65FR38214 Clarification of the Commission's Rules Regarding Use of Combinations of Unbundled Network Elements To Provide Exchange Access Service
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Posting-number: Volume 65, Issue 119, Page 38214
[Federal Register: June 20, 2000 (Volume 65, Number 119)]
[Rules and Regulations]
[Page 38214-38216]
From the Federal Register Online via GPO Access [wais.access.gpo.gov]
[DOCID:fr20jn00-15]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 51
[CC Docket No. 96-98; FCC 00-183]
Clarification of the Commission's Rules Regarding Use of
Combinations of Unbundled Network Elements To Provide Exchange Access
Service
AGENCY: Federal Communications Commission.
ACTION: Final rule; clarification.
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SUMMARY: This document clarifies certain requirements regarding the
obligation of incumbent local exchange carriers to provide combinations
of unbundled network elements to competitive telecommunications
carriers for the provision of exchange access service. This action is
needed to clarify the requirements that the Commission adopted in the
Supplemental Order in this docket, and is also intended to provide the
telecommunications industry with more clearly defined standards for
using such combinations.
DATES: Effective June 20, 2000.
FOR FURTHER INFORMATION CONTACT: Jodie Donovan, Attorney Advisor,
Policy and Program Planning Division, Common Carrier Bureau, (202) 418-
1580.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's
Supplemental Order Clarification in CC Docket No. 96-98, FCC 00-183,
adopted May 19, 2000 and released June 2, 2000. On November 5, 1999,
the Commission released the Third Report and Order and Fourth Further
Notice of Proposed Rulemaking (FNPRM) in this docket (65 FR 2367, Jan.
14, 2000; 65 FR 2542, Jan. 18, 2000). On November 24, 1999, the
Commission released a Supplemental Order (65 FR 2367, 2368, Jan. 14,
2000; 65 FR 2542, 2547, Jan. 18, 2000) that modified the Third Report
and Order and Fourth FNPRM with regard to the ability of requesting
carriers to use combinations of unbundled network elements to provide
exchange access service prior to resolution of the Fourth FNPRM. The
Supplemental Order Clarification clarifies certain requirements
contained in the Supplemental Order. The complete text of the
Supplemental Order Clarification is available for inspection and
copying during normal business hours in the FCC Reference Information
Center, Courtyard Level, 445 12th Street, SW, Washington, DC, and also
may be purchased from the Commission's copy contractor, International
Transcription Services (ITS, Inc.), CY-B400, 445 12th Street, SW,
Washington, DC. It is also available on the Commission's website at
http://www.fcc.gov.
Synopsis of the Supplemental Order Clarification
1. The Commission adopts a Supplemental Order Clarification in CC
Docket No. 96-98 regarding the obligation of incumbent local exchange
carriers (LECs) to provide access by competitive LECs to unbundled
loop-transport combinations for the provision of exchange access
service. This order is needed to clarify certain requirements that the
Commission adopted in the Supplemental Order in this docket (65 FR
2542, 2547, Jan. 18, 2000).
2. In particular, this document extends the temporary constraint
identified in the Supplemental Order in CC Docket No. 96-98 while the
Commission compiles an adequate record in the Fourth FNPRM (65 FR 2367,
Jan. 14, 2000) regarding the ability of requesting carriers to use
unbundled loop-transport combinations as a substitute for the incumbent
LECs' special access service. Until the Commission resolves the issues
in the Fourth FNPRM, interexchange carriers (IXCs) may not substitute
an incumbent LEC's unbundled loop-transport combinations for special
access services unless they provide a significant amount of local
exchange service, in addition to exchange access service, to a
particular customer. This temporary constraint does not apply to stand-
alone loops. By issuing the Supplemental Order Clarification, the
Commission does not decide any of the substantive issues contained in
the Fourth FNPRM.
3. The primary issue on which the Commission must build an adequate
record concerns its identification of the network elements that
``should be made available'' for purposes of 47 U.S.C. section
251(d)(2). In considering whether loop-transport combinations meet the
``impair'' standard in section 251(d)(2), the Commission must determine
whether the local exchange and exchange access markets, although
legally distinct, are otherwise interrelated from an economic and
technological perspective, such that a finding that a network element
meets the ``impair'' standard for the local exchange market would
itself entitle competitors to use that network element solely or
primarily in the exchange access market. Unless the Commission finds
that these markets are inextricably interrelated in these other
respects, it is unlikely that Congress intended to compel the
Commission, once it determines that a network element meets the
``impair'' standard for the local exchange market, to grant competitors
access--for that reason alone, and without further inquiry--to that
same network element solely or primarily for use in the exchange access
market.
4. The Commission extends the temporary constraint so that it may
take into account the market effects of its new unbundling rules (65 FR
2542, Jan. 18, 2000) as it conducts its ``impair'' analysis for special
access service, and must allow a meaningful period of time to elapse
from the date on which those new rules became effective. The Commission
will therefore issue a Public Notice in early 2001 to gather evidence
on this issue so that it may then resolve it expeditiously. In
addition, the Commission and the parties need more time to evaluate the
issues raised in the record in the Fourth FNPRM.
5. To reduce uncertainty for incumbent LECs and requesting carriers
and to maintain the status quo while the Commission reviews the issues
[[Page 38215]]
contained in the Fourth FNPRM, it defines more precisely the
``significant amount of local exchange service'' that a requesting
carrier must provide in order to obtain unbundled loop-transport
combinations. These definitions provide a safe harbor that allows the
Commission to preserve the status quo while it examines the issues in
the Fourth FNPRM in more detail, while still allowing carriers to use
combinations of unbundled loop and transport network elements to
provide local exchange service.
6. The Commission finds that a requesting carrier is providing a
``significant amount of local exchange service'' to a particular
customer if it meets one of three alternative definitions. The
Commission notes that traffic is considered to be local under these
definitions if it is defined as such in a requesting carrier's state-
approved local exchange tariff and/or it is subject to a reciprocal
compensation arrangement between the requesting carrier and the
incumbent LEC: (1) The requesting carrier certifies that it is the
exclusive provider of an end user's local exchange service. The loop-
transport combinations must terminate at the requesting carrier's
collocation arrangement in at least one incumbent LEC central office.
This option does not allow loop-transport combinations to be connected
to the incumbent LEC's tariffed services, or (2) The requesting carrier
certifies that it provides local exchange and exchange access service
to the end user customer's premises and handles at least one third of
the end user customer's local traffic measured as a percent of total
end user customer local dialtone lines; and for DS1 circuits and above,
at least 50 percent of the activated channels on the loop portion of
the loop-transport combination have at least 5 percent local voice
traffic individually, and the entire loop facility has at least 10
percent local voice traffic. When a loop-transport combination includes
multiplexing (e.g., DS1 multiplexed to DS3 level), each of the
individual DS1 circuits must meet this criteria. The loop-transport
combination must terminate at the requesting carrier's collocation
arrangement in at least one incumbent LEC central office. This option
does not allow loop-transport combinations to be connected to the
incumbent LEC's tariffed services, or (3) The requesting carrier
certifies that at least 50 percent of the activated channels on a
circuit are used to provide originating and terminating local dialtone
service and at least 50 percent of the traffic on each of these local
dialtone channels is local voice traffic, and that the entire loop
facility has at least 33 percent local voice traffic. When a loop-
transport combination includes multiplexing (e.g., DS1 multiplexed to
DS3 level), each of the individual DS1 circuits must meet this
criteria. This option does not allow loop-transport combinations to be
connected to the incumbent LEC's tariffed services. Under this option,
collocation is not required.
7. The Commission clarifies that the definitions described above
provide a reasonable threshold for determining whether a carrier has
taken affirmative steps to provide local service. There may be
extraordinary circumstances under which a requesting carrier is
providing a significant amount of local exchange service but does not
qualify under any of the three definitions. In such a case, the
requesting carrier may always petition the Commission for a waiver of
the safe harbor requirements under its existing rules.
8. The Commission does not eliminate the prohibition on ``co-
mingling'' (i.e. combining loops or loop-transport combinations with
tariffed special access services) in the local usage definitions
discussed. It is not persuaded on this record that removing this
prohibition would not lead to the use of unbundled network elements by
interexchange carriers solely or primarily to bypass special access
services. The Commission also emphasizes that the co-mingling
determinations that it makes in this order do not prejudge any final
resolution on whether unbundled network elements may be combined with
tariffed services. The Commission will seek further information on this
issue in the Public Notice that we will issue in early 2001.
9. The Commission also clarifies that incumbent LECs must allow
requesting carriers to self-certify that they are providing a
significant amount of local exchange service over combinations of
unbundled network elements. The Commission also states that it
continues to believe that the Access Service Request process that
incumbent LECs use to provision access circuits will allow requesting
carriers to avoid material provisioning delays and unnecessary costs to
integrate unbundled loop-transport combinations into their networks,
and expect that carriers will use this process for circuit conversions.
10. In order to confirm reasonable compliance with the local usage
requirements in the Supplemental Order Clarification, the Commission
also finds that incumbent LECs may conduct limited audits only to the
extent reasonably necessary to determine a requesting carrier's
compliance with the local usage definitions. Incumbent LECs requesting
an audit should hire and pay for an independent auditor to perform the
audit, and competitive LECs should reimburse the incumbent if an audit
uncovers non-compliance with the local usage definitions. Incumbent
LECs must provide at least 30 days written notice to a carrier that it
will conduct an audit, and may not conduct more than one audit of the
carrier in any calendar year unless an audit finds non-compliance. At
the same time that an incumbent LEC provides notice of an audit to the
affected carrier, it should send a copy of the notice to the
Commission. The Commission expects that carriers will maintain
appropriate records that they can use to support their local usage
certification, and emphasizes that an audit should not impose an undue
financial burden on smaller requesting carriers that may not keep
extensive records. In the event of an audit of these smaller carriers,
the incumbent LEC should verify compliance using the records that the
carriers keep in the normal course of business.
Procedural Issues: Final Regulatory Flexibility Certification
11. The Regulatory Flexibility Act (RFA) requires that regulatory
flexibility analyses be prepared for notice and comment rulemaking
proceedings, unless the agency certifies that ``the rule will not, if
promulgated, have a significant economic impact on a substantial number
of small entities.'' See 5 U.S.C. 605(b). The RFA generally defines
``small entity'' as having the same meaning as the terms ``small
business,'' ``small organization,'' and ``small governmental
jurisdiction.'' See 5 U.S.C. 601(6). In addition, the term ``small
business'' has the same meaning as the term ``small business concern''
under the Small Business Act. See 5 U.S.C. 601(3). 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 Small Business Administration
(SBA). See 15 U.S.C. section 632. SBA rules provide that for
establishments providing ``Telephone Communications Except
Radiotelephone,'' which is Standard Industrial Classification (SIC)
Code 4813, a small entity is one employing no more than 1,500 persons.
12. This Clarification of the Supplemental Order in CC Docket No.
96-98 sets out the criteria under which a requesting carrier may use
combinations of unbundled network
[[Page 38216]]
elements to provide exchange access services. The criteria is
consistent with several of the Commission's findings in the
Supplemental Order. It also extends the date by which the Commission
will resolve its Fourth FNPRM from June 30, 2000. Until resolution of
the Fourth FNPRM, IXCs are prohibited from converting special access
services that they purchase from the Bell Operating Companies or other
incumbent local exchange carriers to combinations of unbundled loops
and transport network elements unless they meet the designated
criteria. This clarification therefore pertains directly to IXCs, and
indirectly to Bell Operating Companies (BOCs), other incumbent local
exchange carriers, competitive local exchange carriers, and competitive
access providers.
13. The Commission certifies that this clarification of the
Supplemental Order will not have a significant economic impact on a
substantial number of small entities because it maintains the status
quo regarding the ability of IXCs to purchase special access services
for a longer period of time. It also maintains the status quo for any
small incumbent local exchange carriers from which interexchange
carriers purchase special access services. The clarification also
allows some limited auditing by incumbent local exchange carriers to
determine whether IXCs that use combinations of unbundled network
elements meet the established criteria in the Order. This limited
auditing will not have a significant economic impact on a substantial
number of small entities because any incumbent LEC that chooses to
voluntarily exercise its limited auditing rights will bear all expenses
associated with any resulting audit. The Commission has also required
that audits be conducted based on the records that a small carrier
keeps in the normal course of business. The Commission will send a copy
of the Supplemental Order Clarification, including a copy of this final
certification, in a report to Congress pursuant to the Small Business
Regulatory Enforcement Fairness Act of 1996, see 5 U.S.C. 801(a)(1)(A).
In addition, the Supplemental Order Clarification and this
certification will be sent to the Chief Counsel for Advocacy of the
Small Business Administration, and will be published in the Federal
Register. See 5 U.S.C. 605(b).
Ordering Clauses
14. Pursuant to authority contained in sections 1,3,4,201-205, 251,
256, 271, and 303(r) of the Communications Act of 1934, as amended, 47
U.S.C. 151, 153, 154, 201-205, 251, 252, 256, 271, 303(r), the
Commission clarifies the Supplemental Order discussed.
15. The requirements in this order will become effective
immediately upon publication in the Federal Register.
16. The Commission's Consumer Information Bureau, Reference
Information Center, SHALL SEND a copy of this Supplemental Order
Clarification, including the Final Regulatory Flexibility
Certification, to the Chief Counsel for Advocacy of the Small Business
Administration.
Federal Communications Commission.
Magalie Roman Salas,
Secretary.
[FR Doc. 00-15576 Filed 6-19-00; 8:45 am]
BILLING CODE 6712-01-P