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 Federal  Communications  Commission  FCC  04-  98 
 Before  the  Federal  Communications  Commission 
 Washington,  D.  C.  20554 
 In  the  Matter  of 
 Review  of  Part  15  and  other  Parts  of  the  Commissions  Rules 
 )  ) 
 )  ) 
 )  ) 
 ET  Docket  No.  01-  278  RM-  9375 
 RM-  10051 


 THIRD  REPORT  AND  ORDER 
 Adopted:  April  15,  2004  Released:  April  23,  2004 
 By  the  Commission:  Chairman  Powell  issuing  a  statement. 
 I.  INTRODUCTION 
 1.  In  this  Third  Report  and  Order,  we  are  adopting  regulations  to  allow  for  operation  of  improved  radio  frequency  identification  (RFID)  systems  in  the  433.5-  434.5  MHz  (  433  MHz)  band. 


 Specifically,  we  are  increasing  the  maximum  permitted  field  strength  and  transmission  duration  for  433  MHz  RFID  systems  used  to  identify  the  contents  of  commercial  shipping  containers  in  commercial  and 
 industrial  areas  to  allow  more  rapid  and  reliable  data  transmission.  Such  improved  RFID  systems  could  benefit  commercial  shippers  and  have  significant  homeland  security  benefits  by  enabling  the  entire 
 contents  of  shipping  containers  to  be  easily  and  immediately  identified,  and  by  allowing  a  determination  of  whether  tampering  with  their  contents  has  occurred  during  shipping. 


 II.  BACKGROUND 
 2.  RFID  systems  use  radio  signals  to  track  and  identify  items  such  as  shipping  containers  and  merchandise  in  stores.  A  system  typically  consists  of  a  tag  mounted  on  the  item  to  be  identified,  and 


 a  transmitter/  receiver  unit  that  interrogates  the  tag  and  receives  identification  data  back  from  the  tag.  The  tag  may  be  a  self-  powered  transmitter,  or  it  may  receive  power  from  the  interrogating  transmitter  and  re-radiate 
 an  RF  signal  to  the  receiver.  RFID  systems  can  operate  in  a  number  of  frequency  bands  under  Part  15  of  the  rules,  such  as  the  13.110-  14.010  MHz  (13.56  MHz)  and  902-  928  MHz  bands.  1  RFID 
 systems  can  also  operate  in  the  40.66-  40.70  MHz  band  and  above  70  MHz.  2 
 3.  On  October  15,  2001,  the  Commission  adopted  a  Notice  of  Proposed  Rule  Making  and  Order  in  this  proceeding  that  proposed  a  number  of  changes  to  Part  15  and  other  parts  of  the  rules.  3 
 These  proposals  were  based  on  recommendations  contained  within  the  Biennial  Regulatory  Review  2000 


 1  See  47  C.  F.  R.    15.225  and  15.249. 
 2  See  47  C.  F.  R.    15.231. 
 3  See  Notice  of  Proposed  Rule  Making  and  Order  in  ET  Docket  No.  01-  278,  (  Notice),  16  FCC  Rcd  18205 
 (2001). 
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 Updated  Staff  Report,  4  staff  recommendations,  and  two  petitions  for  rule  making  concerning  RFID  systems.  5  The  petitions  for  rule  making  were  filed  by  the  National  Council  for  Information  Technology 
 Standardization  Technical  Committee  B10  (  NCITS  B10)  and  Savi  Technology,  Inc.  (Savi).  6  The  NCITS  B10  petition  requested  rule  changes  for  RFID  systems  operating  in  the  13.56  MHz  band,  and  the 
 Savi  petition  requested  rule  changes  for  RFID  systems  operating  at  433  MHz. 
 4.  On  July  12,  2002,  the  Commission  adopted  a  First  Report  and  Order  in  this  proceeding  that  required  radar  detectors  to  comply  with  the  Part  15  emission  limits  for  unintentional  radiators  with 
 regard  to  emissions  in  the  11.7-  12.2  GHz  band  to  protect  very  small  aperture  satellite  terminals  (VSATs)  from  interference.  7  On  June  25,  2003,  the  Commission  adopted  a  Second  Report  and  Order  and 
 Memorandum  Opinion  and  Order  (  Second  Report  and  Order)  that  addressed  many  of  the  issues  raised  in  the  Notice  that  were  not  addressed  in  the  First  Report  and  Order,  including  RFID  systems  operating  in 
 the  13.56  MHz  band.  8  In  the  Second  Report  and  Order,  the  Commission  stated  that  it  would  address  rule  changes  for  radio  frequency  identification  systems  in  the  433  MHz  band  at  a  later  date.  9 


 III.  DISCUSSION 
 5.  Savi  requests  that  the  Commission  modify  the  requirements  in  Section  15.231  of  the  rules  for  RFID  systems  operating  at  433  MHz.  This  section  allows  the  operation  of  intentional  radiators, 


 including  RFID  systems,  in  the  40.66-  40.70  MHz  band  and  at  any  frequency  above  70  MHz,  except  in  designated  restricted  bands.  10  There  are  two  separate  provisions  for  operation  under  this  section.  The 
 first  provision,  in  paragraph  (a)  of  this  rule  section,  contains  operational  requirements  for  devices  that  transmit  control  signals,  such  as  those  used  with  alarm  systems,  door  openers  and  remote  switches.  A 
 device  operated  under  this  paragraph  must  cease  transmission  within  5  seconds  after  being  activated  automatically  or  after  a  manually  operated  switch  is  released.  Continuous  transmissions  such  as  voice 
 and  video  are  not  permitted.  Data  is  permitted  to  be  transmitted  with  a  control  signal.  11  Periodic  transmissions  at  regular  predetermined  intervals  are  not  permitted  except  for  transmissions  of  not  more 


 4  See  The  2000  Biennial  Regulatory  Review  Report  and  Federal  Communications  Commission  Biennial 
 Regulatory  Review  2000  Updated  Staff  Report  (  Updated  Staff  Report),  FCC  00-  456,  dated  January  17,  2001. 
 5  See  National  Council  for  Information  Technology  Standardization  Technical  Committee  B10  (NCITS  B10) 


 petition  for  rule  making  filed  September  4,  1998,  RM-  9375  and  Savi  Technology,  Inc.  (Savi)  petition  for  rule  making  filed  November  22,  2000,  RM  10051. 


 6  See  NCITS  B10  Petition  for  Rule  Making  to  Amend  Section  15.225  of  the  Commissions  Rules,  filed  September 
 10,  1998,  RM-  9375  and  Savi  Technology,  Inc.  (Savi)  petition  for  rule  making  filed  November  22,  2000,  RM-10051. 


 7  See  First  Report  and  Order  in  ET  Docket  No.  01-  278,  17  FCC  Rcd  14063  (2002). 
 8  See  Second  Report  and  Order  and  Memorandum  Opinion  and  Order  in  ET  Docket  No.  01-  278,  18  FCC  Rcd 
 14741  (2003)  (  Second  Report  and  Order). 
 9  See  Second  Report  and  Order  at  14742. 


 10  See  47  C.  F.  R.    15.231. 
 11  The  previous  prohibition  on  data  transmissions  under  this  section  was  removed  in  the  Second  Report  and  Order 
 in  this  proceeding. 
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 than  two  seconds  per  hour  per  transmitter  to  verify  the  integrity  of  security  transmitters  in  a  system.  12  The  second  provision,  in  Section  15.231(  e),  allows  any  type  of  transmission,  including  data  and  transmissions 
 at  regular  periodic  intervals.  However,  the  field  strength  limits  for  devices  operating  under  the  provisions  of  paragraph  (e)  are  lower  than  the  field  strength  limits  for  devices  operating  under  the  provisions  of 
 paragraph  (a).  In  addition,  the  provisions  of  paragraph  (e)  limit  transmissions  to  no  more  than  one  second,  with  a  silent  period  between  transmissions  of  at  least  30  times  the  duration  of  the  transmission, 
 but  in  no  case  less  than  10  seconds.  The  field  strength  limits  for  intentional  radiators  operating  under  either  provision  in  this  section  are  based  on  the  average  value  of  the  measured  emissions.  The  peak  level 
 of  emissions  must  comply  with  a  limit  of  20  dB  (ten  times)  higher  than  emission  limits  specified  in  Section  15.231.  13 


 6.  RFID  devices  such  as  tags  that  send  data  not  associated  with  a  control  signal  are  permitted  to  operate  at  433  MHz  under  the  provisions  of  Section  15.231(  e)  of  the  rules.  14  For  devices 
 operating  at  this  frequency,  the  maximum  permitted  average  field  strength  is  4,383  V/  m  and  the  maximum  permitted  peak  field  strength  is  43,833  V/  m,  measured  at  a  distance  of  3  meters.  15  Devices 
 operating  under  this  section  must  comply  with  the  timing  requirements  described  above  that  limit  transmissions  to  no  more  than  one  second.  16  Transmitters  that  send  a  control  signal  to  interrogate  RFID 
 tags  may  operate  at  the  higher  field  strength  levels  permitted  for  devices  operating  under  Section  15.231(  a),  which  are  an  average  field  strength  of  11,000  V/  m  and  a  peak  field  strength  of  110,000  V/  m 
 at  3  meters  at  a  frequency  of  433  MHz.  17 
 7.  Savi  states  that  is  has  developed  RFID  tags  for  operation  at  433  MHz  because  unlicensed  operation  is  permitted  at  that  frequency  in  many  countries  around  the  world,  and  because  signals 
 propagate  better  through  objects  at  433  MHz  than  at  higher  frequencies  such  as  900  MHz.  Savi  requests  that  the  Commission  increase  the  maximum  field  strength  and  transmission  duration  for  433  MHz  RFID 
 systems  above  the  current  limits  in  Section  15.231(  e).  18  It  states  that  a  rule  change  to  allow  transmissions  of  longer  duration  is  necessary  because  the  current  timing  limit  in  Section  15.231(  e)  results  in  a  slow 
 transfer  of  data  from  the  identification  tag,  and  that  transferring  the  full  128  kilobytes  of  data  needed  to  identify  all  the  contents  of  a  shipping  container  could  take  up  to  30  minutes  under  the  current  rules,  but 
 would  take  no  more  than  two  minutes  with  its  proposed  changes.  Savi  requests  that  the  maximum  transmission  duration  be  increased  to  120  seconds,  while  maintaining  the  current  ten  second  minimum 
 silent  period  between  transmissions.  In  addition,  it  states  that  the  maximum  field  strength  limit  under  Section  15.231(  e)  is  not  sufficient  to  ensure  reliable  transmissions  in  all  circumstances.  It  requests  that 
 the  field  strength  limit  for  433  MHz  RFID  tags  be  increased  to  the  higher  level  permitted  for  control 
 12  The  rules  previously  limited  periodic  transmissions  to  a  single  transmission  of  not  more  than  one  second  per 
 hour.  This  rule  was  changed  in  the  Second  Report  and  Order  to  allow  multiple  transmissions  not  to  exceed  a  total  duration  of  two  seconds  per  hour. 


 13  See  47  C.  F.  R.    15.231(  b)(  2)  and  15.35(  b). 
 14  See  47  C.  F.  R.    15.231(  e). 
 15  Id. 
 16  Id. 
 17  See  47  C.  F.  R.    15.231(  b). 
 18  See  Savi  petition  for  rule  making  dated  November  22,  2000,  RM-  10051. 
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 signals.  Savi  requests  that  the  Commission  implement  the  requested  rule  changes  through  one  of  three  alternatives:  1)  modifying  Section  15.231,  2)  adding  a  new  section  for  RFID  devices  operating  in  the  420- 
 450  MHz  band  that  specifies  higher  field  strength  limits  but  no  timing  restrictions,  or  3)  adding  a  new  section  for  RFID  devices  operating  in  the  425-  435  MHz  band  with  higher  field  strength  limits  and  a  120 
 second  transmission  duration  with  a  ten  second  silent  period  between  transmissions.  Savi  asserts  that  these  changes  would  enable  use  of  improved  RFID  technology  that  would  provide  benefits  including 
 easier  identification  of  the  contents  of  shipping  containers,  the  ability  to  detect  tampering  of  shipping  containers  in  transit  and  improved  inventory  control  at  commercial  facilities. 


 8.  In  the  Notice,  the  Commission  proposed  to  create  a  new  rule  section  for  RFID  systems  operating  in  the  425-  435  MHz  band.  19  The  proposed  rule  would  allow  RFID  tags  to  transmit  data  at  the 
 higher  level  normally  permitted  for  control  signals,  with  an  average  field  strength  of  11,000  V/  m  and  a  peak  field  strength  of  110,000  V/  m  measured  at  a  distance  of  3  meters.  Out-  of-  band  emissions  would 
 have  to  meet  the  current  limit  in  Section  15.209.  The  Commission  proposed  to  limit  transmissions  to  120  seconds  with  at  least  a  10  second  silent  period  between  transmissions,  and  to  permit  retransmissions  in 
 case  of  data  errors.  It  also  proposed  to  allow  powered  tags  and  readers  to  be  approved  either  separately  or  under  a  single  application,  as  proposed  in  the  Notice  for  RFID  devices  operating  in  the  13.56  MHz  band. 
 These  proposals  were  intended  to  allow  greater  range  for  433  MHz  RFID  systems  and  to  allow  data  to  be  transferred  from  an  RFID  tag  more  quickly. 


 9.  Comments  in  favor  of  the  proposal  to  increase  the  field  strength  limit  and  maximum  transmission  duration  for  433  MHz  RFID  devices  were  received  from  Interlogix,  Mattel,  Savi,  and 
 VYTEK  Solutions,  Inc.  (VYTEK).  20  Interlogix  states  that  the  433  MHz  band  is  widely  used  in  Europe  and  other  Region  1  countries  for  radio  control  and  short-  range  operations,  and  that  the  Commission 
 should  consider  raising  the  power  level  in  this  band  to  harmonize  with  the  ITU  regulations.  21  It  believes  that  the  considerable  savings  to  manufacturers  in  producing  one  model  of  device  for  sale  in  both  the 
 United  States  and  Europe  would  enhance  manufacturers  ability  to  better  compete  in  world  markets.  22  VYTEK  states  that  increasing  the  permitted  RFID  device  transmission  time  would  increase  the  utility  of 
 such  devices  by  allowing  them  to  transmit  greater  amounts  of  data.  VYTEK  states  that  this  would  increase  the  efficiency  and  speed  in  handling  materials  and  has  the  potential  for  increasing  throughput  at 
 United  States  ports  without  the  need  for  costly  expansions.  23  Savi  states  that  authorization  of  advanced  RFID  products  would  provide  public  benefits,  including  greater  transfer  of  data,  new  and  more  robust 
 services,  lower  costs,  and  increased  homeland  security.  24  It  states  that  its  system  operates  with  low  power  and  that  operations  will  be  restricted  to  commercial/  industrial  environments  that  severely  restrict 
 propagation.  25 


 19  See  Notice  at  18214. 
 20  See  Interlogix  comments  at  6,  Mattel  comments  at  2,  Savi  comments  at  3-  5  and  VYTEK  comments  at  1-  2. 
 21  See  Interlogix  comments  at  6. 
 22  See  Interlogix  comments  at  6. 
 23  See  VYTEK  comments  at  1-  2. 
 24  See  Savi  comments  at  3-  5. 
 25  See  Savi  comments  at  6-  8. 
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 10.  A  number  of  parties  object  to  the  proposed  rule  changes  for  RFID  systems  in  the  425-  435  MHz  band,  stating  that  such  changes  would  result  in  interference  to  remote  control  door  openers, 
 although  no  parties  provided  an  interference  analysis.  26  Operator  Specialty  Company,  Inc.  (OSCO)  states  that  the  proposed  changes  would  allow  new  devices  of  unproven  reliability  to  overpower  the  signals  of 
 millions  of  existing  door  and  gate  openers  and  render  them  unreliable.  27  Genie  states  that  the  Savi  devices  would  transmit  virtually  a  continuous  signal  that  could  reduce  the  effective  range  of  remote  control 
 transmitters,  and  they  would  most  likely  be  used  outside  commercial  areas,  making  homeowners  remote  controls  inoperative  for  two  minutes  without  an  identifiable  cause.  28  Chamberlain  believes  that  433  MHz 
 RFID  devices  would  interrupt  commercial  and  residential  use  of  access  devices  such  as  door  and  entry  control  systems  and  would  create  interference  on  a  scale  far  beyond  that  typically  introduced  by  new  Part 
 15  devices.  29 
 11.  ARRL  alleges  that  operation  of  unlicensed  RFID  devices  at  433  MHz  will  cause  substantial  interference  to  licensed  amateur  radio  operations  in  the  425-  435  MHz  amateur  band,  which  it 
 states  is  heavily  used  for  terrestrial  weak-  signal  communications  in  most  parts  of  the  country.  30  It  alleges  that  interference  could  occur  to  amateur  operations  even  beyond  1000  meters  from  an  RFID  system.  31 
 ARRL  believes  that  RFID  systems  would  be  used  outside  commercial  areas,  so  that  geographic  separation  could  not  be  relied  upon  for  interference  mitigation.  32  It  claims  that  Savi  could  manufacture  equipment  to 
 operate  in  the  900  MHz  or  2.4  GHz  ISM  bands  for  the  data  throughput  it  needs,  and  that  the  only  basis  for  the  use  of  433  MHz  is  to  reduce  hardware  costs  because  cheaper  components  are  readily  available  for  that 
 frequency.  33  ARRL  does  not  believe  that  global  standardization  of  RFIDs  can  be  achieved  at  433  MHz  because  of  varying  frequency  allocations  between  countries.  34  It  further  claims  that  the  Commission  lacks 
 authority  under  the  Communications  Act  to  authorize  devices  with  a  substantial  potential  for  interference  on  an  unlicensed  basis.  35  It  states  that  the  rationale  for  allowing  unlicensed  devices  under  Part  15  is  based 
 on  the  assumption  that  such  devices  will  not,  in  general,  interfere  with  licensed  radio  services,  and  that  Section  302  of  the  Act,  which  gives  the  Commission  authority  to  regulate  unlicensed  devices,  does  not 
 constitute  an  exception  to  the  license  requirement  in  Section  301.  36  A  large  number  of  comments  were 


 26  See  OSCO  comments  at  1,  Genie  comments  at  1,  Chamberlain  comments  at  3  and  Ademco  comments  at  3. 
 Remote  control  door  openers  may  operate  on  any  frequency  above  70  MHz  except  in  certain  designated  restricted  bands.  They  may  operate  anywhere  within  the  425-  435  MHz  band.  See  47  C.  F.  R.    15.205  and  15.231. 


 27  See  OSCO  comments  at  1. 
 28  See  Genie  comments  at  1. 
 29  See  Chamberlain  comments  at  4-  7. 
 30  See  ARRL  comments  at  11. 
 31  See  ARRL  comments  at  12. 
 32  See  ARRL  comments  at  13. 
 33  See  ARRL  comments  at  15-  16. 
 34  See  ARRL  comments  at  17. 
 35  See  ARRL  comments  at  4. 
 36  See  ARRL  comments  at  7. 
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 also  received  from  individual  amateur  operators  and  groups  of  amateurs  expressing  concerns  similar  to  those  of  ARRL. 
 12.  The  National  Telecommunications  and  Information  Administration  (NTIA)  initially  opposed  the  rule  changes  proposed  in  the  Notice  for  433  MHz  RFID  devices.  It  stated  that  the 
 425-  435  MHz  band  is  within  the  420-  450  MHz  band  that  is  allocated  to  the  Federal  Government  on  a  primary  basis,  and  that  this  band  contains  ground-  based,  shipborne  and  airborne  radars  that  are  essential 
 for  the  nations  homeland  defense.  37  NTIA  claims  that  RFID  devices  operating  under  the  proposed  parameters  would  cause  interference  to  federal  radar  operations  in  the  425-  435  MHz  band.  38  In  response 
 to  the  interference  concerns  raised  by  NTIA,  Savi  states  that  a  number  of  adjustments  could  be  made  to  the  proposed  operational  requirements  that  would  alleviate  NTIAs  interference  concerns  yet  still  allow 
 for  improved  RFID  operation  at  433  MHz.  Specifically,  Savi  states  that  the  following  adjustments  could  be  made:  39 


 1)  Narrow  the  permissible  frequency  band  of  operation  from  425-  435  MHz  to  433-  435  MHz  2)  Lower  the  peak  field  strength  limit  from  110,000  V/  m  to  55,000  V/  m  at  3  meters 
 3)  Reduce  the  maximum  transmission  duration  from  120  seconds  to  60  seconds  4)  Adopt  a  narrower  definition  of  RFID  systems,  including  adding  a  prohibition  on  voice 
 transmissions  5)  Restrict  operation  of  RFID  systems  at  433  MHz  to  commercial  or  industrial  areas 


 13.  After  further  study,  NTIA  concluded  that  RFID  systems  could  be  operated  at  433  MHz  without  interference  to  Federal  Government  radar  systems  if  the  frequency  band  were  further  narrowed, 
 the  conditions  proposed  by  Savi  were  met  and  certain  additional  conditions  were  met.  40  These  modified  and  additional  conditions  are: 


 1)  Narrow  the  permissible  frequency  band  of  operation  to  433.5-  434.5  MHz  2)  Prohibit  operation  within  40  kilometers  of  the  five  Federal  Government  radar  sites  listed  in 
 Appendix  A.  3)  Register  the  locations  where  433  MHz  RFID  systems  operate 


 14.  Based  on  the  record  in  this  proceeding,  we  find  that  the  public  interest  would  be  served  by  allowing  operation  of  improved  433  MHz  RFID  systems.  Accordingly,  we  are  adopting  the  proposal 
 to  increase  the  maximum  field  strength  and  transmission  duration  for  RFID  systems  operating  at  433  MHz,  subject  to  the  requirements  that  NTIA  states  are  necessary  to  prevent  interference  to  Federal 
 Government  radar  systems.  These  changes  will  allow  the  development  of  RFID  systems  with  greater  range  and  faster,  more  reliable  data  transmission.  Such  RFID  systems  could  enable  the  entire  contents  of 
 shipping  containers  to  be  easily  and  immediately  identified,  and  could  interface  with  sensors  that  indicate  whether  tampering  with  a  container  had  occurred  in  shipment.  These  capabilities  could  help  increase 
 homeland  security  and  improve  inventory  control. 
 37  See  letter  from  NTIA  to  the  Chief,  Office  of  Engineering  and  Technology  dated  March  14,  2002. 
 38  See  letter  from  NTIA  to  the  Chief,  Office  of  Engineering  and  Technology  dated  October  15,  2002  at  4. 
 39  See  Savi  ex-  parte  filings  dated  October  28,  2002  and  October  15,  2003. 
 40  See  letters  from  NTIA  to  the  Chief,  Office  of  Engineering  and  Technology  dated  March  18,  2004  and  March  24, 
 2004. 
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 15.  We  are  implementing  these  changes  by  adding  a  new  rule  section  specifically  for  RFID  systems  operating  in  the  band  433.5-  434.5  MHz  that  contains  the  technical  and  operational  requirements 
 for  these  devices.  The  field  strength  limits  will  be  11,000  V/  m  average  and  55,000  V/  m  peak,  measured  at  a  distance  of  3  meters.  The  maximum  permitted  transmission  duration  will  be  60  seconds 
 rather  than  120  seconds  as  proposed  in  the  Notice,  with  a  ten  second  silent  period  between  transmissions.  While  this  change  will  result  in  somewhat  slower  data  transmission  speeds  in  cases  where  all  the  data  in  a 
 device  can  not  be  transmitted  within  60  seconds,  it  represents  a  substantial  improvement  in  speed  over  that  which  the  current  rules  allow.  In  recognition  of  the  fact  that  data  transmission  errors  may 
 occasionally  occur,  re-  transmission  of  data  will  be  permitted  in  case  of  transmission  error  without  the  need  for  a  ten  second  silent  period.  As  proposed  in  the  Notice,  we  are  adopting  the  current  out-  of-  band 
 emission  limits  in  Section  15.209  for  433  MHz  RFID  devices  because  these  limits  have  a  long  and  successful  history  of  controlling  interference. 


 16.  We  recognize  that  the  interference  concerns  raised  with  respect  to  433  MHz  RFID  systems  can  be  largely  ameliorated  by  restricting  the  locations  where  they  operate  and  the  types  of  uses 
 permitted.  Such  restrictions  will  limit  the  use  of  433  MHz  RFID  systems  to  locations  where  they  will  not  operate  in  close  proximity  to  other  users  on  the  same  frequency.  Accordingly,  we  are  restricting 
 operation  under  the  new  RFID  rule  to  the  identification  of  the  contents  of  commercial  shipping  containers.  Voice  communications  will  not  be  permitted.  Further,  we  will  require  that  operations  be  limited  to 
 commercial  and  industrial  areas  such  as  ports,  rail  terminals  and  warehouses.  These  requirements  are  essentially  consistent  with  the  conditions  that  Savi  proposed  and  with  which  NTIA  agreed  that  limit  the  types 
 of  devices  and  their  operating  locations  to  RFID  systems  used  in  commercial  and  industrial  areas.  41  We  do  not  believe  that  these  restrictions  will  inhibit  the  development  of  this  technology  for  important  homeland 
 security  applications.  We  are  permitting  two-  way  operation  by  433  MHz  RFID  devices  as  currently  allowed  for  remote  control  devices.  42  Two-  way  operation  will  make  RFID  devices  more  useful  by  allowing  a  single 
 device  to  both  read  data  from,  and  write  data  to,  remote  devices.  For  example,  an  interrogator  that  reads  data  from  a  tag  in  a  shipping  container  could  also  be  used  to  update  the  data  stored  in  the  tag  when  items 
 are  added  to  or  removed  from  the  container.  As  proposed  in  the  Notice  and  consistent  with  our  actions  in  the  Second  Report  and  Order  for  13.56  MHz  RFID  tags,  we  will  allow  433  MHz  RFID  tags  to  be 
 approved  either  as  part  of  a  system  with  a  tag  reader  under  one  FCC  identification  number,  or  under  separate  FCC  identification  numbers.  Allowing  powered  tags  and  readers  to  be  approved  together  will 
 simplify  the  filing  requirements  in  cases  where  the  devices  are  always  sold  together,  and  permitting  tags  and  readers  to  be  approved  separately  will  provide  increased  flexibility  to  manufacturers  by  permitting 
 the  sale  of  different  combinations  of  tags  and  readers. 
 17.  In  the  Notice,  the  Commission  proposed  to  require  that  433  MHz  RFID  devices  be  self-contained  with  no  external  or  readily  accessible  controls  that  may  be  adjusted  to  cause  operation  out  of 
 compliance  with  the  rules,  and  proposed  to  require  that  devices  have  permanently  attached  antennas  that 
 41  See  Savi  ex-  parte  filing  dated  October  28,  2002  at  3.  Savi  notes  that  their  devices  are  intended  to  be  used  on 
 commercial  shipping  containers.  Id.  at  1. 
 42  Remote  control  devices  are  operated  under  the  provisions  of  Section  15.231  of  the  rules.  This  section  allows 


 periodic  operation  of  devices  in  the  40.66-  40.70  MHz  band  and  any  frequency  above  70  MHz  except  for  the  restricted  bands  of  operation  specified  in  Section  15.205.  See  47  C.  F.  R.    15.205  and  15.231.  Examples  of 


 remote  control  devices  include  garage  door  openers,  keychain  transmitters  for  locking  and  unlocking  car  doors  and  tire  pressure  monitors.  RFID  systems  may  be  operated  under  the  provisions  of  Section  15.231.  This  section 
 allows  either  one-  way  or  two-  way  operation  by  devices. 
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 are  not  readily  modifiable  by  the  user.  43  Upon  further  consideration,  we  find  that  it  is  not  necessary  to  specify  these  requirements  in  the  final  rules.  Section  15.15(  b)  already  prohibits  readily  accessible 
 controls  that  can  cause  a  device  to  operate  in  violation  of  the  rules.  44  Further,  Section  15.203  specifies  that  intentional  radiators  must  have  either  a  permanently  attached  antenna  or  other  means  to  prevent  a 
 user  from  installing  an  antenna  that  causes  a  device  to  operate  in  violation  of  the  rules.  Because  the  existing  rules  provide  adequate  safeguards  against  these  types  of  changes,  the  proposed  requirements 
 concerning  external  adjustments  and  antenna  substitutions  are  not  necessary. 
 18.  NTIA  requests  that  operation  of  433  MHz  RFID  systems  be  prohibited  for  a  distance  of  40  kilometers  around  five  Federal  Government  radar  sites  to  prevent  harmful  interference  to  radar 
 operations.  NTIA  supplied  a  list  of  these  locations  and  their  geographic  coordinates  that  is  shown  in  Appendix  A.  None  of  the  five  sites  are  within  40  kilometers  of  large  metropolitan  areas.  Such  a 
 prohibition  will  still  allow  433  MHz  RFID  tags  to  be  used  in  the  vast  majority  of  commercial  and  industrial  areas  in  the  United  States.  In  light  of  the  need  to  protect  government  radar  operations  from 
 interference,  we  are  prohibiting  433  MHz  RFID  operation  within  40  kilometers  of  these  five  radar  sites.  The  coordinates  of  these  sites  are  specified  in  Appendix  A. 


 19.  NTIA  also  requests  that  the  operating  locations  of  433  MHz  RFID  systems  be  registered  to  assist  in  locating  the  source  of  any  interference  to  Federal  Government  operations  that  may  arise. 
 While  we  generally  do  not  require  users  of  unlicensed  devices  to  register  their  location,  we  have  required  users  of  certain  ultra-  wideband  (UWB)  transmitters  to  do  so  to  protect  Federal  Government  operations 
 from  interference.  Specifically,  we  require  users  of  UWB  imaging  systems  to  supply  operational  details  to  the  Commissions  Office  of  Engineering  and  Technology,  which  submits  this  information  to  NTIA.  45 


 20.  Consistent  with  NTIAs  letter  stating  the  need  to  protect  critical  government  radar  operations  from  interference,  we  are  requiring  grantees  to  register  the  locations  of  users  of  433  MHz 
 RFID  systems  with  the  Commission.  46  Registration  of  433  MHz  RFID  systems  is  not  a  coordination,  pre-approval,  or  licensing  process,  and  it  is  not  intended  to  give  unlicensed  devices  protection  from 
 interference  from  other  unlicensed  devices.  Rather,  registration  will  allow  the  Commission  and  NTIA  to  monitor  the  deployment  of  433  MHz  RFID  systems  and  help  pinpoint  the  source  of  interference  to 
 government  operations  in  case  such  interference  occurs.  The  information  that  the  grantee  must  supply  to  the  Commission  in  registering  the  devices  shall  include  the  name,  address,  telephone  number  and  e-  mail 
 address  of  the  user,  the  address  and  geographic  coordinates  of  the  operating  location,  and  the  FCC  identification  number  of  the  device.  The  user  will  be  responsible  for  submitting  updated  information  in 
 the  event  the  operating  location  or  other  information  changes  after  the  initial  registration.  The  registration  information  must  be  submitted  to  the  Commissions  Office  of  Engineering  and  Technology  at  the  address 
 provided  in  Appendix  A.  The  Commission  will  provide  this  information  to  NTIA.  As  a  condition  of  the  grant,  we  will  require  the  grantee  of  an  equipment  authorization  for  a  433  MHz  RFID  device  to  inform 
 purchasers  of  the  locations  where  the  devices  may  and  may  not  be  used,  i.  e.,  that  they  may  be  used  only  in  commercial  and  industrial  areas,  and  that  they  may  not  be  used  within  40  kilometers  of  the  five  Federal 
 Government  radar  sites  specified  in  the  rules.  We  are  also  requiring  grantees  to  notify  users  of  their 
 43  See  Notice  at  Appendix  A,  proposed  Section  15.240(  d). 
 44  See  47  C.  F.  R.    15.15(  b). 
 45  See  47  C.  F.  R.    15.525(  b). 
 46  See  letter  from  NTIA  to  the  Chief,  Office  of  Engineering  and  Technology  dated  March  24,  2004. 
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 responsibility  to  register  any  changes  in  the  operating  location  of  devices  or  other  registration  information  with  the  Commission. 
 21.  Requiring  grantees  to  register  the  locations  of  433  MHz  RFID  system  users  as  NTIA  requests  raises  confidentiality  issues  for  grantees.  Savi  states  that  a  list  of  users  and  locations  where 
 equipment  is  used  would  likely  be  company  sensitive  information  and  that  access  should  be  restricted  by  password  protection  or  otherwise  limited  to  personnel  at  NTIA,  the  Department  of  Defense  (DoD)  or  the 
 Commission.  47  We  recognize  Savis  concern  that  such  a  list  would  be  commercial  and/  or  financial  information  that  a  manufacturer  would  want  to  remain  confidential  because  it  would  be  the 
 manufacturers  customer  list  and  could  indicate  approximately  how  many  units  of  a  device  have  been  sold.  Consistent  with  statute,  the  Commission  does  not  make  certain  information  available  for  public 
 inspection,  including  trade  secrets  and  commercial  and  financial  information  that  are  privileged  and  confidential.  48  The  rules  explicitly  list  certain  types  of  materials  in  the  category  of  trade  secrets  and 
 commercial  and  financial  information  that  are  automatically  afforded  certain  degrees  of  protection  from  public  inspection.  49  If  material  in  this  category  is  not  explicitly  listed  as  being  protected  from  public 
 inspection,  the  party  submitting  the  material  to  the  Commission  must  accompany  it  with  a  request  for  non-  disclosure  if  it  wants  the  material  to  remain  confidential.  50 


 22.  Because  433  MHz  RFID  registration  information  does  not  fall  into  a  category  that  is  explicitly  listed  as  being  protected  from  public  inspection,  the  party  supplying  registration  information 
 would  have  to  submit  a  request  for  confidentiality  each  time  it  files  with  the  Commission,  and  the  Commission  would  have  to  act  upon  each  individual  request.  We  expect  that  grantees  would  routinely 
 request  confidentiality  for  registration  information  filed  with  the  Commission  because  they  would  consider  this  to  be  commercial  and  financial  information  that  they  do  not  want  made  available  for  public 
 inspection.  Each  of  these  requests  would  be  essentially  identical  and  we  expect  that  the  Commission  would  grant  them  because  the  required  registration  information  would  fall  into  a  category  of  information 
 that  the  rules  allow  to  be  held  confidential.  Rather  than  process  individual  confidentiality  requests  each  time  a  grantee  registers  a  users  location  or  submits  updated  information,  we  find  that  it  would  be  more 
 efficient  to  adopt  a  change  to  Section  0.457(  d)  of  the  rules  to  state  that  433  MHz  RFID  registration  information  is  not  routinely  available  for  public  inspection.  This  action  would  save  Commission 
 resources  that  would  be  used  for  processing  numerous  confidentiality  requests  and  would  be  less  burdensome  on  grantees  because  grantees  will  not  have  to  file  a  request  for  confidentiality  each  time  new 
 or  updated  registration  information  is  submitted  to  the  Commission.  Therefore,  we  are  adding  433  MHz  RFID  registration  information  to  the  list  of  materials  that  are  automatically  afforded  protection  from 
 public  inspection.  We  will,  however,  make  this  information  available  to  NTIA,  DoD  or  other  Federal  Government  entities  with  a  need  for  it. 


 23.  We  have  made  a  number  of  adjustments  from  our  proposal  that  will  eliminate  any  significant  risk  of  interference  to  garage  door  controls.  First,  as  noted  above,  we  have  restricted 
 installation  to  use  at  only  commercial  and  industrial  areas  for  the  express  purpose  of  identifying  the  contents  of  shipping  containers.  Therefore,  we  do  not  anticipate  widespread  deployment  in  close 


 47  See  Savi  ex  parte  filing  dated  December  4,  2003. 
 48  See  5  U.  S.  C.    552(  b)  and  47  C.  F.  R.    0.457(  d). 
 49  See  47  C.  F.  R.    0.457(  d)(  1). 
 50  See  47  C.  F.  R.    0.457(  d)(  2). 
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 proximity  to  door  opener  controls.  Further,  we  have  narrowed  the  frequency  range  for  RFID  systems  from  the  proposed  10  MHz  to  1  MHz.  We  note  that  garage  door  controls  can  operate  anywhere  in  the 
 425-  435  MHz  band  where  we  originally  proposed  operation  for  RFIDs,  thus  reducing  the  likelihood  of  interference  to  such  controls.  51  In  addition,  we  have  reduced  both  the  peak  signal  level  and  the  maximum 
 permitted  transmission  duration  for  433  MHz  RFID  systems  by  a  factor  of  two  from  the  proposed  levels,  further  reducing  the  likelihood  of  interference.  We  find  the  arguments  that  433  MHz  RFID  systems 
 would  cause  interference  unpersuasive  in  any  event  because  the  signal  levels  proposed  in  the  Notice  are  no  greater  than  the  rules  permit  for  garage  door  controls.  52  Further,  users  of  unlicensed  devices  have  no 
 protection  from  interference  from  other  devices  and  no  vested  right  to  the  continued  use  of  any  frequency  by  virtue  of  prior  certification  of  equipment.  53  Because  operation  of  433  MHz  RFID  systems  will  be 
 limited  to  commercial  and  industrial  areas  such  as  ports,  rail  yards  and  warehouses,  there  will  generally  be  substantial  geographic  separation  between  433  MHz  RFID  devices  and  most  other  devices  such  as 
 residential  garage  door  openers  that  could  receive  interference.  Door  opener  controls  used  in  close  proximity  to  433  MHz  RFID  devices  would  most  likely  be  under  the  control  of  the  party  operating  the 
 RFID  devices,  who  could  take  appropriate  steps  in  the  event  interference  occurs,  including  changing  the  frequency  of  a  door  opener  control,  if  possible,  or  ceasing  operation  a  device  that  causes  interference. 


 24.  We  observe  that  any  potential  interference  to  amateur  operations  is  mitigated  for  the  same  reasons  discussed  above  for  door  opener  controls.  ARRL  expressed  concern  that  the  425-  435  MHz  band 
 originally  proposed  for  RFID  systems  encompasses  several  bands  that  it  has  designated  for  weak  signal  use  in  its  band  plan.  54  However,  the  rules  we  are  adopting  limit  433  MHz  RFID  systems  to  the  433.5- 
 434.5  MHz  band.  This  band  is  separated  by  500  kHz  from  the  nearest  weak  signal  band  listed  in  ARRLs  band  plan,  thus  addressing  ARRLs  concern  about  RFID  operation  in  weak  signal  bands.  55 


 25.  The  433.5-  434.5  MHz  RFID  band  we  are  adopting  falls  within  the  433-  435  MHz  band  that  ARRL  has  designated  for  auxiliary  and  repeater  links.  Auxiliary  stations  are  required  by  the 
 Commissions  rules  to  operate  on  a  point-  to-  point  basis  and  are  permitted  to  operate  with  a  maximum  power  of  50  watts.  56  Because  point-  to-  point  operations  typically  use  directional  antennas,  there  is  less 
 likelihood  of  interference  from  other  sources.  The  rules  we  are  adopting  for  433  MHz  RFID  systems  reduce  the  peak  transmit  level  by  a  factor  of  6  dB  (two  times)  from  the  proposal,  to  a  level  47  dB  (55,000 
 times)  lower  than  the  level  permitted  for  amateur  auxiliary  stations,  further  reducing  the  likelihood  of  interference.  Additionally,  the  rules  we  are  adopting  limit  operation  to  commercial  and  industrial  area 
 such  as  ports  and  rail  yards,  so  operation  will  not  be  permitted  in  residential  areas  and  on  delivery  trucks  as  many  parties  expressed  concern.  While  there  are  other  bands  besides  433  MHz  where  RFID  systems 


 51  Door  opener  controls  are  permitted  to  operate  on  any  frequency  above  70  MHz,  except  for  certain  designated 
 restricted  bands.  See  47  C.  F.  R.    15.205  and  15.231. 
 52  See  Notice  at  18214. 


 53  See  47  C.  F.  R.    15.5. 
 54  See  ARRL  comments  at  11.  ARRL  has  developed  a  voluntary  plan  for  use  of  the  420-  450  MHz  band  by 
 amateur  radio  operators  that  specifies  different  uses  for  different  segments  of  the  band.  ARRL  supplied  a  copy  of  their  band  plan  for  the  420-  435  MHz  band  in  Appendix  A  of  their  comments.  This  division  of  the  band  is  not 


 required  by  the  Commissions  rules. 
 55  See  ARRL  comments  at  Appendix  A. 


 56  See  47  C.  F.  R.    97.3(  a)(  7). 
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 could  operate,  such  as  the  902-  928  MHz  and  2400-  2483.5  MHz  bands,  we  recognize  that  there  are  advantages  to  allowing  operation  in  the  433  MHz  band.  Signals  at  lower  frequencies,  i.  e.,  433  MHz,  are 
 attenuated  less  passing  through  objects,  thus  allowing  more  reliable  operation.  Further,  although  the  433  MHz  band  may  not  be  available  for  use  by  unlicensed  devices  worldwide  with  the  same  technical 
 parameters  we  are  adopting  for  RFID  systems,  operation  in  the  433.05-  434.79  MHz  band  is  permitted  in  Europe,  potentially  allowing  the  development  of  RFID  systems  that  are  capable  of  operating  in  multiple 
 countries. 
 26.  We  disagree  with  ARRL  that  the  Commission  lacks  authority  under  Section  301  of  the  Communications  Act  to  authorize  433  MHz  RFID  devices  to  operate  at  the  power  levels  adopted  herein 
 on  an  unlicensed  basis  because  they  will  pose  a  significant  potential  for  interference  to  licensed  services.  ARRL  advanced  a  similar  argument  in  a  proceeding  concerning  certification  of  transmitters  in  the  24.05- 
 24.25  GHz  band.  57  The  Commission  stated  in  that  proceeding  that  it  need  not  reach  this  statutory  argument  when  it  finds  no  significant  interference  potential.  58  It  also  noted  that  ARRL  concurs  that  it  is 
 appropriate  for  the  Commission  to  make  reasonable  regulations  regarding  Part  15  devices  pursuant  to  Section  302(  a)  of  the  Act.  Because  we  find  that  the  rules  we  are  adopting  for  433  MHz  RFID  systems 
 will  not  result  in  an  interference  risk  to  amateur  services,  we  reject  ARRLs  argument  in  this  proceeding  that  the  Commission  lacks  legal  authority  to  adopt  such  rules. 


 IV.  PROCEDURAL  MATTERS 
 27.  Final  Regulatory  Flexibility  Analysis.  The  Final  Regulatory  Flexibility  Analysis  for  this  Third  Report  and  Order,  pursuant  to  the  Regulatory  Flexibility  Act,  see  5  U.  S.  C.    604,  is  contained  in 


 Appendix  C. 
 28.  This  Third  Report  and  Order  contains  new  or  modified  information  collections  subject  to  the  Paperwork  Reduction  Act  of  1995  (PRA),  Public  Law  104-  13.  It  will  be  submitted  to  the  Office  of 
 Management  and  Budget  (OMB)  for  review  under  Section  3507(  d)  of  the  PRA.  OMB,  the  general  public,  and  other  Federal  agencies  are  invited  to  comment  on  the  new  or  modified  information  collection(  s) 
 contained  in  this  proceeding. 
 29.  To  make  cited  sources  more  easily  available  to  the  readers,  we  are  testing  the  use  of  hyperlinks  to  some  FCC  documents  that  are  cited  in  this  document.  The  World  Wide  Web  addresses/  URLs 
 that  we  give  here  were  correct  at  the  time  this  document  was  prepared  but  may  change  over  time.  We  do  not  have  staff  dedicated  to  updating  these  URLs,  however,  so  readers  may  find  some  URLs  to  be  out  of  date  as 
 time  progresses.  We  also  advise  that  the  only  definitive  text  of  FCC  documents  is  the  one  that  is  published  in  the  FCC  Record.  In  case  of  discrepancy  between  the  electronic  documents  cited  here  and  the  FCC  Record, 
 the  version  in  the  FCC  Record  is  definitive. 
 30.  For  further  information  regarding  this  Second  Report  and  Order  and  Memorandum  Opinion  and  Order,  contact  Mr.  Hugh  L.  Van  Tuyl,  Office  of  Engineering  and  Technology,  (202)  418-  7506,  e-  mail 
 Hugh.  VanTuyl@  fcc.  gov. 


 57  See  Memorandum  Opinion  and  Order  in  ET  Docket  No.  98-  156,  18  FCC  Rcd  15,944  (2003). 
 58  Id  at  15,947. 
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 V.  ORDERING  CLAUSES 
 31.  Accordingly,  IT  IS  ORDERED  that  pursuant  to  the  authority  contained  in  Sections  4(  i),  301,  302,  303(  e),  303(  f)  and  303(  r)  of  the  Communications  Act  of  1934,  as  amended,  47  USC  Sections 


 154(  i),  301,  302,  303(  e),  303(  f)  and  303(  r),  this  Third  Report  and  Order  IS  ADOPTED  and  Part  15  of  the  Commissions  Rules  IS  AMENDED  as  set  forth  in  Appendix  A  effective  30  days  after  publication  in  the 
 Federal  Register. 
 32.  IT  IS  FURTHER  ORDERED  that  the  Commission's  Consumer  and  Governmental  Affairs  Bureau,  Reference  Information  Center,  SHALL  SEND  a  copy  of  this  Second  Report  and  Order  and 
 Memorandum  Opinion  and  Order,  including  the  Final  Regulatory  Flexibility  Analysis,  to  the  Chief  Counsel  for  Advocacy  of  the  Small  Business  Administration. 


 FEDERAL  COMMUNICATIONS  COMMISSION 
 Marlene  H.  Dortch  Secretary 
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 APPENDIX  A:  FINAL  RULE  CHANGES 
 Part  0  of  Title  47  the  Code  of  Federal  Regulations  is  amended  as  follows: 
 1.  The  authority  citation  for  Part  0  continues  to  read  as  follows: 


 AUTHORITY:  Secs.  5,  48  Stat.  1068,  as  amended;  47  U.  S.  C.  155. 
 2.  Section  0.457  is  amended  by  adding  a  new  paragraph  (d)(  1)(  vii) 
   0.457  Records  not  routinely  available  for  public  inspection. 
 *  *  *  *  *  (d)  *  *  * 


 (1)  *  *  *  (vii)  Information  on  the  users  and  locations  of  radio  frequency  identification  systems  submitted  to  the 
 Commission  pursuant  to    15.240  will  be  made  available  to  other  Federal  Government  agencies  but  will  not  otherwise  be  made  available  for  inspection. 


 Part  15  of  Title  47  of  the  Code  of  Federal  Regulations  is  amended  as  follows: 
 3.  The  authority  citation  for  Part  15  continues  to  read  as  follows: 
 AUTHORITY:  47  U.  S.  C.  154,  302,  303,  304,  307  and  544A. 
 4.  A  new  section  15.240  is  added  to  read  as  follows. 
   15.240  Operation  in  the  band  433.5-  434.5  MHz. 
 (a)  Operation  under  the  provisions  of  this  section  is  restricted  to  devices  that  use  radio  frequency  energy  to  identify  the  contents  of  commercial  shipping  containers.  Operations  must  be  limited  to  commercial 
 and  industrial  areas  such  as  ports,  rail  terminals  and  warehouses.  Two-  way  operation  is  permitted  to  interrogate  and  to  load  data  into  devices.  Devices  operated  pursuant  to  the  provisions  of  this  section  shall  not 
 be  used  for  voice  communications. 
 (b)  The  field  strength  of  any  emissions  radiated  within  the  specified  frequency  band  shall  not  exceed  11,000  microvolts  per  meter  measured  at  a  distance  of  3  meters.  The  emission  limit  in  this  paragraph  is  based 
 on  measurement  instrumentation  employing  an  average  detector.  The  peak  level  of  any  emissions  within  the  specified  frequency  band  shall  not  exceed  55,000  microvolts  per  meter  measured  at  a  distance  of  3  meters. 
 Additionally,  devices  authorized  under  these  provisions  shall  be  provided  with  a  means  for  automatically  limiting  operation  so  that  the  duration  of  each  transmission  shall  not  be  greater  than  60  seconds  and  be  only 
 permitted  to  reinitiate  an  interrogation  in  the  case  of  a  transmission  error.  Absent  such  a  transmission  error,  the  silent  period  between  transmissions  shall  not  be  less  than  10  seconds. 


 (c)  The  field  strength  of  emissions  radiated  on  any  frequency  outside  of  the  specified  band  shall  not  exceed  the  general  radiated  emission  limits  in    15.209. 
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 (d)  In  the  case  of  radio  frequency  powered  tags  designed  to  operate  with  a  device  authorized  under  this  section,  the  tag  may  be  approved  with  the  device  or  be  considered  as  a  separate  device  subject 
 to  its  own  authorization.  Powered  tags  approved  with  a  device  under  a  single  application  shall  be  labeled  with  the  same  identification  number  as  the  device. 


 (e)  To  prevent  interference  to  Federal  Government  radar  systems,  operation  under  the  provisions  of  this  section  is  not  permitted  within  40  kilometers  of  the  following  locations: 
 DoD  Radar  Site  Latitude  Longitude  Beale  Air  Force  Base  39  08  10  N  121  21  04  W 
 Cape  Cod  Air  Force  Station  41  45  07  N  070  32  17  W  Clear  Air  Force  Station  64  55  16  N  143  05  02  W 
 Cavalier  Air  Force  Station  48  43  12  N  097  54  00  W  Eglin  Air  Force  Base  30  43  12  N  086  12  36  W 


 (f)  As  a  condition  of  the  grant,  the  grantee  of  an  equipment  authorization  for  a  device  operating  under  the  provisions  of  this  section  shall  provide  information  to  the  user  concerning  compliance  with  the 
 operational  restrictions  in  paragraphs  (a)  and  (e)  of  this  section.  As  a  further  condition,  the  grantee  shall  provide  information  on  the  locations  where  the  devices  are  installed  to  the  FCC  Office  of  Engineering  and 
 Technology,  which  shall  provide  this  information  to  the  Federal  Government  through  the  National  Telecommunications  and  Information  Administration.  The  user  of  the  device  shall  be  responsible  for 
 submitting  updated  information  in  the  event  the  operating  location  or  other  information  changes  after  the  initial  registration.  The  grantee  shall  notify  the  user  of  this  requirement.  The  information  provided  by  the 
 grantee  or  user  to  the  Commission  shall  include  the  name,  address,  telephone  number  and  e-  mail  address  of  the  user,  the  address  and  geographic  coordinates  of  the  operating  location,  and  the  FCC  identification 
 number  of  the  device.  The  material  shall  be  submitted  to  the  following  address: 
 Experimental  Licensing  Branch,  OET  Federal  Communications  Commission 
 445  12  th  Street,  S.  W.  Washington,  D.  C.  20554 


 ATTN:  RFID  Registration 
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 APPENDIX  B:  LIST  OF  COMMENTING  PARTIES 
 Parties  filing  comments 
 1.  ADEMCO  Group  2.  AdvaMed 
 3.  Al  Brittain  4.  Albert  Deshotel 
 5.  Armadillo  Intertie,  Inc.  6.  ARRL,  The  National  Association 
 for  Amateur  Radio  7.  Bernard  K.  Skoch 
 8.  Brian  D.  Allen  9.  Brian  James  Jarchow 
 10.  Britain  Rothrock  11.  Bruce  Perens 
 12.  Bryan  King  13.  Central  States  VHF  Society 
 14.  Chamberlain  Group,  Inc.  15.  Charles  Byers 
 16.  Charles  P.  Adkins  17.  Chester  Piotrowski 
 18.  Christian  O.  Hunt  19.  Christopher  Howard 
 20.  Christopher  J.  Osburn  21.  Cisco  Systems,  Inc. 
 22.  Cobra  Electronics  Corporation  23.  Comsearch 
 24.  Consumer  Electronics  Association  25.  Cubic  Corporation 
 26.  Dale  Drake  27.  Daniel  Kane 
 28.  DataBrokers,  Inc.  29.  David  A.  Merriweather 
 30.  David  Batzle  31.  David  C.  Counce 
 32.  David  Clark  33.  David  Donnelly 
 34.  David  HM  Spector  35.  David  Wilkinson 
 36.  Deerik  W.  Shryock  37.  Dennis  Swanson 
 38.  Derwood  Eadie  39.  Donald  C.  Karon 
 40.  Doran  S.  Platt  III  41.  Dr.  Andrew  E.  Mossberg 
 42.  Dwight  B.  Hill  43.  Enalasys  Corporation 
 44.  Eric  M.  Funderburk  45.  Eric  Schmidt 
 46.  Escort,  Inc.  and  BEL,  Inc. 


 47.  Flash  Parlini  48.  Fred  C.  Jensen 
 49.  Frederick  C.  Gantzer  50.  Frederick  Patton 
 51.  Galen  K.  Watts  52.  Gap,  Inc. 
 53.  Gary  Rotter  54.  George  Washburn 
 55.  Harold  Tate  56.  HID  Corporation 
 57.  Howard  Malone  58.  Hughes  Network  Systems,  Inc. 
 59.  IBM  Corporation  60.  Information  Technology  Industry 
 Council  61.  Interlogix,  Inc. 
 62.  Jack  Daane  63.  James  A.  Talbot,  Jr. 
 64.  James  E.  Reynolds  65.  James  Edwin  Whedbee 
 66.  James  Hayes  67.  Jeff  Ballif 
 68.  Jeff  Stidham  69.  Jeffrey  D.  Taylor 
 70.  Jeffrey  P.  LaCosse  71.  Jeffrey  Peter  Kershaw 
 72.  John  Douglas  Lamb  73.  John  L.  DAusilio 
 74.  John  Paul  Dooley  75.  John  Robert  Foulks 
 76.  Johnson  Controls,  Inc.  77.  Jose  Cadrecha 
 78.  Joseph  A.  Elcavage  79.  Joseph  A.  Naujokas 
 80.  Joseph  H.  Underwood  81.  Joseph  R.  Semer 
 82.  Joseph  S.  Keer  83.  Kenneth  P.  Eckel,  Jr. 
 84.  Kevin  Gibson  85.  Kyle  A.  Yoksh 
 86.  Lifeline  Systems,  Inc.  87.  Linear  Corporation 
 88.  Loral  Skynet  89.  MagTek,  Inc. 
 90.  Mark  S.  Seidler  91.  Martin  Shinko 
 92.  Mattel,  Inc. 
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 93.  Matthew  Becker  94.  Melvyn  L.  Bernstein 
 95.  Michael  Brooks  96.  Michael  J.  Linden 
 97.  Michael  M.  Bradley  98.  Michael  Swiderski 
 99.  Mike  Baugh  100.  Mike  Moreken 
 101.  Miller  Edge,  Inc.  102.  MOBA  Systeme 
 103.  Morris  Jones  104.  Motorola,  Inc. 
 105.  National  Aeronautics  and  Space  Administration 
 106.  Nicholas  S.  Frost  107.  Nickolaus  E.  Leggett 
 108.  Operator  Specialty  Company,  Inc.  109.  PanAmSat  Corporation 
 110.  Paul  J.  Tringas  111.  Pete  Myers 
 112.  Philips  Semiconductors  113.  Polhemus,  Inc. 
 114.  Power  Line  Communications  Association 
 115.  RADAR  Members  116.  Ray  Todd  Stevens 
 117.  Richard  Adamo  118.  Richard  Lourette 
 119.  Rick  Eastwood  120.  Roadrunners  Microwave  Group 
 121.  Robert  Brown  122.  Robert  S.  Bennett 
 123.  Robert  Winkworth  124.  Safety  Warning  System,  L.  C. 
 125.  Sanjay  Kapur  126.  Satellite  Industry  Association 
 127.  Savi  Technology,  Inc.  128.  SES  Americom,  Inc. 
 129.  Short  Range  Automotive  Radar  Frequency  Allocation  Group 
 130.  Shure  Incorporated  131.  Sirius  Satellite  Radio,  Inc. 
 132.  Spacenet,  Inc.  and  StarBand  Communications,  Inc. 
 133.  Steven  Bryant  134.  Telecommunications  Industry 
 Association  135.  Texas  Instruments 
 136.  Texas  VHF-  FM  Society,  Inc.  137.  The  Genie  Company 
 138.  The  Whistler  Group,  Inc. 


 139.  Tighe  W.  Kuykendall  140.  Tom  Masterson 
 141.  TRP,  Inc.  142.  Uniden  America  Corporation 
 143.  United  Telecom  Council  144.  Verlin  E.  Reiter 
 145.  Vincent  F.  DiMalta  146.  VYTEK  Solutions,  Inc. 
 147.  Wacom  Technology  Corp.  148.  Warren  Bruene 
 149.  Warren  J.  Dickie  150.  William  A.  Tynan 
 151.  William  F.  Osler  152.  William  Owens 
 153.  XM  Radio,  Inc. 
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 Parties  filing  reply  comments 
 1.  Ademco  Group  2.  Amateur  Television  Network 
 3.  American  Council  of  Independent  Laboratories 
 4.  ARRL,  The  National  Association  of  Amateur  Radio 
 5.  Arthur  T.  Farrand  6.  Brent  D.  Oots 
 7.  Brice  D.  Hornblack  8.  Calvin  Keli  Lunny 
 9.  Charles  E.  Quentel,  III  10.  Christopher  Nelson 
 11.  Current  Technologies  12.  Curtis  V.  Rocke 
 13.  Daniel  J.  Serafini  14.  Duane  Whittingham 
 15.  Edwin  S.  Toal  16.  Escort  Incorporated  and  BEL 
 Incorporated  17.  Gerald  W.  Murray 
 18.  Glenn  Pederson  19.  Harold  C.  Arnold 
 20.  Hughes  Network  Systems,  Inc.  21.  Illinois  Repeater  Association,  Inc. 
 22.  Indiana  Repeater  Council  23.  Interlogix,  Inc. 
 24.  Intersil  Corporation  25.  James  Anderson 
 26.  John  A.  Weeks  27.  Kevin  D.  Adam 
 28.  Lloyd  W.  Fink  29.  Martin  H.  Leider 
 30.  Martin  Wilcoxson  31.  Matthew  Hamm 
 32.  Matthew  T.  Weeks  33.  Michael  J.  Borowiec 
 34.  Moody  Law  35.  Motorola,  Inc. 
 36.  Patrick  T.  Weeks  37.  RADAR  Members 
 38.  Ray  Todd  Stevens  39.  Retlif  Testing  Laboratories 
 40.  Richard  Kelly  41.  Satellite  Industry  Association 
 42.  Savi  Technology,  Inc.  43.  SES  Americom,  Inc. 
 44.  Seymour  Hersh  45.  Short  Range  Automotive  Radar 
 Frequency  Allocation  Group 


 46.  Sirius  Satellite  Radio,  Inc.  47.  Sky  A.  Borgenhagen 
 48.  Stanley  Vandiver  49.  Steven  Handler 
 50.  Texas  Instruments  51.  The  Chamberlain  Group,  Inc. 
 52.  Timothy  Thomas  Lanners  53.  TRP,  Inc. 
 54.  Upper  New  York  Repeater  Council,  Inc.  55.  Ward  Wheaton 
 56.  Western  Washington  Amateur  Relay  Association 
 57.  William  Richards  58.  XM  Radio,  Inc. 
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 APPENDIX  C:  FINAL  REGULATORY  FLEXIBILITY  ANALYSIS 
 As  required  by  the  Regulatory  Flexibility  Act  (RFA),  59  an  Initial  Regulatory  Flexibility  Analysis  (IRFA)  was  incorporated  in  the  Notice  of  Proposed  Rule  Making  and  Order,  Review  of  Part  15  and  other 
 Parts  of  the  Commissions  Rules  (Notice).  60  The  Commission  sought  written  public  comments  on  the  proposals  in  the  Notice,  including  comment  on  the  IRFA.  61  This  Final  Regulatory  Flexibility  Analysis 
 conforms  to  the  RFA.  62 
 A.  Need  for,  and  Objectives  of,  the  Third  Report  and  Order 
 Section  11  of  the  Communications  Act  of  1934,  as  amended,  and  Section  202(  h)  of  the  Telecommunications  Act  of  1996  require  the  Commission  (1)  to  review  biennially  its  regulations 
 pertaining  to  telecommunications  service  providers  and  broadcast  ownership;  and  (2)  to  determine  whether  economic  competition  has  made  those  regulations  no  longer  necessary  in  the  public  interest.  The 
 Commission  is  directed  to  modify  or  repeal  any  such  regulations  that  it  finds  are  no  longer  in  the  public  interest. 


 As  part  of  the  biennial  review  for  the  year  2000,  the  Commission  reviewed  its  regulations  pertaining  to  telecommunications  service  providers  and  broadcast  ownership  and  recommended  a  number 
 of  changes  to  those  rules.  While  not  specifically  required  by  statute,  the  Commission  also  reviewed  Parts  2,  15  and  18  as  part  of  this  process. 


 The  Third  Report  and  Order  increases  the  maximum  permitted  field  strength  and  transmission  duration  for  radio  frequency  identification  (RFID)  systems  operating  in  the  433.5-  434.5  MHz  band  to  allow 
 more  rapid  and  reliable  data  transmission.  Operation  of  such  systems  is  limited  to  commercial  shipping  containers  in  commercial  and  industrial  areas.  Improved  RFID  systems  could  benefit  commercial 
 shippers  and  have  significant  homeland  security  benefits  by  enabling  the  entire  contents  of  shipping  containers  to  be  easily  and  immediately  identified,  and  by  allowing  a  determination  of  whether  tampering 
 with  the  contents  has  occurred  during  shipping. 
 B.  Summary  of  Significant  Issues  Raised  by  Public  Comments  in  Response  to  the  IRFA 
 None. 
 C.  Description  and  Estimate  of  the  Number  of  Small  Entities  To  Which  the  Proposed  Rules  Will  Apply 


 The  RFA  directs  agencies  to  provide  a  description  of  and,  where  feasible,  an  estimate  of  the  number  of  small  entities  that  may  be  affected  by  the  rules  adopted  herein.  63  The  RFA  generally  defines 
 59  See  5  U.  S.  C.    603.  The  RFA,  see  5  U.  S.  C.    601    612,  has  been  amended  by  the  Small  Business  Regulatory 
 Enforcement  Fairness  Act  of  1996  (SBREFA),  Pub.  L.  No.  104-  121,  Title  II,  110  Stat.  857  (1996). 
 60  See  Notice  of  Proposed  Rule  Making  and  Order  in  ET  Docket  No.  01-  278,  16  FCC  Rcd  18205  (2001). 


 61  Id. 
 62  See  5  U.  S.  C.    604. 
 63  5  U.  S.  C.    604. 
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 the  term  "small  entity"  as  having  the  same  meaning  as  the  terms  "small  business,"  "small  organization,"  and  "small  governmental  jurisdiction."  64  In  addition,  the  term  "small  business"  has  the  same  meaning  as 
 the  term  "small  business  concern"  under  the  Small  Business  Act.  65  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  SBA.  66 
 The  SBA  has  developed  small  business  size  standards  for  two  pertinent  Economic  Census  categories,  "Radio  and  Television  Broadcasting  and  Communications  Equipment"  (RTB)  and  "Other 
 Communications  Equipment,"  both  of  which  consist  of  all  such  companies  having  750  or  fewer  employees.  67  According  to  Census  Bureau  data  for  1997,  there  were  a  total  of  1,215  establishments  in  the 
 first  category,  total,  that  had  operated  for  the  entire  year.  68  Of  this  total,  1,150  had  499  or  fewer  employees,  and  an  additional  37  establishments  had  500  to  999  employees.  69  Consequently,  we  estimate 
 that  the  majority  of  businesses  in  the  first  category  are  small  businesses  that  may  be  affected  by  the  rules  and  policies  adopted  herein.  Concerning  the  second  category,  the  data  for  1997  show  that  there  were  a 
 total  of  499  establishments  that  operated  for  the  entire  year.  70  Of  this  total,  491  had  499  or  fewer  employees,  and  additional  3  establishments  had  500  to  999  employees.  71  Consequently,  we  estimate  that 
 the  majority  of  businesses  in  the  second  category  are  small  businesses  that  may  be  affected  by  the  rules  and  policies  adopted  herein. 


 D.  Description  of  Projected  Reporting,  Recordkeeping,  and  Other  Compliance  Requirements 
 Manufacturers  of  433  MHz  RFID  systems  will  have  to  obtain  certification  for  the  equipment  before  it  can  be  marketed.  This  requires  the  manufacturer  to  have  the  equipment  tested  for  compliance,  file  an 
 application  with  the  Commission  or  a  designated  Telecommunication  Certification  Body  (TCB)  and  wait  for 
 64  5  U.  S.  C.    601(  6). 
 65  5  U.  S.  C.    601(  3)  (incorporating  by  reference  the  definition  of  "small  business  concern"  in  15  U.  S.  C.    632). 
 Pursuant  to  the  RFA,  the  statutory  definition  of  a  small  business  applies  "unless  an  agency,  after  consultation  with  the  Office  of  Advocacy  of  the  Small  Business  Administration  and  after  opportunity  for  public  comment,  establishes  one 


 or  more  definitions  of  such  term  which  are  appropriate  to  the  activities  of  the  agency  and  publishes  such  definition(  s)  in  the  Federal  Register."  5  U.  S.  C.    601(  3). 


 66  Small  Business  Act,  15  U.  S.  C.    632  (1996). 
 67  13  C.  F.  R.    121.201,  NAICS  codes  334220,  334290. 
 68  U.  S.  Census  Bureau,  1997  Economic  Census,  Industry  Series:  Manufacturing,  Radio  and  Television  and  Wireless 
 Communications  Equipment  Manufacturing,  "Industry  Statistics  by  Employment  Size:  1997,"  Table  4,  NAICS  code  334220  (issued  Aug.  1999).  The  number  of  "establishments"  is  a  less  helpful  indicator  of  small  business 


 prevalence  in  this  context  than  would  be  the  number  of  "firms"  or  "companies,"  because  the  latter  take  into  account  the  concept  of  common  ownership  or  control.  Any  single  physical  business  location  is  an  establishment,  and  that 
 location  and  others  may  be  under  the  common  ownership  of  a  given  firm.  Thus,  the  numbers  given  in  text  may  reflect  inflated  numbers  of  businesses  in  this  category,  including  the  numbers  of  small  businesses.  Census  data  in 
 this  context  are  available  only  for  establishments. 
 69  Id. 


 70  U.  S.  Census  Bureau,  1997  Economic  Census,  Industry  Series:  Manufacturing,  Other  Communications 
 Equipment  Manufacturing,  "Industry  Statistics  by  Employment  Size:  1997,"  Table  4,  NAICS  code  334290  (issued  Sept.  1999). 


 71  Id. 
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 an  approval  before  the  equipment  may  be  imported  into  or  marketed  within  the  United  States.  There  will  be  no  change  to  the  certification  procedure  from  what  the  rules  currently  require.  There  will  be  a  new 
 requirement  for  the  grantee  of  certification  to  supply  information  to  the  Commission  on  where  the  devices  are  used.  The  information  that  must  be  submitted  includes  the  name,  address  and  other  pertinent  contact 
 information  of  the  user,  the  address  and  geographic  coordinates  of  the  operating  location,  and  the  FCC  identification  number  of  the  device.  In  addition,  the  user  of  the  device  will  have  to  notify  the 
 Commission  of  any  changes  to  this  information  after  the  initial  registration  by  the  grantee. 
 E.  Steps  Taken  to  Minimize  Significant  Economic  Impact  on  Small  Entities,  and  Significant  Alternatives  Considered 


 The  RFA  requires  an  agency  to  describe  any  significant  alternatives  that  it  has  considered  in  reaching  its  proposed  approach,  which  may  include  the  following  four  alternatives  (among  others):  (1)  the 
 establishment  of  differing  compliance  or  reporting  requirements  or  timetables  that  take  into  account  the  resources  available  to  small  entities;  (2)  the  clarification,  consolidation,  or  simplification  of  compliance  or 
 reporting  requirements  under  the  rule  for  small  entities;  (3)  the  use  of  performance,  rather  than  design,  standards;  and  (4)  an  exemption  from  coverage  of  the  rule,  or  any  part  thereof,  for  small  entities.  72 


 The  rules  specify  performance  standards  for  RFID  equipment  such  as  emission  levels,  as  opposed  to  design  standards.  Because  the  rules  are  intended  to  minimize  the  potential  for  interference  to  authorized 
 services  in  the  433  MHz  band,  and  it  is  not  possible  to  exempt  small  entities  from  complying  with  any  requirements  without  increasing  the  risk  of  harmful  interference.  We  note  that  a  number  of  entities  expressed 
 concern  about  the  possibility  of  interference  from  433  MHz  RFID  systems  to  door  opener  controls.  As  discussed  in  paragraph  23  of  the  Third  Report  and  Order,  we  have  made  a  number  of  changes  from  our 
 proposals  that  will  eliminate  any  significant  risk  of  interference  to  door  opener  controls. 
 Report  to  Congress:  The  Commission  will  send  a  copy  of  the  Third  Report  and  Order,  including  this  FRFA,  in  a  report  to  be  sent  to  Congress  pursuant  to  the  Congressional  Review  Act,  see  5  U.  S.  C.   
 801(  a)(  1)(  A).  In  addition,  the  Commission  will  send  a  copy  of  the  Third  Report  and  Order,  including  FRFA,  to  the  Chief  Counsel  for  Advocacy  of  the  Small  Business  Administration.  A  copy  of  the  Third 
 Report  and  Order  and  FRFA  (or  summaries  thereof)  will  also  be  published  in  the  Federal  Register.  See  5  U.  S.  C.    604(  b). 


 72  See  5  U.  S.  C.    603(  c). 
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 STATEMENT  OF  CHAIRMAN  MICHAEL  K.  POWELL 
 Re:  Review  of  Part  15  and  other  Parts  of  the  Commissions  Rules,  Third  Report  and  Order,  ET  Docket  No.  01-  278 
 With  more  than  two  billion  tons  of  freight  traveling  through  U.  S.  ports  and  waterways  yearly,  ensuring  the  efficient  flow  of  goods  while  reducing  the  possibility  of  terrorism  and  fraud 
 is  no  easy  task. 
 Todays  Third  Report  and  Order  allows  a  powerful  new  technology  to  help  secure  our  ports  while  increasing  productivity.  Specifically,  we  change  Commission  rules  to  allow  for  the 
 introduction  of  smart  shipping  containers  that  can  detect  intrusions  and  streamline  the  inventory  process. 


 When  you  consider  that  a  trillion  dollars  worth  of  goods  pass  through  our  ports  annually,  the  potential  economic  benefits  of  this  technology  become  clear. 
 It  is  worth  noting  that  some  have  raised  privacy  concerns  regarding  the  use  of  radio  frequency  identification  (RFID)  tags.  We  are  aware  of  these  concerns,  and  stress  that  todays  ruling  is  narrowly 
 tailored.  The  technical  and  operational  rules  we  adopt  today  allow  higher-  powered/  longer-  duration  RFID  tag  use  on  limited  frequencies,  and  only  in  commercial  and  industrial  environments.  We  also  take  steps 
 to  protect  federal  government  radar  sites  from  interference  by  requiring  grantees  of  an  equipment  authorization  for  a  433  MHz  RFID  device  to  register  their  location  and  inform  purchasers  where  the 
 devices  may  or  may  not  be  used. 
 Im  excited  by  the  prospects  for  improved  inventory  control,  lower  costs,  and  increased  homeland  security  that  this  technology  promises  to  bring. 
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