SECTION 1. SHORT TITLE; PURPOSE.

    (a) Short Title.--This Act may be referred to as the ``VoIP 
Regulatory Freedom Act of 2004''.
    (b) Purpose.--The purpose of this Act is to prevent the imposition 
of harmful obligations or a patchwork of multiple and discriminatory 
regulations on the providers of applications that utilize the Internet 
protocol or any successor protocol to offer 2-way or multidirectional 
voice communications.

SEC. 2. ASSERTION OF FEDERAL JURISDICTION.

    (a) In General.--Notwithstanding any other provision of law, 
responsibility and authority to regulate the offering or provision of a 
voice-over-Internet-protocol application is reserved solely to the 
Federal Government.
    (b) Prohibition of State Regulation.--No State or political 
subdivision thereof may enact or enforce any law, rule, regulation, 
standard, or other provision having the force or effect of law that 
regulates, or has the effect of regulating, the offering or provision 
of a VoIP application.
    (c) Prohibition of Delegation to States.--Any responsibility or 
authority to regulate the offering or provision of a VoIP application 
that, pursuant to subsection (a), is reserved by the Federal Government 
may not be delegated, by any Federal agency or officer, to any State or 
political subdivision thereof.

SEC. 3. PREEMPTION OF BROAD FCC AUTHORITY.

    Except as specifically provided in this Act and notwithstanding any 
other provision of law, the Commission shall not impose any rule or 
regulation on, or otherwise regulate, the offering or provision of a 
VoIP application.

SEC. 4. FCC AUTHORITY REGARDING CONNECTED VOIP APPLICATIONS.

    (a) Interprovider Compensation.--
            (1) Rulemaking.--Within 180 days after the date of the 
        enactment of this Act, the Commission shall complete a 
        proceeding to establish a set of rules and standards to provide 
        for appropriate arrangements to compensate providers of 
        facilities and equipment used to transmit communications 
        employing a connected VoIP application.
            (2) Factors.--In the proceeding the Commission shall--
                    (A) provide for an appropriate transition period to 
                allow providers of such facilities and equipment and 
                providers of connected VoIP applications to comply with 
                any rules and standards established; and
                    (B) consider the unique nature and circumstances 
                relating to the use of such facilities and equipment in 
                varying geographic markets and rural areas.
    (b) Universal Service.--Within 180 days after the date of the 
enactment of this Act, the Commission shall complete a proceeding to 
provide a contribution mechanism applicable to connected VoIP 
applications, which may include a collection methodology based on the 
assignment of telephone numbers to end users, other methodologies, or 
any combination thereof. In the proceeding, the Commission shall seek 
to ensure the preservation, enhancement, and long-term sustainability 
of universal service by maximizing participation in the support of 
universal service among the greatest number of providers of connected 
VoIP applications.
    (c) Law Enforcement Access.--
            (1) Requirements regarding assistance capabilities.--
        Effective as provided in paragraph (3)(D), each provider of a 
        connected VoIP application shall ensure that its equipment, 
        facilities, or services are capable of--
                    (A) enabling the government to intercept 
                communications transmitted using such application and 
                to access call-identifying information regarding 
                communications so transmitted, and
                    (B) delivering such intercepted communications and 
                call-identifying information to the government,
        for the same purposes, to a similar extent, and subject to 
        similar limitations and protections (including protections 
        regarding privacy and security and protections ensuring access 
        only pursuant to lawful authorization) that, under sections 103 
        and 105 of the Communications Assistance for Law Enforcement 
        Act, are required of the capabilities of the equipment, 
        facilities, or services of a telecommunications carrier.
            (2) Determination regarding feasibility.--Not later than 
        180 days after the date of the enactment of this Act, and not 
        later than every 180 days thereafter, the Commission shall 
        conduct a proceeding to determine whether it is technologically 
        feasible and reasonable to commence applicability of the 
        assistance capability requirements established under paragraph 
        (1).
            (3) Effect of determination.--If the Commission, pursuant 
        to a proceeding under paragraph (2), determines that it is 
        technologically feasible and reasonable to commence 
        applicability of the assistance capability requirements 
        established under paragraph (1)--
                    (A) the requirement under paragraph (2) to conduct 
                further semi-annual proceedings shall not apply after 
                such determination;
                    (B) not later than 180 days after such 
                determination, the Commission shall establish rules, 
                technical requirements, and standards that--
                            (i) implement the requirements under 
                        paragraph (1);
                            (ii) protect the privacy and security of 
                        communications not authorized to be 
                        intercepted;
                            (iii) minimize the cost of such compliance 
                        on customers or subscribers;
                            (iv) serve the policy of the United States 
                        to encourage the provision of new technologies 
                        and services to the public; and
                            (v) provide a reasonable time and 
                        conditions for compliance with and the 
                        transition to any new standard;
                    (C) in establishing such rules, technical 
                requirement, and standards, the Commission consult with 
                providers of connected VoIP applications, manufacturers 
                of equipment used by such applications, other 
                appropriate parties providing services used in such 
                applications, the Attorney General of the United 
                States, and State and local law enforcement agencies; 
                and
                    (D) the requirement under paragraph (1) shall take 
                effect upon the expiration of the 180-day period 
                beginning upon such determination.

SEC. 5. VOLUNTARY INDUSTRY CONSENSUS PROCESS REGARDING OTHER CONNECTED 
              VOIP OBLIGATIONS.

    (a) Voluntary Process.--The Commission shall appoint an appropriate 
representative industry organization or organizations which shall, 
within 180 days after the date of the enactment of this Act, develop, 
as applicable, consensus guidelines, protocols, or performance 
requirements pertaining to the offering or provision of connected VoIP 
applications for--
            (1) providing comparable capabilities to 911 and enhanced 
        911 services;
            (2) improving use by the disabled community;
            (3) improving reliability of voice over Internet protocol 
        applications; and
            (4) ensuring appropriate security for the application and 
        voice communications.
    (b) Information to Customers.--A provider of a connected VoIP 
application that does not provide for its customers services that are 
comparable to 911 service and enhanced 911 service shall provide a 
clear and conspicuous notice of the failure to provide such services to 
each customer prior to the offering of the application to that 
customer.
    (c) Technical Support.--The Commission shall provide technical 
support, as appropriate, to the organization selected pursuant to 
subsection (a).

SEC. 6. COMMISSION REVIEW.

    Beginning in 2005, the Commission shall provide a report to the 
Congress not less than biennially indicating any regulatory obligations 
that it recommends be enacted on the offering or provision of a VoIP 
application, including nondiscriminatory treatment for processing or 
treatment of digital packets.

SEC. 7. NO STATE OR LOCAL TAXATION OF VOIP APPLICATIONS.

    (a) In General.--No State or political subdivision shall impose any 
tax, fee, surcharge, or other charge for the purpose of generating 
revenues for governmental purposes on the offering or provision of a 
VoIP application.
    (b) Exemption.--Subsection (a) shall not apply to a fee imposed for 
a specific privilege, service, or benefit conferred.

SEC. 8. NO IMPACT ON TRANSMISSION FACILITIES.

    Nothing in this Act shall affect the authority of the Commission or 
any State commission to regulate the transmission facilities used to 
transmit a voice communication of a VoIP application. This section may 
not be construed to authorize the Commission or any State to regulate 
the offering or provision of a VoIP application by regulating such 
transmission facilities.

SEC. 9. FTC AUTHORITY.

    (a) In General.--Except as provided in subsection (b), nothing in 
this Act shall be constructed to affect the authority of the Federal 
Trade Commission to prevent unfair or deceptive acts or practices.
    (b) Regulations Excluded.--Subsection (a) does not authorize the 
Federal Trade Commission to issue any regulations to implement this 
Act.

SEC. 10. DEFINITIONS.

    (a) In General.--For purposes of this Act:
            (1) Commission.--The term ``Commission'' means the Federal 
        Communications Commission.
            (2) Connected voip application.--The term ``connected VoIP 
        application'' means a VoIP application that is capable of 
        receiving voice communications from or sending voice 
        communications to the public switched telephone network, or 
        both.
            (3) Customer.--The term ``customer'' includes a consumer of 
        goods or services whether for a fee, in exchange for an 
        explicit benefit, or provided for free.
            (4) Regulate.--The term ``regulate'' includes taking any 
        governmental action that restricts, prohibits, limits, or 
        burdens, or imposes any obstacle, obligation, or duty, or 
        interferes with, an application.
            (5) Universal service.--The term ``universal service'' has 
        the meaning given such term by section 254(c) of such Act (47 
        U.S.C. 254(c)).
            (6) Voice-over-internet-protocol application; voip 
        application.--
                    (A) In general.--The terms ``Voice-over-Internet-
                protocol application'' and ``VoIP application'' mean 
                the use of software, hardware, or network equipment for 
                real-time 2-way or multidirectional voice 
                communications over the public Internet or a private 
                network utilizing Internet protocol, or any successor 
                protocol, in whole or part, to connect users 
                notwithstanding--
                            (i) the underlying transmission technology 
                        used to transmit the communications;
                            (ii) whether the packetizing and 
                        depacketizing of the communications occurs at 
                        the customer premise or network level; or
                            (iii) the software, hardware, or network 
                        equipment used to connect users.
                    (B) Exclusion.--The term does not include an 
                application that is used for voice communications that 
                both originate and terminate on the public switched 
                telephone network.
    (b) Common Terminology.--Except as otherwise provided in subsection 
(a), terms used in this Act shall have the meaning provided under 
section 3 of the Communications Act of 1934.
VoIP Regulatory Freedom Act of 2004 - Reserves solely to the Federal Government the responsibility and authority to regulate the offering or provision of a voice-over-Internet-protocol (VoIP) application (an application that uses the Internet or any successor protocol to offer two-way or multidirectional voice communications). Prohibits State regulation, or delegation to States, of such authority.

Directs the Federal Communications Commission (FCC) to: (1) establish rules and standards for appropriate arrangements to compensate providers of facilities and equipment used to transmit communications employing a connected VoIP application; and (2) maximize participation in the support of universal service among the greatest number of providers of connected VoIP applications. Requires such providers to assist the Federal Government in enforcement actions.

Requires the FCC to appoint an appropriate representative industry organization to develop guidelines, protocols, or performance requirements pertaining to the offering or provision of connected VoIP applications for: (1) providing comparable capabilities to 911 services; (2) improving use by the disabled community; (3) improving reliability of VoIP applications; and (4) ensuring appropriate security for the application and voice communications.

Prohibits a State or political subdivision from imposing a tax or other charge on the offering or provision of a VoIP application.
To provide a clear and unambiguous structure for the jurisdictional and regulatory treatment for the offering or provision of voice-over-Internet-protocol applications, and for other purposes.