02-26238. Implementation of Section 402(b)(1)(A) of the Telecommunications Act of 1996

AGENCY:

Federal Communications Commission.

ACTION:

Final rule.

SUMMARY:

In this document the Commission declined to revise its streamlined tariff procedures in the manner requested by the AT&T Corporation, MCI Telecommunications Corporation, and Southwestern Bell Telephone Company. The intended effect of this document is to maintain the existing Commission rules regarding the filing of tariffs on a streamlined basis.

FOR FURTHER INFORMATION CONTACT:

Joi Roberson Nolen, Wireline Competition Bureau, 202-418-1537.

SUPPLEMENTARY INFORMATION:

In this document, the Commission denies the petitions for reconsideration filed by AT&T Corporation (AT&T), MCI Telecommunications Corporation (MCI), and Southwestern Bell Telephone Company (SWBT) (hereinafter “the petitioners”) regarding the Commission's 1997 Streamlined Tariff Report and Order, 12 FCC Rcd 2170 (1997), 62 FR 5757-03, February 7, 1997. The Commission also denies the requests for clarification filed by AT&T and MCI. The Streamlined Tariff Report and Order implemented amendments to section 204(a) of the Communications Act (Act) made by the Telecommunications Act of 1996 (1996 Act). Specifically, the 1996 Act allowed local exchange carriers (LECs) to file new or revised charges, classifications, regulations or practices with the Commission on a streamlined basis. See 47 U.S.C. 204(a)(3). In particular, the Streamlined Tariff Report and Order implemented the “deemed lawful” tariff provisions that the 1996 Act added to section 204(a)(3) of the Act. AT&T and MCI sought reconsideration of the Commission's conclusion that “deemed lawful” status confers a conclusive presumption of lawfulness. In their petitions, AT&T and MCI assert that the Commission should have interpreted the phrase “deemed lawful” as creating a rebuttable presumption, i.e., a tariff filed on a streamlined basis that becomes effective without suspension and investigation is presumed lawful, but that presumption may be rebutted. In support of their position, AT&T and MCI argue that the “deemed lawful” language in section 204(a)(3) is ambiguous. Subsequent to the filing of the petitions for reconsideration, the United States Court of Appeals for the District of Columbia Circuit considered the meaning of “deemed lawful” in section 204(a)(3) in the context of a section 208 complaint case. ACS of Anchorage, Inc. v. FCC, 290 F. 3d 406, 412 (D.C. Cir. 2002). The court focused on whether there was a distinction to be made between rates and rates of return for determining whether the deemed lawful standard was applicable to the case. In this context, however, the court specifically considered the Commission's statements in the Streamlined Tariff Report and Order that the term “deemed lawful” was “unambiguous” in the “consistent” interpretation of the courts. Id. That consideration led the court to say, “[t]his being so [that case law consistently found deemed lawful to be unambiguous], we find section 204(a)(3) equally unambiguous in banning refunds purportedly for rate-of-return violations.” Id. Given the court's conclusion, the Commission cannot adopt the reading urged by AT&T and MCI. The Commission thus denies the petitions filed by AT&T and MCI with respect to this issue.

The Commission also, however, denies SWBT's petition with respect to the issue of the Commission's interpretation of “deemed lawful.” In its petition, SWBT asserts that “deemed lawful” creates a safe harbor in which LECs can operate without fear of an attack on their rates or other provisions once the tariffs become effective. The court's holding was limited to the question of refund liability for rates that were “deemed lawful'; it in fact acknowledged that the Commission might order prospective relief “[i]f a later reexamination shows them to be unreasonable.” See ACS of Anchorage, Inc. v. FCC, 290 F. 3d at 411. Therefore, a rate that is deemed lawful within the meaning of section 204(a)(3) may be the subject of a complaint alleging that the rate has become unjust and unreasonable, and the Commission by order may prescribe a new rate to be effective prospectively, even if the Commission can not require a carrier to make refunds. The Commission also denies reconsideration and clarification of a number of other issues related to streamlined tariff filings.

Accordingly, it is ordered, pursuant to sections 1, 2, 4(i), 4(j), 201-205, and 405 of the Act of 1934, as amended, 47 U.S.C. 151, 152, 154(i), 154(j), 201-205, and 405, that the petitions for reconsideration filed by AT&T Corp., MCI Communications Corp., and Southwestern Bell Telephone Company are hereby denied.

List of Subjects

47 CFR Part 1

• Administrative Practices and Procedures
• Communications common carriers
• Telecommunications

47 CFR Part 61

• Access Charges
• Communications common carriers
• Telephone

47 CFR Part 69

• Communications common carriers
• Telephone

Federal Communications Commission.

Marlene H. Dortch,

Secretary.