Rural Call Completion, 25692-25707 [2019-11267]

Agencies

• FEDERAL COMMUNICATIONS COMMISSION

[Federal Register Volume 84, Number 107 (Tuesday, June 4, 2019)]
[Rules and Regulations]
[Pages 25692-25707]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2019-11267]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 64

[WC Docket No. 13-39; FCC 19-23]


Rural Call Completion

AGENCY: Federal Communications Commission.

ACTION: Final rule.

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SUMMARY: In this Fourth Report and Order, the Federal Communications 
Commission (Commission) completes its implementation of the Improving 
Rural Call Quality and Reliability Act of 2017 (RCC Act) by adopting 
service quality standards for intermediate providers; and an exception 
to those standards for intermediate providers that qualify for the 
covered provider safe harbor in our existing rules. We also set forth 
procedures to enforce our intermediate provider requirements. Moreover, 
we sunset the rural call completion data recording and retention 
requirements adopted in the First RCC Order one year after the 
effective date of the service quality standards we adopt today. 
Finally, we deny petitions for reconsideration of the Second RCC Order.

DATES: Effective July 5, 2019.

ADDRESSES: Federal Communications Commission, 445 12th Street SW, 
Washington, DC 20554.

FOR FURTHER INFORMATION CONTACT: Zach Ross, FCC Wireline Competition 
Bureau, Competition Policy Division, Room 5-C211, 445 12th Street SW, 
Washington, DC 20554, at (202) 418-1033 or [email protected].

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Fourth 
Report and Order, in WC Docket No. 13-39, adopted and released March 
15, 2019. A full text version of this document may be obtained at the 
following Internet Address: https://docs.fcc.gov/public/attachments/FCC-19-23A1.pdf.

Synopsis

I. Introduction

    1. In 2019, all Americans should have confidence that when a phone 
call is made to them, they will receive it. Yet, that is not always the 
case for those living in rural or remote areas of the country. Rural 
call completion problems persist and they can have significant impacts 
on quality of life, economic opportunity, and public safety in rural 
communities. Additional work remains to be done to fix this vexing 
problem. Today, we take up that charge, furthering the Commission's 
ongoing efforts to ensure that calls are indeed completed to all 
American consumers and continuing our implementation of the Improving 
Rural Call Quality and Reliability Act of 2017 (RCC Act). Specifically, 
based on the record before us, we adopt service quality standards for 
intermediate providers that complement the rules we have already 
established for covered providers. We also sunset our remaining call 
data recording and retention rules one year after the service quality 
standards adopted today become effective.

II. Background

    2. Prior to 2018, the Commission relied on data recording, 
retention, and reporting rules to address rural call completion issues. 
These rules, adopted in the 2013 First RCC Order, 78 FR 76218, were 
intended to improve the Commission's ability to monitor the delivery of 
long-distance calls to rural areas and aid enforcement action with 
respect to providers' call completion practices. Under these rules, 
``covered providers''--entities that select the initial long-distance 
route for a large number of lines--are required to record and retain, 
for six months, specific information about each call attempt to a rural 
operating company number (OCN) from subscriber lines for which the 
providers make the initial long-distance call path choice. In addition, 
the First RCC Order required covered providers to file quarterly 
reports with the Commission containing aggregated information.
    3. In the April 2018 Second RCC Order, 83 FR 21723, the Commission 
reoriented its existing rural call completion rules to better reflect 
strategies that have worked to reduce rural call completion problems 
while at the same time reducing the overall burden of the rules on 
providers. First, the Commission adopted a new rule requiring covered 
providers to monitor

[[Page 25693]]

the performance of the ``intermediate providers'' to which they hand 
off calls. The Commission held that the monitoring rule entails both 
prospective monitoring of intermediate provider performance to prevent 
problems and retrospective investigation of any problems that arise. At 
the same time, the Commission gave covered providers flexibility in 
determining the monitoring practices best suited to their individual 
networks and declined to mandate compliance with specific standards or 
best practices as part of the monitoring requirement.
    4. Second, the Commission eliminated the rural call completion data 
reporting requirement for covered providers that was established in the 
First RCC Order. It concluded that the reporting rule was burdensome on 
covered providers while the resulting reports were of limited utility 
in discovering the source of rural call completion problems and a 
pathway to their resolution. The Commission further concluded that the 
covered provider monitoring rule would be more effective than the 
reporting requirement because it imposed a direct, substantive 
obligation.
    5. On February 26, 2018, the RCC Act was signed into law. It 
directs the Commission to establish an intermediate provider registry, 
and stipulates that (1) certain intermediate providers must register 
with the Commission, and (2) covered providers may only use registered 
intermediate providers to transmit covered voice communications. In 
addition, the RCC Act directs the Commission to establish service 
quality standards for the transmission of covered voice communications 
by intermediate providers, and requires intermediate providers to 
comply with such standards.
    6. In the April 2018 Third RCC FNPRM, 83 FR 21983, the Commission 
sought comment on how best to implement the RCC Act and craft service 
quality rules for intermediate providers in a way that would ``ensure 
the integrity of the transmission of covered voice communications to 
all customers in the United States'' without imposing unnecessary 
burdens on providers. After noting that ``proposals that rely on or are 
consistent with industry best practices'' are often less burdensome 
than other potential approaches, the Third RCC FNPRM proposed ``to 
require intermediate providers to take reasonable steps to: (1) Prevent 
`call looping,' a practice in which the intermediate provider hands off 
a call for completion to a provider that has previously handed off the 
call; (2) `crank back' or release a call back to the originating 
carrier, rather than simply dropping the call, upon failure to find a 
route; and (3) not process calls so as to `terminate and re-originate' 
them (e.g., fraudulently using ``SIM boxes'' or unlimited VoIP plans to 
re-originate large amounts of traffic in an attempt to shift the cost 
of terminating these calls from the originating provider to the 
wireless or wireline provider).'' These proposed standards were based 
on industry best practices developed by the Alliance for 
Telecommunications Industry Solutions (ATIS) and set forth in its 
Intercarrier Call Completion/Call Termination Handbook (ATIS RCC 
Handbook).
    7. In the Third RCC FNPRM, the Commission also sought comment on 
alternative proposals for intermediate provider service quality 
standards, including whether ``to pursue `the more general adoption of 
duties to complete calls analogous to those that already apply to 
covered providers under prior Commission rules and orders.' '' The 
Commission further sought comment on whether to eliminate or sunset the 
rural call completion data recording and retention requirements 
established in 2013.
    8. In the August 2018 Third RCC Order, 83 FR 47296, the Commission 
began its implementation of the RCC Act by codifying rules mandating 
registration of all intermediate providers and requiring that covered 
providers use only registered intermediate providers. Specifically, the 
Third RCC Order required that intermediate providers submit certain 
information to the Commission via a publicly available intermediate 
provider registry. The registration requirement applies to ``any 
intermediate provider that offers or holds itself out as offering the 
capability to transmit covered voice communications from one 
destination to another.'' The Commission set the registration deadline 
at ``30 days after a Public Notice announcing the approval by the 
Office of Management and Budget of the rules establishing the 
registry,'' with any subsequent information updates made within 10 
business days of a change.
    9. The Third RCC Order also implemented the RCC Act's prohibition 
against the use of unregistered intermediate providers by any covered 
provider in the path of a given call. Covered providers have ``a 
reasonable period of time, but no more than 45 days in which to adjust 
their call routing practices to avoid use of an unregistered 
intermediate provider after gaining knowledge of its deregistration or 
lack of registration.''

III. Discussion

A. Service Quality Standards for Intermediate Providers

    10. As the RCC Act mandates, we adopt service quality standards for 
intermediate providers. First, we impose on intermediate providers a 
general duty to complete calls. Specifically, we require intermediate 
providers to take steps reasonably calculated to ensure that any calls 
they handle are in fact completed. If an intermediate provider knows, 
or should know, that calls are not being completed to certain areas, 
the intermediate provider may be in violation of this general duty if 
it engages in acts or omissions that allow or effectively allow these 
conditions to persist. Second, when routing traffic destined for rural 
areas, intermediate providers must actively monitor the performance of 
any directly contracted downstream intermediate provider and, based on 
the results of such monitoring, take steps to address any identified 
performance issues with that provider. Third, intermediate providers 
must ensure that any additional intermediate providers to which they 
hand off calls are registered with the Commission. As was true for our 
monitoring obligations for covered providers, the service quality 
standards described in this section will go into effect six months from 
the date that this Order is released by the Commission, or 30 days 
after publication of a summary of this Order in the Federal Register, 
whichever is later. This phase-in period is intended to allow 
intermediate providers sufficient time to conduct any contractual 
negotiations necessary to come into compliance with our rules, and for 
the Commission's intermediate provider registry obligations to become 
effective.
    11. The service quality standards we adopt in this Order further 
the Commission's efforts to ensure that all calls to rural areas are 
completed and they further Congress's explicit purpose in passing the 
RCC Act: To ``ensure the integrity of the transmission of covered voice 
communications to all customers in the United States'' and ``prevent 
unjust or unreasonable discrimination among areas of the United States 
in the delivery of covered voice communications.'' By requiring 
intermediate providers to take steps reasonably calculated to ensure 
that all calls reach their intended destination, these service quality 
standards prevent intermediate providers from routing calls in a manner 
that results in persistent call completion problems. Where intermediate 
providers know, or should know, of a call completion issue,

[[Page 25694]]

they must now act to address it. This rule establishes a minimum, 
baseline standard that will ``ensure the integrity of the transmission 
of covered voice communications to all customers in the United 
States.'' Our rules also recognize and address longstanding issues with 
call completion to rural areas. The requirement that intermediate 
providers take affirmative steps to monitor their performance when 
directing traffic to rural areas--and act to resolve these problems--is 
designed to ``prevent unjust or unreasonable discrimination among areas 
of the United States in the delivery of covered voice communications,'' 
as Congress has directed.
    12. As discussed above, the RCC Act charges the Commission with the 
duty to promulgate rules to ``ensure the integrity of the transmission 
of covered voice communications to all customers in the United 
States.'' To ensure that the intermediate provider service quality 
requirements are meeting this charge and serving their intended 
purpose, we direct the Wireline Competition Bureau to seek comment, one 
year from the effective date of the intermediate provider service 
quality standards we adopt today, on the effectiveness of those 
standards in preventing intermediate providers, both those that also 
operate as covered providers and those that do not, from engaging in 
behavior that leads to call competition problems and on whether the 
rural call completion problems that these rules were intended to 
address have improved or changed.
1. Flexible Standards for Intermediate Providers
    13. Based on the record in this proceeding, we decline to mandate 
compliance with the three ATIS best practices as proposed in the Third 
RCC FNPRM, and instead adopt a set of flexible standards for 
intermediate providers based on our existing rules for covered 
providers. This approach is well supported by the record, and by the 
legislative history of the RCC Act. The Senate Commerce Committee 
Report accompanying the RCC Act specifies that in adopting service 
quality standards, the Commission may apply the ``more general adoption 
of duties to complete calls analogous to those that already apply to 
covered providers under prior Commission rules and orders.'' The 
service quality standards for intermediate providers that we adopt 
today parallel the standards already applicable to covered providers 
under the Second RCC Order and earlier Commission orders and rulings, 
ensuring that our rules will effectively address rural call completion 
issues while also avoiding unnecessary compliance burdens on 
intermediate providers--particularly those that serve dual roles as 
both covered and intermediate providers.
    14. We agree with commenters who argue that mandating compliance 
with the three ATIS best practices may be impractical or unduly 
burdensome for some intermediate providers, particularly those relying 
on older network technologies to provide service. Due to the 
differences among providers and their underlying networks, adoption of 
the ATIS best practices as the service quality standards applicable to 
all intermediate providers might impose unnecessary costs on some 
intermediate providers. As Verizon observes, ``[s]ome providers may 
find certain [ATIS] best practices useful, while others may prefer 
different best practices based on their particular networks, 
technologies, and call patterns. Requiring intermediate providers to 
implement the best practices outlined in the Third RCC FNPRM would 
reduce the flexibility providers need to manage their networks.'' In 
addition, because the ATIS best practices are meant to be dynamic and 
responsive to technological and industry developments, imposing those 
as mandatory rules could hinder the evolution of these and similar 
industry best practices. As the Commission found in the Second RCC 
Order with respect to its rural call completion rules for covered 
providers, requiring compliance with ATIS best practices ``could have a 
chilling effect on future industry cooperation to develop solutions to 
industry problems.'' As USTelecom observes, these same concerns are 
relevant to our efforts to craft service quality standards for 
intermediate providers.
    15. We also agree with commenters who argue that we should adopt a 
flexible regulatory approach to intermediate provider service quality 
standards, and that we should seek to align our service quality 
standards for intermediate providers with those call completion rules 
that already apply to covered providers. As ATIS notes, ``many 
providers are both `covered providers' and `intermediate providers,' 
changing roles on a call to call basis.'' USTelecom further submits 
that ``these entities generally utilize the same network facilities, 
the same business processes, and the same vendors to process calls'' 
regardless of whether they operate as a covered provider or 
intermediate provider, and that each category of provider has the same 
fundamental obligation to ensure that calls traversing their networks 
are completed. We have found that the monitoring rule applicable to 
covered providers ``encourages covered providers to ensure that calls 
are completed, assigns clear responsibility for call completion issues, 
and enhances our ability to take enforcement action where needed to 
address persistent problems.'' Moreover, we agree with commenters that 
application of a similar approach to intermediate providers should 
provide similar benefits and avoid unnecessary costs. For these 
reasons, the rules we adopt today for intermediate providers closely 
parallel those that currently apply to covered providers.
    16. We therefore reject the arguments from several commenters 
urging adoption of the Commission's proposal to require compliance with 
the three ATIS best practices listed in the Third RCC FNPRM rather than 
allowing for more flexibility. These commenters generally argue that 
the best practices provide an appropriate regulatory framework because 
they have been designed by a broad cross section of industry 
stakeholders to effectively address call completion issues and are 
widely known and utilized in the industry. NTCA, for example, argues 
that ``[i]ndustry defined best practices such as those identified by 
ATIS establish an appropriate base-line standard'' by which to evaluate 
intermediate providers' call completion efforts. Although we agree with 
these observations as a general matter, after carefully considering the 
record, we conclude that any benefits associated with the adoption of 
the ATIS best practices framework proposed in the Third RCC FNPRM are 
likely outweighed by the compliance burdens associated with this 
approach. NTCA argues that the ATIS best practices are ``the most 
proven measure thus far to accomplish the goal of minimizing . . . 
rural call completion problems.'' However, while the ATIS best 
practices may be a useful guide to addressing call completion issues, 
they may not be appropriate for all networks or providers, and 
mandating compliance with the proposed best practices may create 
unnecessary compliance burdens for providers that serve as both covered 
providers and intermediate providers.
    17. In addition to the shortcomings discussed above, the adoption 
of the proposed ATIS best practices framework could raise other 
practical issues that might limit its utility. For example, West 
Telecom, while supporting the use of the ATIS best practices as a 
general regulatory framework in lieu of ``Commission micro-
management,''

[[Page 25695]]

notes that ``the ATIS RCC Handbook may not necessarily reflect [the] 
best approaches to resolving certain situations'' and that ``the 
Commission should continue to decline to mandate strict compliance with 
the ATIS RCC Handbook or other industry standards in all situations.'' 
Similarly, ANI generally supports the Commission's proposed framework 
based on the ATIS best practices but also ``urges the Commission not to 
impose more complex service quality standards, which may not be 
appropriate for all intermediate providers and could unnecessarily 
restrict carriers' flexibility to determine the standards best suited 
to their individual networks.'' Additionally, ANI and West Telecom both 
point out potential issues related to our adoption of a ``crank back'' 
requirement. Furthermore, at least one rural intermediate provider has 
argued that its legacy infrastructure precludes compliance with the 
proposed ATIS best practices framework as a technical matter.
    18. Notwithstanding these issues, we agree with commenters that the 
ATIS best practices provide an effective roadmap for mitigating call 
completion issues, and we reaffirm our finding in the Second RCC Order 
that the Commission should encourage providers to adopt these 
practices, while being mindful that the ATIS best practices may not be 
appropriate for all providers. For this reason, as is true of our 
monitoring rule for covered providers, we will treat compliance with 
the ATIS best practices, as specified in the 2015 ATIS RCC Handbook, as 
a safe harbor demonstrating compliance with our service quality 
standards for intermediate providers, including the general duty to 
deliver covered voice communications and the intermediate provider 
monitoring requirements discussed below. Consistent with our approach 
to covered providers in the Second RCC Order, we will also take the 
ATIS RCC Handbook best practices into account when evaluating whether 
an intermediate provider has established an effective monitoring regime 
for evaluating its performance in delivering calls to rural areas. As 
discussed above, however, we recognize that the ATIS best practices may 
not be appropriate for all providers and all network configurations, 
and our evaluation of an intermediate provider's monitoring regime will 
necessarily reflect these considerations. We find, as we did in the 
Second RCC Order, that this approach will ``encourage adherence to the 
best practices while giving . . . providers flexibility to tailor their 
practices to their particular networks and business arrangements.''
2. Intermediate Providers Must Take Steps Reasonably Calculated To 
Ensure That All Covered Voice Communications Traversing Their Networks 
Are Delivered to Their Destination
    19. Building on the regulatory approach for ensuring rural call 
completion that we have previously applied to covered providers, in 
this Order we require intermediate providers to take steps reasonably 
calculated to ensure that all covered voice communications that 
traverse their networks are delivered to their destinations. An 
intermediate provider may violate this general duty to complete calls 
if it knows, or should know, that calls are not being completed to 
certain areas, and it engages in acts or omissions that allow or 
effectively allow these conditions to persist.
    20. As is true for covered providers under the 2012 Declaratory 
Ruling and Second RCC Order, under this rule intermediate providers 
must promptly resolve any anomalies or problems that arise preventing 
call completion, and take action to ensure they do not recur. If an 
intermediate provider determines that responsibility for a call 
completion problem lies with a party other than the provider itself or 
any of its downstream providers, the provider must use commercially 
reasonable efforts to alert that party to the anomaly or problem. 
Willful ignorance will not excuse a failure by an intermediate provider 
to investigate evidence of poor performance. Evidence of poor 
performance includes, among other indicators, ``persistent low answer 
or completion rates; unexplained anomalies in performance reflected in 
the metrics used by the [intermediate] provider; repeated complaints to 
the Commission, state regulatory agencies, or [intermediate] providers 
by customers, rural incumbent LECs and their customers, competitive 
LECs, and others.''
    21. We note that nothing in this rule should be construed to 
dictate how intermediate providers must route their traffic, nor does 
the general duty to deliver covered voice communications impose strict 
liability upon intermediate providers who fail to complete calls. As we 
specified in the context of our monitoring rule for covered providers, 
``[w]e do not impose strict liability on . . . providers for a call 
completion failure; rather, we may impose a penalty where a . . . 
provider fails to take actions to prevent reasonably foreseeable 
problems or, if it knows or should know that a problem has arisen, 
where it fails to investigate or take appropriate remedial action.'' 
Similarly, the rules we adopt today for intermediate providers focus on 
addressing persistent call completion issues; thus, strict liability 
under our service quality rules for isolated call failures is not 
contemplated. Rather, we require all intermediate providers to take 
steps reasonably calculated to ensure that covered voice communications 
reach their destination, utilizing the tools available to each 
provider, recognizing that these tools may vary depending on the size 
of the provider, their network configuration, and other variables.
    22. As we found in the Third RCC Order, the provisions of the RCC 
Act are not limited to rural areas; therefore, we apply the general 
duty discussed above to all covered voice communications, regardless of 
their destination. This rule directly addresses Congress's instruction 
to adopt rules to ``ensure the integrity of the transmission of covered 
voice communications to all customers in the United States[.]'' Our 
approach also aligns the obligations of intermediate providers with 
those applicable to covered providers pursuant to the 2012 Declaratory 
Ruling and the Second RCC Order, which require a covered provider 
``that knows or should know that it is providing degraded service to 
certain areas'' to take action to correct the problem and ``ensure that 
intermediate providers, least-cost routers, or other entities acting 
for or employed by the carrier are performing adequately.''
3. Intermediate Providers Must Monitor the Performance of any Directly 
Contracted Intermediate Providers When Routing Traffic to Rural Areas
    23. In addition to the general duty to deliver all covered voice 
communications, we adopt the Third RCC FNPRM proposal to require that 
intermediate providers establish processes to monitor their rural call 
completion performance. Therefore, when transmitting covered voice 
communications to rural areas, intermediate providers must: (a) Monitor 
the performance of each intermediate provider with which it contracts; 
and (b) based on the results of such monitoring, take steps that are 
reasonably calculated to correct any identified performance problem 
with the intermediate provider, including removing that provider for 
sustained poor performance.
    24. These requirements parallel the monitoring obligations the 
Commission

[[Page 25696]]

adopted for covered providers in the Second RCC Order, and are broadly 
supported by the record in this proceeding. We agree with arguments 
advanced by ITTA and several other commenters that ``the Commission 
should model this self-monitoring rule on the monitoring rule for 
covered providers.''
    25. As was true of our covered provider monitoring requirements, 
the rural call completion performance monitoring obligation ``entails 
both prospective evaluation to prevent problems and retrospective 
investigation of any problems that arise.'' Prospective monitoring 
``includes regular observation of intermediate provider performance and 
call routing decision-making; periodic evaluation to determine whether 
to make changes to improve rural call completion performance; and 
actions to promote improved call completion performance where 
warranted.'' Retrospective monitoring requires intermediate providers 
to take steps reasonably calculated to correct any identified 
performance problems. Where intermediate providers detect persistent 
problems routing covered voice traffic to rural areas, we require 
intermediate providers to develop a solution that is reasonably 
calculated to be effective, and specifically require intermediate 
providers to remove a contracted intermediate provider from a route 
after sustained inadequate performance, except in situations where an 
intermediate provider can demonstrate that no alternative routes exist. 
Intermediate providers that do not effectively correct problems with 
delivery of covered voice communications to rural areas may be subject 
to enforcement action for violations of our service quality standards, 
including the general duty to deliver covered voice traffic to its 
destination and the monitoring requirement. Together, these rules 
satisfy Congress's direction to the Commission to ``ensure the 
integrity of the transmission of covered voice communications to all 
customers in the United States'' and ``prevent unjust or unreasonable 
discrimination among areas of the United States in the delivery of 
covered voice communications.''
4. Intermediate Providers Must Ensure That Any Intermediate Providers 
to Which They Hand Off Calls Are Registered
    26. We also require intermediate providers to ensure that any 
additional intermediate providers to which they hand off calls are 
registered with the Commission pursuant to Sec.  64.2115 of the 
Commission's rules. As is true of the general duty to complete calls 
and the rural call completion performance monitoring obligations 
discussed above, we adopt this rule pursuant to the authority granted 
to the Commission by Congress in the RCC Act, which directs us to 
develop service quality standards for intermediate providers. The RCC 
Act requires that all intermediate providers register with the 
Commission and prohibits covered providers from using any unregistered 
intermediate providers. We find that extending this prohibition to 
intermediate providers as well will further the aims of the RCC Act by 
making all participants in the call path responsible for ensuring the 
registration of any subsequent intermediate providers. We also note 
that the RCC Act expressly requires the rules we promulgate pursuant to 
the statute to ensure the integrity of the transmission of covered 
voice communications ``to all customers in the United States'' and to 
``prevent unjust or unreasonable discrimination among areas of the 
United States'' in the delivery of such communications. Accordingly, we 
clarify that the registry requirements in Sec.  64.2115 as well as the 
intermediate service quality standards we adopt today do not apply to 
non-U.S. intermediate providers on calls terminating outside of the 
United States. This requirement aligns with the prohibition on covered 
provider use of unregistered intermediate providers pursuant to the RCC 
Act and Sec.  64.2117 of the Commission's rules, and will promote 
compliance with the registry provisions of the RCC Act by making 
intermediate providers jointly responsible for ensuring the 
registration status of directly contracted downstream intermediate 
providers in their call path.
    27. The RCC Act requires that all intermediate providers must 
maintain a registration with the Commission in order to transmit 
covered voice communications, and the Third RCC Order requires covered 
providers to use contractual restrictions designed to ensure the 
registration status of any downstream intermediate providers in the 
call path. And, pursuant to the RCC Act and the Third RCC Order, 
information concerning the registration status of intermediate 
providers will be readily available on the Commission's website. For 
these reasons, we expect the burdens associated with this requirement 
to be minimal.
    28. In order to further reduce the compliance burdens associated 
with this rule, we decline to require intermediate providers to submit 
a certification to the Commission stating that they do not transmit 
covered voice communications to other unregistered intermediate 
providers. As we noted with respect to the monitoring rule for covered 
providers, ``[w]e expect all entities subject to our rules to comply at 
all times,'' and we decline to impose a certification requirement 
absent a clear public interest benefit. Although some parties believe a 
certification, for example on an annual basis, is useful to ensure 
intermediate providers are taking reasonable steps to comply with 
Commission requirements, we find consistent with other commenters that 
the RCC Act and Commission rules provide sufficient methods to monitor 
and enforce non-compliance. For example, as discussed below, the 
Commission has authority to take enforcement actions against covered 
and intermediate providers that are not registered such as forfeitures 
and deregistration. We therefore decline to require intermediate 
providers to certify that they do not transmit covered voice 
communications to other intermediate providers that are not registered 
with the Commission. Nor do we require intermediate providers to take 
responsibility for ensuring the registration status of downstream 
intermediate providers with which they do not share a direct 
relationship, as we do for covered providers. Compared with covered 
providers, which must exceed a minimum size threshold and determine the 
initial long-distance path of a call, intermediate providers may have 
less ability to modify call routing paths. And, because each 
intermediate provider in the path of a given call is responsible for 
determining the registration of any other intermediate provider to 
which it hands off calls, we find that such a requirement would be 
duplicative and, thus, unnecessary.
5. Other Issues
    29. Additional Rules to Prevent Ring Signaling Manipulation. We 
decline to adopt any additional rules to prevent intermediate providers 
from manipulating signaling information for calls destined for rural 
areas. As supported in the record, our existing rules already require 
intermediate providers to pass and return unaltered signaling 
information, and we conclude that additional rules are unnecessary. 
Moreover, a covered provider is also responsible when a downstream 
intermediate provider unlawfully generates ring signaling on a call. 
Although NTCA supports prohibiting intermediate providers from 
manipulating signaling information, it does not recommend additional 
rules. Because these waiver petitions involve

[[Page 25697]]

the technical signaling capabilities of the various carriers, we 
conclude that these petitions are outside the scope of this rulemaking, 
and therefore, decline to address them as part of this Order. We note 
that Sec.  64.1601(a)(2) of our rules makes clear that intermediate 
carriers are already mandated to faithfully relay signaling. As such, 
we decline to impose additional regulation.
    30. Limitation of number of intermediate providers. We also decline 
to require intermediate providers to limit the number of subsequent 
intermediate providers in the call chain. Although Inteliquent supports 
a limitation and requests the Commission to limit the number of 
intermediate providers in the call path to no more than three, the 
majority of commenters reject this proposal. We agree with West Telecom 
that the number of intermediate providers is not ``an appropriate proxy 
to identify specific intermediate providers or routing practices that 
interfere with RCC.'' We do not agree with Inteliquent that, in all 
cases, limiting the number of intermediate providers will encourage 
efficient network architecture and thus improve call completion rates. 
The Commission remains concerned that specific limitations on the 
number of intermediate providers ``conflate[] the number of `hops' with 
good hops . . . [by assuming] that a small number of badly performing 
intermediate providers are better than multiple well-performing 
intermediate providers.'' Instead, we believe that providers should 
have flexibility to meet the requirements the Commission has in place. 
Consistent with our treatment of covered providers, although we decline 
to mandate a specific limit on the number of intermediate providers in 
the call chain, we believe the service quality standards adopted herein 
will encourage intermediate providers to limit other providers in the 
chain.
    31. Numeric performance thresholds. In an effort to consider 
alternative service quality standards, we sought comment on whether the 
Commission should require intermediate providers to meet or exceed one 
or more numeric rural call completion performance targets. Consistent 
with the majority of comments, we decline to set specific numeric 
thresholds, but rather allow intermediate providers flexibility to 
self-monitor rural call completion performance. We therefore decline to 
adopt Inteliquent's proposal for performance targets on a weekly and 
LATA/OCN basis. We agree, as described by Georgetown University, that 
while evaluation of these and other metrics over time is a valuable 
tool to ensure call completion, specific performance targets are not 
useful. Nonetheless, we expect intermediate providers to monitor their 
networks and downstream providers with sufficient specificity to 
adequately evaluate their performance. We recognize that intermediate 
providers handle calls on a variety of networks and agree with most 
commenters that a reasonable self-monitoring process--consistent with 
monitoring processes for covered providers and contemplated by the 
Senate Commerce Committee Report--will sufficiently monitor downstream 
providers and allow correction.
    32. Modification of Rules Adopted in the Second RCC Order. We also 
decline to make any modifications to rules adopted in the Second RCC 
Order. As discussed in more detail below in rejecting USTelecom's 
Petition for Reconsideration, we reaffirm the Commission's findings in 
the Second RCC Order that the monitoring rule is necessary to address 
ongoing rural call completion issues, and is supported by the record in 
this proceeding and the regulatory regime established by Congress in 
the RCC Act. We disagree with ITTA that the Commission should ``abandon 
the covered provider monitoring requirements altogether, or at least 
curtail them substantially.'' We further disagree with NCTA that 
covered providers should only be responsible for conduct directly 
within their control. Rather, we again reject any ``all-or-nothing'' 
approach to the monitoring rule and reaffirm that our balanced approach 
provides for responsibility for rural call completion without imposing 
an unduly rigid or burdensome mandate.

B. Exception To Service Quality Standards for Safe Harbor Covered 
Providers

    33. The RCC Act provides that the service quality standards 
established by the Commission pursuant to the RCC Act ``shall not apply 
to a covered provider'' that has certified as a safe harbor provider 
under Sec.  64.2107(a) on or before February 26, 2019 (which is one 
year after the enactment of the RCC Act) and that continues to maintain 
eligibility for the safe harbor. To implement this provision of the RCC 
Act, we adopt an exception to the service quality standards described 
above for intermediate providers that qualify for our covered provider 
safe harbor established in new Sec.  64.2109 of the Commission's rules, 
similar to the Commission's existing Sec.  64.2107 safe harbor from the 
rural call completion recording and retention requirements.
    34. As the Commission proposed in the Third RCC FNPRM, we maintain 
the three safe harbor requirements as currently provided in our 
existing rules. Therefore, in order to qualify for the exemption from 
the intermediate provider service quality standards established by the 
RCC Act, covered providers must satisfy three requirements: (1) The 
covered provider must restrict by contract any intermediate provider to 
which a call is directed from permitting more than one additional 
intermediate provider in the call path before the call reaches the 
terminating provider or terminating tandem; (2) any nondisclosure 
agreement with an intermediate provider must permit the covered 
provider to reveal the identity of the intermediate provider and any 
additional intermediate provider to the Commission and to the rural 
incumbent LEC(s) whose incoming long-distance calls are affected by the 
intermediate provider's performance; and (3) the covered provider must 
have a process in place to monitor the performance of its intermediate 
providers.
    35. We note that the service quality standards we adopt today under 
the RCC Act apply only to intermediate providers; however, the 
exemption established by the RCC Act is, like the safe harbor in our 
existing rules, limited to covered providers. We note that we did not 
receive comments about this disparity. We therefore clarify that 
covered providers qualifying for our safe harbor on or before February 
26, 2019 will be exempt from our service quality standards when serving 
as intermediate providers, provided they maintain their safe harbor 
certification with the Commission.

C. Enforcement of Intermediate Provider Requirements

    36. In the Third RCC Order, the Commission required intermediate 
providers that offer to transmit covered voice communications to 
register with the Commission, pursuant to subsection (a)(1) of the RCC 
Act. The Commission determined that because the RCC Act intends the 
registry to function as a qualification for providers to enter the 
intermediate provider market, the requirement to register (as well as 
to maintain registration in good standing) is tantamount to a license. 
The Commission concluded that it may exercise its forfeiture authority 
against intermediate providers that fail to register without first 
issuing a citation.
    37. Under subsection (a)(2) of the RCC Act, once the service 
quality standards we adopt here take effect, registered intermediate 
providers, and providers

[[Page 25698]]

that subsequently seek registration with the Commission, must comply 
with these standards. Accordingly, as supported by a number of 
commenters, we conclude that we may deregister intermediate providers 
from the registry as an enforcement option. As in the case of 
intermediate providers that fail to register with the Commission, we 
also may exercise our forfeiture authority against intermediate 
providers that fail to comply with the service quality standards, and, 
as explained in the Third RCC Order, we may do so without first issuing 
a citation. In such cases, as in all forfeiture matters, the Commission 
will consider the nature, circumstances, extent and gravity of the 
violation, and with respect to the violator, the degree of culpability, 
any history of prior offenses, ability to pay, and such other matters 
as justice may require. 47 U.S.C. 503(b)(2)(E). Our choice of 
enforcement remedy will depend upon the totality of circumstances, and 
we may impose penalties for both single infractions and patterns of 
non-compliance or misconduct. Requiring repeated violations before 
allowing enforcement action, as some commenters propose, could result 
in, if not indirectly encourage, systemic call completion issues--an 
outcome that would frustrate the underlying purpose of the RCC Act.
    38. When the Commission seeks to remove an intermediate provider 
from the registry, the procedures specified in Section 558 of the 
Administrative Procedure Act apply. Except in cases of willfulness or 
where public health, interest, or safety requires otherwise, 
deregistration may occur after the intermediate provider has been given 
written notice of the facts or conduct at issue and an opportunity to 
demonstrate or achieve compliance with the service quality standards. 
Such notice will take the form of a publicly issued order to show 
cause. Intermediate providers that do not present a response with 
written evidence of their compliance with the requirements identified 
in the notice for this reason, we find it unnecessary to establish a 
separate requirement that intermediate providers ``maintain records of 
how they are complying'' with the service quality standards, as NTCA 
suggests or a detailed plan on how they intend to achieve compliance 
within thirty days will be removed from the registry. A hearing will 
not be required unless the intermediate provider's response presents a 
substantial and material question of fact. In any case where a hearing 
proceeding is conducted, the hearing shall be based on written evidence 
only. Deregistration orders will be subject to judicial review under 
Section 402(a) of the Communications Act. We note that, if a proceeding 
results in deregistration, the order to show cause will afford affected 
covered providers ample notice to explore alternative arrangements, in 
order to migrate their traffic to other, compliant, intermediate 
providers if necessary.
    39. Moreover, a covered provider that becomes aware that an 
intermediate provider it uses is violating the service quality 
standards may also be subject to enforcement action, even if the 
intermediate provider is properly registered. Because covered providers 
must know or be capable of knowing the identity of all intermediate 
providers in the path of a given call, monitor the performance of their 
intermediate providers in completing calls to rural destinations, and 
take steps to correct performance problems, when a provider learns that 
its intermediate provider is violating service quality standards, it is 
responsible for removing that provider from all affected call paths 
until the provider demonstrates compliance. A failure to do so may 
result in enforcement action.

D. One-Year Sunset of Recording and Retention Rules

    40. We sunset the rural call completion data recording and 
retention requirements established in the First RCC Order one year 
after the effective date of the service quality standards adopted here 
today. Based upon the record developed since those requirements' 
adoption in 2013, and the analysis the Wireline Competition Bureau 
(Bureau) developed in the 2017 RCC Data Report, we find that the few, 
if any, benefits the call data offers do not outweigh the burden 
presented by having covered providers collect and retain data that is 
not useful in monitoring or remedying call completion issues.
    41. The call data recording, retention, and reporting requirements 
were intended to improve the Commission's ability to monitor rural call 
completion, and to aid enforcement action when necessary. These 
requirements, instituted by the 2013 First RCC Order, apply to covered 
providers for calls signaled as Answered, Busy, Ring No Answer, and 
Unassigned. The Commission declined to then adopt a specific sunset 
date for data recording, retention, and reporting, but directed the 
Bureau to produce a report, analyzing covered provider call data 
``submitted during the first two years of the data collection's 
effectiveness'' and committed to complete a proceeding reevaluating 
``whether to keep, eliminate, or amend the data collection and 
reporting rules three years after they become effective.''
    42. The Bureau recommended in its resulting 2017 RCC Data Report 
that the Commission consider eliminating the recording, retention, and 
reporting rules. The Bureau reached this recommendation after finding 
significant data reliability issues--including inconsistent covered 
provider categorization methodologies for the four call types, and 
failure by some covered providers to exclude autodialer, wholesale, and 
intermediate provider traffic because of technical inabilities to do 
so. The RCC Data Report noted that even if the Commission were to 
modify the recording, retention, and reporting requirements, ``it is 
not clear that that the benefits of such modifications would outweigh 
the costs.'' In the Second RCC Order, the Commission instituted the 
Bureau's recommendation in part by eliminating the reporting, but 
keeping the recording and retention requirements. Having received 
significant comments in favor of eliminating all three requirements 
pursuant to the Second RCC FNPRM, 82 FR 34911, the Third RCC FNPRM 
sought further comment on the elimination or sunsetting of the 
recording and retention rules upon implementation of the RCC Act. The 
Commission also asked whether it should instead ``sunset the rules at a 
different point in time'' or ``instead retain the recording and 
retention rules without any sunset.''
    43. We sunset the recording and retention rules as the burden of 
continuing to mandate that covered providers collect and retain data, 
especially as prescribed by those rules, outweighs any benefit or 
usefulness of the data. We agree with USTelecom that it makes ``little 
sense for the Commission to continue to require providers to record and 
retain data that neither the Commission nor the carriers use, or find 
useful for analysis of, rural call completion issues.'' For the same 
reason, we disagree with NTCA's argument that ``the Commission should 
retain the record keeping requirement for covered providers until such 
time as there is an affirmative determination that the rules are 
effective and records are no longer necessary.'' Because the data as 
prescribed by the First RCC Order is not useful to covered providers in 
alleviating rural call completion issues, our recording and retention 
rules have placed covered providers in the position of maintaining one 
pre-packaged set of data for rural call completion rule compliance only 
and possibly retaining another data set actually used by covered 
providers in

[[Page 25699]]

operating their networks and remedying call completion issues via the 
covered provider monitoring rule. We expect covered providers to 
dedicate all available resources to prevent and remedy call completion 
issues; and, therefore, it is unnecessary for us to require covered 
providers to produce data unused in meeting these purposes.
    44. We disagree with NTCA that maintaining the recording and 
retention rules will inform us of the efficiency of the monitoring 
requirements, intermediate provider service quality standards, and 
intermediate provider registry. Because the monitoring rule permits 
covered providers ``flexibility in determining and conducting 
prospective monitoring that is appropriate for their respective 
networks and mixes of traffic,'' mandating specific data collection 
metrics would stifle this flexibility, and would in practice, prescribe 
monitoring practices.
    45. We also disagree with NTCA's argument that eliminating the 
recording and retention rules ``may lead to an increase in the number 
of intermediate providers being used in the call path for providers who 
now have a good record of completing calls.'' We find it unlikely that 
covered providers with a good track record of completing calls would 
suddenly assume bad call completion practices, and risk violating the 
Commission's call completion rules, as a result of the removal of the 
recording and retention requirements. Nor does NTCA point to any 
evidence suggesting such an outcome. For these same reasons, we 
disagree with NTCA's assertion that removal of the recording and 
retention rules will reduce the appeal of the safe harbor for covered 
providers and thereby lead to diminished rural call completion 
performance by safe harbor covered providers. Moreover, as we stated 
above and in the Second RCC Order, we believe that our intermediate 
provider service quality standards, the intermediate provider registry 
requirement, and the covered provider monitoring requirement will limit 
the number of providers in call paths.
    46. The Third RCC FNPRM did not propose a sunset timeline for the 
recording and retention requirements, but suggested a period ``such as 
three years'' from the Second RCC Order. Commenters in this proceeding 
have advocated that the recording and retention rules be eliminated 
upon effectiveness of our RCC Act implementing regulations, or upon 
adoption of the service quality standards. Despite the data quality 
issues discussed above, we find that immediate removal of the recording 
and retention rules could impact our ability to address rural call 
completion issues pending full implementation of the RCC Act 
requirements. We therefore find that a one-year sunset of the recording 
and retention rules will serve as a sufficient bridge between the 
Commission's previous recording and retention rules and the RCC Act 
regulations.
    47. This sunset period will allow covered and intermediate 
providers to come into full compliance with the rural call completion 
rules adopted pursuant to the RCC Act before the recording and 
retention requirements are removed. The Third RCC Order mandates that 
intermediate providers register ``within 30 days after publication of a 
Public Notice announcing the approval by the Office of Management and 
Budget of the final rules establishing the registry,'' and covered 
providers have 90 days thereafter to only use registered intermediate 
providers. And as discussed above, we grant intermediate providers a 
period of six months from the date that this Order is released by the 
Commission, or 30 days after publication of a summary of this Order in 
the Federal Register, whichever is later, to comply with our service 
quality standards. We therefore believe a one-year sunset period for 
the remaining recording and retention rules will provide a sufficient 
overlap between the new call completion rules and the Commission's 
previous data collection regime.
    48. The recording and retention safe harbor will also thus remain 
concurrently, without change, until the recording and retention 
requirements expire one year after the service quality standards are in 
effect. Accordingly, we sunset the remaining call data recording and 
retention requirements established in the First RCC Order one year 
after the effective date of the intermediate provider service quality 
standards. We also extend the application of the safe harbor to our 
newly adopted service quality standards for intermediate providers.

E. Petitions for Reconsideration of Second RCC Order

1. NTCA Petition for Reconsideration
    49. On June 11, 2018, NTCA filed a Petition for Reconsideration 
(Petition) of a portion of the Second RCC Order, requesting ``that the 
Commission reevaluate and reconsider its decision to not require 
covered providers to file their documented rural call completion 
monitoring procedures with the Commission.'' For the reasons listed 
below, we deny NTCA's Petition.
a. Background
    50. In the Second RCC Order, the Commission instituted a covered 
provider monitoring requirement. This monitoring requirement, which 
became effective October 17, 2018, requires covered providers to 
prospectively and retrospectively monitor their contracted intermediate 
providers, and to document those monitoring processes, ``to ensure 
consistent prospective monitoring and facilitate Commission 
oversight.'' The Commission declined to require covered providers to 
file or publish this monitoring process documentation, due to concerns 
about revealing ``important technical, personnel, and commercial 
details about the covered provider's network and business operations,'' 
and a corresponding lack of any ``countervailing benefit to warrant 
imposing'' such a burden. In addition to this Petition, NTCA previously 
submitted two near-identical ex parte presentations in April 2018. The 
two ex partes, identical in facts and argument to its Petition, 
requested ``that the Commission require covered providers to file with 
the Commission their documented monitoring procedures,'' as filing of 
procedures imposes ``no meaningful burden on covered providers, while 
offering greater transparency and certainty.''
b. Discussion
    51. Our rules allow interested persons to file petitions for 
reconsideration of final actions in rulemaking proceedings, and 
provides that petitions for reconsideration relying on ``facts or 
arguments which have not previously been presented to the Commission 
will be granted'' only under certain circumstances. Where the petition 
presents no new facts or arguments, the Commission has full discretion 
to grant such petitions in ``whole or in part or may deny or dismiss 
the petition.''
    52. Although we agree that NTCA is an interested party to a final 
action, the Commission has already considered and rejected NTCA's 
arguments, and NTCA presents no new facts or arguments to explain why 
the Commission should reconsider its decision on covered provider 
monitoring documentation. As Sprint points out, NTCA's Petition is a 
near verbatim restatement of the facts and arguments NTCA submitted in 
its two April 2018 ex parte filings that transparency and certainty 
compel the Commission to mandate that covered providers file their 
monitoring processes with the Commission. Accordingly, because NTCA 
does not submit new facts or arguments, we have full

[[Page 25700]]

discretion to grant or deny its Petition in whole or in part.
    53. Under such discretionary authority, we deny the Petition. 
Beyond its editorialization of our decisions, NTCA does not present new 
arguments or facts warranting a discretionary change in the 
Commission's decision to not require covered providers to file or 
publish their monitoring processes. NTCA specifically challenges the 
Commission's ``conclusion'' of expecting covered providers to document 
their monitoring procedures without requiring covered providers to file 
those procedures with the Commission ``or otherwise make them publicly 
available.'' The Commission indeed specifically and fully addressed 
NTCA's identical argument in the Second RCC Order. We continue to 
reiterate that there is no ``countervailing benefit sufficient to 
warrant imposing'' the burden of filing monitoring processes, as the 
Commission may obtain most information--including monitoring process 
information--pursuant to its investigatory authority into covered 
provider practices under the Communications Act. Accordingly, we deny 
NTCA's Petition for Reconsideration in whole, pursuant to Sec.  
1.429(i) of our rules.
2. USTelecom Petition for Reconsideration
    54. We also dismiss and deny a petition for reconsideration filed 
by USTelecom seeking review of rules adopted in the Second RCC Order. 
Specifically, USTelecom requests reconsideration of certain aspects of 
the Commission's monitoring rules for covered providers. As explained 
below, we dismiss the Petition as it relies on arguments already 
considered and rejected by the Commission in the Second RCC Order, and 
we reaffirm our findings that the monitoring rule appropriately 
balances the burdens our rules impose on covered providers with the 
need to address ongoing rural call completion issues. Moreover, the 
Commission's adoption of the monitoring rule is supported by the record 
in this proceeding and consistent with the provisions of the RCC Act.
a. Background
    55. On June 11, 2018, USTelecom filed a petition for 
reconsideration of certain aspects of the covered provider monitoring 
rule adopted in the Second RCC Order. The Second RCC Order adopted a 
requirement, codified at 47 CFR 64.2111, that covered providers monitor 
the performance of the intermediate providers to which they hand off 
calls, and, based on the results of such monitoring, take steps 
reasonably calculated to correct any identified performance problems 
with downstream intermediate providers. The Second RCC Order indicated 
that, under the monitoring rule, ``a covered provider is accountable 
for monitoring the performance of any intermediate provider with which 
it contracts, including that intermediate provider's decision as to 
whether calls may be handed off to additional downstream intermediate 
providers . . . and whether it has taken sufficient steps to ensure 
that calls will be completed post-handoff.'' In order to comply with 
their obligations under the monitoring rule, the Second RCC Order 
afforded covered providers the flexibility to manage the call path 
through ``(i) direct monitoring of all intermediate providers or (ii) a 
combination of direct monitoring of contracted intermediate providers 
and contractual restrictions on directly monitored intermediate 
providers that are reasonably calculated to ensure rural call 
completion through the responsible use of any further intermediate 
providers.''
    56. USTelecom seeks reconsideration of the requirement that covered 
providers exercise responsibility for the call completion performance 
of downstream intermediate providers with which there is no direct 
contractual relationship, arguing that this requirement ``poses severe 
practical issues'' and ``creates an unreasonable compliance trap for 
originating providers.'' NCTA--The internet & Television Association 
(NCTA) and ITTA--The Voice of America's Broadband Providers (ITTA) 
filed comments in support of USTelecom's petition for reconsideration, 
while NTCA--The Rural Broadband Association filed comments in 
opposition.
b. Discussion
    57. As an initial matter, we note that the Petition and supporting 
commenters rely on several substantive arguments previously submitted 
to the Commission prior to the adoption of the monitoring rule. Under 
Sec.  1.429 of the Commission rules, petitions which ``[r]ely on 
arguments that have been fully considered and rejected by the 
Commission within the same proceeding'' ``plainly do not warrant 
consideration by the Commission'' and may be dismissed or denied.
    58. As one of their primary arguments for reconsideration, 
USTelecom, NCTA, and ITTA claim that compliance with the monitoring 
rule necessitates modification of existing vendor agreements, which, 
they allege, ``poses severe practical issues.'' However, as NTCA 
observes, ``this same argument was raised in the notice-and-comment 
phase of the rulemaking and rightly and squarely rejected by the 
Commission.'' In the Second RCC Order, we considered, and rejected, the 
argument that covered providers could not, or should not, bear any 
responsibility for the performance of non-contracted intermediate 
carriers. The Commission also recognized that ``covered providers will 
need some time to evaluate and renegotiate contracts with intermediate 
providers in order to comply with the monitoring requirement.'' For 
this reason, we established a six-month transition period for covered 
providers to come into compliance with our rules. We therefore dismiss 
these arguments as having previously been considered by the Commission. 
Similarly, we dismiss related arguments advanced by USTelecom, ITTA, 
and NCTA concerning whether ``direct'' monitoring of intermediate 
providers with which there is no contractual relationship is feasible. 
These arguments were likewise considered, and rejected, by the 
Commission in the Second RCC Order.
    59. Although USTelecom claims that ``many originating providers 
will be unable to modify their vendor agreements'' because ``revisions 
[to contracts] can generally be made only during the vendor contract 
renewal terms,'' it offers no evidence to support these assertions, nor 
do any other commenters supporting the Petition. On the contrary, as 
NTCA notes, the Second RCC Order offered covered providers ``ample time 
to establish the contractual provisions necessary'' to comply with the 
monitoring rule, and, in any event, any covered provider unable to 
comply after this time has the option to request a waiver of our rules 
provided it can demonstrate good cause warranting grant of such relief.
    60. We also disagree with ITTA's assertion that the monitoring rule 
``[c]ontravene[s] the RCC Act'' because it ``fl[ies] in the face of the 
statutory balancing crafted by Congress.'' ITTA has previously advanced 
similar arguments in this proceeding, which we rejected in the Second 
RCC Order. As we have explained, ``passage of the RCC Act does not 
obviate the need for covered provider regulation,'' and our monitoring 
rule ``complements, but exists independently of, the registry and 
service quality obligations contained in the RCC Act.''
    61. ITTA argues that the RCC Act's adoption of service quality and 
registry standards for intermediate providers suggests that Congress 
intended to focus responsibility for call completion issues

[[Page 25701]]

predominantly or entirely on intermediate providers. We disagree. 
ITTA's arguments suggest a fundamental misreading of the RCC Act and 
its relationship to existing Commission rules and precedent concerning 
rural call completion issues. Had Congress intended to shield covered 
providers from rural call completion rules, it could easily have done 
so in the RCC Act. Contrary to ITTA's suggestion, however, the RCC Act 
recognized and approved of the Commission's efforts to hold covered 
providers accountable for rural call completion issues, and granted the 
Commission additional authority to support a complementary regulatory 
regime for intermediate providers. Specifically, in passing the RCC 
Act, Congress repeatedly referenced the Commission's regulation of 
covered providers, both in the text of the Act and the accompanying 
legislative history, noting that the Commission was free to model its 
service quality standards for intermediate providers on the ``general . 
. . duties to complete calls'' that apply to covered providers. These 
duties, implicitly endorsed by Congress, include those described in the 
2012 Declaratory Ruling, which clarified that ``a carrier remains 
responsible for the provision of service to its customers even when it 
contracts with another provider to carry the call to its destination.'' 
As we explained in the Second RCC Order, these same obligations form 
the basis of the monitoring rule for covered providers.
    62. ITTA also argues that the Commission's finding in the Second 
RCC Order that covered providers are able to use pass-through 
contractual restrictions to ensure call completion is ``[u]nsupported 
by the [r]ecord.'' We disagree. Indeed, ITTA's own comments point to 
relevant record support for this finding, including, as described by 
ITTA: ``[A] reference to third-party vendors performing monitoring; a 
suggested best practice whereby contractual agreements can be used to 
ensure that intermediate providers meet performance standards and hold 
other intermediate providers accountable for performance; and one 
commenter stating that its direct contracts with intermediate providers 
stipulate that the intermediate provider may use no more than one 
additional intermediate provider before the call is terminated.'' In 
its comments, ITTA summarily dismisses this record support based on the 
assertion that it does not constitute ``actual evidence.'' ITTA 
provides no analysis or elaboration whatsoever to support this claim; 
however, insofar as ITTA makes an argument that the monitoring rule 
lacks record support, we disagree. We also disagree with ITTA's 
contention that the Second RCC Order is ``rife with potential 
confusion.'' ITTA's argument appears to rest on its assertion that the 
Second RCC Order ``cobbl[es] together three things that it 
`encourage[s]' into a de facto requirement.'' However, as the Second 
RCC Order makes clear, none of the specific practices referenced by 
ITTA--including ``adherence to the ATIS RCC Handbook,'' ``limit[ing] 
the number of intermediate providers in the call chain,'' and 
incorporation of examples of contractual provisions that ensure quality 
call completion--are required. Id. To the contrary, while covered 
providers ``must exercise responsibility for the performance of the 
entire intermediate provider call path to help ensure that calls to 
rural areas are completed,'' the Second RCC Order grants covered 
providers ``flexibility in how they fulfill this responsibility'' 
allowing each to ``determine the standards and methods best suited to 
their individual networks.'' The record evidence in this proceeding 
demonstrates that covered providers can, and do, utilize contractual 
restrictions to ensure call completion by downstream intermediate 
providers, including those with which there is no direct contractual 
relationship. For these reasons, we affirm our finding that the 
monitoring rule is supported by the record in this proceeding.
    63. For the foregoing reasons, to the extent that USTelecom and 
commenters supporting its Petition rely on arguments concerning the 
costs associated with contractual negotiations that may be necessitated 
by the monitoring rule, we dismiss these arguments as having been 
previously considered and rejected by the Commission. To the extent 
that the Petition and supporting comments raise novel arguments in this 
proceeding, we dismiss these arguments on the merits, as discussed 
above.

IV. Final Regulatory Flexibility Analysis

    64. As required by the Regulatory Flexibility Act of 1980, as 
amended (RFA), an Initial Regulatory Flexibility Analysis (IRFA) was 
incorporated into the Third Further Notice of Proposed Rulemaking 
(Third RCC FNPRM) for the Rural Call Completion proceeding. The 
Commission sought written public comment on the proposals in the Third 
RCC FNPRM, including comment on the IRFA. The Commission received no 
comments on the IRFA. Because the Commission amends its rules in this 
Fourth Report and Order (Order), the Commission has included this Final 
Regulatory Flexibility Analysis (FRFA). This present FRFA conforms to 
the RFA.

A. Need for, and Objectives of, the Proposed Rules

    65. In this Order, we revise our rules to continue to address 
ongoing problems in completion of long-distance calls. Specifically, we 
establish intermediate provider service quality standards; modify the 
covered provider safe harbor, and sunset call data recording and 
retention requirements. These actions further implement the Improving 
Rural Call Quality and Reliability Act of 2017 (RCC Act), and to 
continue ``to ensure the integrity of voice communications and to 
prevent unjust or unreasonable discrimination among areas of the United 
States in the delivery of such communications.''
    66. First, we establish service quality standards for intermediate 
providers. Specifically, we require intermediate providers to take 
steps reasonably calculated to ensure that any calls that they handle 
are in fact completed. If an intermediate provider knows, or should 
know, that calls are not being completed to certain areas, the 
intermediate provider may be in violation of this general duty if it 
engages in acts or omissions that allow or effectively allow these 
conditions to persist. Intermediate providers must also ensure that any 
additional intermediate providers to which they hand off calls are 
registered with the Commission.
    67. In addition, with respect to traffic destined for rural areas, 
intermediate providers must actively monitor the performance of any 
directly contracted downstream intermediate provider and, based on the 
results of such monitoring, take steps to address any identified 
performance issues with that provider. The Commission believes these 
rules will effectuate Congress's intent in passing the RCC Act, and 
further the Commission's efforts to ensure that all calls to rural 
areas are completed.
    68. Due to the variety of providers and network technologies that 
may be subject to the Commission's service quality standards, the rules 
set forth in the Order grant intermediate providers compliance 
flexibility, thereby benefitting businesses of all sizes and their 
subscribers. The Order's intermediate provider service quality 
standards parallel those already applicable to covered providers under 
the Second RCC Order and earlier Commission orders and rulings, 
ensuring the Commission's rules effectively address rural call 
completion

[[Page 25702]]

issues while also avoiding unnecessary compliance burdens on 
intermediate providers--particularly those that serve dual roles as 
both covered and intermediate providers.
    69. Second, we add a covered provider safe harbor to comply with 
the RCC Act. The service quality standards adopted in the Order--
pursuant to the RCC Act--apply only to intermediate providers. However, 
the RCC Act's exemption is limited to covered providers. The Order 
therefore clarifies that covered providers qualifying for the safe 
harbor on or before February 26, 2019 will be exempt from the 
intermediate provider service quality rules when serving as 
intermediate providers, provided they maintain their safe harbor 
certification with the Commission. Though the Order maintains the three 
preexisting safe harbor requirements without change, and retains the 
existing recording and retention safe harbor until those requirements 
expire, it adds Sec.  64.2109 to add the application of the safe harbor 
to the Order's newly adopted service quality standards for intermediate 
providers.
    70. Third, as proposed by the Third RCC FNPRM, we sunset the 
covered provider call data recording and retention requirements the 
Commission established in 2013, thus eliminating these requirements one 
year after the effective date of the service quality standards adopted 
in this Order. We conclude that the existing recording and retention 
rules are burdensome on covered providers, and the resulting data, as 
previously prescribed by the Commission, are of limited utility to us 
in discovering the source of rural call completion problems. We further 
conclude that a voluntary recording and retention scheme, using the 
metrics chosen by individual covered providers, will serve to best 
inform covered providers and the Commission of rural call completion 
issues and the best pathway to their resolution. As this will serve to 
effectively remove an information collection burden from all size 
businesses, small businesses should benefit from a removed information 
collection and retention burden as well.

B. Summary of Significant Issues Raised by Public Comments in Response 
to the IRFA

    71. The Commission did not receive comments specifically addressing 
the rules and policies proposed in the IRFA.

C. Response to Comment by the Chief Counsel for Advocacy of the Small 
Business Administration

    72. The Chief Counsel did not file any comments in response to this 
proceeding.

D. Description and Estimate of the Number of Small Entities to Which 
the Proposed Rules Will Apply

    73. The RFA directs agencies to provide a description of, and where 
feasible, an estimate of the number of small entities that may be 
affected by the proposed rules and by the rule revisions on which the 
NPRM seeks comment, if adopted. The RFA generally defines the term 
``small entity'' as having the same meaning as the terms ``small 
business,'' ``small organization,'' and ``small governmental 
jurisdiction.'' In addition, the term ``small business'' has the same 
meaning as the term ``small-business concern'' under the Small Business 
Act. A ``small-business concern'' is one which: (1) Is independently 
owned and operated; (2) is not dominant in its field of operation; and 
(3) satisfies any additional criteria established by the SBA.
    74. Small Businesses, Small Organizations, Small Governmental 
Jurisdictions. Our actions, over time, may affect small entities that 
are not easily categorized at present. We therefore describe here, at 
the outset, three comprehensive small entity size standards that could 
be directly affected herein. First, while there are industry specific 
size standards for small businesses that are used in the regulatory 
flexibility analysis, according to data from the SBA's Office of 
Advocacy, in general a small business is an independent business having 
fewer than 500 employees. These types of small businesses represent 
99.9% of all businesses in the United States which translates to 28.8 
million businesses. Next, the type of small entity described as a 
``small organization'' is generally ``any not-for-profit enterprise 
which is independently owned and operated and is not dominant in its 
field.'' Nationwide, as of 2007, there were approximately 1,621,215 
small organizations. Finally, the small entity described as a ``small 
governmental jurisdiction'' is defined generally as ``governments of 
cities, towns, townships, villages, school districts, or special 
districts, with a population of less than fifty thousand.'' U.S. Census 
Bureau data published in 2012 indicate that there were 89,476 local 
governmental jurisdictions in the United States. We estimate that, of 
this total, as many as 88,761 entities may qualify as ``small 
governmental jurisdictions.'' Thus, we estimate that most governmental 
jurisdictions are small.
    75. Wired Telecommunications Carriers. The U.S. Census Bureau 
defines this industry as ``establishments primarily engaged in 
operating and/or providing access to transmission facilities and 
infrastructure that they own and/or lease for the transmission of 
voice, data, text, sound, and video using wired communications 
networks. Transmission facilities may be based on a single technology 
or a combination of technologies. Establishments in this industry use 
the wired telecommunications network facilities that they operate to 
provide a variety of services, such as wired telephony services, 
including VoIP services, wired (cable) audio and video programming 
distribution, and wired broadband internet services. By exception, 
establishments providing satellite television distribution services 
using facilities and infrastructure that they operate are included in 
this industry.'' The SBA has developed a small business size standard 
for Wired Telecommunications Carriers, which consists of all such 
companies having 1,500 or fewer employees. Census data for 2012 show 
that there were 3,117 firms that operated that year. Of this total, 
3,083 operated with fewer than 1,000 employees. Thus, under this size 
standard, the majority of firms in this industry can be considered 
small.
    76. Local Exchange Carriers (LECs). Neither the Commission nor the 
SBA has developed a size standard for small businesses specifically 
applicable to local exchange services. The closest applicable NAICS 
Code category is Wired Telecommunications Carriers as defined above. 
Under the applicable SBA size standard, such a business is small if it 
has 1,500 or fewer employees. According to Commission data, census data 
for 2012 show that there were 3,117 firms that operated that year. Of 
this total, 3,083 operated with fewer than 1,000 employees. The 
Commission therefore estimates that most providers of local exchange 
carrier service are small entities that may be affected by the rules 
adopted.
    77. Incumbent LECs. Neither the Commission nor the SBA has 
developed a small business size standard specifically for incumbent 
local exchange services. The closest applicable NAICS Code category is 
Wired Telecommunications Carriers as defined above. Under that size 
standard, such a business is small if it has 1,500 or fewer employees. 
According to Commission data, 3,117 firms operated

[[Page 25703]]

in that year. Of this total, 3,083 operated with fewer than 1,000 
employees. Consequently, the Commission estimates that most providers 
of incumbent local exchange service are small businesses that may be 
affected by the rules and policies adopted. Three hundred and seven 
(307) Incumbent Local Exchange Carriers reported that they were 
incumbent local exchange service providers. Of this total, an estimated 
1,006 have 1,500 or fewer employees.
    78. Competitive Local Exchange Carriers (Competitive LECs), 
Competitive Access Providers (CAPs), Shared-Tenant Service Providers, 
and Other Local Service Providers. Neither the Commission nor the SBA 
has developed a small business size standard specifically for these 
service providers. The appropriate NAICS Code category is Wired 
Telecommunications Carriers, as defined above. Under that size 
standard, such a business is small if it has 1,500 or fewer employees. 
U.S. Census data for 2012 indicate that 3,117 firms operated during 
that year. Of that number, 3,083 operated with fewer than 1,000 
employees. Based on this data, the Commission concludes that the 
majority of Competitive LECS, CAPs, Shared-Tenant Service Providers, 
and Other Local Service Providers, are small entities. According to 
Commission data, 1,442 carriers reported that they were engaged in the 
provision of either competitive local exchange services or competitive 
access provider services. Of these 1,442 carriers, an estimated 1,256 
have 1,500 or fewer employees. In addition, 17 carriers have reported 
that they are Shared-Tenant Service Providers, and all 17 are estimated 
to have 1,500 or fewer employees. Also, 72 carriers have reported that 
they are Other Local Service Providers. Of this total, 70 have 1,500 or 
fewer employees. Consequently, based on internally researched FCC data, 
the Commission estimates that most providers of competitive local 
exchange service, competitive access providers, Shared-Tenant Service 
Providers, and Other Local Service Providers are small entities.
    79. We have included small incumbent LECs in this present RFA 
analysis. As noted above, a ``small business'' under the RFA is one 
that, inter alia, meets the pertinent small business size standard 
(e.g., a telephone communications business having 1,500 or fewer 
employees), and ``is not dominant in its field of operation.'' The 
SBA's Office of Advocacy contends that, for RFA purposes, small 
incumbent LECs are not dominant in their field of operation because any 
such dominance is not ``national'' in scope. We have therefore included 
small incumbent LECs in this RFA analysis, although we emphasize that 
this RFA action has no effect on Commission analyses and determinations 
in other, non-RFA contexts.
    80. Interexchange Carriers (IXCs). Neither the Commission nor the 
SBA has developed a definition for Interexchange Carriers. The closest 
NAICS Code category is Wired Telecommunications Carriers as defined 
above. The applicable size standard under SBA rules is that such a 
business is small if it has 1,500 or fewer employees. U.S. Census data 
for 2012 indicate that 3,117 firms operated during that year. Of that 
number, 3,083 operated with fewer than 1,000 employees. According to 
internally developed Commission data, 359 companies reported that their 
primary telecommunications service activity was the provision of 
interexchange services. Of this total, an estimated 317 have 1,500 or 
fewer employees. Consequently, the Commission estimates that the 
majority of IXCs are small entities that may be affected by our rules.
    81. Local Resellers. The SBA has developed a small business size 
standard for the category of Telecommunications Resellers. The 
Telecommunications Resellers industry comprises establishments engaged 
in purchasing access and network capacity from owners and operators of 
telecommunications networks and reselling wired and wireless 
telecommunications services (except satellite) to businesses and 
households. Establishments in this industry resell telecommunications; 
they do not operate transmission facilities and infrastructure. Mobile 
virtual network operators (MVNOs) are included in this industry. Under 
that size standard, such a business is small if it has 1,500 or fewer 
employees. Census data for 2012 show that 1,341 firms provided resale 
services during that year. Of that number, all operated with fewer than 
1,000 employees. Thus, under this category and the associated small 
business size standard, the majority of these prepaid calling card 
providers can be considered small entities.
    82. Toll Resellers. The Commission has not developed a definition 
for Toll Resellers. The closest NAICS Code Category is 
Telecommunications Resellers. The Telecommunications Resellers industry 
comprises establishments engaged in purchasing access and network 
capacity from owners and operators of telecommunications networks and 
reselling wired and wireless telecommunications services (except 
satellite) to businesses and households. Establishments in this 
industry resell telecommunications; they do not operate transmission 
facilities and infrastructure. Mobile virtual network operators (MVNOs) 
are included in this industry. The SBA has developed a small business 
size standard for the category of Telecommunications Resellers. Under 
that size standard, such a business is small if it has 1,500 or fewer 
employees. Census data for 2012 show that 1,341 firms provided resale 
services during that year. Of that number, 1,341 operated with fewer 
than 1,000 employees. Thus, under this category and the associated 
small business size standard, the majority of these resellers can be 
considered small entities. According to Commission data, 881 carriers 
have reported that they are engaged in the provision of toll resale 
services. Of this total, an estimated 857 have 1,500 or fewer 
employees. Consequently, the Commission estimates that the majority of 
toll resellers are small entities.
    83. Other Toll Carriers. Neither the Commission nor the SBA has 
developed a definition for small businesses specifically applicable to 
Other Toll Carriers. This category includes toll carriers that do not 
fall within the categories of interexchange carriers, operator service 
providers, prepaid calling card providers, satellite service carriers, 
or toll resellers. The closest applicable NAICS Code category is for 
Wired Telecommunications Carriers as defined above. Under the 
applicable SBA size standard, such a business is small if it has 1,500 
or fewer employees. Census data for 2012 show that there were 3,117 
firms that operated that year. Of this total, 3,083 operated with fewer 
than 1,000 employees. Thus, under this category and the associated 
small business size standard, the majority of Other Toll Carriers can 
be considered small. According to internally developed Commission data, 
284 companies reported that their primary telecommunications service 
activity was the provision of other toll carriage. Of these, an 
estimated 279 have 1,500 or fewer employees. Consequently, the 
Commission estimates that most Other Toll Carriers are small entities 
that may be affected by rules adopted pursuant to this Order.
    84. Prepaid Calling Card Providers. The SBA has developed a 
definition for small businesses within the category of 
Telecommunications Resellers. Under that SBA definition, such a 
business is small if it has 1,500 or fewer employees. According to the 
Commission's Form

[[Page 25704]]

499 Filer Database, 500 companies reported that they were engaged in 
the provision of prepaid calling cards. The Commission does not have 
data regarding how many of these 500 companies have 1,500 or fewer 
employees. Consequently, the Commission estimates that there are 500 or 
fewer prepaid calling card providers that may be affected by the rules.
    85. Wireless Telecommunications Carriers (except Satellite). This 
industry comprises establishments engaged in operating and maintaining 
switching and transmission facilities to provide communications via the 
airwaves. Establishments in this industry have spectrum licenses and 
provide services using that spectrum, such as cellular services, paging 
services, wireless internet access, and wireless video services. The 
appropriate size standard under SBA rules is that such a business is 
small if it has 1,500 or fewer employees. For this industry, U.S. 
Census data for 2012 show that there were 967 firms that operated for 
the entire year. Of this total, 955 firms had employment of 999 or 
fewer employees and 12 had employment of 1000 employees or more. Thus 
under this category and the associated size standard, the Commission 
estimates that the majority of wireless telecommunications carriers 
(except satellite) are small entities.
    86. The Commission's own data--available in its Universal Licensing 
System--indicate that, as of October 25, 2016, there are 280 Cellular 
licensees that will be affected by our actions today. The Commission 
does not know how many of these licensees are small, as the Commission 
does not collect that information for these types of entities. 
Similarly, according to internally developed Commission data, 413 
carriers reported that they were engaged in the provision of wireless 
telephony, including cellular service, Personal Communications Service, 
and Specialized Mobile Radio Telephony services. Of this total, an 
estimated 261 have 1,500 or fewer employees, and 152 have more than 
1,500 employees. Thus, using available data, we estimate that the 
majority of wireless firms can be considered small.
    87. Wireless Communications Services. This service can be used for 
fixed, mobile, radiolocation, and digital audio broadcasting satellite 
uses. The Commission defined ``small business'' for the wireless 
communications services (WCS) auction as an entity with average gross 
revenues of $40 million for each of the three preceding years, and a 
``very small business'' as an entity with average gross revenues of $15 
million for each of the three preceding years. The SBA has approved 
these definitions.
    88. Wireless Telephony. Wireless telephony includes cellular, 
personal communications services, and specialized mobile radio 
telephony carriers. As noted, the SBA has developed a small business 
size standard for Wireless Telecommunications Carriers (except 
Satellite). Under the SBA small business size standard, a business is 
small if it has 1,500 or fewer employees. According to Commission data, 
413 carriers reported that they were engaged in wireless telephony. Of 
these, an estimated 261 have 1,500 or fewer employees and 152 have more 
than 1,500 employees. Therefore, a little less than one third of these 
entities can be considered small.
    89. Cable and Other Subscription Programming. This industry 
comprises establishments primarily engaged in operating studios and 
facilities for the broadcasting of programs on a subscription or fee 
basis. The broadcast programming is typically narrowcast in nature 
(e.g., limited format, such as news, sports, education, or youth-
oriented). These establishments produce programming in their own 
facilities or acquire programming from external sources. The 
programming material is usually delivered to a third party, such as 
cable systems or direct-to-home satellite systems, for transmission to 
viewers. The SBA has established a size standard for this industry 
stating that a business in this industry is small if it has 1,500 or 
fewer employees. The 2012 Economic Census indicates that 367 firms were 
operational for that entire year. Of this total, 357 operated with less 
than 1,000 employees. Accordingly we conclude that a substantial 
majority of firms in this industry are small under the applicable SBA 
size standard.
    90. Cable Companies and Systems (Rate Regulation). The Commission 
has developed its own small business size standards for the purpose of 
cable rate regulation. Under the Commission's rules, a ``small cable 
company'' is one serving 400,000 or fewer subscribers nationwide. 
Industry data indicate that there are currently 4,600 active cable 
systems in the United States. Of this total, all but eleven cable 
operators nationwide are small under the 400,000-subscriber size 
standard. In addition, under the Commission's rate regulation rules, a 
``small system'' is a cable system serving 15,000 or fewer subscribers. 
Current Commission records show 4,600 cable systems nationwide. Of this 
total, 3,900 cable systems have fewer than 15,000 subscribers, and 700 
systems have 15,000 or more subscribers, based on the same records. 
Thus, under this standard as well, we estimate that most cable systems 
are small entities.
    91. Cable System Operators (Telecom Act Standard). The 
Communications Act also contains a size standard for small cable system 
operators, which is ``a cable operator that, directly or through an 
affiliate, serves in the aggregate fewer than 1 percent of all 
subscribers in the United States and is not affiliated with any entity 
or entities whose gross annual revenues in the aggregate exceed 
$250,000,000.'' There are approximately 52,403,705 cable video 
subscribers in the United States today. Accordingly, an operator 
serving fewer than 524,037 subscribers shall be deemed a small operator 
if its annual revenues, when combined with the total annual revenues of 
all its affiliates, do not exceed $250 million in the aggregate. Based 
on available data, we find that all but nine incumbent cable operators 
are small entities under this size standard. We note that the 
Commission neither requests nor collects information on whether cable 
system operators are affiliated with entities whose gross annual 
revenues exceed $250 million. Although it seems certain that some of 
these cable system operators are affiliated with entities whose gross 
annual revenues exceed $250 million, we are unable at this time to 
estimate with greater precision the number of cable system operators 
that would qualify as small cable operators under the definition in the 
Communications Act.
    92. All Other Telecommunications. ``All Other Telecommunications'' 
is defined as follows: This U.S. industry is comprised of 
establishments that are primarily engaged in providing specialized 
telecommunications services, such as satellite tracking, communications 
telemetry, and radar station operation. This industry also includes 
establishments primarily engaged in providing satellite terminal 
stations and associated facilities connected with one or more 
terrestrial systems and capable of transmitting telecommunications to, 
and receiving telecommunications from, satellite systems. 
Establishments providing internet services or voice over internet 
protocol (VoIP) services via client-supplied telecommunications 
connections are also included in this industry. The SBA has developed a 
small business size standard for ``All Other Telecommunications,'' 
which consists of all such firms with gross annual receipts of $32.5 
million or less. For this category, census data for 2012 show that 
there were 1,442 firms that

[[Page 25705]]

operated for the entire year. Of these firms, a total of 1,400 had 
gross annual receipts of less than $25 million. Consequently, we 
estimate that the majority of All Other Telecommunications firms are 
small entities that might be affected by our action.

E. Description of Projected Reporting, Recordkeeping, and Other 
Compliance Requirements for Small Entities

    93. In implementing the RCC Act, first, the Order establishes 
service quality standards for intermediate providers. Specifically, it 
requires intermediate providers to take steps reasonably calculated to 
ensure that any calls that they handle are in fact completed. Due to 
the variety of providers and network technologies that may be subject 
to the Commission's service quality standards, the rules set forth in 
the Order grant intermediate providers compliance flexibility, thereby 
benefitting subscribers and entities of all sizes.
    94. Second, the Order modifies the covered provider safe harbor to 
comply with the RCC Act. The service quality standards adopted in the 
Order--pursuant to the RCC Act--apply only to intermediate providers. 
However, the RCC Act's exemption is limited to covered providers. The 
Order therefore clarifies that covered providers qualifying for safe 
harbor on or before February 26, 2019 will be exempt from the 
intermediate provider service quality rules when serving as 
intermediate providers, provided they maintain their safe harbor 
certification with the Commission. Though the Order maintains the three 
preexisting safe harbor requirements without change, it modifies Sec.  
64.2107 to reflect removal of the remaining data recording and 
retention requirements originally associated with the safe harbor, and 
the application of the safe harbor to the Order's newly adopted service 
quality standards for intermediate providers. Until the intermediate 
provider registry is established pursuant to the RCC Act, it is unknown 
to the Commission at this time the number of any size entities affected 
by this regulation.
    95. The Order sunsets the remaining covered provider call data 
recording and retention requirements the Commission established in 
2013, thus eliminating these requirements one year after the service 
quality standards in this Order become effective. As this will serve to 
effectively remove any information collection burden from all size 
entities, small entities should benefit from a removed information 
collection and retention burden as well.

F. Steps Taken To Minimize the Significant Economic Impact on Small 
Entities, and Significant Alternatives Considered

    96. 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.
    97. In the Order, the Commission establishes intermediate provider 
service quality standards, modifies the covered provider safe harbor, 
and sunsets call data recording and retention. The Commission also 
directs the Wireline Competition Bureau to seek comment, one year from 
the effective date of the intermediate provider service quality 
standards, on the effectiveness of those standards in addressing rural 
call completion issues.
    98. As the RCC Act mandates, this Order first adopts service 
quality standards for intermediate providers. Specifically, we require 
intermediate providers to take steps reasonably calculated to ensure 
that any calls that they handle are in fact completed. If an 
intermediate provider knows, or should know, that calls are not being 
completed to certain areas, the intermediate provider may be in 
violation of this general duty if it engages in acts or omissions that 
allow or effectively allow these conditions to persist. Intermediate 
providers must also establish processes to monitor their rural call 
completion performance and ensure that any additional intermediate 
providers to which they hand off calls are registered with the 
Commission.
    99. One alternative considered--and declined--is mandating 
compliance with the with the three ATIS best practices as proposed in 
the Third RCC FNPRM, and instead adopt a set of flexible standards for 
intermediate providers based on our rules for covered providers. We 
agree with commenters who argue that mandating compliance with the 
three ATIS best practices may be impractical or unduly burdensome for 
some intermediate providers, particularly those relying on older 
network technologies to provide service. However, the Commission will 
treat intermediate provider compliance with the ATIS best practices as 
a safe harbor demonstrating compliance with our service quality 
standards for intermediate providers of all sizes.
    100. Second, we add the covered provider safe harbor to comply with 
the RCC Act. The service quality standards adopted in the Order--
pursuant to the RCC Act--apply only to intermediate providers. However, 
the RCC Act's exemption is limited to covered providers. The Order 
therefore clarifies that covered providers qualifying for safe harbor 
on or before February 26, 2019 will be exempt from the intermediate 
provider service quality rules when serving as intermediate providers, 
provided they maintain their safe harbor certification with the 
Commission. Though the Order maintains the three preexisting safe 
harbor requirements without change, and retains the existing recording 
and retention safe harbor until those requirements expire, it adds 
Sec.  64.2109 to add the application of the safe harbor to the Order's 
newly adopted service quality standards for intermediate providers. 
Because no small entities have previously filed for safe harbor in this 
proceeding, the Commission is confident the economic impact of this 
change upon small entities is minimal.

V. Procedural Matters

    101. Final Regulatory Flexibility Analysis. As required by the 
Regulatory Flexibility Act of 1980, see 5 U.S.C. 604, the Commission 
has prepared a Final Regulatory Flexibility Analysis (FRFA) of the 
possible significant economic impact on small entities of the policies 
and rules, as proposed, addressed in this Fourth Report and Order. The 
FRFA is set forth in section IV above. The Commission will send a copy 
of this Fourth Report and Order, including the FRFA, to the Chief 
Counsel for Advocacy of the Small Business Administration (SBA).
    102. Paperwork Reduction Act. As the Commission is hereby 
sunsetting the remaining rural call completion data recording and 
retention requirements, thereby eliminating an information collection 
in its entirety, this Fourth Report and Order does not contain new or 
modified information collection requirements subject to the Paperwork 
Reduction Act of 1995 (PRA), Public Law 104-13. In addition, therefore, 
it does not contain any new or modified information collection burden 
for small business concerns with fewer than 25 employees, pursuant to 
the Small Business Paperwork Relief Act of 2002,

[[Page 25706]]

Public Law 107-198, see 44 U.S.C. 3506(c)(4).
    103. Congressional Review Act. The Commission will send a copy of 
this Fourth Report and Order to Congress and the Government 
Accountability Office pursuant to the Congressional Review Act, see 5 
U.S.C. 801(a)(1)(A).
    104. Contact Person. For further information about this rulemaking 
proceeding, please contact Zach Ross, FCC Wireline Competition Bureau, 
Competition Policy Division, Room 5-C211, 445 12th Street SW, 
Washington, DC 20554, at (202) 418-1033 or [email protected].

VI. Ordering Clauses

    105. Accordingly, it is ordered that, pursuant to sections 1, 4(i), 
201(b), 202(a), 217, and 262 of the Communications Act of 1934, as 
amended, 47 U.S.C. 151, 154(i), 201(b), 202(a), 217, and 262, this 
Fourth Report and Order is adopted.
    106. It is further ordered that part 64 of the Commission's rules 
are amended as set forth in the Final Rules.
    107. It is further ordered that, pursuant to Sec. Sec.  1.4(b)(1) 
and 1.103(a) of the Commission's rules, 47 CFR 1.4(b)(1), 1.103(a), 
this Fourth Report and Order shall be effective 30 days after 
publication of a summary in the Federal Register.
    108. It is further ordered that pursuant to the authority contained 
in sections 1, 4(i), 201(b), 202(a), 217, 218, 220(a), 251(a), and 262 
of the Communications Act of 1934, as amended, 47 U.S.C. 151, 154(i), 
201(b), 202(a), 217, 218, 220(a), 251(a), and 262, NTCA's Petition for 
Reconsideration filed on June 11, 2018 in WC Docket No. 13-39 is 
denied.
    109. It is further ordered that pursuant to the authority contained 
in sections 1, 4(i), 201(b), 202(a), 217, 218, 220(a), 251(a), and 262 
of the Communications Act of 1934, as amended, 47 U.S.C. 151, 154(i), 
201(b), 202(a), 217, 218, 220(a), 251(a), and 262, USTelecom's Petition 
for Reconsideration filed on June 11, 2018 in WC Docket No. 13-39 is 
denied.
    110. It is further ordered that the Commission shall send a copy of 
this Fourth Report and Order to Congress and to the Government 
Accountability Office pursuant to the Congressional Review Act, see 5 
U.S.C. 801(a)(1)(A).
    111. It is further ordered that the Commission's Consumer and 
Governmental Affairs Bureau, Reference Information Center, shall send a 
copy of this Fourth Report and Order, including the Final Regulatory 
Flexibility Analysis and Initial Regulatory Flexibility Analysis, to 
the Chief Counsel for Advocacy of the Small Business Administration.

List of Subjects in 47 CFR Part 64

    Communications and common carriers, Reporting and recordkeeping 
requirements, Telecommunications, Telephone.

Federal Communications Commission.
Marlene Dortch,
Secretary.

Final Rules

    For the reasons discussed in the preamble, the Federal 
Communications Commission amends part 64 of title 47 of the Code of 
Federal Regulations as follows:

PART 64--MISCELLANEOUS RULES RELATING TO COMMON CARRIERS

0
1. The authority citation for part 64 continues as follows:

    Authority: 47 U.S.C. 154, 201, 202, 217, 218, 220, 222, 225, 
226, 227, 228, 251(a), 251(e), 254(k), 262, 403(b)(2)(B), (c), 616, 
620, 1401-1473, unless otherwise noted.


0
2. Amend Sec.  64.2103 by adding paragraph (g) to read as follows:


Sec.  64.2103  Retention of call attempt records.

* * * * *
    (g) The provisions of this section shall expire on September 15, 
2020.


0
3. Amend Sec.  64.2107 by adding paragraph (d) to read as follows:


Sec.  64.2107  Reduced recording and retention requirements for 
qualifying providers under the Safe Harbor.

* * * * *
    (d) The provisions of this section shall expire on September 15, 
2020.

0
4. Add Sec.  64.2109 to read as follows:


Sec.  64.2109  Safe harbor from intermediate provider service quality 
standards.

    (a)(1) A covered provider may qualify as a safe harbor provider 
under this subpart if it files, in WC Docket No. 13-39, one of the 
following certifications, signed under penalty of perjury by an officer 
or director of the covered provider regarding the accuracy and 
completeness of the information provided:
    ``I __(name), __(title), an officer of __(entity), certify that 
__(entity) uses no intermediate providers;'' or
    ``I __(name), __(title), an officer of __(entity), certify that 
__(entity) restricts by contract any intermediate provider to which a 
call is directed by __(entity) from permitting more than one additional 
intermediate provider in the call path before the call reaches the 
terminating provider or terminating tandem. I certify that any 
nondisclosure agreement with an intermediate provider permits 
__(entity) to reveal the identity of the intermediate provider and any 
additional intermediate provider to the Commission and to the rural 
incumbent local exchange carrier(s) whose incoming long-distance calls 
are affected by the intermediate provider's performance. I certify that 
__(entity) has a process in place to monitor the performance of its 
intermediate providers.''
    (2) The certification in paragraph (a)(1) of this section must be 
submitted:
    (i) For the first time on or before February 26, 2019; and
    (ii) Annually thereafter.
    (b) The requirements of Sec.  64.2119 shall not apply to 
intermediate provider traffic transmitted by safe harbor qualifying 
covered providers functioning as intermediate providers.

0
5. Add Sec.  64.2119 to subpart V to read as follows:


Sec.  64.2119  Intermediate provider service quality standards.

    Any intermediate provider that offers or holds itself out as 
offering the capability to transmit covered voice communications from 
one destination to another and that charges any rate to any other 
entity (including an affiliated entity) for the transmission must abide 
by the following service quality standards:
    (a) Duty to complete calls. Intermediate providers must take steps 
reasonably calculated to ensure that all covered voice communications 
that traverse their networks are delivered to their destination. An 
intermediate provider may violate this duty to complete calls if it 
knows, or should know, that calls are not being completed to certain 
areas, and it engages in acts or omissions that allow, or effectively 
allow, these conditions to persist.
    (b) Rural call completion performance monitoring. For each 
intermediate provider with which it contracts, an intermediate provider 
shall:
    (1) Monitor the intermediate provider's performance in the 
completion of call attempts to rural telephone companies; and
    (2) Based on the results of such monitoring, take steps that are 
reasonably calculated to correct any identified performance problem 
with the intermediate provider, including removing that provider for 
sustained poor performance.
    (c) Registration of subsequent intermediate providers. Intermediate 
providers shall ensure that any additional intermediate providers to 
which they hand off calls are registered

[[Page 25707]]

with the Commission pursuant to Sec.  64.2115.
[FR Doc. 2019-11267 Filed 6-3-19; 8:45 am]
BILLING CODE 6712-01-P