Process Reform for Executive Branch Review of Certain FCC Applications and Petitions Involving Foreign Ownership, 46870-46883 [2016-16780]

Agencies

• FEDERAL COMMUNICATIONS COMMISSION

[Federal Register Volume 81, Number 138 (Tuesday, July 19, 2016)]
[Proposed Rules]
[Pages 46870-46883]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2016-16780]


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

FEDERAL COMMUNICATIONS COMMISSION

47 CFR Parts 0, 1, and 63

[IB Docket No. 16-155, FCC 16-79]


Process Reform for Executive Branch Review of Certain FCC 
Applications and Petitions Involving Foreign Ownership

AGENCY: Federal Communications Commission.

ACTION: Proposed rule.

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

SUMMARY: In this Notice of Proposed Rulemaking (NPRM), the Federal 
Communications Commission (Commission) proposes changes to our rules 
and procedures related to certain applications and petitions for 
declaratory ruling involving foreign ownership (together, 
``applications''). The Commission refers certain applications to the 
relevant Executive Branch agencies for their input on any national 
security, law enforcement, foreign policy, and trade policy concerns 
that may arise from the foreign ownership interests held in the 
applicants and petitioners (together,

[[Page 46871]]

``applicants''). As part of our effort to reform the Commission's 
processes, we seek to improve the timeliness and transparency of this 
referral process. More specifically, our goals here are to identify 
ways in which both the Commission and the agencies might streamline and 
facilitate the process for obtaining information necessary for 
Executive Branch review and identify expected time frames, while 
ensuring that we continue to take Executive Branch concerns into 
consideration as part of our public interest review.

DATES: Submit comments on or before August 18, 2016, and replies on or 
before September 2, 2016.

ADDRESSES: You may submit comments, identified by IB Docket No. 16-155, 
by any of the following methods:
     Federal eRulemaking Portal: https://www.regulations.gov. 
Follow the instructions for submitting comments.
     Federal Communications Commission's ECFS 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 to FCC504@fcc.gov, phone: 202-418-
0530 (voice), tty: 202-418-0432.
    For detailed instructions on submitting comments and additional 
information on the rulemaking process, see the SUPPLEMENTARY 
INFORMATION section of this document.

FOR FURTHER INFORMATION CONTACT: David Krech or Veronica Garcia-Ulloa, 
Telecommunications and Analysis Division, International Bureau, FCC, 
(202) 418-1480 or via email to Veronica.Garcia-Ulloa@fcc.gov, mail to: 
David.Krech@fcc.gov. On PRA matters, contact Cathy Williams, Office of 
the Managing Director, FCC, (202) 418-2918 or via email to 
Cathy.Williams@fcc.gov.

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Notice 
of Proposed Rulemaking in IB Docket No. 16-155, adopted on June 24, 
2016 and released on June 24, 2016. The full text of this document is 
available for inspection and copying during normal business hours in 
the FCC Reference Center, 445 12th Street SW., Washington, DC 20554. 
The document also is available for download over the Internet at: 
https://transition.fcc.gov/Daily_Releases/Daily_Business/2016/db0624/FCC-16-79A1.pdf.

Comment Filing Procedures

    Pursuant to Sec. Sec.  1.415, 1.419, interested parties may file 
comments and reply comments on or before the dates indicated above. 
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 Commission's ECFS Web site at 
https://apps.fcc.gov/ecfs/.
     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.

Synopsis of Notice of Proposed Rulemaking

    1. In this Notice of Proposed Rulemaking, we propose changes to our 
rules and procedures related to certain applications and petitions for 
declaratory ruling involving foreign ownership. On May 10, 2016, the 
National Telecommunications and Information Administration (NTIA) filed 
a letter on behalf of the Executive Branch requesting that the 
Commission make changes to its processes that would help facilitate a 
more streamlined Executive Branch review process. The Executive Branch 
asks the Commission to require applicants seeking international section 
214 authorizations or transfer of such authorizations, submarine cable 
landing licenses, satellite earth station authorizations, and section 
310(b) foreign ownership rulings to provide certain information as part 
of their applications. The Executive Branch specifically asks that 
applicants with reportable foreign ownership provide certain 
information regarding ownership, network operations, and related 
matters, and that all applicants, regardless of whether they have 
reportable foreign ownership, certify that they will comply with 
applicable law enforcement assistance requirements and respond 
truthfully and accurately to lawful requests for information and/or 
legal process. The NTIA Letter states that such requirements will 
improve the ability of the Executive Branch to expeditiously and 
efficiently review referred applications, particularly in regard to 
identifying and assessing applications that raise national security or 
law enforcement concerns. The letter further states that the proposed 
certifications, in many cases, may eliminate the need for national 
security or law enforcement conditions, and thus facilitate expeditious 
responses to the Commission on specific applications.
    2. Based on the NTIA Letter and the comments received, we propose 
specific changes in our rules, designed to address the Executive 
Branch's request in a manner that furthers our mandate to serve the 
public interest. We also propose to adopt time frames for Executive 
Branch review of applications and other changes to our processing 
rules. We seek comment on those proposed changes. We believe that 
implementation of these rule changes would speed the action on 
applications while continuing to take into consideration relevant 
national security, law enforcement, foreign policy, and trade policy 
concerns.
    3. The Commission refers certain applications to the Executive 
Branch when there is reportable foreign ownership in the applicant. 
Specifically, where an applicant has a ten percent or greater direct or 
indirect owner that is not a U.S. citizen, Commission practice has been 
to refer an application for: (1) International section 214 authority; 
(2) assignment or transfer of control of domestic or international 
section 214 authority; (3) a submarine cable landing license; and (4) 
assignment or transfer of control of a submarine cable landing license. 
The Commission also refers petitions seeking authority to exceed the 
section 310(b) foreign ownership limits for broadcast and common 
carrier wireless licensees, including common carrier satellite earth 
stations.
    4. Our understanding is that the national security and law 
enforcement agencies generally initiate review of an application by 
sending the applicant a

[[Page 46872]]

set of questions seeking information on the five percent or greater 
owners of the applicant, the names and identifying information of 
officers and directors of companies, the business plans of the 
applicant, and details about the network to be used to provide 
services. The applicant provides answers to these threshold and any 
follow-up questions directly to the agencies, without involvement of 
Commission staff. The agencies use the information gathered through the 
questions to conduct their review and determine whether they need to 
negotiate a mitigation agreement with the applicant to address 
potential national security or law enforcement issues. Mitigation 
agreements can take the form of a letter of assurance (LOA) or a 
national security agreement (NSA). An LOA is a letter from the 
applicant to the agencies in which it agrees to undertake certain 
actions and that is signed only by the applicant. An NSA is a formal 
agreement between the applicant and the agencies and is signed by all 
parties.
    5. Upon completion of review, the Executive Branch notifies the 
Commission of its recommendation in typically one of two forms. The 
national security and law enforcement agencies may have no comment, in 
which case they file a letter to this effect, and the Commission moves 
forward with its action on the application. Alternatively, the agencies 
may advise the Commission that they have no objection to the grant of 
an application so long as the applicant complies with the terms of the 
relevant LOA or NSA. In such case, a grant of the application will 
typically be subject to the express condition that the applicant abide 
by the commitments and undertakings contained in the LOA and or NSA. 
More specifically, a typical authorization states that a failure to 
comply and/or remain in compliance with any of the commitments and 
undertakings in the LOA or NSA shall constitute a failure to meet a 
condition of such authorization, and thus grounds for declaring that 
the authorization has been terminated under the terms of the condition 
without further action on the part of the Commission. See IB Public 
Notice, 30 FCC Rcd at 11018; see, e.g., Wypoint Telecom, Inc., 
Termination of International Section 214 Authorization, Order, 30 FCC 
Rcd 13431, 13431-32, para. 2 (IB 2015). Failure to meet a condition of 
the authorization may also result in monetary sanctions or other 
enforcement action by the Commission. 47 U.S.C. 312; 47 U.S.C. 503. A 
third type of notification might involve a request to deny an 
application on national security or law enforcement grounds. To date, 
the agencies have not requested that the Commission deny an 
application. Regardless of the type of response from the Executive 
Branch, the Commission acts quickly to dispose of an application after 
the agencies complete their review.
    6. On May 12, 2016, the International Bureau released a public 
notice seeking comment on the May 10, 2016 NTIA Letter. Based on the 
NTIA Letter and the comments we have received, we identify below 
several proposals to make the Executive Branch review process more 
efficient and transparent. These include proposals that address the 
following requests set out in the NTIA Letter: (1) Requiring certain 
applicants with reportable foreign ownership to file information 
regarding ownership, network operations, and related matters; and (2) 
requiring applicants, regardless of whether they have reportable 
foreign ownership, to certify they will comply with certain law 
enforcement assistance requirements and respond truthfully and 
accurately to lawful requests for information and/or legal process. 
They also include additional proposals to establish time frames for 
Executive Branch review of applications and modify our processing 
rules. We seek comment on these and other ways to expedite the review 
process and increase transparency while ensuring that relevant 
Executive Branch concerns receive consideration as part of the 
Commission's public interest review.
    7. TYPES OF APPLICATIONS. We propose that only certain types of 
applications may be required to provide the information and 
certifications requested by the Executive Branch in the NTIA Letter. In 
the NTIA Letter, the Executive Branch requests that applicants seeking 
international section 214 authorizations or transfer of such 
authorizations, submarine cable landing licenses, satellite earth 
station authorizations, and section 310(b) foreign ownership rulings, 
provide certain information and certifications as part of their 
applications. We currently refer to the Executive Branch applications 
with reportable foreign ownership for international section 214 
authorizations, applications to assign or transfer control of domestic 
or international section 214 authority, submarine cable landing 
licenses and applications to assign or transfer control of such 
licenses, and petitions for section 310(b) foreign ownership rulings 
(broadcast, common carrier wireless, and common carrier satellite earth 
stations). We do not propose to expand the types of applications that 
we refer to the Executive Branch.
    8. Currently, we refer applications for transfer of control of 
domestic section 214 authority that have reportable foreign ownership 
and that do not have a corresponding international section 214 transfer 
of control application. The NTIA Letter does not seek to review these 
types of applications, nor do we propose to include these applications 
among those we will refer to the Executive Branch or to require the 
requested information and certifications. We seek comment on this and 
whether there are situations where we should refer a domestic-only 
section 214 authority transfer of control application to the Executive 
Branch.
    9. EchoStar/Hughes and SIA raise concerns that the NTIA Letter 
seeks to require non-common carrier earth station licenses to be 
subject to the information and certification requests by the Executive 
Branch. We have not been referring earth station applications to the 
Executive Branch because most earth stations are authorized on a non-
common carrier basis, and we do not collect ownership information in 
the applications. An earth station application, however, may be 
included as part of a referral of associated applications, such as an 
international section 214 application or an assignment or transfer of 
control application. We propose to maintain our current practice and 
only refer common carrier earth station applications if the applicant 
requires a section 310(b) foreign ownership ruling. Consequently, an 
applicant for an earth station license would not be required to provide 
the information and certifications sought by the Executive Branch as 
part of its application, but would only need to provide such 
information as part of its section 310(b) petition if it required a 
foreign ownership ruling. Similarly, we propose that an applicant for a 
broadcast or common carrier wireless license not be required to provide 
the information as part of its application, but only need to provide 
such information as part of its section 310(b) petition if it required 
a foreign ownership ruling. We seek comment on whether these are the 
appropriate types of applications to be required to provide the 
information and certifications requested by the Executive Branch and be 
considered for referral to the Executive Branch for national security, 
law enforcement, foreign policy, and trade policy concerns.
    10. OWNERSHIP, NETWORK OPERATIONS, AND OTHER INFORMATION 
REQUIREMENTS. We propose to require applicants with reportable foreign 
ownership to provide information on ownership, network

[[Page 46873]]

operations, and related matters when filing their applications. For 
international section 214 authorizations and submarine cable landing 
licenses, the applicant must report all individuals or entities with a 
ten percent or greater direct or indirect ownership interest in the 
applicant. 47 CFR 1.767(a)(8), 63.18(h). For assignment or transfer of 
control applications, the applicant must report all individuals or 
entities with a ten percent or greater direct or indirect ownership 
interest in the applicant. 47 CFR 1.767(a)(11), 63.24. Common carrier 
wireless licensees, common carrier satellite earth station licensees, 
and broadcast licensees must seek a foreign ownership ruling if their 
foreign ownership would exceed the relevant benchmark set out in 
section 310(b) of the Act. 47 U.S.C. 310(b). The NTIA Letter states 
that receiving the requested information as part of an application will 
allow the Executive Branch to start its review of the application 
sooner than is possible under the current review process. We agree. We 
propose to require that the information be filed at the time an 
applicant submits its application to the Commission. We seek comment on 
this proposal and any alternative or additional methods to streamline 
the application process and increase transparency, while providing the 
Executive Branch with the information needed to conduct its national 
security and law enforcement review.
    11. Categories of Information. Under the current process, the 
questions asked of applicants by the Executive Branch require 
information that is not included in the applications submitted to the 
Commission. The NTIA Letter states that the relevant agencies need 
answers to these questions to evaluate whether an application may raise 
national security or law enforcement concerns. The questions may vary 
depending on the specifics of the application. The applicant generally 
cannot prepare answers in advance of receiving the questions. Because 
tailoring the questions sent to each applicant takes time, there often 
is some delay between when the Commission refers the application and 
when the agencies send questions to the applicant. The NTIA Letter 
notes that there is currently no required timeline on the applicant's 
response to the questions. Thus, it may take the Executive Branch 
additional time to obtain complete answers from applicants, which adds 
delay. The agencies also may have follow-up questions for the applicant 
upon review of the initial set of answers. This, among other factors, 
can lead to longer time periods for review.
    12. To help ensure that the relevant departments and agencies have 
the information needed to review an application promptly, the Executive 
Branch requests that we require applicants with reportable foreign 
ownership seeking international section 214 authorizations or transfer 
of such authorization, submarine cable landing licenses, and satellite 
earth station authorizations, as well as petitioners for section 310(b) 
foreign ownership rulings, to provide as part of their applications 
detailed and comprehensive information in the following areas:
    (1) Corporate structure and shareholder information;
    (2) Relationships with foreign entities;
    (3) Financial condition and circumstances;
    (4) Compliance with applicable laws and regulations; and
    (5) Business and operational information, including services to be 
provided and network infrastructure.
    13. The Executive Branch asks the Commission ``to adopt 
requirements that focus on the above categories of information to be 
collected, while also providing sufficient flexibility for the 
Commission to prescribe and, as necessary, modify the specific 
questions posed to applicants.'' The Executive Branch recommends that 
the Commission propose and seek comment on specific questions through 
an information collection process consistent with the Paperwork 
Reduction Act of 1995 (PRA) process. For illustrative purposes, the 
Executive Branch also filed sample questions that show the types and 
extent of the information it seeks to obtain. The introductory language 
for the sample questions states that the questions seek ``information 
regarding the business organization and services, network 
infrastructure, relationships with foreign entities or persons, 
historical regulatory and penal actions, and capabilities to comply 
with applicable legal requirements, and would be shared with relevant 
Executive Branch departments and agencies to assist in the review of 
public interest factors.''
    14. The NTIA Letter states that this information is necessary for 
the agencies to assess whether an application with reportable foreign 
ownership raises national security or law enforcement concerns, 
including preventing abuses of U.S. communications systems, protecting 
the confidentiality, integrity and availability of U.S communications, 
protecting the national infrastructure, preventing fraudulent or other 
criminal activity, and preserving the ability to effectuate legal 
process for communications data. It states that receiving the 
information at the time of referral, rather than having to request it 
after referral, will help the Executive Branch begin review of the 
application promptly after referral. Commenters state that requiring 
these categories of information may help expedite the process, but may 
go beyond the information the Executive Branch currently requests. For 
example, one commenter asserts that seeking information on financial 
condition and circumstances and compliance with applicable laws and 
regulations ``seems far outside the scope of [the Executive Branch's] 
review of applications for `national security, law enforcement, foreign 
policy, or trade concerns.''' Others argue that the requested 
information is duplicative of information provided as part of the 
Commission's application. We seek comment on this request and on the 
proposed categories of information. Are there more narrowly tailored 
questions that can adequately serve the goals sought in the NTIA 
Letter? Are there additional questions that should be included, and, if 
so, what are those questions?
    15. Information Filing. We propose to require applicants with 
reportable foreign ownership seeking an international section 214 
authorization or a submarine cable landing license or to assign or 
transfer control of such authorizations, and petitioners for section 
310(b) foreign ownership rulings (common carrier wireless, common 
carrier satellite earth stations, or broadcast) to provide the 
information requested by the NTIA Letter at the time they file their 
applications or petitions. We seek comment on whether there are 
situations where an applicant should not be required to file the 
information. For example, should the Commission require an applicant to 
provide such information when the applicant has an existing LOA or NSA 
and there has been no material change in the foreign ownership since it 
negotiated the LOA or NSA? Should non-facilities-based carriers be 
subject to the information request?
    16. Publicly Available Questions. We propose that the Commission 
retain flexibility regarding the specific questions to be answered and 
thus propose to include in the rules the categories of questions to be 
answered but not to place the specific questions in the rules. The NTIA 
Letter urges the Commission to adopt requirements that focus on the 
categories of information to be collected so as to afford the

[[Page 46874]]

Commission flexibility to vary the specific questions as appropriate to 
the circumstances at the time. The NTIA Letter notes that the specific 
questions would be subject to the PRA as an information collection. We 
propose to adopt the approach described in the Executive Branch 
request, and after the new rules are adopted, we would start a PRA 
process with the specific questions, and then make the questions 
publicly available on a Web site as a downloadable document so it is 
readily available to applicants. This approach would be similar to our 
practice of outlining the requirements for an application in our rules 
and then including specific questions that elicit the required 
information during the PRA process to adopt the forms for filing the 
application. If we adopt this proposal, applicants and other interested 
parties will have the opportunity to comment on the specific questions 
during the PRA review process. We seek comment on this proposal.
    17. We also seek comment on whether the use of a publicly available 
set of standardized questions for which the answers must be provided at 
the time of filing an application will help to streamline the Executive 
Branch review process. For instance, will the inclusion of responses to 
the standardized questions at the time the application is filed result 
in more timely review than the use of individualized questions that are 
sent to the applicant after the application has been filed? Many of the 
commenters support having the questions publicly available and the 
answers provided at the time the application is filed, stating that 
this should expedite Executive Branch review. CTIA, while supporting 
publicly-available standardized questions, recommends that the answers 
not be provided when the application is filed because the answers would 
likely delay and complicate applications. CTIA instead suggests that 
applicants ``certify in their application that they will provide 
complete responses to the questionnaire within a particular time frame 
after filing the application.'' We seek comment on whether the answers 
should be provided when the application is filed with the Commission, 
and if not, how a later filing would serve the goal of expediting 
Executive Branch review of the applications.
    18. We propose that, although the questions would be standardized, 
they vary by category of application. For example, an applicant for an 
international section 214 authorization would not be required to 
provide information about cable landing location sites. We also seek 
comment on whether there is information that the Executive Branch may 
require that cannot be provided when an application is filed, but which 
could be made available later in the review process. For example, Level 
3 notes that submarine cable landing applicants usually cannot provide 
answers to all the questions at the time the application is filed. 
Should an application be considered complete and acceptable for filing 
if there is information that an applicant cannot provide at the time of 
filing? Are there specific questions for submarine cable applicants or 
other applicants that should not be required at the time the applicant 
files?
    19. FCC Review of Responses. We propose that, as part of our review 
of an application for acceptability for filing, the Commission staff 
review the responses to the threshold questions for completeness, but 
leave the substantive review to the Executive Branch. CTIA and Level 3 
question the usefulness of submitting the answers to the Commission and 
suggest that they be sent directly to the Executive Branch. We seek 
comment on whether the Commission should receive and/or review the 
answers in the first instance. We seek comment on what Commission staff 
should look for to determine if the responses are sufficient to find 
the application acceptable for filing. We also seek comment on 
alternatives if Commission staff does not review the responses to the 
questions. For example, should we require a certification that the 
applicant has provided the responses to the Executive Branch at the 
time of filing or will do so within a specified period of time? If so, 
what would be an appropriate period? If the Commission staff does not 
review the responses, how would that affect the proposed time frames 
for Executive Branch review? When would the 90-day period for the 
review start if the Executive Branch has to go back and forth with the 
applicant to get complete responses to the questions?
    20. We recognize that the responses to some of these threshold 
questions may contain confidential commercial information. Some of the 
threshold questions would seek personally identifiable information 
(PII). Any questions that seek PII would require the Commission to 
assess whether by obtaining and using such PII it would be creating a 
system of records under the Privacy Act. 5 U.S.C. 552a. With respect to 
any information we may receive that includes PII, we intend to comply 
fully with the requirements of that statute and related statutes that 
protect PII. The Commission's rules provide a mechanism for requesting 
confidential treatment of such information. Under these rules, such 
information will be accorded confidential treatment until the 
Commission acts on the confidentiality request and all subsequent 
agency review and judicial stay proceedings have been exhausted. To the 
extent the information qualifies as trade secrets or confidential 
commercial or financial information that is exempt from disclosure 
under the Freedom of Information Act, our rules require a ``persuasive 
showing'' for public release of the information, showing among other 
factors that the information is relevant to a public interest issue 
before the Commission. In application proceedings, the Commission may 
rely upon protective orders to limit disclosure and use of 
competitively sensitive and other confidential information. We seek 
comment on whether these established procedures serve to provide 
appropriate protections in such situations. Given the scope of this 
information, the likelihood that some of it may already be public, and 
the relevance of context in evaluating competitive concerns, we do not 
propose to designate such information in our rules as the kind that is 
presumed confidential and therefore does not require the filing of a 
request for confidentiality. We seek comment on this view. We seek 
comment on whether some of this information can be presumed to be 
confidential and request that commenters specify which types of 
information should be presumed confidential.
    21. If we require the responses to the questions to be filed with 
the Commission, we seek comment on whether the Commission should take 
special steps to ensure that the responses to threshold questions 
submitted by applicants are secure, such as having applicants submit 
their responses through a secure portal. We note that the Commission 
has experience in receiving confidential information and sharing that 
information with other agencies. Currently, the Commission has in place 
secure portals, such as the Network Outage Reporting System (NORS). We 
would anticipate developing a similar system to facilitate the 
receiving, reviewing, sharing, and generally storing any confidential 
or sensitive information in the applicants' submissions in response to 
the threshold questions. We also invite suggestions about other 
heightened security measures that the Commission can undertake to 
ensure the protection

[[Page 46875]]

of the information submitted by applicants.
    22. In this case, our proposals contemplate sharing of confidential 
information submitted as part of the application with Executive Branch 
agencies, who would continue to review it in the first instance for 
national security, law enforcement, foreign policy, and trade policy 
concerns. Under our rules, such sharing is subject to the requirement 
that the Executive Branch agencies must comply with the protections 
applicable both to the Commission and to themselves relating to the 
unlawful disclosure of information. Because current practice already 
involves submission of similar information for review by these 
agencies, and in light of their legitimate need for the information, we 
propose to amend section 0.442 of the Commission's rules to make clear 
that sharing with Executive Branch agencies under these restrictions is 
permissible without the pre-notification procedures of that rule. We 
seek comment on this proposal. Are the obligations of the various 
Executive Branch agencies different than the Commission's obligation to 
protect the information? If so, what are the differences and what is 
the possible impact of those differences?
    23. We seek comment on whether there are reasons why the Commission 
should or should not undertake the initial review of the answers for 
completeness. We seek comment on whether there are concerns with 
Commission staff receiving, reviewing, storing, and forwarding to the 
Executive Branch such personally identifiable and business sensitive 
information. What are the benefits and burdens of the Commission 
receiving and reviewing the threshold questions? We invite suggestions 
on heightened confidentiality protections for sensitive and proprietary 
financial, operational, and privacy related information that applicants 
would provide as part of the Commission's application process.
    24. CERTIFICATION REQUIREMENTS. We propose to add a certification 
requirement to our rules, and seek comment on the scope of this 
proposal. The Executive Branch requests that the Commission require all 
applicants to certify that they agree to comply with several mitigation 
measures, as discussed below. The NTIA Letter states that requiring an 
applicant to certify to compliance with these measures as part of its 
application should reduce the need for routine mitigation, which should 
facilitate a faster response to the Commission by the Executive Branch 
on its review and advance the shared goal of making the Executive 
Branch review process as expeditious and efficient as possible.
    25. The NTIA Letter observes that national security and law 
enforcement review frequently requires time both to negotiate 
assurances from an applicant that it will comply with applicable law 
enforcement assistance requirements and to draft an individualized LOA 
upon which the Executive Branch will rely to address national security 
and law enforcement concerns. It states that the proposed certification 
would simplify and expedite the review process. The Executive Branch 
therefore requests that an applicant certify that, with respect to the 
communications services to be provided under the requested license or 
authorization, it will:
    (1) Comply with applicable provisions of the Communications 
Assistance for Law Enforcement Act (CALEA);
    (2) make communications to, from, or within the United States, as 
well as records thereof, available in a form and location that permits 
them to be subject to lawful request or valid legal process under U.S. 
law, for services covered under the requested Commission license or 
authorization; and
    (3) agree to designate a point of contact located in the United 
States who is a U.S. citizen or lawful permanent resident for the 
execution of lawful requests and/or legal process.

For certification number (2), the proposed certifications cite to the 
following U.S. laws and other legal processes: (1) The Wiretap Act, 18 
U.S.C. 2501 et seq.; (2) the Stored Communication Act, 18 U.S.C. 2701 
et seq.; (3) the Pen Register and Trap and Trace Statute, 18 U.S.C. 
3121; and (4) other court orders, subpoenas or other legal process. The 
Executive Branch suggests that by requiring applicants to certify 
compliance with these law enforcement requirements as part of the 
application process, the applicant would consider and address these 
requirements prior to submitting the application. The NTIA Letter 
states that the requested certifications ``would continue to require 
applicants to declare that all information submitted is complete, up-
to-date, and truthful, and that the applicant understands that failure 
to fulfill the obligations contained in the certifications could result 
in revocation or termination of the requested license or authorization, 
as well as criminal and civil penalties.'' It asserts that these 
certifications would strengthen compliance because an applicant would 
understand that failure to comply with the certifications could be a 
basis for the Commission to terminate or revoke the authorization or 
license. We invite comment on the certifications above and seek 
specific comments as to whether any changes should be made and why. We 
also seek comment on whether the Executive Branch's suggestions will be 
burdensome, and if so, the nature and extent, of any burden.
    26. Eliminating the Need to Negotiate LOAs. We believe that 
eliminating the need to negotiate LOAs for routine mitigation measures 
should help to streamline the Executive Branch review process and 
provide the opportunity to allocate resources to resolution of more 
complicated applications. Our experience shows that in 2014 almost half 
(13 of 29) of all mitigation agreements filed with the Commission 
concerned only issues that would have been adequately addressed by the 
certification requirement; in 2015, the figure was over half (17 of 
29). We encourage those who have had experience in negotiating routine 
LOAs that cover compliance with CALEA and other law enforcement 
assistance requirements to address whether and in what ways and by how 
much time the proposed certifications might have expedited Executive 
Branch review of their applications.
    27. Applicants. We seek comment on the Executive Branch request 
that all applicants seeking an international section 214 authorization 
or a submarine cable landing license, or applications to assign or 
transfer control of such authorizations, and petitioners for section 
310(b) foreign ownership rulings (common carrier wireless, common 
carrier satellite earth stations or broadcast) be required to make the 
foregoing certifications, not just those applicants with reportable 
foreign ownership. Specifically, we seek comment on the premise that 
the certification requirement would address legitimate law enforcement 
concerns that should apply regardless of foreign ownership. We note 
that extension of this requirement to all applicants would encompass 
the vast majority of such applications, including many that do not 
require Executive Branch review. Several commenters oppose requiring 
applicants that do not have reportable foreign ownership to make the 
requested certification. For example, CTIA argues that the NTIA letter 
``does not explain why [the proposed] certifications should be extended 
to all applicants'' when the Executive Branch review process is 
currently limited to applicants with reportable foreign ownership. In 
addition, T-Mobile claims that ``[t]here is no basis to require 
applicants without cognizable foreign ownership to submit to these new

[[Page 46876]]

requirements.'' Moreover, USTelecom contends that applicants should not 
have to ``submit up front information or certifications if their 
applications have no meaningful nexus to national security, law 
enforcement, foreign policy, or trade concerns,'' which are the main 
reasons behind the Executive Branch review. We seek comment on their 
concerns. Are there reasons why the certification should apply only to 
applicants with reportable foreign ownership? How would requiring 
certifications from all applicants expedite the review of applications 
with reportable foreign ownership? Would distinguishing between 
applicants with reportable foreign ownership and those without foreign 
ownership raise concerns with any U.S. treaty obligations, such as the 
non-discrimination/national treatment obligations common to U.S. free 
trade agreements? We invite comments on whether the benefits of the 
certifications outweigh the burdens related to compliance with the 
requirement.
    28. Extent of Current Laws and Obligations. We seek comment on 
whether, and in what ways, the proposed certifications might add any 
new requirements beyond those set out in the applicable statutes and 
rules. The NTIA Letter states that the requested certification 
essentially reflects current laws and obligations. Several commenters 
disagree, arguing that the certifications go beyond the existing 
obligations of carriers under current statute and rules. For example, 
CTIA contends that the second proposed certification could be 
interpreted as requiring carriers to ``take steps beyond what is 
currently required to assist with breaking security measures on 
customers' accounts and devices.'' In particular, T-Mobile and Wiley 
Rein are concerned that the certification is broad enough to be read as 
prohibiting encryption, establishing duties to decrypt, and requiring 
disclosure to government agencies that is not legally compelled. T-
Mobile further contends that the ``certification language also appears 
to be trying to improperly enforce localization and repatriation in the 
United States,'' running contrary to the Commerce Department's policy 
of favoring the ``free flow of information.'' USTelecom ultimately 
finds that some certifications such as the second certification are 
``subject to differing legal interpretation and potential legal 
challenge,'' making their ``validity and wisdom . . . unclear.'' We 
seek comment on these concerns as well as alternatives to the second 
certification offered by these parties, such as T-Mobile's proposal 
that it should be limited to compliance with obligations otherwise 
established in statute or regulation. We also seek comment on whether 
there are conflicts between U.S. law and other laws applicable to 
communications made to or from other countries or records associated 
therewith, and if so how should applicants resolve any such conflicts? 
Would the proposed certifications raise foreign policy or other 
concerns regarding potential reciprocal demands by foreign regulatory 
authorities on U.S. entities? Would this burden vary by the type of 
license or authorization to which the certification applies? What 
experience have prior applicants had with any similar provisions under 
existing LOAs or NSAs?
    29. We also seek comment on whether the certifications regarding 
compliance with CALEA and making communications within the United 
States as well as records thereof available in a form and location that 
permits them to be subject to lawful request or valid legal process 
under U.S. law, should be applied to all applicants or only applied to 
certain applicants. We also seek comment on whether the certifications 
regarding compliance with CALEA and making communications within the 
United States, as well as records thereof, available in a form and 
location that permits them to be subject to lawful request or valid 
legal process under U.S. law should be applied more narrowly than 
proposed in the NTIA Letter. Should they only apply to common carrier 
licensees? For example, the Broadcaster Representatives argue that the 
CALEA compliance and intercept capabilities have nothing to do with 
broadcasting, or with broadcast licensees or applicants that file a 
petition for a foreign ownership ruling under section 310(b). The 
Broadcaster Representatives state that broadcasters ``do not have 
compliance obligations'' under CALEA and recommend the Commission 
consider differentiating the requirements in the broadcast context. We 
seek comment on considerations of the scope and implications of the 
certifications proposal.
    30. TIME FRAMES FOR EXECUTIVE BRANCH REVIEW. We propose to adopt a 
90-day period for the Executive Branch to complete its review of 
referred applications and petitions. In rare instances, we propose to 
allow a one-time additional 90-day extension provided the Executive 
Branch demonstrates that issues of complexity warrant such an extension 
and provides to the Commission the status of its review every 30 days 
thereafter. We also propose that the time period would start from the 
date the application is placed on the Commission's acceptable for 
filing public notice. We believe that time frames will bring additional 
clarity and certainty to the review process. Such transparency would 
benefit the Commission and applicants alike, by keeping all parties 
better informed of the application's status and facilitating 
expectations for resolution of pending cases. Several commenters agree, 
stating that time frames (including a 90-day period) should be 
established for Executive Branch review in order to promote 
transparency and certainty of action. Because these time frames will 
affect multiple types of applications with requirements that are set 
out in different parts of the Commission's rules, we propose to 
establish a new subpart U in Part 1 of the rules for referral of 
applications to the Executive Branch.
    31. Acceptability for Filing. Under our proposal, Commission staff 
will review the application to ensure it is acceptable for filing. If 
the threshold questions have been answered, the certification is 
complete, and the application otherwise complies with our rules, the 
Commission proposes to place the application on public notice, with 
appropriate protections, and forward the application, including the 
answers to the threshold questions, to the Executive Branch. In 
instances where the Commission finds that any of the threshold 
questions have not been answered or the certification is incomplete, we 
propose that the Commission notify the applicants and give them a 
reasonable time to respond. We seek comment on what a reasonable time 
frame should be (such as, for example, seven days). Failure to respond 
within the time frame will be grounds for dismissal of the application 
without prejudice to refiling. We seek comment on this proposal and any 
other recommendations on the process to ensure transparency to the 
public and applicants and to promote an efficient review process. One 
commenter suggested that to enhance transparency, applicants should 
have names and contact information of the individuals in the Executive 
Branch who are reviewing their applications. We seek comment regarding 
whether the Executive Branch agencies should identify a single point of 
content or point agency for referral of applications and any inquiries 
the Commission or applicants have during the course of the Executive 
Branch review process for any given application. In the alternative, we 
seek comment on whether each participating agency should identify its

[[Page 46877]]

own point of contact. If obtained, we propose to provide Executive 
Branch contact information on our Web site along with the standardized 
national security and law enforcement questions. We seek comment on 
this proposal.
    32. Non-Streamlined Processing. We propose to process on a non-
streamlined basis international section 214 and submarine cables 
applications with foreign ownership that are referred to the Executive 
Branch for review. Streamlined processing of an international section 
214 application means that the application is granted on the 14th day 
after the application is placed on public notice. Based on our 
experience, the Executive Branch needs time to review an application 
and streamlined processing, particularly a 14-day process, does not 
provide sufficient time for such a review. The Commission previously 
has made such a determination in the context of submarine cable landing 
licenses, where it found that a 14-day review period was insufficient 
due to the need to coordinate such licenses with the State Department. 
Moreover, the Executive Branch regularly requests that we remove 
applications from streamlined processing as it cannot complete its 
review in that short of a time period. We believe it would be 
beneficial to the applicant, the Commission, and the Executive Branch 
agencies to process the applications as non-streamlined from the 
beginning rather than to initially process the application on a 
streamlined basis and then remove it from streamlining. This should 
provide more transparency as to the process for those applications 
referred to the Executive Branch for review. We seek comment on this 
proposal and seek suggestions on alternative changes to our processing 
of applications. We propose to remove from streamlining any 
transactions involving joint domestic and international section 214 
authority where foreign ownership of the international 214 
authorization alone would be cause for non-streamlined processing. In 
such cases, we see no reason to streamline one part of the transaction 
(domestic 214 authority) while another part (international 214 
authority) is not streamlined. We seek comment on these proposals and 
seek suggestions on alternative changes to our processing of 
applications.
    33. 90-Day and 180-Day Time Frames for Executive Branch Review. We 
propose a 90-day review period for applications referred to the 
Executive Branch, with a one-time additional 90-day extension for 
circumstances where the Executive Branch requires additional review 
time beyond the initial period. Many of the commenters support a 90-day 
review period. We expect that many of the referred applications will be 
processed within the initial comment period because the certification 
requirement should obviate the need for negotiating LOAs related to 
compliance with routine law enforcement requirements. We will refer 
applications with reportable foreign ownership to the Executive Branch 
upon release of the public notice, and we propose that, at that time, 
the 90-day clock would begin. Currently, only applications concerning 
international section 214 authorizations--either initial applications 
for authority or applications for assignment or transfer of authority--
that qualify for streamlined processing pursuant section 63.12 are 
referred to the Executive Branch prior to the application being placed 
on public notice. 47 CFR 63.12. In those cases, the applications have 
been referred to the Executive Branch generally a week prior to release 
of the public notice, and the Executive Branch is requested to notify 
the Commission prior to the automatic grant of the application if it 
wishes to review the application. Commenters support starting the clock 
when the application either is referred to the Executive Branch or 
placed on an accepted for filing public notice.
    34. In keeping with current practice, we propose to continue to 
request that the Executive Branch notify us within the comment period 
established by the public notice if it will require additional time to 
review the application (i.e., beyond the comment period established by 
the public notice). Any request to defer Commission action beyond the 
public notice period pending national security, law enforcement, 
foreign policy, and trade policy review would be filed in the public 
record for the application. If the Executive Branch asks us to defer 
action on an application beyond the public comment period for the 
application, we propose a timetable for completing its review within 90 
days of the release of the accepted-for-filing public notice. Should 
the Executive Branch complete review prior to the end of the 90-day 
period, we propose that it should notify the Commission at the time the 
review is complete. If the Executive Branch does not notify the 
Commission within the 90-day period that it is requesting additional 
time to review the application, we propose to deem that it has not 
found any national security, law enforcement, foreign policy, or trade 
policy issues present, and we will move ahead with Commission action on 
the application. Commenters agree with this approach. We seek comment 
on this proposal and on any alternative proposals for processing such 
applications.
    35. A 90-day period is consistent with the existing timelines for 
action on non-streamlined international 214 and cable landing license 
applications. Moreover, a 90-day review period is consistent with 
review periods used by other agencies as well. For example, CFIUS 
conducts national security reviews of mergers, acquisitions, and 
takeovers by, or with, any foreign person that could result in foreign 
control of a U.S. business (a ``covered transaction'') under a similar 
time frame. After an organization submits notice of a transaction to 
the Committee, CFIUS has up to 90 days to complete its review of the 
transaction.
    36. We recognize that, in some unusual cases, the Executive Branch 
may need more than 90 days to investigate and/or resolve any national 
security, law enforcement, foreign policy, or trade policy issues. 
Allowing the Executive Branch up to an additional 90 days (i.e., 180 
days total from the date of public notice and referral) for review 
would be consistent with our rules regarding international section 214 
and cable landing license applications that provide the Commission an 
additional 90 days' review in cases of extraordinary complexity.
    37. Under our proposal, the Executive Branch would complete its 
review within the 90-day period or notify the Commission no later than 
the initial 90-day date that it requires additional time for review 
and, every 30 days thereafter, would notify the Commission on the 
status of review. We propose that the notification would explain why 
the Executive Branch requires additional time to complete review, along 
with an estimate of the additional time required. We invite comment on 
factors that would provide a basis for an extension. If the explanation 
includes classified or other information that should not be made 
public, the agencies would have the ability to file a short statement 
in the public record, and provide a more thorough explanation to 
Commission staff in a non-public record.
    38. We seek comment on the proposed 90-day and 180-day time 
periods. Are these appropriate? Should they apply to all the 
applications that are referred to the Executive Branch or should there 
be different time periods for different types of applications? If 
different periods should be adopted, what would be the rationale for 
such a

[[Page 46878]]

distinction and what would be an appropriate period?
    39. Follow-Up Questions. As discussed above, the period for 
Executive Branch review would begin when the application goes on public 
notice and is referred to the Executive Branch. After receiving an 
applicant's answers to the threshold questions, there may be 
situations, as there are under the current process, when the agencies 
will need to seek additional information or clarification from the 
applicant to conduct their national security, law enforcement, foreign 
policy, and trade policy review. As is the current practice, we propose 
that the agencies engage directly with the applicant regarding any 
follow-up information requests, and that the applicant send its answers 
to the follow-up requests directly and solely to the agencies, but that 
the Commission could request copies of such answers in its discretion. 
To ensure that the time frames for Executive Branch review can be 
maintained, we propose that the applicant be required to respond to the 
agencies' requests for information within seven days. If the applicant 
does not provide the requested information on time, we propose that the 
Commission have the discretion to dismiss the application without 
prejudice. We propose that the Executive Branch would need to notify 
the Commission when an applicant fails to provide supplemental 
information within seven days. The applicant would have the option of 
asking for additional time to respond, but that would stop the 90-day 
review clock until the applicant provides the requested information. We 
propose that a request for additional time to provide supplemental 
information be submitted by the applicant directly to the Executive 
Branch with a copy submitted to the Commission.
    40. We also propose to place similar requirements on the applicant 
to be responsive to requests by the agencies to negotiate mitigation, a 
process which we expect to occur within the 90-day review period 
following referral of an application, as discussed in the paragraphs 
above. Thus, under this proposed approach, an applicant would have 
seven days after receiving a draft mitigation agreement to respond to 
it (either by signing it or offering a counter-proposal). If an 
applicant desires more than seven days to respond to the draft 
mitigation agreement, it must submit an extension request directly to 
the Executive Branch. The 90-day clock would stop for the duration of 
the extension, just as it would stop for extensions to respond to 
follow-up questions. Negotiation of the mitigation agreement could 
involve several rounds of seven-day review periods (or longer if 
extensions are sought) if multiple drafts and counter-proposals are 
exchanged. Failure of an applicant to respond within the seven days or 
any approved extension period would result in dismissal of the 
application, without prejudice. We seek comment on these proposals. In 
particular, we request comment on whether seven days is sufficient time 
to respond to follow-up questions, and what impact allowing a longer 
period would have on the 90-day period for Executive Branch review.
    41. CATEGORIES OF REFERRALS. Although we propose to continue to 
refer certain applications to the Executive Branch agencies, we seek 
comment on whether there are categories of applications with foreign 
ownership that the Commission should generally not refer to the 
Executive Branch. For example, currently the Commission does not refer 
a pro forma notification because by definition there is no change in 
the ultimate control of the licensee. Under section 63.24(f), carriers 
may submit post-transaction notifications for non-substantial, or pro 
forma, transfers and assignments in which no change in the actual 
controlling party occurs. 47 CFR 63.24(f). Thus, for example, where the 
owner maintains de facto control of the carrier, less than 50 percent 
of the carrier's voting interests changes hands, and no new party gains 
negative or de jure control as a result of the transaction or series of 
transactions, the transaction would constitute a pro forma transfer of 
control. See Amendment of Parts 1 and 63 of the Commission's Rules, IB 
Docket No. 04-47, Report and Order, 22 FCC Rcd 11398, 11411, para. 36 
(2007). Under section 63.24(f), the carrier can notify the Commission 
of the transaction after the transfer is completed. Several commenters 
support exclusion of pro forma notifications from the referral process. 
TelePacific asserts that applications for transactions that involve 
resellers with no facilities should not be referred to the Executive 
Branch. If the Commission adopted this position, how would the 
Commission know that no facilities are being assigned/transferred in 
the proposed transaction? Are there other categories of applications 
that the Commission should generally not refer to the Executive Branch, 
such as when the applicant has an existing LOA or NSA and there has 
been no change in the foreign ownership since the Executive Branch and 
applicant negotiated the relevant LOA or NSA? We also seek comment on 
whether the Commission might review and not refer to the Executive 
Branch certain categories of applications. How would this process work 
and which categories of applications might be included? Would internal 
Commission review for national security and law enforcement concerns 
serve to expedite the processing of applications?
    42. OTHER CHANGES TO THE APPLICATION PROCESS. We also propose other 
revisions to the application process to streamline the review process. 
First, we propose to amend our rules to clarify that applicants for 
international section 214 authorizations, assignments or transfers of 
control of domestic or international section 214 authority, and 
applications for submarine cable landing licenses or to assign or 
transfer control of such licenses must include in their applications 
the voting interests, in addition to the equity interests, of 
individuals or entities with ten percent or greater direct or indirect 
ownership in the applicant. Second, we propose to require these 
applicants to include in their applications a diagram of the 
applicant's ownership, showing the ten percent or greater direct or 
indirect ownership interests in the applicant. We believe that these 
two rule revisions will facilitate faster review of applications by 
Commission staff.
    43. The current rules require applicants to provide the name, 
address, citizenship, and principal businesses of any individual or 
entity that owns directly or indirectly at least ten percent of the 
equity of the applicant. These rules originated when equity and voting 
ownership were usually the same. Today, applicants often have multiple 
classes of ownership and equity interests that differ from the voting 
interests. It is important for the Commission to know for potential 
control purposes who has voting interests in the applicant. The 
Commission has recognized this in other rules, where it requires an 
applicant to provide both equity and voting interests in an applicant. 
Although most applicants provide the voting information in their 
international section 214 and submarine cable license applications, 
others do not. If the filing does not provide information about the 
voting interests, either by providing separate equity and voting share 
information or noting that the voting interests track the equity 
interests, it is the practice of Commission staff to contact applicants 
and request the information. Having to request this information delays 
review of the

[[Page 46879]]

application. We seek comment on this proposal to include applicant's 
applicable voting interests.
    44. We also believe that inclusion of a diagram showing the ten-
percent-or-greater interests in the applicant can help speed the 
processing of an application. Many applicants have complex ownership 
structures, particularly those with private equity ownership. A diagram 
can help distill a lengthy description of an ownership structure and 
make it more easily understood. The Commission has found this 
especially helpful in the context of foreign ownership petitions and 
recently included such a requirement in the rules regarding the 
contents of a request for declaratory ruling under section 310(b) of 
the Act. While many applicants already provide ownership diagrams in 
their applications, Commission staff often request such a diagram from 
an applicant after the application has been filed. We believe that 
requiring the application to include the diagram would impose a minimal 
burden on applicants which would be offset by the Commission staff's 
ability to process applications more expeditiously. We seek comment on 
this proposal.
    45. Finally, we propose a clean-up edit to the cable landing 
license rules. In 2014, the Commission removed the effective 
competitive opportunities test for cable landing licenses. The 
Commission at that time failed to amend the reporting requirement for 
licensees affiliated with a carrier with market power in a cable's 
destination market to remove the limitation that it apply only to 
destination markets in World Trade Organization (WTO) Member countries. 
We propose to remove that limitation and apply the reporting 
requirements to licensees affiliated with a carrier with market power 
in a cable's destination market for all countries, whether or not they 
are a WTO Member. We seek comment on this proposal.
    46. CONCLUSION. The Commission seeks to streamline and to bring 
more transparency to the Executive Branch referral process while 
continuing to give consideration to relevant national security, law 
enforcement, foreign policy, and trade policy concerns. We seek comment 
on the proposals we make to implement the suggestions submitted by the 
Executive Branch. We also seek comment on establishing appropriate time 
frames for Executive Branch review of an application with reportable 
foreign ownership and other changes to our processing rules. We 
tentatively conclude that implementation of these proposals would 
provide for more timely and transparent review while ensuring that 
relevant national security, law enforcement, foreign policy, and trade 
policy concerns receive consideration.

Paperwork Reduction Act

    47. This document contains new and 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. Public and agency comments 
are due September 19, 2016. 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 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), we seek 
specific comment on how we might further reduce the information 
collection burden for small business concerns with fewer than 25 
employees.

Initial Regulatory Flexibility Act Analysis

    48. As required by the Regulatory Flexibility Act (RFA), the 
Commission has prepared this Initial Regulatory Flexibility Analysis 
(IRFA) of the possible significant economic impact on small entities by 
the policies and rules proposed in this Notice of Proposed Rule Making 
(NPRM). We request written public comments on this IRFA. Commenters 
must identify their comments as responses to the IRFA and must file the 
comments by the deadlines provided in 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. In addition, the NPRM 
and IRFA (or summaries thereof) will be published in the Federal 
Register.
    49. This NPRM seeks comment on the proposed changes to our rules 
and procedures related to the review of certain applications and 
petitions for declaratory ruling involving foreign ownership by the 
Executive Branch agencies. The Commission's objective is to improve the 
timeliness and transparency of the Executive Branch review process. 
Industry has expressed concern about the uncertainty and lengthy review 
times that make it difficult to put a business plan in place. In 
response, the Executive Branch agencies filed a letter requesting the 
Commission make changes to its processes that would help facilitate a 
more streamlined review. The proposed rules seek to remedy the 
uncertainty and time frame for review.
    50. The NPRM proposes several changes to our rules. Specifically, 
it proposes to:

    1. Standardize the threshold questions that the national 
security and law enforcement agencies routinely ask applicants with 
foreign ownership and require applicants to provide the information 
as part of the application process. The NPRM proposes to collect 
information on: Corporate structure and shareholder information; 
relationship with foreign entities; financial condition and 
circumstances; compliance with applicable laws and regulations; and 
business and operational information, including services to be 
provided and network infrastructure. The specific questions would be 
adopted through the Paperwork Reduction Act (PRA) process and would 
be publicly available on a Web site, as a downloadable document, so 
it is readily available to applicants prior to filing its 
application. This proposal would help provide transparency and 
expedite the review process.
    2. Include in the rules a requirement that applicants certify 
that they will comply with routine mitigation measures. The 
Executive Branch agencies state that the proposed certification 
requirement reflects current laws and obligations applicable to 
applicants, but ensures that the applicants focus on those laws and 
obligations at the beginning of the application process. This would 
also help reduce the number of individualized Letters of Assurances 
that the Executive Branch agencies would need to negotiate, thus 
expediting response to the Commission.
    3. Include applicable time frames for the Executive Branch 
agencies to complete its review of FCC applications. A 90-day clock 
is proposed upon referral of an application to the agencies, with an 
additional one-time 90 day extension in rare circumstances. Under 
the proposed rules, the Executive Branch would complete its review 
within the 90-day period or notify the Commission no later than the 
initial 90-day date that it requires additional time for review and, 
every 30 days thereafter, would notify the Commission on the status 
of review. The notification would explain why the Executive Branch 
requires additional time to complete review, along with an estimate 
of the additional time required. This proposal will help improve the 
timeliness of review and allow agencies

[[Page 46880]]

time to review for national security, law enforcement, foreign 
policy, or trade policy concerns.

    51. The proposed action is authorized under sections 4(i), 4(j), 
214, 303, 309, 310 and 413 of the Communications Act as amended, 47 
U.S.C. 154(i), 154(j), 214, 303, 309, 310 and 413, and the Cable 
Landing License Act of 1921, 47 U.S.C. 34 through 39, and Executive 
Order No. 10530, section 5(a) reprinted as amended in 3 U.S.C. 301.
    52. 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 rules adopted herein. Below, we describe and 
estimate the number of small entity applicants that may be affected by 
the adopted rules.
    1. Wired Telecommunications Carriers.
    2. Competitive Local Exchange Carriers (Competitive LECs), 
Competitive Access Providers (CAPs), Shared-Tenant Service Providers, 
and Other Local Service Providers.
    3. Interexchange Carriers (IXCs).
    4. Prepaid Calling Card Providers.
    5. Local Resellers.
    6. Toll Resellers.
    7. Other Toll Carriers.
    8. Wireless Telecommunications Carriers (except Satellite).
    9. All Other Telecommunications.
    10. Satellite Telecommunications and All Other Telecommunications.
    11. Radio Broadcasting.
    53. The NPRM proposes a number of rule changes that would affect 
reporting, recordkeeping and other compliance requirements for 
applicants who file international section 214 authorizations, submarine 
cable landing licenses or applications to assign or transfer control of 
such authorizations, and section 310 rulings (common carrier wireless, 
common carrier satellite earth stations or broadcast) (applicants). The 
proposed threshold questions request information already routinely 
asked by the Executive Branch agencies after filing the application but 
the proposed rules will require applicants with reportable foreign 
ownership to submit answers to the threshold questions at the time of 
filing their FCC application. Information requested will be on: 
Corporate structure and shareholder information; relationship with 
foreign entities; financial condition and circumstances; compliance 
with applicable laws and regulations; and business and operational 
information, including services to be provided and network 
infrastructure. Applicants would have a time frame by when they need to 
respond to any follow-up questions relevant to the application. 
Applicants would also be required to certify that they will comply with 
the Communications Assistance to Law Enforcement (CALEA); will make 
communications to, from, or within United States, as well as records 
thereof, available in a form and location that permits them to be 
subject to a valid and lawful request or legal process in accordance 
with U.S. law; certify that applicants would designate a point of 
contact in the U.S. that is a U.S. citizen or lawful permanent 
resident; certify that all information at time of submission is 
accurate and notify when information submitted is no longer accurate; 
and if an applicant fails to fulfill obligations contained in 
certifications they will be subject to all remedies available to the 
United States Government.
    54. 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.''
    55. In this NPRM, the proposed changes for Executive Branch's 
review of FCC applications involving foreign ownership would help 
improve the timeliness and transparency of the review process, thus 
lessening the burden of the licensing process on all applicants, 
including small entities. The threshold questions would be publicly 
available, thus providing transparency and helping expedite Executive 
Branch's review. The proposed certifications will help reduce the need 
for routine mitigation, which should facilitate a faster response by 
the Executive Branch on its review and advance the shared goal of 
making the Executive Branch review process as efficient as possible. 
Time frames for review of FCC applications referred to the Executive 
Branch have also been proposed, which will help prevent unnecessary 
delays and make the process more efficient and transparent, which 
ultimately benefits all applicants, including small entities.
    56. The NPRM seeks comment from all interested parties. The 
Commission is aware that some of the proposals under consideration may 
impact small entities. Small entities are encouraged to bring to the 
Commission's attention any specific concerns they may have with the 
proposals outlined in the NPRM.
    57. The Commission expects to consider the economic impact on small 
entities, as identified in comments filed in response to the NPRM, in 
reaching its final conclusions and taking action in this proceeding.
    58. Our proposed rules require applicants to certify that they will 
comply with federal rules related to assistance to law enforcement. 
Some of the federal rules that may duplicate with our proposed rules 
are:
    1. Communications Assistance to Law Enforcement Act. 47 U.S.C. 1001 
through 10.
    2. Wiretap Act. 18 U.S.C. 2510 et seq.
    3. Stored Communications Act. 18 U.S.C. 2701 et seq.
    4. Pen Register and Trap and Trace Statute. 18 U.S.C. 3121 et seq.

List of Subjects in

47 CFR Part 0

    Classified information, Privacy.

47 CFR Part 1

    Administrative practice and procedure, Communications common 
carriers, Telecommunications.

47 CFR Part 63

    Communications common carriers, Reporting and recordkeeping 
requirements.

Federal Communications Commission.
Gloria J. Miles,
Federal Register Liaison Officer, Office of the Secretary.

Proposed Rules

    For the reasons discussed in the preamble, the Federal 
Communications Commission proposes to amend 47 CFR parts 0, 1, and 63 
as follows:

PART 0--COMMISSION ORGANIZATION

0
1. The authority citation for part 0 continues to read as follows:

    Authority:  Sec. 5, 48 Stat. 1068, as amended; 47 U.S.C. 155, 
225, unless otherwise noted.

0
2. Amend Sec.  0.442 by revising paragraph (d)(3) to read as follows:


Sec.  0.442  Disclosure to other Federal government agencies of 
information submitted to the Commission in confidence.

* * * * *
    (d) * * *
    (3) A party who furnished records to the Commission in confidence 
will not be afforded prior notice when the

[[Page 46881]]

disclosure is made to the Comptroller General of the United States, in 
the Government Accountability Office. Such a party will instead be 
notified of disclosure of the records to the Comptroller General either 
individually or by public notice. No prior notice will be afforded 
where records have been furnished to the Commission in confidence and 
shared with the Executive Branch pursuant to Sec.  1.6001 of this 
chapter.
* * * * *

PART 1--PRACTICE AND PROCEDURE

    The authority citation for part 1 is revised to read as follows:

    Authority:  15 U.S.C. 79, et seq.; 47 U.S.C. 34 through 39, 151, 
154(i), 154(j), 155, 157, 160, 201, 225, 227, 303, 309, 332, 1403, 
1404, 1451, 1452, and 1455.

0
3. Amend Sec.  1.767 by revising paragraphs (a)(8)(i), (a)(11)(i), and 
(j), and by adding paragraph (k)(5) and revising paragraph (l) 
introductory text to read as follows:


Sec.  1.767  Cable landing licenses.

    (a) * * *
    (8) * * *
    (i) The place of organization and the information and 
certifications required in Sec.  63.18 paragraphs (h), (o), (p) and (q) 
of this chapter.
* * * * *
    (11)(i) If applying for authority to assign or transfer control of 
an interest in a cable system, the applicant shall complete paragraphs 
(a)(1) through (a)(3) of this section for both the transferor/assignor 
and the transferee/assignee. Only the transferee/assignee needs to 
complete paragraphs (a)(8) through (a)(9) of this section. The 
applicant shall provide the ownership diagram required under paragraph 
(a)(8)(i) of this section and include both the pre-transaction and 
post-transaction ownership of the licensee. At the beginning of the 
application, the applicant should also include a narrative of the means 
by which the transfer or assignment will take place. The application 
shall also specify, 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 
reserves the right to request additional information as to the 
particulars of the transaction to aid it in making its public interest 
determination.
* * * * *
    (j) 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.
    (k) * * *
    (5) Certifying that all ten percent or greater direct or indirect 
equity and/or voting interests in the applicant are U.S. citizens or 
entities organized in the United States.
* * * * *
    (l) 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:
* * * * *
0
4. Amend Sec.  1.991 by adding paragraphs (l) and (m) to read as 
follows:


Sec.  1.991  Contents of petitions for declaratory ruling under the 
Communications Act of 1934.

* * * * *
    (l) Each petitioner subject to a referral to the Executive Branch 
pursuant to Sec.  1.6001 must file the national security and law 
enforcement information. The information will include:
    (1) Corporate structure and shareholder information;
    (2) Relationships with foreign entities;
    (3) Financial condition and circumstances;
    (4) Compliance with applicable laws and regulations; and
    (5) Business and operational information, including services to be 
provided and network infrastructure. The instructions for submitting 
the information to be filed are available on the FCC Web site. The 
required information shall be submitted separately from the petition 
and shall be filed via an FCC Web site.
    (m) Each petitioner shall make the following certifications:
    (1) To comply with all applicable Communications Assistance to Law 
Enforcement Act (CALEA) requirements and related rules and regulations, 
including any and all FCC orders and opinions governing the application 
of CALEA and assistance to law enforcement (see, e.g., the Commission's 
orders in conjunction with ET Docket No. 04-295, Communications 
Assistance for Law Enforcement Act and Broadband Access and Services 
and the Commission's rules and regulations in part 1, subpart Z--
Communications Assistance for Law Enforcement Act);
    (2) To make communications to, from, or within the United States, 
as well as records thereof, available in a form and location that 
permits them to be subject to a valid and lawful request or legal 
process in accordance with U.S. law;
    (3) To designate a point of contact located in the United States 
and who is a U.S. citizen or lawful permanent resident, for the service 
of the requests and/or valid legal process described in paragraph 
(m)(2) of this section and the receipt of other communications from the 
U.S. government;
    (4) That all information submitted, whether at the time of 
submission of the petition or subsequently in response to either 
Commission or Executive Branch agency request, is substantially 
accurate and complete in all significant respects to the best of 
petitioner's knowledge at the time of the submission. While the 
petition is pending, as defined in Sec.  1.65(a), the petitioner agrees 
to promptly inform the Commission and, if the petitioner originally 
submitted the information in response to the request of another 
Executive Branch agency, that agency, if the information in the 
application is no longer substantially accurate and complete in all 
significant respects; and
    (5) That the petitioner understands that if the applicant fails to 
fulfill any of the conditions to the grant of its petition and/or the 
information provided to the United States Government is materially 
false, fictitious, or fraudulent, the petitioner may be subject to all 
remedies available to the United States Government, including but not 
limited to revocation or termination of the applicant's Commission 
authorization, and criminal and civil penalties, including penalties 
under 18 U.S.C. 1001.
0
5. Add Subpart U to part 1 to read as follows:

Subpart U--Review of Applications, Petitions, and Other Filings 
With Foreign Ownership by Executive Branch Agencies on National 
Security, Law Enforcement, Foreign Policy, and Trade Policy 
Concerns

Sec.
1.6001 Executive Branch review of applications, petitions, and other 
filings with foreign ownership.

[[Page 46882]]

1.6002 Referral of applications, petitions, and other filings with 
foreign ownership to the Executive Branch agencies for review.
1.6003 Time frames for Executive Branch review of applications, 
petitions, and other filings with foreign ownership.


Sec.  1.6001  Executive Branch review of applications, petitions, and 
other filings with foreign ownership.

    (a) The Commission, in its discretion, may refer applications, 
petitions, and other filings with foreign ownership to the Executive 
Branch for review for national security, law enforcement, foreign 
policy, and trade policy concerns.
    (b) The Commission will consider any recommendations from the 
Executive Branch regarding whether a pending matter affects national 
security, law enforcement, foreign policy and/or trade policy as part 
of its public interest analysis. The Commission will make an 
independent decision and will evaluate concerns raised by the Executive 
Branch in light of all the issues raised in the context of a particular 
application, petition, or other filing.


Sec.  1.6002  Referral of applications, petitions, and other filings 
with foreign ownership to the Executive Branch agencies for review.

    (a) The Commission shall refer any applications, petitions, or 
other filings for which it determines to seek Executive Branch review 
at the time such application, petition, or other filing is placed on an 
accepted for filing public notice.
    (b) If the Executive Branch does not otherwise notify the 
Commission by filing in the record for the application, petition, or 
other filing within the comment period established by the public 
notice, the Commission will deem that the Executive Branch does not 
have any national security, law enforcement, foreign policy, and trade 
policy concerns with the application, petition, or other filing and 
will act on the application, petition, or other filing as appropriate 
based on its determination of the public interest.


Sec.  1.6003  Time frames for Executive Branch review of applications, 
petitions, and other filings with foreign ownership.

    If the Executive Branch notifies the Commission that it needs 
additional time for its review of the application, petition, or other 
filing referred in accordance with Sec.  1.6002(b):
    (a) The Executive Branch shall notify the Commission by filing in 
the record for the application, petition, or other filing no later than 
90 days from the date of public notice for the application, petition, 
or other filing whether it:
    (1) Has national security, law enforcement, foreign policy, and 
trade policy concerns with the application, petition or other filing;
    (2) Has no concerns;
    (3) Has no concerns provided that the grant of the application, 
petition or other filing is conditioned; or
    (4) Needs additional time to review the application, petition, or 
other filing.
    (b) In cases of extraordinary complexity, when the Executive Branch 
notifies the Commission that it needs more than the 90-day period for 
review of the application, petition, or other filing under paragraph 
(a) of this section, the Executive Branch may request a one-time 90-day 
extension to review the application, petition, or other filing, 
provided that it:
    (1) Explains why it was unable to complete its review within the 
initial 90-day review period and;
    (2) Provides the Commission with updates on the status of its 
review every 30 days (at the 120-day and 150-day dates after release of 
the public notice). The Executive Branch must notify the Commission by 
filing in the record for the application, petition, or other filing no 
later than 180 days from the date of public notice for the application, 
petition or other filing whether it:
    (i) Has national security, law enforcement, foreign policy, and 
trade policy concerns with the application, petition, or other filing;
    (ii) Has no concerns; or
    (iii) Has no concerns if the grant of the application, petition, or 
other filing is conditioned.
    (c)(1) The Executive Branch shall file its notifications as to the 
status of its review in the public record for the application, 
petition, or other filing.
    (2) In circumstances where the notification of the Executive Branch 
contains nonpublic information, the Executive Branch shall file a 
public version of the notification in the public record for the 
application, petition, or other filing and shall file the nonpublic 
information with the Commission pursuant to Sec.  0.457 of this 
chapter.

PART 63--EXTENSION OF LINES, NEW LINES, AND DISCONTINUANCE, 
REDUCTION, OUTAGE AND IMPAIRMENT OF SERVICE BY COMMON CARRIERS; AND 
GRANTS OF RECOGNIZED PRIVATE OPERATING AGENCY STATUS

0
6. The authority citation for part 63 continues to read as follows:

    Authority: Sections 1, 4(i), 4(j), 10, 11, 201-205, 214, 218, 
403 and 651 of the Communications Act of 1934, as amended, 47 U.S.C. 
151, 154(i), 154(j), 160, 201 through 205, 214, 218, 403, and 571, 
unless otherwise noted.

0
7. Amend Sec.  63.04 by revising paragraph (a)(4) to read as follows:


Sec.  63.04  Filing procedures for domestic transfer of control 
applications.

    (a) * * *
    (4)(i) 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 applicant, 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 applicant, a statement to that effect.
    (ii) An ownership diagram that illustrates the applicant'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 (a)(4)(i) of this section. Each such 
individual or entity shall be depicted in the ownership diagram and all 
controlling interests labeled as such.
* * * * *
0
8. Amend Sec.  63.12 by redesignating paragraph (c)(3) as paragraph 
(c)(4) and add a new paragraph (c)(3) to read as follows:


Sec.  63.12  Processing of international Section 214 applications.

* * * * *
    (c) * * *
    (3) An individual or entity that is not a U.S. citizen holds a ten 
percent or greater direct or indirect equity or voting interest in any 
applicant; or
* * * * *
0
9. Amend Sec.  63.18 by revising paragraph (h) and redesignating 
paragraphs (p), (q) and (r) as paragraphs (r), (s), and (t), and adding 
new paragraphs (p) and (q) to read as follows:


Sec.  63.18  Contents of applications for international common 
carriers.

    (h)(1) The name, address, citizenship and principal businesses 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). Where no individual or entity directly or indirectly owns 
ten percent or more of the equity interests and/or

[[Page 46883]]

voting interests, or a controlling interest, of the applicant, a 
statement to that effect.
    (2) An ownership diagram that illustrates the applicant'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 (h)(1) of this section. Each such 
individual or entity shall be depicted in the ownership diagram and all 
controlling interests labeled as such.
    (3) The applicant shall also identify any interlocking directorates 
with a foreign carrier.
    Note to paragraph (h): Ownership and other interests in U.S. and 
foreign carriers will be attributed to their holders and deemed 
cognizable pursuant to the following criteria: Attribution of ownership 
interests in a carrier that are held indirectly by any party through 
one or more intervening corporations will be determined by successive 
multiplication of the ownership percentages for each link in the 
vertical ownership chain and application of the relevant attribution 
benchmark to the resulting product, except that wherever the ownership 
percentage for any link in the chain that is equal to or exceeds 50 
percent or represents actual control, it shall be treated as if it were 
a 100 percent interest. For example, if A owns 30 percent of company X, 
which owns 60 percent of company Y, which owns 26 percent of 
``carrier,'' then X's interest in ``carrier'' would be 26 percent (the 
same as Y's interest because X's interest in Y exceeds 50 percent), and 
A's interest in ``carrier'' would be 7.8 percent (0.30 x 0.26 because 
A's interest in X is less than 50 percent). Under the 25 percent 
attribution benchmark, X's interest in ``carrier'' would be cognizable, 
while A's interest would not be cognizable.
* * * * *
    (p) With respect to each applicant for which an individual or 
entity that is not a U.S. citizen holds a ten percent or greater direct 
or indirect equity or voting interest in the applicant, file national 
security and law enforcement information regarding the applicant. The 
information may include:
    (1) Corporate structure and shareholder information;
    (2) Relationships with foreign entities;
    (3) Financial condition and circumstances;
    (4) Compliance with applicable laws and regulations; and
    (5) Business and operational information, including services to be 
provided and network infrastructure. The instructions for submitting 
the information to be filed are available on the FCC Web site. The 
required information shall be submitted separately from the application 
and shall be filed via an FCC Web site.
    (q) Each applicant shall make the following certifications:
    (1) To comply with all applicable Communications Assistance to Law 
Enforcement Act (CALEA) requirements and related rules and regulations, 
including any and all FCC orders and opinions governing the application 
of CALEA and assistance to law enforcement (see, e.g., the Commission's 
orders in conjunction with ET Docket No. 04-295, Communications 
Assistance for Law Enforcement Act and Broadband Access and Services, 
and the Commission's rules and regulations in part 1, subpart Z of this 
chapter--Communications Assistance for Law Enforcement Act);
    (2) To make communications to, from, or within the United States, 
as well as records thereof, available in a form and location that 
permits them to be subject to a valid and lawful request or legal 
process in accordance with U.S. law;
    (3) To designate a point of contact located in the United States 
and who is a U.S. citizen or lawful permanent resident, for the service 
of the requests and/or valid legal process described in paragraph 
(q)(2) of this section and the receipt of other communications from the 
U.S. government;
    (4) That all information submitted, whether at the time of 
submission of the application or subsequently in response to either 
Commission or Executive Branch agency request, is substantially 
accurate and complete in all significant respects to the best of 
applicant's knowledge at the time of the submission. While the 
application is pending, as defined in Sec.  1.65(a) of this chapter, 
the applicant agrees to promptly inform the Commission and, if the 
applicant originally submitted the information in response to the 
request of another Executive Branch agency, that agency, if the 
information in the application is no longer substantially accurate and 
complete in all significant respects; and
    (5) That the applicant understands that if the applicant fails to 
fulfill any of the conditions to the grant of its application and/or 
the information provided to the United States Government is materially 
false, fictitious, or fraudulent, the applicant may be subject to all 
remedies available to the United States Government, including but not 
limited to revocation or termination of the applicant's Commission 
authorization, and criminal and civil penalties, including penalties 
under 18 U.S.C. 1001.
* * * * *
0
10. Amend Sec.  63.24 by revising paragraphs (e)(2) and (f)(2)(i) to 
read as follows:


Sec.  63.24  Assignments and transfers of control.

* * * * *
    (e) * * *
    (2) The application shall include the information requested in 
paragraphs (a) through (d) of Sec.  63.18 for both the transferor/
assignor and the transferee/assignee. The information requested in 
paragraphs (h) through (p) of Sec.  63.18 is required only for the 
transferee/assignee. The ownership diagram required under Sec.  
63.18(h)(2) shall include both the pre-transaction and post-transaction 
ownership of the authorization holder. At the beginning of the 
application, the applicant shall include a narrative of the means by 
which the proposed transfer or assignment will take place.
* * * * *
    (f) * * *
    (2) * * *
    (i) The information requested in paragraphs (a) through (d) and (h) 
of Sec.  63.18 for the transferee/assignee. The ownership diagram 
required under Sec.  63.18(h)(2) shall include both the pre-transaction 
and post-transaction ownership of the authorization holder;
* * * * *
[FR Doc. 2016-16780 Filed 7-18-16; 8:45 am]
 BILLING CODE 6712-01-P