Earlier this month, the FCC simplified the information that must be provided in certain international reports, action that should be welcomed by many carriers that have been subject to these reporting requirements. The FCC’s Second Report and Order (“Second Streamlining Order”) in IB Docket No. 04-112 built on its May 2011 First Report and Order and Further Notice of Proposed Rulemaking eliminating or revising certain international reporting obligation. As a result of this latest action, most international telecommunications carriers will be required, once the new rules take effect, to file annual International Traffic and Revenue reports and Circuit Status reports (collectively, the “Annual International Reports”) under a streamlined Section 43.62 of the FCC’s Rules. The Second Streamlining Order directs the International Bureau to establish and maintain a consolidated filing manual reflecting the rulings in the Second Streamlining Order.
The Second Streamlining Order does impose requirements on some new classes of providers. It extends the requirement to file the Traffic and Revenue Report to providers of both international interconnected Voice over Internet Protocol (“VoIP”) service and international “one-way” VoIP services. One-way VoIP services are those VoIP providers that permit users either to receive calls from or place calls to the public switched telephone network, but not both. The Second Streamlining Order also requires for the first time a Circuit Status report from all submarine cable licensees, not just licensees that are common carriers, as well as for international common carrier terrestrial and satellite circuits of facilities-based common carriers and the non-common carrier circuits of satellite operators.
The Annual International Reports will retain their current separate filing deadlines — March 31 for the Circuit Status Report and July 31 of the Traffic and Revenue Report. The effective date of the rule changes is currently unknown; it is at present unclear if the requirements will go into effect in time for the filing of either of the International Reports this year. The Office of Management and Budget must first approve the reporting and filing changes. The FCC expressly directed parties in the Second Streamlining Order to continue filing the Annual International Reports pursuant to its existing rules until it announces the new reporting requirements have become effective.
A host of other changes were made to the Traffic and Revenue reporting requirements, including, among others, use of specific Commission-created filing schedules; a requirement to disaggregate world-total international calling services (“ICS”) traffic and revenue data for specific customer categories and routing arrangements (for example, residential and mass market, reoriginated foreign traffic, and U.S. resellers); a requirement to report circuit and revenue data for private line service provided over resold circuits only on a world-total basis; a requirement to report on international private line services only in terms of total 64 kbps-equivalents; and a requirement to disaggregate data, for minutes and settlement payments, between calls terminated on fixed line networks and those terminated on mobile networks when the termination rates are different. Under the new rules, filers will be required to file any revisions or corrections to their Traffic and Revenue reports by October 31 in the filing year for any values with errors exceeding one percent (1%). Those U.S. International Service Providers that do not provide facilities-based ICS and have less than $5 million in revenues from ICS resale will not be required to include resale-ICS on their annual Traffic and Revenue Report.
The Second Streamlining Order extended the Circuit Status reporting requirements beyond common carriers. Under the new rules, the international common carrier terrestrial and satellite circuits of facilities-based common carriers and the non-common carrier circuits of satellite operators must be reported. At the same time, the Commission also streamlined the Circuit Status reporting obligations for affected parties by eliminating the requirements to report on the destination of circuits or the number of idle circuits. International terrestrial and satellite circuit providers that must file will now need to report only world totals of aggregate active 64 kbps terrestrial and satellite circuits.
The Second Streamlining Order made changes that will require Circuit Status reports to be filed for all submarine cable capacity, not just capacity used for common carrier services. Consequently, all cable landing licensees (both common carrier and non-common carrier licensees) and those common carriers with capacity on international submarine cables will be required to report on both available and planned capacity on all such circuits.
You can read our full client advisory on the Second Streamlining Order here.