International Markets & Team Telecom

Editor’s note:  CommLaw Monitor primarily addresses developments in communications and technologies in the United States. We provide this special update regarding new regulations in Germany for the benefit of U.S. and foreign service providers alike. The security issues discussed below may have implications for all service providers.

The German Federal Network Agency, Bundesnetzagentur (BNetzA), recently launched a final public consultation on its new draft Catalogue on security requirements for telecommunications service providers and operators of public telecommunications networks. The draft is revamped significantly, but follows the same vein as its predecessors to prevent disruptions and manage security risks, by requiring providers and operators to implement technical security measures and safeguards for operating telecommunications and data processing systems. The deadline for comments on this version 2.0 of the Catalogue is 13 November 2019, but the BNetzA is unlikely to make fundamental changes at this late stage. Consequently, stakeholders should consider the draft as a reliable indicator of the official version, and assess how to best satisfy the requirements.


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The FCC plans to prohibit the use of Universal Service Fund (“USF”) support to purchase equipment or services from foreign entities that it determines pose national security risks at its next meeting scheduled for November 19, 2019. As we previously reported, the ban may severely impact participants in all federal USF programs and involve a costly “rip and replace” process to remove foreign-made equipment from domestic telecommunications networks. The FCC also expects to move forward on its heavily-anticipated E911 vertical accuracy (i.e., z-axis) proceeding and adopt new requirements for wireless carriers to better identify caller locations in multi-story buildings. Rounding out the major actions, the FCC anticipates proposing new rules for suspending and debarring entities from participating in USF and other funding programs; removing longstanding unbundling and resale requirements for certain telecommunications services; and widening the contribution base for the Internet Protocol Captioned Telephone Service (“IP CTS”) to include intrastate revenues.

The draft items cover the gamut of telecommunications issues, affecting everything from the construction of next-generation 5G networks to legacy intercarrier competition rules, and should be closely watched. You will find more details on the most significant November FCC meeting items after the break:


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On Friday, October 4, 2019, Federal Communications Commission (“FCC”) Chairman Ajit Pai circulated a draft Report and Order (“Order”) that would adopt two uncontroversial changes to the FCC’s tariff filing requirements. Specifically, a 2018 Notice of Proposed Rulemaking and Interim Waiver Order (“Notice”) teed up the potential elimination of the requirement to file annual short form tariff review plans (“short form TRP”) and of the prohibition on tariff cross-references. That 2018 Notice also granted an interim waiver of the tariff cross-reference prohibition while the short form TRP has been the subject of separate waivers for each of the past few years. As a result, the proposed Order essentially would simply be codifying the regulatory status quo.

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Last week, the FCC announced its tentative agenda for its upcoming October 25, 2019 open meeting and released drafts of the items on which the commissioners will vote. There is a notable lack of a spectrum item on the agenda, as Chairman Pai does not appear ready yet to address the pending mid-band spectrum proceedings (including C-Band and 6 GHz). In addition, while the items will address themes that have been consistent throughout Ajit Pai’s chairmanship, like bridging the digital divide and removing unnecessary regulatory burdens, there does not appear to be a particular common theme among the items on the agenda. We have not been able to come up with a way to weave a Halloween theme into the agenda either, but at least the Chairman’s blog did take time out to wish the Nationals good luck in their series with the Dodgers. Those well wishes appear to have paid off!

You will find more details on some of the most significant October meeting items after the break:


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FCC regulatory fees for FY 2019 must be paid by September 24, 2019, under an order issued by the agency earlier this week. Federal law requires the FCC to assess regulatory fees each year to cover its operating costs (thus, the agency is largely self-funding). The FCC plans to collect a total of $339 million in fees for FY 2019, representing about a 5 percent increase from FY 2018. Beyond providing the specific fees due, the order offers important guidance for entities seeking fee waivers or dealing with bankruptcy or license transfers. While most services saw only slight fee increases, the significant fee jump for certain industry sectors led Commissioner O’Rielly to push for new restraints on agency spending. As the FCC collects its regulatory fees across all regulated services, any decline in fees for one service necessarily means increased fees for others. In light of this “zero sum” game, all service providers should carefully examine the impact of the order on their business and the potential for future reforms.

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On August 1, the FCC took another step in its ongoing effort to combat deceptive and unlawful calls to consumers. This action once again sets its sights on a common target:  concealment or alteration of the originating number on a communication. This practice is known as “spoofing” and, when conducted with an intent to cause harm to consumers, is unlawful. In the August 1 Report and Order, the FCC amended its Truth In Caller ID rules to expand anti-spoofing prohibitions to foreign-originated calls and text messaging services.

Once these rules take effect, the FCC closes a significant gap in its prior rules – calls which originate outside the United States – at the same time that it acts preemptively to prohibit deceptive spoofing in a growing area – text messaging. In the process, the FCC will enhance one of its most commonly used tools in its effort to combat unlawful robocalls – fines for unlawful spoofing. Generally, the FCC has attacked parties that originate unlawful robocalls by fining them for the subsidiary violation of spoofing the unlawful calls. In telecommunications enforcement, spoofing violations are the tax evasion charges to Al Capone’s criminal enterprise.


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Last week, the U.S. Bureau of Industry & Security (BIS) added Chinese telecommunications giant Huawei and its non-U.S. affiliates to the U.S. Entity List. The move by the U.S. export control regulator broadly prohibits U.S. and non-U.S. persons from providing the listed Huawei entities with any “items” that are “subject to” BIS’s Export Administration Regulations (EAR).

The sanctions could have a serious impact on Huawei and on companies that supply and do business with the firm. Similar sanctions temporarily imposed on ZTE, another Chinese telecommunications firm, last year were referred to as a “death penalty” ban due to the crippling impact it had on ZTE’s operations.


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The FCC is requiring fixed-satellite service (“FSS”) operators to provide the Commission with information about their current use of the 3.7-4.2 GHz band (“C-Band”) by May 28, 2019, according to a Public Notice released jointly earlier this month by the FCC’s International Bureau, Wireless Bureau, and Office of Engineering and Technology. The FCC will use the information to consider potential rules that allow new commercial terrestrial services in the Band while protecting incumbent satellite and earth station operators. The Band is currently allocated to FSS and the fixed service, but the Commission has proposed adding a mobile, except aeronautical mobile, allocation, which would allow commercial wireless providers to operate 5G services in the Band. The amount of spectrum to be reallocated or shared, the extent of protection for incumbents, and the means of protection for incumbents are all, as yet, undetermined, and they are topics of substantial debate among stakeholders.

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The FCC plans to bar a Chinese telecommunications provider from offering international telecommunications service between the United States and foreign points based on national security concerns at its next open meeting scheduled for May 9, 2019. Under a draft Order released last week, the agency would conclude that China Mobile International USA (“China Mobile USA” or the “Company”) is ultimately controlled by the Chinese government and subject to Chinese government exploitation, influence, and control that could undermine the security and reliability of U.S. networks. The denial of China Mobile USA’s application would mark the first time the FCC has rejected an application to access the U.S. market based on national security concerns raised by the group of federal Executive Branch agencies commonly known as “Team Telecom.” The denial also would represent another salvo in the FCC’s recent efforts to combat network security and corporate espionage issues involving foreign-owned carriers. While the proposed action against China Mobile USA likely will not affect foreign carrier investment or access to the U.S. telecommunications market overall, it serves as a reminder of the barriers foreign-owned telecommunications providers (and particularly those with ties to China) may face when dealing with the FCC.

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