRM seeks comment on a potential new or revised 
information collection requirement. If the Commission adopts any new or 
revised information collection requirement, the Commission will publish 
a separate notice in the Federal Register inviting the public to 
comment on the requirement, as required by the Paperwork Reduction Act 
of 1995, Public Law 104-13 (44 U.S.C. 3501-3520). 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 
it might ``further reduce the information collection burden for small 
business concerns with fewer than 25 employees.''

Initial Regulatory Flexibility Analysis

    12. As required by the Regulatory Flexibility Act of 1980, as 
amended (RFA), the Commission has prepared this Supplemental Initial 
Regulatory Flexibility Analysis (Supplemental IRFA) of the possible 
significant economic impact on a substantial number of small entities 
by the policies proposed in this Second NPRM. Written comments are 
requested on this Supplemental IRFA. Comments must be identified as 
responses to the Supplemental IRFA and must be filed by the deadlines 
for comments on the Second FNPRM. The Commission will send a copy of 
the Second FNPRM, including this Supplemental IRFA, to the Chief 
Counsel for Advocacy of the Small Business Administration (SBA). In 
addition, the Second FNPRM and Supplemental IRFA (or summaries thereof) 
will be published in the Federal Register.
    13. Purpose of the Proposed Rules. In the Second FNPRM, we explore 
the costs and benefits of continuing to apply the structural separation 
requirements contained in section 64.1903 of the Commission's rules, 47 
CFR 64.1903, to

[[Page 35194]]

independent incumbent local exchange carriers (ILECs) subject to rate-
of-return regulation and providing in-region, interexchange, interstate 
long distance services (in-region long distance services) in today's 
marketplace.
    14. In the Second FNPRM, we seek comments addressing marketplace 
changes such as the decline of stand-alone long distance services, the 
rise of facilities-based ``all-distance services'' competition from 
cable and wireless, and the role of bundles in today's long distance 
market. We therefore seek comment addressing whether incentives for 
anticompetitive behavior exist for independent ILECs subject to rate-
of-return regulation, and whether granting relief from section 64.1903 
is appropriate.
    15. Legal Basis. The legal basis for any action that may be taken 
pursuant to the Second FNPRM is contained in sections 4(i), 4(j), 10, 
201 through 204, 214, 220(a), and 303(r) of the Communications Act of 
1934, as amended, 47 U.S.C. 154(i), 154(j), 160, 201 through 204, 214, 
220(a), and 303(r).
    16. Description and Estimate of the Number of Small Entities to 
Which the Proposed Rules Will Apply. 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 SBA.
    17. Small Businesses. Nationwide, there are a total of 
approximately 27.5 million small businesses, according to the SBA.
    18. Wired Telecommunications Carriers. The SBA has developed a 
small business size standard for Wired Telecommunications Carriers, 
which consists of all such companies having 1,500 or fewer employees. 
According to Census Bureau data for 2007, there were 3,188 firms in 
this category, total, that operated for the entire year. Of this total, 
3144 firms had employment of 999 or fewer employees, and 44 firms had 
employment of 1000 employees or more. Thus, under this size standard, 
the majority of firms can be considered small.
    19. Incumbent Local Exchange Carriers (ILECs). Neither the 
Commission nor the SBA has developed a size standard for small 
businesses specifically applicable to incumbent local exchange 
services. The closest applicable size standard under SBA rules is for 
Wired Telecommunications Carriers. Under that size standard, such a 
business is small if it has 1,500 or fewer employees. According to 
Commission data, 1,307 carriers reported that they were incumbent local 
exchange service providers. Of these 1,307 carriers, an estimated 1,006 
have 1,500 or fewer employees and 301 have more than 1,500 employees. 
Consequently, the Commission estimates that most providers of incumbent 
local exchange service are small businesses that may be affected by 
rules adopted pursuant to the Second FNPRM.
    20. We have included small incumbent LECs in this present RFA 
analysis. As noted above, a ``small business'' under the RFA is one 
that, inter alia, meets the pertinent small business size standard 
(e.g., a telephone communications business having 1,500 or fewer 
employees), and ``is not dominant in its field of operation.'' The 
SBA's Office of Advocacy contends that, for RFA purposes, small 
incumbent LECs are not dominant in their field of operation because any 
such dominance is not ``national'' in scope. We have therefore included 
small incumbent LECs in this RFA analysis, although we emphasize that 
this RFA action has no effect on Commission analyses and determinations 
in other, non-RFA contexts.
    21. Interexchange Carriers (IXCs). Neither the Commission nor the 
SBA has developed a size standard for small businesses specifically 
applicable to interexchange services. The closest applicable size 
standard under SBA rules is for Wired Telecommunications Carriers. 
Under that size standard, such a business is small if it has 1,500 or 
fewer employees. According to Commission data, 359 companies reported 
that their primary telecommunications service activity was the 
provision of interexchange services. Of these 359 companies, an 
estimated 317 have 1,500 or fewer employees and 42 have more than 1,500 
employees. Consequently, the Commission estimates that the majority of 
interexchange service providers are small entities that may be affected 
by rules adopted pursuant to the Order.
    22. Description of Projected Reporting, Recordkeeping, and Other 
Compliance Requirements for Small Entities. In this Second FNPRM, the 
Commission proposes additional or modified information collections that 
would impose reporting and recordkeeping on current independent ILECs 
subject to rate-of-return regulation, including small entities. 
Specifically, the Second FNPRM invites comment on whether the 
Commission should replace its legacy framework for the provision of in-
region, interstate long distance services provided by independent ILECs 
subject to rate-of-return regulation with a framework more closely 
tailored to the needs of consumers and competitors in today's 
marketplace. The central feature of this proposal is to amend or 
eliminate the application of section 64.1903 to independent ILECs 
subject to rate-of-return regulation.
    23. Based on these questions, the Commission anticipates that a 
record will be developed concerning actual burdens and alternative ways 
in which the Commission could lessen the burdens on small entities 
subject to these requirements throughout the nation.
    24. Steps Taken to Minimize the Significant Economic Impact on 
Small Entities, and Significant Alternatives Considered. 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.''
    25. The overall objective of this proceeding is to reduce 
regulatory burdens on independent ILECs to the extent consistent with 
the public interest, and is part of the Commission's ongoing efforts 
under Executive Order 13,579 to revisit ``rules that may be outmoded, 
ineffective, insufficient, or excessively burdensome, and to modify, 
streamline, expand, or repeal them in accordance with what has been 
learned.'' The Second FNPRM seeks specific proposals as to which 
existing regulations might be removed or streamlined in their 
application to provision of in-region, interstate and international 
interexchange services by independent ILECs subject to rate-of-return 
regulation absent current safeguards, and asks parties to comment

[[Page 35195]]

on whether such independent ILECs should continue to be classified as 
nondominant in the provision of such services if section 64.1903 is 
repealed. The Second FNPRM also asks parties to discuss whether, and to 
what extent, dominant carrier regulation is aptly suited to achieving 
the Commission's objectives to promote competition and to deter 
anticompetitive behavior by independent ILECs subject to rate-of-return 
regulation. The Second FNPRM seeks comment on these matters, especially 
as they might affect small entities subject to the rules.
    26. Federal Rules that May Duplicate, Overlap, or Conflict with the 
Proposed Rules. None.

Ex Parte Presentations

    27. 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 section 1.1206(b). In proceedings governed by 
section 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.

Ordering Clauses

    28. Accordingly, it is ordered that, pursuant to Sections 1, 2, 
4(i), 4(j), 201 through 205, 220(a), 251, 272, and 303(r) of the 
Communications Act of 1934, as amended, 47 U.S.C. 151, 152, 154(i), 
154(j), 201 through 205, 220(a), 251, 272, and 303(r) this Second 
Further Notice of Proposed of Rulemaking in CC Docket No. 00-175 is 
adopted.
    29. It is further ordered that the Commission's Consumer and 
Governmental Affairs Bureau, Reference Information Center, shall send a 
copy of this Second Further Notice of Proposed Rulemaking in CC Docket 
No. 00-175, including the Initial Regulatory Flexibility 
Certifications, to the Chief Counsel for Advocacy of the Small Business 
Administration.

Federal Communications Commission.
Marlene H. Dortch,
Secretary.
[FR Doc. 2013-13976 Filed 6-11-13; 8:45 am]
BILLING CODE 6712-01-P
This site is protected by reCAPTCHA and the Google Privacy Policy and Terms of Service apply.