98-12406. Policies and Rules for Alternative Incentive Based Regulation of Comsat Corporation

[Federal Register Volume 63, Number 90 (Monday, May 11, 1998)]
[Proposed Rules]
[Pages 25811-25812]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 98-12406]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR 61

[IB Docket No. 98-60; FCC 98-78]


Policies and Rules for Alternative Incentive Based Regulation of 
Comsat Corporation

AGENCY: Federal Communications Commission.

ACTION: Notice of proposed rulemaking.

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SUMMARY: The Commission has issued a notice of proposed rulemaking to 
consider replacing traditional rate of return regulation with an 
alternative incentive based regulation plan for Comsat Corporation 
(``Comsat'') with respect to Comsat's provision of INTELSAT switched 
voice, private line and occasional-use video services to those markets 
where the Commission finds it dominant. The Commission believes that 
its current rate of return regulation that would be applicable to 
Comsat's dominant markets may no longer be an efficient or effective 
means of regulating Comsat's rates and may not create adequate 
efficiency incentives for Comsat. Therefore, the Commission invites 
interested parties to file comments in response to the Commission's 
tentative conclusions set forth in the notice of proposed rulemaking 
regarding alternative incentive based regulation for Comsat's dominant 
markets.

DATES: Interested parties may file comments by May 26, 1998 and reply 
comments by June 5, 1998.

ADDRESSES: Office of the Secretary, Federal Communications Commission, 
1919 M Street, NW., Washington, D.C. 20554.

FOR FURTHER INFORMATION CONTACT: Daniel Connors, International Bureau, 
Satellite Policy Branch, [phone]; or Kathleen Campbell, 
International Bureau, Satellite Policy Branch [phone].

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Notice 
of Proposed Rulemaking in IB Docket No. 98-60 that is contained in the 
Commission's Order and Notice of Proposed Rulemaking; FCC 98-78, 
adopted April 24, 1998, and released April 28, 1998. The complete text 
of the Order and Notice of Proposed Rulemaking is available for 
inspection and copying during normal business hours in the FCC 
Reference Center (Room 239), 1919 M Street, NW. Washington, D.C., and 
from the Commission's world-wide-web page on the Internet (http://
www.fcc.gov), and also may be purchased from the Commission's copy 
contractor, International Transcription Service, [phone], 2100 M 
Street, NW., Suite 140, Washington, D.C. 20037. Because this Notice of 
Proposed Rulemaking contains information collections that affect less 
than 10 persons and, therefore, is not subject to the Paperwork 
Reduction Act of 1995, Public Law 104-13. As required by section 603 of 
the Regulatory Flexibility Act, the Commission has prepared an Initial 
Regulatory Flexibility Certification certifying that the proposed rule 
will not impact small entities.
    1. The Initial Regulatory Flexibility Certification necessary to 
comply with the Regulatory Flexibility Act, 5 U.S.C. Sec. 601 et seq., 
is set forth below.
    2. The Paperwork Reduction Act does not apply to the rules adopted 
herein because such rules apply to less than 10 persons.

Initial Regulatory Flexibility Certification

    3. The Regulatory Flexibility Act (``RFA'') requires that an 
initial regulatory flexibility analysis 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.'' U.S.C. Sec. 605(b). The RFA 
generally defines ``small entity'' as having the same meaning as the 
terms ``small business,'' ``small organization,'' and ``small 
governmental jurisdiction.'' Id. Sec. 601(6). In addition, the term 
``small business'' has the same meaning as the term ``small business 
concern'' under the Small Business Act. Id. Sec. 601(3). A small 
business concern is one which: (a) is

[[Page 25812]]

independently owned and operated; (b) is not dominant in its field of 
operation; and (c) satisfies any additional criteria established by the 
Small Business Administration (``SBA''). See 15 U.S.C. Sec. 632.
    4. The Order and Notice of Proposed Rulemaking is an order 
reclassifying Comsat as a non-dominant common carrier in certain 
INTELSAT markets. The Order and Notice of Proposed Rulemaking contains 
a notice of proposed rulemaking (``Notice``) proposing rules that will 
apply to Comsat. The Notice indicates that the Commission will consider 
replacing the current rate of return regulations applicable to Comsat's 
INTELSAT switched voice, private line and occasional-use video services 
in the markets, where Comsat continues to be subject to dominant common 
carrier regulation, with an alternative form of incentive based 
regulation similar to a price cap. The Notice tentatively concludes: 
(a) that any alternative incentive based regulation plan that the 
Commission adopts for Comsat with respect to its services in dominant 
markets remain in effect for an indefinite period of time, rather than 
expiring after three years; and (b) that any alternative incentive 
based regulation plan that the Commission adopts for Comsat with 
respect to its services in dominant markets allow all users of Comsat's 
service in dominant markets to benefit from a competitive or 
``transaction'' rate rather than the non-discounted tariffed rate that 
would result from Comsat's uniform pricing commitment. The Notice 
invites Comsat and other interested parties to comment on these 
tentative conclusions. If commenters believe that the proposed rules 
discussed in the in Notice require additional RFA analysis, they should 
include a discussion of this in their comments.
    5. The Commission has not developed a definition of small entities 
applicable to satellite service licensees. Therefore, the applicable 
definition of small entity is the definition under the SBA rules 
applicable to Communications Services ``Not Elsewhere Classified.'' 
This definition provides that a small entity is one with $11 million or 
less in annual receipts. 13 CFR Sec. 121.201. The proposed rules will 
apply only to Comsat's INTELSAT services in markets where the 
Commission finds Comsat dominant. Comsat's 1996 INTELSAT revenues were 
in excess of $11 million. Thus, Comsat does not qualify as a small 
entity under the SBA's definition. We therefore certify that the 
proposed rules in this Notice will not apply to any small entities.
    6. The Commission's Office of Public Affairs, Reference Operations 
Division, will send a copy of this Notice, including this 
certification, to the Chief Counsel for Advocacy of the SBA.

List of Subjects in 47 CFR 61

    Satellites.
Federal Communications Commission.
Magalie Roman Salas,
Secretary.
[FR Doc. 98-12406 Filed 5-8-98; 8:45 am]
BILLING CODE 6712-01-F