45758 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

FEDERAL COMMUNICATIONS

COMMISSION

47 CFR Part 63

[IB Docket No. 96–261, FCC 97–280]

International Settlement Rates

AGENCY: Federal Communications

Commission.

ACTION: Final rule.

SUMMARY: On August 7, 1997, the

Federal Communications Commission

adopted a Report and Order that revises

the Commission’s international

settlement rate benchmarks. The

revisions will move settlement rates

closer to the underlying costs of

providing international termination

services. The Commission took this

action in light of the significant changes

that have occurred in the global

telecommunications market in recent

years. The decision represents one of

the steps in an ongoing effort by the

Commission, many foreign

governments, and multilateral

organizations such as the International

Telecommunication Union (‘‘ITU’’) and

the Organization for Economic

Cooperation and Development

(‘‘OECD’’) to lower international

telephony costs by reforming the

international accounting rate system.

DATES: Effective: January 1, 1998. The

new information collection

requirements adopted in this Order will

become effective following OMB

approval. The Commission will publish

a document at a later date establishing

the effective date. Written comments by

the public and other agencies on the

proposed information collections are

due October 28, 1997.

ADDRESSES: Federal Communications

Commission, 1919 M Street, NW., Room

222, Washington, DC 20554. For filing

comments on the proposed information

collections contained herein, in

addition to filing comments with the

Secretary, a copy of any comments

should be submitted to Judy Boley,

Federal Communications Commission,

Room 234, 1919 M Street, NW.,

Washington, DC 20554, or via the

Internet to jboley@fcc.gov.

FOR FURTHER INFORMATION CONTACT:

Kathryn O’Brien, Attorney-Advisor, or

John Giusti, Attorney-Advisor, Policy

and Facilities Branch,

Telecommunications Division,

International Bureau, (202) 418–1470.

For additional information concerning

the information collections contained in

this Order contact Judy Boley at 202–

418–0214, or via the Internet at

jboley@fcc.gov.

SUPPLEMENTARY INFORMATION:

Summary of Report and Order

1. On December 19, 1996, the

Commission released a Notice of

Proposed Rulemaking in the Matter of

International Settlement Rates, IB

Docket No. 96–261, FCC 96–484 (61 FR

68702, December 30, 1996). In the

NPRM, the Commission proposed

options for revising international

settlement rate benchmarks that would

move settlement rates closer to the

underlying costs of providing

international termination services. The

NPRM sought comment on several

alternate methods for calculating

benchmark rates in the absence of

reliable data on the costs foreign carriers

incur to terminate international traffic.

2. On August 7, 1997, the Commission

adopted a Report and Order in this

proceeding that revised settlement rate

benchmarks. The Commission

concluded that current settlement rates

are in most cases substantially above the

cost that foreign carriers incur to

terminate U.S.-originated traffic. These

inflated settlement rates contribute to

high international calling prices for U.S.

consumers and create the potential for

distortions in the U.S. market for

international services.

3. The Commission adopted revised

settlement rate benchmarks to assist

U.S. international carriers in negotiating

settlement rates that are more closely

related to the costs incurred by foreign

carriers. The benchmarks are calculated

using foreign carriers’ tariffed prices and

information published by the

International Telecommunication

Union. The Commission concluded that

basing benchmarks on foreign carriers’

tariffed prices would more closely

reflect the underlying costs of providing

international termination service than

most current settlement rates, although

they still would result in benchmarks

that are substantially above cost-based

settlement rate levels. The Commission

believes that basing benchmark

settlement rates on the same rates that

foreign carriers charge their own

customers would ensure

nondiscriminatory treatment for U.S.

carriers. In addition, foreign carriers

will be permitted to recover more than

their incremental cost of terminating

international service because the tariffed

rates are for retail services and include

costs that would not be included in

cost-based settlement rates.

4. The Commission adopted four

settlement rate benchmarks: $0.15 for

upper income countries; $0.19 for

upper-middle income countries and

lower-middle income countries; and

$0.23 for lower income countries. The

Commission concluded that these

settlement rate benchmarks will

continue to exceed, usually

substantially, any reasonable estimate of

the level of foreign carriers’ costs. Using

the limited data available to the FCC for

calculating benchmarks, these

benchmarks will substantially reduce

the above-cost excesses in current

settlement rates in a manner that is

reasonable and treats foreign carriers

fairly. The Commission adopted its

proposal in the NPRM to revise and

update the benchmarks periodically as

necessary.

5. The Commission also adopted a

‘‘best practices’’ rate that will be

enforced as a safeguard when it detects

distortion in the U.S. market for IMTS.

The ‘‘best practices’’ rate is closer to a

cost-based level than the settlement rate

benchmarks and can be applied to

prevent market distorting behavior. This

rate will be applied only to the extent

carriers seek authorization to provide

facilities-based service from the United

States to affiliated markets and to

provide private line resale service. In

those cases, the rate will be enforced

only if the Commission detects market

distortion on the route or routes in

question. The rate is based on the

lowest, commercially viable, settlement

rate currently paid by U.S. carriers to an

overseas carrier from a competitive

market. The Commission selected a rate

of $.08, which is the current settlement

rate between the United States and

Sweden. The ‘‘best practice’’ rate will

apply only in cases of competitive

distortion, and that if an affected carrier

believes such a requirement would

prove unjustified it may follow

established procedures to request an

individualized settlement rate

prescription.

6. The Commission adopted a

transition schedule for compliance with

the settlement rate benchmarks to

balance the competing concerns of

providing time for carriers to make

adjustments and expeditiously reduce

rates to a more cost-based level. The

transition schedule is based primarily

on the categorization of countries used

to calculate the settlement rate

benchmarks, the World Bank, and ITU’s

GNP per capita classifications. The

Commission believes that this

classification scheme provides a

reasonable basis for determining a

country’s ability to transition to a morecost based system or settlement rates

without undue disruption to its

telecommunications network. The

Commission also established a separate

category for the ‘‘least

telecommunications developed’’

countries based on level of teledensity,
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 45759

or lines per 100 people, rather than GNP

per capita. The Commission will require

that U.S. carriers negotiate settlement

rates at or below the relevant

benchmarks according to the following

schedule:

Carriers in upper income countries—1

year from implementation of the

Order

Carriers in upper-middle income

countries—2 years from

implementation of the Order

Carriers in lower-middle income

countries—3 years from

implementation of the Order

Carriers in lower income countries—4

years from implementation of the

Order

Carriers in countries with teledensity

(lines per 100) less than 1—5 years

from implementation of the Order

7. The Commission declined to adopt

the proposal to permit additional

flexibility in the application of the

benchmarks beyond the transition

periods for U.S. carriers serving

developing countries that have

committed to introducing competitive

reforms. The Commission believes that

these transition periods adequately

balance the challenges faced by

developing countries in moving to more

cost-based rates.

8. The Commission intends to take the

appropriate enforcement measures that

may be necessary to ensure that U.S.

international carriers satisfy the

benchmark requirements. Initially, the

Commission will identify foreign

carriers that are reluctant to engage in

meaningful progress toward negotiating

settlement rates at or below the relevant

benchmark. The Commission will take

steps to work with the foreign

governments and carriers to achieve the

goal of cost-based rates. If these efforts

are unsuccessful, U.S. international

carriers may file a petition with the

FCC. The Commission can and will

ensure compliance with its settlement

rate benchmarks. Rather than adopt a set

enforcement mechanism, the

Commission will consider individual

circumstances surrounding each carrierinitiated petition to determine the

appropriate enforcement action to take.

To protect smaller carriers from

reprisals, the Commission emphasized

that it will continue to safeguard U.S.

carriers against discriminatory treatment

by foreign carriers by vigorously

enforcing its international settlements

policy.

9. The Commission will consider, on

a case-by-case basis, grandfathering

settlement rate agreements that were

negotiated prior to the effective date of

this Order. The agreement, however,

must meet the Commission’s public

interest standard of serving the same

goals set forth in this Order and

achieving settlement rates at or below

the relevant benchmark within a

reasonable period of time. The

Commission will reserve the right to

consider alternative approaches to the

settlement rate benchmarks if, in the

future, it finds that meaningful progress

is made in a multilateral forum to

achieve its goals.

10. In the NPRM, the Commission

identified two types of market

distortions that could be created by

above-cost settlement rates—price

squeeze behavior and one-way bypass.

In the Order, the Commission describes

how it will detect and address these

distortions. Price squeeze behavior

potentially could distort competition in

the U.S. market for IMTS by affecting

the ability of other carriers to compete.

The Commission will condition

authorizations to provide international

facilities-based switched or private line

service from the United States to an

affiliated market in order to restrain the

ability of foreign-affiliated carriers to

engage in anticompetitive price squeeze

behavior in the U.S. market. The

Commission adopted a rebuttable

presumption that a carrier’s service

offering has distorted market

performance if any of the carrier’s

tariffed collection rates on the affiliated

route are less than the carrier’s average

variable costs on that route. In order to

prevent one-way bypass of the

accounting rate system, the Commission

will condition the Section 214

authorizations of carriers to provide

switched basic services over

international facilities-based or resold

private lines. The Commission also

adopted a rebuttable presumption that

one-way bypass is occurring if the

percentage of outbound traffic relative

to inbound traffic increases more than

10% in two successive quarterly

measurement periods and it reserves the

right to investigate other shifts in the

inbound/outbound ratio to determine

whether one-way bypass is occurring.

11. To assist in detecting market

distortion, the Commission will amend

§ 43.61 of its rules to require certain

carriers to file quarterly traffic reports

pursuant to filing criteria adopted in the

Order. In addition, the Commission

intends to monitor closely U.S. carriers’

collection rates to ensure that they

reflect fully all net settlement savings.

U.S. carriers with more than five

percent of the outbound IMTS traffic on

a route will be required to file a report

every six months.

12. In the Notice, the Commission

proposed a condition to carriers’

applications that would balance its

desire to encourage international resale

services and at the same time limit the

potential for one-way bypass. In the

Order, the Commission modified the

proposed condition. The first

modification to the condition will

authorize carriers to provide switched

services over resold international

private lines between the United States

and foreign destination countries on the

condition that settlement rates for at

least 50 percent of the settled U.S.-billed

traffic on the route or routes are at or

below the appropriate benchmark. In

the event that competitive distortions

result on the route in question, i.e.,

carriers are engaging in one-way bypass,

the Commission will take enforcement

action. Such enforcement action may

include a requirement prohibiting

carriers from using their authorizations

to provide switched services over

private lines on that route until

settlement rates for at least 50 percent

of the settled U.S.-billed traffic on the

route are at or below the level of the best

practice rate of $0.08, or revocation of

a carrier’s authorization.

13. The second modification the

Commission made to the proposed

condition would apply it to U.S.

facilities-based carriers’ use of their

authorized private lines for the

provision of switched, basic services.

Carriers will be permitted to use their

authorized facilities-based private lines

to originate or terminate U.S. switched

traffic on the condition that settlement

rates for at least 50 percent of the settled

U.S. billed traffic on the route or routes

in question are at or below the

appropriate benchmark. If market

distortion occurs on the route, i.e.,

carriers are using their authorized

private lines to engage in one-way

bypass of the accounting rate system,

the Commission will take enforcement

action.

14. Final Regulatory Flexibility

Analysis. Pursuant to the Regulatory

Flexibility Act of 1990, 5 U.S.C. 601–

612, the Commission’s Final Regulatory

Flexibility Analysis with respect to the

Order is as follows:

Reason for action: The Commission

issues this Report and Order adopting

changes in the benchmark settlement

rates for international message

telephone service between U.S.

facilities-based carriers and foreign

carriers and related issues. The

Commission believes that its benchmark

rates should be revised to reflect recent

technological improvements, their

associated cost reductions, and the

market structure changes occurring in

the global telecommunications market.

We also believe these revisions, and
45760 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

related actions taken here, are necessary

to move settlement rates closer to the

actual costs of providing international

termination services.

Objectives: The objective of this

proceeding is to attain reform in the

international accounting rate system

and thereby help ensure lower

international calling prices for

consumers and protect competition in

the U.S. IMTS market. The Commission

will achieve this objective by revising

its benchmark settlement rates so that

they more closely resemble the

underlying costs of providing

international termination services.

Legal basis: The Report and Order is

adopted pursuant to sections 1, 2, 4(i),

201, 205, 214 and 303(r) of the

Communications Act of 1934, as

amended, 47 U.S.C. 151, 152, 154(i),

201, 205, 214, 303(r).

Description, potential impact, and

number of small entities affected: The

Commission has not developed a

definition of small entities applicable to

international common carriers. We

therefore have used as the applicable

definition of small entity the definition

under the Small Business

Administration (SBA) rules applicable

to Communications Services, Not

Elsewhere Classified. This definition

provides that a small entity is expressed

as one with $11.0 million or less in

annual receipts. Based on preliminary

1995 data, at present there are 29

international facilities-based common

carriers that qualify as small entities

pursuant to the SBA’s definition. The

number of small international facilitiesbased common carriers has been

growing significantly, and by the end of

1996 that number could increase to

approximately 50. The revised

benchmark rates will apply to all

international facilities-based common

carriers, including small entities, that

enter into an operating agreement with

a foreign carrier that provides for the

payment of settlement rates. We note

that the revised benchmark rates should

result in lower settlement rates for

carriers. This Report and Order also

requires that a foreign carrier’s

settlement rates be at or below the

relevant benchmark as a condition of

Section 214 authorization for that

carrier, or an affiliate, to provide U.S.

international facilities-based services

between the United States and the

affiliated destination country. This

condition will apply to all U.S.

international facilities-based carriers,

including small entities, that are

affiliated with foreign carriers. The

Commission has concluded that this

condition is necessary to prevent

potential anticompetitive distortions in

the IMTS market.

The Order also imposes an additional

requirement on carriers that seek to

provide switched services using resold

or facilities-based private lines. Carriers

must demonstrate that settlement rates

for 50 percent of the settled traffic

between the United States and the

country at the foreign end of the private

line are at or below the relevant

benchmark for that country. The

Commission believes that at most 635

small international carriers, both

facilities-based and resale carriers,

could be affected by this requirement.

The Commission has concluded this

requirement is necessary to prevent

potential anticompetitive distortions in

the IMTS market. We base our estimate

of the number of small entities

potentially affected on the number of

toll carriers filing Telecommunications

Relay Service Fund (TRS) worksheets.

In 1995, 445 toll carriers filed TRS fund

worksheets. We believe that between 50

and 200 carriers failed to file TRS fund

worksheets. We also believe that fewer

than 10 toll carriers were not small

entities (based on the SBA’s definition

of small entity as one with fewer than

1,500 employees). Thus, at most 635

international carriers would be

classified as small entities. The

Secretary shall send a copy of this

Report and Order to the Chief Counsel

for Advocacy of the Small Business

Administration in accordance with

section 603(a) of the Regulatory

Flexibility Act, Pub. L. 96–354, 94 Stat.

1164, 5 U.S.C. 601, et seq. (1981).

Reporting, recordkeeping and other

compliance requirements: In its Initial

Regulatory Flexibility Analysis the

Commission did not propose any

reporting requirements. The Notice,

however, raised the issues of possible

anticompetitive behavior and market

distortions, and sought comment on

how the Commission’s reporting system

could be modified in order to make

monitoring and enforcement more

effective. To address the concerns of

commenters, the Report and Order

contains certain mechanisms to detect

potential market distortions. In this

regard, the Commission amends its rules

to impose an additional reporting

requirement. Section 43.61 of the

Commission’s rules currently requires

that carriers file annual reports that

include actual traffic and revenue data.

Common carriers subject to the existing

§ 43.61 requirements will be required to

file traffic reports for each quarter in

which their traffic meets any of the

following thresholds: (i) Their aggregate

U.S.-billed minutes of switched

telephone traffic exceeds 1% of the total

of such minutes of international traffic

for all U.S. carriers (as published in the

most recent § 43.61 traffic data report);

(ii) their aggregate foreign-billed

minutes of switched telephone traffic

exceeds 1% of the total of such minutes

of international traffic for all U.S.

carriers; (iii) their aggregate U.S.-billed

minutes of switched telephone traffic

for any country exceeds 2.5% of the

total of such minutes for that country for

all U.S. carriers; or (iv) their aggregate

foreign-billed minutes of switched

telephone traffic for any foreign country

exceeds 2.5% of the total of such

minutes for that country for all U.S.

carriers. Limiting the quarterly filing

requirement to carriers that meet these

criteria will reduce the burden on small

carriers, while enabling us to identify

distortions in the balance of payments.

The Report and Order only imposes an

increase in the frequency with which

the report must be filed. It will contain

the same data that must be included in

the current required annual report.

Thus, the reporting requirement should

not impose a significant economic

burden, and no additional outside

professional skills should be required in

complying with this requirement.

Federal rules which overlap,

duplicate or conflict with the

Commission’s proposal: None.

Any significant alternatives

minimizing impact on small entities and

consistent with stated objectives: The

Notice solicited comments on a variety

of alternative methodologies for

calculating benchmark settlement rates,

but these have no impact on small

entities. The Notice also solicited

comments on enforcement mechanisms

that may be necessary to support U.S.

carriers, including small entities, in

their negotiations with foreign carriers

and in their provision of international

service. We did not receive any

comments on the impact of these

alternatives on small entities.

Comments solicited: Written

comments were requested on the Initial

Regulatory Flexibility Analysis in

accordance with the same filing

deadlines set for comments on the other

issues in the Notice, but we did not

receive any comments.

15. Paperwork Reduction Act. This

Report and Order contains either a

proposed or modified information

collection. The Commission, as part of

its continuing effort to reduce

paperwork burdens, invites the general

public and the Office of Management

and Budget (OMB) to comment on the

information collections contained in

this order, as required by the Paperwork

Reduction Act of 1995, Pub. L. 104–13.

Public and agency comments are due 60
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 45761

days from the date of publication of this

decision in the Federal Register.

Comments should address: (a) whether

the proposed collection of information

is necessary for the proper performance

of the functions of the Commission,

including whether the information shall

have practical utility; (b) the accuracy of

the Commission’s burden estimates; (c)

ways to enhance the quality, utility, and

clarity of the information collected; and

(d) ways to minimize the burden of the

collection of information on the

respondents, including the use of

automated collection techniques or

other forms of information technology.

OMB Approval Number: 3060–0106.

Title: Section 43.61—Reports of

Overseas Telecommunications Traffic.

Form No.: None.

Type of Review: Revision of existing

collection.

Respondents: U.S. common carriers

providing international

telecommunications services.

Number of Respondents: We estimate

the number of respondents to be 5.

Although the number of respondents is

less than 10, the Commission is unable

to identify specific respondents because

the respondents will vary depending on

whether they carry specified levels of

U.S. international traffic during any

quarterly reporting period. Only those

carriers that meet the reporting criteria

established in the Order will be subject

to the proposed information collection.

Estimated Time Per Response: 160

hours.

Total Annual Burden: 800 hours.

Estimated costs per respondent: None.

Respondents already maintain this data

as part of their normal business

practices.

Needs and Uses: Section 43.61

requires each common carrier that

provides international facilities-based

switched service between the United

States and any foreign country to file an

annual traffic and revenue report. The

annual report includes actual traffic and

revenue data for each service provided

by a common carrier, divided among

service billed in the United States,

service billed outside the United States,

and service transiting the United States.

In this Order we are increasing the filing

frequency in order to detect market

distortion that may occur from the

routing of U.S. international switched,

basic traffic over private lines. Common

carriers subject to the existing § 43.51

requirement will be required to file the

quarterly reports, in addition to annual

reports for each quarter reporting period

in which their minutes of switched

telephone traffic meet certain thresholds

established by the Commission.

However, we will require that carriers

file their traffic and revenue data only

for switched facilities-based telephone

services and switched facilities resale

telephone services—not for their other

international services.

We note that this decision imposes an

additional requirement on carriers that

seek to provide switched services using

resold or facilities-based private lines.

Carriers must demonstrate that

settlement rates for at least 50 percent

of the settled traffic between the United

States and the country at the foreign end

of the private line are at or below the

relevant benchmark for that country. We

do not anticipate that this requirement

will impose any additional burden on

carriers as any paperwork burden

associated with this requirement is

sufficiently covered under the currently

approved information collection (OMB

Control No. 3060–0686).

Ordering Clauses

16. Accordingly, it is ordered that,

pursuant to sections 1, 2, 4(i), 201, 205,

214 and 303(r) of the Communications

Act of 1934, as amended, 47 U.S.C. 151,

152, 154(i), 201, 205, 214, 303(r), the

rules, requirements and policies

discussed in this Order are adopted and

parts 43 and 63 of the Commission’s

rules, 47 CFR parts 43 and 63, are

amended.

17. It is further ordered that the rules,

requirements and policies established in

this decision shall take effect on January

1, 1998. The new information collection

requirements adopted in this Order will

become effective following OMB

approval. The Commission will publish

a document at a later date establishing

the effective date.

List of Subjects in 47 CFR Parts 43 and

63

Communications common carriers,

Reporting and recordkeeping

requirements.

Federal Communications Commission.

William F. Caton,

Acting Secretary.

Rule Changes

Parts 43 and 63 of Title 47 of the Code

of Federal Regulations are amended as

follows:

PART 43—REPORTS OF

COMMUNICATION COMMON

CARRIERS AND CERTAIN AFFILIATES

1. The authority citation for part 43

continues to read as follows:

Authority: Sec. 4 of the Communications

Act of 1934, as amended, 47 U.S.C. 154.

2. In § 43.61, paragraphs (b) through

(d) are redesignated as paragraphs (a)(1)

through (a)(3) and new paragraph (b) is

added to read as follows:

§ 43.61 Reports of international

telecommunications traffic.

* * * * *

(b) Quarterly Traffic Reports. (1) Each

common carrier engaged in providing

international telecommunications

service between the area comprising the

continental United States, Alaska,

Hawaii, and off-shore U.S. points and

any country or point outside that area

shall file with the Commission, in

addition to the report required by

paragraph (a) of this section, actual

traffic and revenue data for each

calendar quarter in which the carrier’s

quarterly minutes exceed the

corresponding minutes for all carriers

by one or more of the following tests:

(i) The carrier’s aggregate minutes of

facilities-based or facilities resale

switched telephone traffic for service

billed in the United States are greater

than 1.0 percent of the total of such

minutes of international traffic for all

U.S. carriers published in the

Commission’s most recent § 43.61

annual report of international

telecommunications traffic;

(ii) The carrier’s aggregate minutes of

facilities-based or facilities resale

switched telephone traffic for service

billed outside the United States are

greater than 1.0 percent of the total of

such minutes of international traffic for

all U.S. carriers published in the

Commission’s most recent § 43.61

annual report of international

telecommunications traffic;

(iii) The carrier’s aggregate minutes of

facilities-based or facilities resale

switched telephone traffic for service

billed in the United States for any

foreign country are greater than 2.5

percent of the total of such minutes of

international traffic for that country for

all U.S. carriers published in the

Commission’s most recent § 43.61

annual report of international

telecommunications traffic; or

(iv) The carrier’s aggregate minutes of

facilities-based or facilities resale

switched telephone traffic for service

billed outside the United States for any

foreign country are greater than 2.5

percent of the total of such minutes of

international traffic for that country for

all U.S. carriers published in the

Commission’s most recent § 43.61

annual report of international

telecommunications traffic.

(2) Except as provided in this

paragraph, the quarterly reports

required by paragraph (b)(1) of this

section shall be filed in the same format

as, and in conformance with, the filing
45762 Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations

procedures for the annual reports

required by paragraph (a) of this section.

(i) Carriers filing quarterly reports

shall include in those reports only their

provision of switched, facilities-based

telephone service and switched,

facilities resale telephone service.

(ii) The quarterly reports required by

paragraph (b)(1) of this section shall be

filed with the Commission no later than

April 30 for the prior January through

March quarter; no later than July 31 for

the prior April through June quarter; no

later than October 31 for the prior July

through September quarter; and no later

than January 31 for the prior October

through December period.

PART 63—EXTENSION OF LINES AND

DISCONTINUANCE, REDUCTION,

OUTAGE AND IMPAIRMENT OF

SERVICE BY COMMON CARRIERS;

AND GRANTS OF RECOGNIZED

PRIVATE OPERATING AGENCY

STATUS

1. The authority citation for Part 63

continues to read as follows:

Authority: Sections 1, 4(i), 4(j), 201–205,

218 and 403 of the Communications Act of

1934, as amended, and Section 613 of the

Cable Communications Policy Act of 1984,

47 U.S.C. secs. 151, 154(i), 154(j), 201–205,

218, 403 and 533 unless otherwise noted.

2. Section 63.18 is amended by

revising paragraphs (e)(2)(ii)(B) through

(e)(2)(ii)(C), (e)(3) introductory text, and

(e)(4) to read as follows:

§ 63.18 Contents of applications for

international common carriers.

* * * * *

(e) * * *

(2) * * *

(ii) * * *

(B) The applicant may resell private

line services for the provision of

international switched basic services

only in circumstances where the

Commission has found that the country

at the foreign end of the private line

provides equivalent resale opportunities

and that settlement rates for at least 50

percent of the settled U.S.-billed traffic

between the United States and that

country are at or below the benchmark

settlement rate adopted for that country

in IB Docket No. 96–261. The

Commission will provide public notice

of its equivalency and settlement rate

determinations. The applicant, however,

shall not initiate such service on a

particular route absent a grant of

specific authority under paragraph (e)(6)

of this section in circumstances where

the applicant is affiliated with a

facilities-based carrier in the country at

the foreign end of the private line and

the Commission has not determined that

the foreign carrier does not possess

market power in that country.

(C) The authority granted under this

paragraph shall be subject to all

Commission rules and regulations,

including the limitation in § 63.21 on

the use of private lines for the provision

of switched services, and any conditions

stated in the Commission’s public

notice or order that serves as the

applicant’s Section 214 certificate. See

Sections 63.12, 63.21.

(3) If applying for authority to provide

international switched basic services

over resold private lines between the

United States and a country for which

the Commission has not made the

settlement rate and equivalency

determinations specified in paragraph

(e)(2)(ii)(B) of this section, applicant

shall demonstrate that settlement rates

for at least 50 percent of the settled U.S.-

billed traffic between the United States

and the country at the foreign end of the

private line are at or below the

benchmark settlement rate adopted for

that country in IB Docket No. 96–261

and that the country affords resale

opportunities equivalent to those

available under U.S. law. In this regard,

applicants shall:

* * * * *

(ii) The procedures set forth in

paragraph (e)(3) of this section are

subject to Commission policies on resale

of international private lines in CC

Docket No. 90–337 as amended in IB

Docket Nos. 95–22 and 96–261.

(4) Any carrier authorized under this

section to acquire and operate

international private line facilities other

than through resale may use those

private lines to provide switched basic

services only in circumstances where

the Commission has found that the

country at the foreign end of the private

line provides equivalent resale

opportunities and that settlement rates

for at least 50 percent of the settled U.S.-

billed traffic between the United States

and that country are at or below the

benchmark settlement rate adopted for

that country in IB Docket No. 96–261.

The Commission will provide public

notice of its equivalency and settlement

rate determinations. This provision is

subject to the following exceptions and

conditions:

(i) The applicant shall not initiate

such service on a particular route absent

a grant of specific authority under

paragraph (e)(6) of this section in

circumstances where the applicant is

affiliated with a facilities-based carrier

in the country at the foreign end of the

private line and the Commission has not

determined that the foreign carrier does

not possess market power in that

country.

(ii) The applicant is subject to all

applicable Commission rules and

regulations, including the limitation in

§ 63.21 on the use of private lines for the

provision of switched services, and any

conditions stated in the Commission’s

public notice or order that serves as the

applicant’s Section 214 certificate. See

§§ 63.12, 63.21.

(A) Except as provided in paragraph

(e)(4)(ii)(B) of this section, any carrier

that seeks to provide international

switched basic services over its

authorized private line facilities

between the United States and a country

for which the Commission has not made

the settlement rate and equivalency

determinations specified in paragraph

(e)(2)(ii)(B) of this section shall

demonstrate that settlement rates for at

least 50 percent of the settled U.S.-billed

traffic between the United States and

the country at the foreign end of the

private line are at or below the

benchmark settlement rate adopted for

that country in IB Docket No. 96–261

and that the country affords resale

opportunities equivalent to those

available under U.S. law. In this regard,

applicant shall include the information

required by paragraph (e)(3) of this

section.

(B) No formal application is required

under paragraph (e)(4) of this section in

circumstances where the carrier’s

previously authorized private line

facility is interconnected to the public

switched network only on one end—

either the U.S. or the foreign end—and

where the carrier is not operating the

facility in correspondence with a carrier

that directly or indirectly owns the

private line facility in the foreign

country at the other end of the private

line.

3. Section 63.21(a) is revised to read

as follows:

§ 63.21 Conditions applicable to

international Section 214 authorizations.

* * * * *

(a) Carriers may not use their

authorized facilities-based or resold

international private lines for the

provision of switched basic services

unless and until the Commission has

determined that the country at the

foreign end of the private line provides

equivalent resale opportunities and that

settlement rates for 50 percent of the

settled U.S.-billed traffic between the

United States and that country are at or

below the benchmark settlement rate

adopted for that country in IB Docket

No. 96–261. See § 63.18 (e)(3) through

(e)(4). If at any time the Commission

finds, after an initial determination of

compliance for a particular country, that

the country no longer provides
Federal Register / Vol. 62, No. 168 / Friday, August 29, 1997 / Rules and Regulations 45763

equivalent resale opportunities or that

market distortion has occurred in the

routing of traffic between the United

States and that country, carriers shall

comply with enforcement actions taken

by the Commission. This condition shall

not apply to a carrier’s use of its

authorized facilities-based private lines

to provide service as described in

§ 63.18 (e)(4)(ii)(B).

[FR Doc. 97–22936 Filed 8–28–97; 8:45 am]

BILLING CODE 6712–01–P

FEDERAL COMMUNICATIONS

COMMISSION

47 CFR Part 73

[MM Docket No. 97–111; RM–9052]

Radio Broadcasting Services;

Deerfield, MO

AGENCY: Federal Communications

Commission.

ACTION: Final rule.

SUMMARY: Action in this document

allots Channel 264C3 to Deerfield,

Missouri, as that community’s first local

broadcast service in response to a

petition filed by Deerfield FM Radio.

See 62 FR 17773, April 11, 1997. The

coordinates for Channel 264C3 at

Deerfield are 37–43–01 and 94–36–22.

There is a site restriction 16.2

kilometers (10.1 miles) southwest of the

community. With this action, this

proceeding is terminated.

DATES: Effective October 6, 1997. The

window period for filing applications

for Channel 264C3 at Deerfield,

Missouri, will open on October 6, 1997,

and close on November 6, 1997.

FOR FURTHER INFORMATION CONTACT:

Kathleen Scheuerle, Mass Media

Bureau, (202) 418–2180.

SUPPLEMENTARY INFORMATION: This is a

summary of the Commission’s Report

and Order, MM Docket No. 97–111,

adopted August 13, 1997, and released

August 22, 1997. The full text of this

Commission decision is available for

inspection and copying during normal

business hours in the Commission’s

Reference Center (Room 239), 1919 M

Street, NW., Washington, DC. The

complete text of this decision may also

be purchased from the Commission’s

copy contractors, International

Transcription Services, Inc., 1231 20th

Street, NW., Washington, DC 20036,

(202) 857–3800, facsimile (202) 857–

3805.

List of Subjects in 47 CFR Part 73

Radio broadcasting.

Part 73 of title 47 of the Code of

Federal Regulations is amended as

follows:

PART 73—[AMENDED]

1. The authority citation for part 73

continues to read as follows:

Authority: Secs. 303, 48 Stat., as amended,

1082; 47 U.S.C. 154, as amended.

§ 73.202 [Amended]

2. Section 73.202(b), the Table of FM

Allotments under Missouri, is amended

by adding Deerfield, Channel 264C3.

Federal Communications Commission.

John A. Karousos,

Chief, Allocations Branch, Policy and Rules

Division, Mass Media Bureau.

[FR Doc. 97–22991 Filed 8–28–97; 8:45 am]

BILLING CODE 6712–01–M

FEDERAL COMMUNICATIONS

COMMISSION

47 CFR Part 73

[MM Docket No. 97–123; RM–9062]

Radio Broadcasting Services; Grand

Isle, LA

AGENCY: Federal Communications

Commission.

ACTION: Final rule.

SUMMARY: The Commission, at the

request of Grand Isle Radio, allots

Channel 283A to Grand Isle, Louisiana,

as the community’s first local aural

transmission service. See 62 FR 23427,

April 30, 1997. Channel 283A can be

allotted to Grand Isle in compliance

with the Commission’s minimum

distance separation requirements

without the imposition of a site

restriction. The coordinates for Channel

283A at Grand Isle are 29–13–54 NL and

89–59–54 WL. With this action, this

proceeding is terminated.

DATES: Effective October 6, 1997. The

window period for filing applications

will open on October 6, 1997, and close

on November 6, 1997.

FOR FURTHER INFORMATION CONTACT: Pam

Blumenthal, Mass Media Bureau, (202)

418–2180.

SUPPLEMENTARY INFORMATION: This is a

synopsis of the Commission’s Report

and Order, MM Docket No. 97–123,

adopted August 13, 1997, and released

August 22, 1997. The full text of this

Commission decision is available for

inspection and copying during normal

business hours in the FCC Reference

Center (Room 239), 1919 M Street, NW,

Washington, DC. The complete text of

this decision may also be purchased

from the Commission’s copy contractor,

ITS, Inc., (202) 857–3800, 2100 M

Street, NW, Suite 140, Washington, DC

20037.

List of Subjects in 47 CFR Part 73

Radio broadcasting.

Part 73 of title 47 of the Code of

Federal Regulations is amended as

follows:

PART 73—[AMENDED]

1. The authority citation for part 73

continues to read as follows:

Authority: Secs. 303, 48 Stat., as amended,

1082; 47 U.S.C. 154, as amended.

§ 73.202 [Amended]

2. Section 73.202(b), the Table of FM

Allotments under Louisiana, is

amended by adding Grand Isle, Channel

283A.

Federal Communications Commission.

John A. Karousos,

Chief, Allocations Branch, Policy and Rules

Division, Mass Media Bureau.

[FR Doc. 97–22997 Filed 8–28–97; 8:45 am]

BILLING CODE 6712–01–P

FEDERAL COMMUNICATIONS

COMMISSION

47 CFR Part 73

[MM Docket No. 96–161; RM–8842]

Radio Broadcasting Services; Carlisle,

Irvine, and Morehead, KY

AGENCY: Federal Communications

Commission.

ACTION: Final rule.

SUMMARY: The Commission, at the joint

request of James P. Gray, Kentucky

River Broadcasting Company, and

Morehead Broadcasting Company,

substitutes Channel 221C3 for Channel

264A at Carlisle, Kentucky, and

modifies Station WCAK(FM)’s license

accordingly; substitutes Channel 264C3

for Channel 291A at Irvine, Kentucky,

and modifies Station WCYO(FM)’s

license accordingly; and substitutes

Channel 291C3 for Channel 221A at

Morehead, Kentucky, and modifies

Station WMOR–FM’s license

accordingly. See 61 FR 42229, August

14, 1996. Channel 221C3 can be allotted

to Carlisle in compliance with the

Commission’s minimum distance

separation requirements with a site

restriction of 13.1 kilometers (8.1 miles)

east. The coordinates for Channel 221C3

at Carlisle are North Latitude 38–17–42

and West Longitude 83–52–32. See

Supplementary Information, infra.

EFFECTIVE DATE: October 9, 1997.