[Federal Register Volume 86, Number 158 (Thursday, August 19, 2021)]
[Proposed Rules]
[Pages 46644-46661]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2021-16085]


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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Part 2

[ET Docket No. 21-232, EA Docket No. 21-233; FCC 21-73; FR ID 39522]


Protecting Against National Security Threats to the 
Communications Supply Chain Through the Equipment Authorization Program 
and the Competitive Bidding Program

AGENCY: Federal Communications Commission.

ACTION: Proposed rule.

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SUMMARY: The Commission proposes to revise rules related to its 
equipment authorization processes to prohibit authorization of any 
``covered'' equipment on the recently established Covered List. The 
Commission also seeks comment on whether to require additional 
certification relating to national security from applicants who wish to 
participate in the Commission's competitive bidding auctions. This 
action explores steps the Commission can take to further its goal of 
protecting communications networks from communications equipment and 
services that pose a national security risk.

DATES: Comments are due September 20, 2021. Reply comments are due 
October 18, 2021. Written comments on the Paperwork Reduction Act 
proposed information collection requirements must be submitted by the 
public, Office of Management and Budget (OMB), and other interested 
parties on or before October 18, 2021.

ADDRESSES: You may submit comments, identified by ET Docket No. 21-232, 
by any of the following methods:
    <bullet> Electronic Filers: Comments may be filed electronically 
using the internet by accessing the ECFS: http://apps.fcc.gov/ecfs/.
    <bullet> Paper Filers: Parties who choose to file by paper must 
file an original and one copy of each filing.
    <bullet> Filings can be sent by commercial overnight courier, or by 
first-class or overnight U.S. Postal Service mail. All filings must be 
addressed to the Commission's Secretary, Office of the Secretary, 
Federal Communications Commission.
    <bullet> Commercial overnight mail (other than U.S. Postal Service 
Express Mail and Priority Mail) must be sent to 9050 Junction Drive, 
Annapolis Junction, MD 20701.
    <bullet> U.S. Postal Service first-class, Express, and Priority 
mail must be addressed to 45 L Street NE, Washington, DC 20554.
    <bullet> Effective March 19, 2020, and until further notice, the 
Commission no longer accepts any hand or messenger delivered filings. 
This is a temporary measure taken to help protect the health and safety 
of individuals, and to mitigate the transmission of COVID-19. See FCC 
Announces Closure of FCC Headquarters Open Window and Change in Hand-
Delivery Policy, Public Notice, DA 20-304 (March 19, 2020). https://www.fcc.gov/document/fcc-closes-headquarters-open-window-and-changes-hand-delivery-policy.
    People with disabilities: To request materials in accessible 
formats for people with disabilities (braille, large print, electronic 
files, audio format), send an email to <a href="/cdn-cgi/l/email-protection#badcd9d98f8a8efadcd9d994ddd5cc"><span class="__cf_email__" data-cfemail="197f7a7a2c292d597f7a7a377e766f">[email protected]</span></a> or calling the 
Consumer and Governmental Affairs Bureau at 202-418-0530 (voice), 202-
418-0432 (TTY).

FOR FURTHER INFORMATION CONTACT: Jamie Coleman, Office of Engineering 
and Technology, 202-418-2705, <a href="/cdn-cgi/l/email-protection#5d173c303438731e323138303c331d3b3e3e733a322b"><span class="__cf_email__" data-cfemail="145e75797d713a577b787179757a547277773a737b62">[email protected]</span></a>. For information 
regarding the PRA information collection requirements contained in this 
PRA, contact Nicole Ongele, Office of Managing Director, at (202) 418-
2991 or <a href="/cdn-cgi/l/email-protection#115f78727e7d743f5e7f76747d74517772723f767e67"><span class="__cf_email__" data-cfemail="0e40676d61626b204160696b626b4e686d6d20696178">[email protected]</span></a>.

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Notice 
of Proposed Rulemaking (NPRM), in ET Docket No. 21-232 and EA Docket 
No. 21-233; FCC 21-73, adopted and released June 17, 2021. The full 
text of this document is available by downloading the text from the 
Commission's website at: https://www.fcc.gov/document/equipment-authorization-and-competitive-bidding-supply-chain-nprm. When the FCC 
Headquarters reopens to the public, the full text of this document will 
also be available for public inspection and copying during regular 
business hours in the FCC Reference Center, 45 L Street NE, Washington, 
DC 20554.

Initial Paperwork Reduction Act of 1995 Analysis

    This document contains proposed information collection 
requirements. 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 collection 
requirements contained in this document, as required by the Paperwork 
Reduction Act of 1995, Public Law 104-13. Public and agency comments 
are due October 18, 2021.
    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; (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; and (e) 
way to further reduce the information collection burden on small 
business concerns with fewer than 25 employees. In addition, pursuant 
to the Small Business Paperwork Relief Act of 2002, Public Law 107-198, 
see 44 U.S.C. 3506(c)(4), we seek specific comment on how we might 
further reduce the information collection burden for small business 
concerns with fewer than 25 employees.
    OMB Control Number: 3060-0057.
    Title: Application for Equipment Authorization, FCC Form 731.
    Form No.: FCC Form 731.
    Type of Review: Revision of a currently approved collection.
    Respondents: Business or other for-profit.
    Number of Respondents and Responses: 11,305 respondents; 24,873 
responses.
    Estimated Time per Response: 8.11 hours (rounded).

[[Page 46645]]

    Frequency of Response: On occasion and one-time reporting 
requirements; third-party disclosure requirement.
    Obligation to Respond: Required to obtain or retain benefits. 
Statutory authority for this information collection is contained in the 
47 U.S.C. 154(i), 301, 302, 303, 309(j), 312, and 316, and 47 CFR 
1.411.
    Total Annual Burden: 206,863 hours.
    Total Annual Costs: $50,155,140.
    Privacy Act Impact Assessment: Yes. The personally identifiable 
information (PII) in this information collection is covered by a 
Privacy Impact Assessment (PIA), Equipment Authorizations Records and 
Files Information System. It is posted at: https://www.fcc.gov/general/privacy-act-information#pia.
    Nature and Extent of Confidentiality: Minimal exemption from the 
Freedom of Information Act (FOIA) under 5 U.S.C. 552(b)(4) and FCC 
rules under 47 CFR 0.457(d) is granted for trade secrets which may be 
submitted as attachments to the application FCC Form 731. No other 
assurances of confidentiality are provided to respondents.
    Needs and Uses: The Commission will submit this revised information 
collection to the Office of Management and Budget (OMB) after this 60-
day comment period to obtain the three-year clearance. The Commission 
is reporting program changes, increases to this information collection.
    On June 17, 2021, the Commission adopted a Notice of Proposed 
Rulemaking and Notice of Inquiry in ET Docket. No. 21-232 and EA Docket 
No. 21-233, FCC 21-73, ``Protecting Against National Security Threats 
to the Communications Supply Chain through the Equipment Authorization 
Program.'' Among other proposed rules intended to secure our nation's 
telecommunications networks, the Commission proposes to amend the 47 
CFR part 2 rules related to equipment authorization to prohibit the 
authorization of communications equipment if the Commission determines 
that such equipment or service poses an unacceptable risk to the 
national security of the United States or the security and safety of 
United States persons. Accordingly, the Commission proposes to add 
Sec.  2.911 to its rules, 47 CFR 2.911. The statutory authority for 
this collection of information is authorized under sections 4(i), 301, 
302, 303, 309(j), 312, and 316 of the Communications Act of 1934, as 
amended, 47 U.S.C. 154(i), 301, 302, 303, 309(j), 312, and 316.

Ex Parte Rules--Permit-But-Disclose

    The proceeding this NPRM initiates shall be treated as a ``permit-
but-disclose'' proceeding in accordance with the Commission's ex parte 
rules, 47 CFR 1.1200 et seq. Persons making ex parte presentations must 
file a copy of any written presentation or a memorandum summarizing any 
oral presentation within two business days after the presentation 
(unless a different deadline applicable to the Sunshine period 
applies). Persons making oral ex parte presentations are reminded that 
memoranda summarizing the presentation must (1) list all persons 
attending or otherwise participating in the meeting at which the ex 
parte presentation was made, and (2) summarize all data presented and 
arguments made during the presentation. If the presentation consisted 
in whole or in part of the presentation of data or arguments already 
reflected in the presenter's written comments, memoranda or other 
filings in the proceeding, the presenter may provide citations to such 
data or arguments in his or her prior comments, memoranda, or other 
filings (specifying the relevant page and/or paragraph numbers where 
such data or arguments can be found) in lieu of summarizing them in the 
memorandum. Documents shown or given to Commission staff during ex 
parte meetings are deemed to be written ex parte presentations and must 
be filed consistent with rule 1.1206(b). In proceedings governed by 
rule 1.49(f) or for which the Commission has made available a method of 
electronic filing, written ex parte presentations and memoranda 
summarizing oral ex parte presentations, and all attachments thereto, 
must be filed through the electronic comment filing system available 
for that proceeding, and must be filed in their native format (e.g., 
.doc, .xml, .ppt, searchable .pdf). Participants in this proceeding 
should familiarize themselves with the Commission's ex parte rules.

Synopsis

I. Introduction

    In this Notice of Proposed Rulemaking (NPRM), the Commission 
proposes revisions to its equipment authorization rules and processes 
to prohibit authorization of any communications equipment on the list 
of equipment and services (Covered List) that the Commission maintains 
pursuant to the Secure and Trusted Communications Networks Act of 2019. 
Secure and Trusted Communications Networks Act of 2019, Public Law 116-
124, 133 Stat. 158 (2020) (codified as amended at 47 U.S.C. 1601-1609) 
(Secure Networks Act). This prohibition would apply to ``covered'' 
equipment on the Covered List maintained and updated by the 
Commission's Public Safety and Homeland Security Bureau (PSHSB) at 
https://www.fcc.gov/supplychain/coveredlist. The Commission also seeks 
comment on whether the rules concerning equipment currently exempted 
from the equipment authorization requirement should be revised to 
ensure that any ``covered'' equipment cannot qualify for such 
exemption. In addition, the Commission seeks comment on whether to 
revoke any of the authorizations that have been previously granted for 
``covered'' equipment on the Covered List, and if so, which ones and 
through what procedures. Finally, the Commission seeks comment on new 
certifications for applicants that wish to participate in Commission 
auctions that would further address the risks posed by companies that 
the Commission has designated as posing a national security threat to 
the integrity of communications networks and the communications supply 
chain.

II. Background

    The Covered List. On March 21, 2021, PSHSB published the Covered 
List identifying the covered equipment and services that specific, 
enumerated sources have deemed to pose an unacceptable risk to the 
national security of the United States or the security and safety of 
United States persons. ``Public Safety and Homeland Security Bureau 
Announces Publication of the List of Equipment and Services Covered by 
Section 2 of the Secure Networks Act,'' WC Docket No. 18-89, Public 
Notice, DA 21-309 (PSHSB, Mar. 12, 2021) (Covered List Public Notice); 
see 47 CFR 1.50002. Pursuant to 47 CFR 1.50002, this Covered List 
identified certain telecommunications equipment and services produced 
or provided by Huawei Technologies Company and ZTE Corporation, and 
video surveillance and telecommunications equipment and services 
produced or provided by Hytera Communications Corporation, Hangzhou 
Hikvision Digital Technology Company, and Dahua Technology Company--and 
their respective subsidiaries and/or affiliates. The Commission tasked 
PSHSB with ongoing responsibilities for monitoring the status of the 
determinations and periodically updating the Covered List to address 
changes as appropriate.
    The equipment authorization program. The Commission's current rules 
provide two different approval procedures for equipment authorization--
Certification of equipment and Supplier's Declaration of Conformity 
(SDoC). As a general matter, for a radiofrequency device (RF device)

[[Page 46646]]

to be marketed or operated in the United States, it must have been 
authorized for use through one of these two processes. Some RF 
equipment has been exempted from the need for an equipment 
authorization. At this time, the Commission's current equipment 
authorization rules do not include specific provisions addressing the 
``covered'' equipment on the Covered List.
    Competitive bidding certifications. The Commission uses competitive 
bidding to determine which among multiple applicants with mutually 
exclusive applications for a license may file a full application for 
the license. Congress gave the Commission the authority to require such 
information and assurances from applicants to participate in 
competitive bidding as is necessary to demonstrate that their 
application is acceptable. Pursuant to this authority, the Commission 
has required each applicant to participate in competitive bidding to 
make various certifications.

III. Discussion

    In this NPRM, the Commission examines its rules relating to 
equipment authorization and participation in Commission auctions to 
help advance the Commission's goal of protecting national security and 
public safety. This proceeding builds on other actions the Commission 
recently has taken to protect and secure our nation's communications 
systems.
    In other proceedings over the last three years, the Commission has 
taken several actions to prevent use of equipment and services that 
pose an unacceptable risk to our nation's communications networks. In 
June 2020, the Public Safety and Homeland Security Bureau (PSHSB) 
designated Huawei and ZTE as national security threats to the integrity 
of communications networks, prohibiting the use of Universal Service 
Fund (USF) support to purchase, obtain, maintain, improve, modify, or 
otherwise support any equipment or services produced or provided by 
Huawei and ZTE. See Protecting Against National Security Threats to the 
Communications Supply Chain Through FCC Programs--Huawei Designation, 
PS Docket No. 19-351, Order, 35 FCC Rcd 6604 (PSHSB 2020) (Huawei 
Designation Order); See Protecting Against National Security Threats to 
the Communications Supply Chain Through FCC Programs--ZTE Designation, 
PS Docket No. 19-352, Order, 35 FCC Rcd 6633 (PSHSB 2020) (ZTE 
Designation Order). Most recently, PSHSB, as required by the December 
2020 Supply Chain Second Report and Order (Supply Chain Second Report 
and Order, 35 FCC Rcd 14284), published the Covered List, which 
identifies ``covered'' equipment and services that pose an unacceptable 
risk to national security or to the security and safety of U.S. 
persons. Covered List Public Notice; see 47 CFR 1.50002. PSHSB will 
continue to update that list as appropriate. Although the Commission, 
through PSHSB, publishes and updates the Covered List, the equipment 
and services included on the list are identified by specific external 
sources enumerated in the Secure Networks Act. 47 CFR 1.50002(b)(1)(i)-
(iv).
    This Covered List identifies communications equipment and services 
that pose an unacceptable risk to the national security of the United 
States or the security and safety of United States persons. The 
Commission is required to include communications equipment and services 
on the list based exclusively on determinations made by Congress and by 
other U.S. government agencies. 47 U.S.C. 1601(c). Currently, the list 
includes equipment and services produced or provided by five entities: 
``Telecommunications equipment produced or provided by'' Huawei 
Technologies Company or ZTE Corporation, or their respective 
subsidiaries and affiliates, ``including telecommunications or video 
surveillance services produced or provided by such [entities] or using 
such equipment;'' and ``Video surveillance and telecommunications 
equipment produced or provided by'' Hytera Communications Corporation, 
Hangzhou Hikvision Digital Technology Company, or Dahua Technology 
Company, or their respective subsidiaries and affiliates, ``to the 
extent it is used for the purpose of public safety, security of 
government facilities, physical security surveillance of critical 
infrastructure, and other national security purposes, including 
telecommunications or video surveillance services produced or provided 
by such [entities] or using such equipment.'' Covered List Public 
Notice at 3. (As noted in this Public Notice, where equipment or 
services on the list are identified by category, such category should 
be construed to include only equipment or services capable of the 
functions outlined in sections 2(b)(2)(A), (B), or (C) of the Secure 
Networks Act. 47 U.S.C. 1601(b)(2)(A)-(C)). Under the Secure Networks 
Act and the Commission's new rule, part 1, subpart DD, inclusion of 
equipment and services on the Covered List precludes the use of federal 
subsidy funds--e.g., funds from the Commission's Universal Service 
Programs--to obtain or maintain such equipment or services. 47 U.S.C. 
1602; 47 CFR 1.50000 et seq.; see Protecting Against National Security 
Threats to the Communications Supply Chain Through FCC Programs, WC 
Docket No. 18-89, Declaratory Ruling and Second Further Notice of 
Proposed Rulemaking, 35 FCC Rcd 7821, 7825-28, paras. 16-22 (2020).
    This NPRM seeks comment on various steps that the Commission could 
take in its equipment authorization program, as well as its competitive 
bidding program, to reduce threats posed to our nation's communications 
system. The Commission proposes revisions to its equipment 
authorization rules and procedures under part 2 to prohibit 
authorization of any ``covered'' equipment on the Covered List. It also 
seeks comment on whether to revise the rules on equipment currently 
exempted from the equipment authorization requirements to no longer 
permit this exemption for such ``covered'' equipment. In addition, it 
seeks comment on whether the Commission should revoke equipment 
authorizations of ``covered'' equipment, and if so under what 
conditions and procedures. Finally, we include questions concerning 
possible revisions to the Commission's competitive bidding procedures 
that could address certain concerns related to ``covered'' equipment 
and services. Notably, the Commission must ``periodically update the 
list . . . to address changes in [external] determinations . . . [and] 
shall monitor the making and reversing of determinations . . . in order 
to place additional communications equipment or services on the list . 
. . or to remove communications equipment and services from such 
list.'' Secure Networks Act Sec.  2(d)(1)-(2); see also 47 CFR 1.50003. 
If one of the enumerated sources named in the Secure Networks Act 
modifies or deletes a determination, PSHSB will do the same and modify 
the Covered List accordingly. See 47 CFR 1.50003(b) (if a determination 
regarding covered communications equipment or service on the Covered 
List is reversed or modified, directing PSHSB to remove from or modify 
the entry of such equipment or service on the Covered List, except if 
any of the sources identified in 47 CFR 1.50002(b)(1)(i)-(iv) maintains 
a determination supporting inclusion of such equipment or service on 
the Covered List). The Commission seeks comment on how future updates 
to the Covered List should affect our proposals in this Notice.

[[Page 46647]]

A. Equipment Authorization Rules and Procedures

    In this Notice, the Commission proposes revisions to the 
Commission's equipment authorization rules and processes to prohibit 
authorization of any ``covered'' equipment on the Covered List. This 
prohibition would apply to ``covered'' equipment on the Covered List 
maintained and updated by PSHSB. The Commission also seeks comment on 
whether its rules concerning equipment currently exempted from the 
equipment authorization requirement should be revised to ensure that 
any ``covered'' equipment cannot qualify for such exemption. In 
addition, it seeks comment on whether it should revoke any of the 
authorizations that have been previously granted for ``covered'' 
equipment on the Covered List, and if so, which ones and through what 
procedures. Finally, it seeks comment on new certifications for 
applicants that wish to participate in Commission auctions that would 
further address the risks posed by companies that the Commission has 
designated as posing a national security threat to the integrity of 
communications networks and the communications supply chain.
1. Equipment Authorization Rules Under Part 2
a. General Provisions of Subpart J
    The Commission's equipment authorization rules and procedures, set 
forth in 47 CFR part 2, include requirements and processes for 
equipment marketing, authorization, and importation. The Commission 
proposes to adopt a new provision, 47 CFR 2.903, as part of the 
``General Provisions'' of subpart J, to provide general guidance 
regarding the prohibition on equipment authorizations with respect to 
communications equipment on the Covered List. In proposing this new 
rule section, the Commission seeks to establish a clear prohibition on 
authorization of any ``covered'' equipment in the Commission's 
equipment authorization processes regardless of the process to which 
that equipment is subject. The Commission seeks comment on this 
proposed rule. Is this rule sufficient to prohibit any such equipment 
on the Covered List from being authorized for use in the United States? 
What modifications or clarifications are needed to this proposed 
language to ensure that the rule is clear as to its scope and effect 
and attains results commensurate with its purpose to protect national 
security? Are there additional provisions that should be included here 
to more fully capture the scope of the Commission's proposed 
prohibition?
    If the Commission were to adopt this proposal to revise the 
Commission's subpart J equipment authorization rules to prohibit any 
further authorization of ``covered'' equipment through the 
certification or SDoC processes, this decision would also serve to 
prohibit the marketing of such equipment that would now be prohibited 
from authorization under subpart I of the Commission's part 2 rules 
(Marketing of Radio-Frequency Devices) and importation of equipment 
under subpart K (Importation of Devices Capable of Causing Harmful 
Interference) of the Commission's part 2 rules. Section 2.803(b) of 
subpart I only permits persons to import or market RF devices that are 
subject to authorization under either the certification or SDoC 
process, as set forth in the Commission's subpart J rules, once those 
devices have been authorized, unless an exception applies. Similarly, 
the Commission's proposed revisions in subpart J also would serve to 
prohibit importing or marketing of ``covered'' equipment if it is 
subject to authorization through either the certification or SDoC 
process in subpart J and has not been authorized, per sections 
2.1201(a) and 2.1204(a). The Commission seeks comment on the need to 
revise or provide clarification with regard to how the Commission's 
proposed prohibition of authorization of ``covered'' equipment affects 
the implementation of the Commission's rules in either subpart I or 
subpart K. Would the general prohibition the Commission proposes for 
equipment subject to certification and SDoC make any changes to 
subparts I or K unnecessary? If not, what changes are needed to the 
Commission rules in those subparts?
    The Commission seeks comment on other revisions that it should make 
regarding equipment authorization either through the certification or 
SDoC rules and procedures. The Commission discusses and seeks comment 
on how the proposed rule should be implemented with respect to each of 
these processes, and whether other rule revisions or clarifications are 
appropriate. While the vast majority of RF devices are subject to 
either certification or an SDoC under the rules in subpart J, there is 
a limited category of devices that are exempt from these authorization 
processes. The Commission also seeks comment on how best to address 
this equipment.
b. Certification Rules
    Background. As described in brief above, under the Commission's 
equipment authorization rules, certain radiofrequency devices that have 
the greatest potential to cause harmful interference to radio services, 
must be processed through the equipment certification procedures. 
Certification generally is required for equipment that consists of 
radio transmitters as well as some unintentional radiators. Examples of 
equipment that requires certification include mobile phones, wireless 
provider base stations, point-to-point and point-to-multipoint 
microwave stations, land mobile, maritime and aviation radios, remote 
control transmitters, wireless medical telemetry transmitters, Wi-Fi 
access points and routers, home cable set-top boxes with Wi-Fi, and 
most wireless consumer equipment (e.g., tablets, smartwatches and smart 
home automation devices). Applicants are required to file with an FCC-
recognized Telecommunication Certification Body (TCB) applications 
containing specified information. See 47 CFR 2.907 (Certification), 
2.911-926 (Applications), 2.960-964 (Telecommunication Certification 
Bodies), 2.1031-1060 (Certification). Each applicant is required to 
provide the TCB with all pertinent information as required by the 
Commission's rules. See, e.g., 47 CFR 2.911(d), 2.1033(a). These 
requirements generally specify the information necessary to document 
compliance with the testing requirements that broadly apply to RF 
devices used under authority of the Commission, including devices used 
under licensed radio services and devices used on an unlicensed basis. 
Additional application information is required to demonstrate 
compliance with specific technical requirements in particular service 
rules (e.g., that antennas on certain unlicensed part 15 devices are 
not detachable (47 CFR 15.203) or that certain part 90 private land 
mobile transmitters meet required efficiency standards (47 CFR 
90.203(j))) or other broadly applicable policy-related Commission 
requirements (e.g., compliance with the Anti-Drug Abuse Act (47 CFR 
1.2002; 2.911(d)(2))). By signing the application for equipment 
authorization (FCC Form 731), each applicant attests that the 
information provided in all statements and exhibits pertaining to that 
particular equipment are true and correct. The TCB then makes a 
determination as to whether to grant an equipment certification based 
on evaluation of the submitted documentation and test data. The 
Commission, through OET, oversees the

[[Page 46648]]

certification application process, and provides guidance to applicants, 
TCBs, and test labs through its pre-approval guidance (including its 
knowledge database system (KDB)) with regard to required testing and 
other information associated with certification approval procedures and 
processes. Applications that involve new technology or for which there 
are no FCC-recognized test procedures require a TCB to obtain pre-
approval guidance from the Commission before the application may be 
approved. 47 CFR 2.964. Once a TCB makes a determination, either on its 
own or after consultation with the Commission, to grant an equipment 
certification, information about that authorization is publicly 
announced ``in a timely manner'' through posting on the Commission-
maintained Equipment Authorization System (EAS) database, and 
referenced via unique FCC identifier (FCC ID). Once this original 
certification is granted, the device is subject to rules that specify 
requirements: for modifying equipment, marketing under or changing FCC 
ID, and transferring ownership of an FCC ID.
    The Commission's part 2 rules also include various provisions that 
help ensure that equipment certifications comply with Commission 
requirements. The Commission is authorized to dismiss or deny an 
application where that application is not in accordance with Commission 
requirements or the Commission is unable to make a finding that grant 
of the application would serve the public interest. The rules also 
provide that the TCB or Commission may set aside a certification within 
30 days of grant if it determines that the equipment does not comply 
with necessary requirements. The rules also require the TCB to perform 
``post market surveillance'' of equipment that has been certified, with 
guidance from OET, as may be appropriate. Revocation of an existing 
equipment authorization is also authorized for various reasons, 
including for false statements and representations in the application. 
And an authorization may be withdrawn if the Commission changes its 
technical standards.
    Discussion. The Commission proposes certain additional revisions to 
the Commission's rules and processes regarding equipment certification. 
In proposing to revise the Commission equipment certification rules, 
the Commission goal is to design a process that efficiently and 
effectively prohibits authorization of ``covered'' equipment without 
delaying the authorization of innovative new equipment that benefits 
lives.
    The Commission proposes revising the equipment certification 
application procedures to include a new provision in section 2.911 that 
would require applicants to provide a written and signed attestation 
that, as of the date of the filing of the application, the equipment 
for which the applicant seeks certification is not ``covered'' 
equipment on the Covered List. Specifically, any applicant for 
certification would attest that no equipment (including component part) 
is comprised of any ``covered'' equipment, as identified on the current 
published list of ``covered'' equipment. This new provision also would 
cross-reference section 1.50002 of the Commission's rules that pertain 
to the Covered List. The Commission seeks comment on this proposal. The 
Commission also invites comment on particular language that should be 
included in this attestation. For instance, to what extent should the 
Commission consider basing this attestation language on the 
certifications that providers of advanced communications services must 
complete to receive a Federal subsidy made available through a program 
administered by the Commission that provides funds to be used for the 
capital expenditures necessary for the provision of advanced 
communications services? Are there additional compliance measures 
beyond the attestation that the Commission should consider? Should the 
applicant have an ongoing duty during the pendency of the application 
to monitor the list of covered equipment and provide notice to the TCB 
or the Commission if, subsequent to the initial filing of the 
application or at the time a grant of certification, the equipment or a 
component part had become newly listed as ``covered'' equipment in an 
updated Covered List?
    Section 2.1033 discusses information that must be included in the 
application. The Commission seeks comment on whether there are 
revisions that the Commission should adopt in this rule provision that 
would further clarify the Commission proposals regarding prohibition of 
the certification of any ``covered'' equipment. What information may be 
pertinent to assist the TCBs and the Commission in ensuring that 
applications do not seek certification of ``covered'' equipment? Should 
the Commission require that the applicant provide certain information 
that would help establish that the equipment is not ``covered'' 
equipment to assist TCBs and the Commission in making determinations 
about whether to grant the application? For example, the Commission 
currently requires applicants to file block diagrams or schematic 
diagrams of their devices. 47 CFR 1.50002 (Covered List). Should the 
Commission also require a parts list noting the manufacturer of each 
part? If the Commission were to adopt such a requirement, should it 
apply to all or only certain components? Which ones? How much 
additional burden, if any, would this place on applicants as compared 
to the current level of effort needed to prepare an equipment 
certification application?
    The Commission proposes to direct the Office of Engineering and 
Technology (OET) to develop guidance for use by interested parties, 
including applicants and TCBs, regarding the Commission's proposed 
prohibition on certification of ``covered'' equipment. In particular, 
the Commission proposes to direct PSHSB, the Wireline Competition 
Bureau (WCB), the Wireless Telecommunications Bureau, the International 
Bureau, and the Enforcement Bureau to assist OET in developing pre-
approval guidance that provides the necessary guidance that TCBs can 
use and should follow in implementing the proposed prohibition. PSHSB, 
which is tasked with publication of the Covered List, and has 
significant responsibilities and expertise regarding ensuring that the 
nation's public safety communications networks are secure, can lend 
important assistance by collaborating with OET to provide such 
guidance. The Commission seeks comment on this proposal. The Commission 
also seeks comment on whether the current pre-approval guidance rule 
(or the use of KDBs) should be revised or clarified consistent with the 
Commission goals in this proceeding.
    As the Commission has noted, following a TCB's grant of 
certification, the Commission will post information on that grant ``in 
a timely manner'' on the Commission-maintained public EAS database. As 
the Commission has also noted, the TCB or Commission may set aside a 
grant of certification within 30 days of the grant date if it is 
determined that such authorization does not comply with applicable 
requirements or is not in the public interest. To what extent should 
interested parties, whether the public or government entities (e.g., 
other expert agencies) be invited to help inform the Commission as to 
whether particular equipment inadvertently received a grant by the TCB 
and is in fact (or might be) ``covered'' equipment such that the grant 
should be set aside? Should the Commission consider adopting any new 
procedures for gathering and considering information

[[Page 46649]]

on potentially relevant concerns that the initial grant is not in the 
public interest and should be set aside? Should such procedures be 
limited to certain parties (e.g., expert agencies), or certain minimal 
showings required by those that seek to raise questions about the 
grant?
    Section 2.962(g) of the Commission's current rules expressly 
provides for ``post-market surveillance'' activities with respect to 
products that have been certified. The Commission proposes to direct 
OET, in exercising its delegated authority, to provide TCBs with 
guidance on the kinds of post-market surveillance that should be 
conducted to help ensure that no equipment that subsequently has been 
authorized includes ``covered'' equipment that has not been authorized. 
Here, the Commission seeks comment on whether revisions or 
clarifications to the post-market surveillance requirements should be 
adopted. Under existing rules, each TCB is required to conduct type 
testing of samples of product types that it has certified. OET has 
delegated authority to develop procedures that TCBs will use for 
performing such post-market surveillance, including the responsibility 
for publishing a document on the post-market surveillance requirements 
that will provide specific information such as the numbers and types of 
samples the TCBs must test. OET may also request that a grantee of 
equipment certification submit a sample directly to the TCB that 
performed the original certification for its evaluation. TCBs also may 
request samples directly from the grantee. If in this post-market 
surveillance, the TCB determines that the product fails to comply with 
the technical regulation for that product, the TCB then notifies the 
grantee and the grantee must then describe actions taken to the correct 
the situation. The TCB provides a report of these actions to the 
Commission within 30 days.
    The Commission also seeks comment on how the rules should be 
implemented, or revised or clarified, to ensure that equipment users 
will not make modifications to existing equipment that would involve 
replacing equipment (in whole or part) with ``covered'' equipment. 
Should, for instance, the Commission revise or clarify its section 
2.932 rules regarding modifications or the section 2.1043 provisions 
concerning ``permissive changes,'' to promote the Commission goals in 
this proceeding? The Commission also notes that section 2.929 of the 
equipment authorization rules includes provisions regarding changes in 
the name, address, ownership, or control of the grantee of an equipment 
authorization. An equipment authorization may not be assigned, 
exchanged, or in any other way transferred to a second party, except as 
provided in this section. Should the Commission consider any revisions 
or clarifications about how these provisions apply in light of the 
Commission proposals regarding prohibition on authorization of 
``covered'' equipment? For example, should the Commission prohibit the 
ownership or control of the certification for any equipment on the 
Covered List from being assigned, exchanged, or transferred to another 
party?
    Under the Commission's part 2 rules concerning equipment 
authorization, various provisions are included that help ensure that 
applicants and TCBs comply with their responsibilities related to the 
Commission's equipment authorization procedures set forth in part 2 
subpart J. The Commission notes, for instance, that pursuant to section 
2.911(d)(1), applicants must provide a written and signed certification 
to the TCB that all statements in its request for equipment 
authorization are true and correct to the best of its knowledge and 
belief. TCBs, which are subject to the accreditation process, must 
comply with all applicable responsibilities set forth in the Commission 
part 2 rules for TCBs, and if the Commission were to adopt the 
proposal, would be obligated to prohibit the certification of any 
``covered'' equipment. In reviewing the applications, TCBs would be 
required to dismiss any application should they become aware that an 
applicant has falsely asserted that its equipment (or components of the 
equipment) is not ``covered'' equipment. The Commission seeks comment 
on the implementation of these rules in the context of prohibiting 
certification of ``covered'' equipment, and any revisions or 
clarifications that may be appropriate to ensure that from this point 
forward applicants and TCBs comply with the proposed prohibition on 
authorization of ``covered'' equipment. Should the Commission's 
existing rules or procedures concerning ensuring compliance be enhanced 
with respect to applicants that intentionally attempt to circumvent the 
rules or TCBs that repeatedly fail to meet their responsibilities to 
comply with the Commission proposed prohibition?
    The Commission seeks comment on revisions that could better ensure 
that applicants comply with the proposed requirements. Under the 
Commission's current equipment certification rules, the grantee of the 
certification is responsible for compliance of the equipment with the 
applicable requirements as the ``responsible party,'' as set forth in 
section 2.909(a). In 2017, the Commission revised the rules applicable 
to equipment authorized through the SDoC process (discussed below) to 
require that the parties responsible under the SDoC rules for 
compliance of equipment authorized under those provisions must be 
located within the United States. 47 CFR 2.909(b); 2.1077(a)(3). Many 
certified devices are also manufactured outside of the United States, 
and there may be no party within the country other than the importer 
that the Commission could readily contact if the equipment is not 
compliant with the Commission's requirements. Accordingly, the 
Commission proposes adopting the same requirement previously adopted 
with regard to responsible parties in the SDoC process with regard to 
responsible parties associated with equipment authorized through the 
equipment certification process. The Commission seeks comment. 
Relatedly, the Commission has encountered difficulties in achieving 
service of process for enforcement matters involving foreign-based 
equipment manufacturers. Should the Commission also require that the 
applicant for certification of equipment include a party and/or an 
agent for service of process that must be located in the United States? 
How much additional burden, if any, would these requirements place on 
applicants as compared to the current level of effort needed to prepare 
an equipment certification application? Should the Commission impose a 
similar requirement on existing equipment certification grantees? If 
so, how would the Commission do so? If not, how should the Commission 
address the difficulty in obtaining service of process on certain 
foreign-based equipment manufacturers?
    As discussed above, PSHSB will periodically publish updates to 
identify the ``covered'' equipment and services that are on the Covered 
List. Under the proposals, the Commission accordingly directs that OET 
expeditiously take all the appropriate steps (e.g., updating as 
necessary the precise certification that applicants must make that no 
newly identified ``covered'' equipment is associated with the 
application, as well as updating any pre-approval guidance, KDB, or 
other guidance) to reflect those updates, consistent with the rules and 
procedures that the Commission ultimately adopts regarding the 
certification rules in this proceeding. The Commission invites comment 
on

[[Page 46650]]

appropriate means for OET to include updates of the ``covered'' 
equipment in an expeditious fashion in ways that best ensure that 
applicants, TCBs, and other interested parties will comply with the 
prohibitions concerning this updated identification of ``covered'' 
equipment.
    Finally, the Commission seeks comment on whether there are other 
rule revisions or clarifications to the equipment certification rules 
and processes that the Commission should make consistent with the goals 
to prohibit authorization of ``covered'' equipment. Commenters should 
explain their suggestions in sufficient detail, including the reasoning 
behind the suggestions and associated issues (e.g., implementation). 
While the proposed prohibition would be reflected in the Commission's 
rules and the engagement with TCBs in ensuring compliance, the 
Commission also seeks comment on any other types of action or activity 
(e.g., outreach and education) that would be helpful to ensure that all 
parties potentially affected by these changes understand the changes 
and will comply the prohibition associated with ``covered'' equipment.
c. Supplier's Declaration of Conformity (SDoC) Rules
    Background. The Supplier's Declaration of Conformity (SDoC) process 
is available for many types of equipment that have less potential to 
cause RF interference. Under the Commission rules, the types of 
equipment that may be processed pursuant to the SDoC procedures include 
fixed microwave transmitters (e.g., point-to-point or multipoint 
transmitter links as well as some links used by carriers and cable 
operators) authorized under part 101, broadcast TV transmitters 
authorized under parts 73 and 74, certain ship earth station 
transmitters authorized under part 80 (Maritime), some emergency 
locator transmitters authorized under part 87 (Aviation), and private 
land mobile radio services equipment and equipment associated with 
special services such as global maritime distress and safety system, 
aircraft locating beacons, ocean buoys), certain unlicensed equipment 
(e.g., business routers, firewalls, internet routers, internet 
appliances, wired surveillance cameras, business servers, workstations, 
laptops, almost all enterprise network equipment, computers, alarm 
clocks) that includes digital circuitry (but no radio transmitters) 
authorized under part 15, certain ISM equipment (e.g., those that use 
RF energy for heating or producing work) authorized under part 18. The 
SDoC process differs significantly from the certification process for 
equipment authorizations, and relies on determinations about the 
equipment made by the party responsible for compliance (``responsible 
party'' as defined in the rules) as to whether the equipment 
``conforms'' with the Commission's requirements. Using the more 
streamlined SDoC process for the equipment authorization is 
``optional'' insofar as the responsible party may choose to apply for 
equipment certification through the equipment certification process 
even if SDoC is acceptable under the Commission rules.
    In the SDoC process, the responsible party makes the necessary 
measurements and completes other procedures found acceptable to the 
Commission to ensure that the particular equipment complies with the 
appropriate technical standards for that device. The information 
provided with devices subject to SDoC must include a compliance 
statement that lists a U.S.-based responsible party. As set forth in 
the rules, the responsible party for equipment subject to the SDoC 
process could include the equipment manufacturer, the assembler (if the 
equipment is assembled from individual component parts and the 
resulting system is subject to authorization), or the importer (if the 
equipment by itself or the assembled system is subject to 
authorization), and could also include retailers and parties performing 
modification under certain circumstances. 47 CFR 2.909(b)(1)-(2); 47 
CFR 2.909(b)(3)-(4). The SDoC signifies that the responsible party has 
determined that the equipment has been shown to comply with the 
applicable technical standards. Given the streamlined nature of this 
particular process, responsible parties are not typically required to 
submit to the Commission an equipment sample or representative data 
demonstrating compliance. Also, while the Commission rules require that 
the equipment authorized under the SDoC procedure must include a unique 
identifier, the equipment is not listed in a Commission equipment 
authorization database, they are required to retain records on the 
equipment that demonstrate the equipment's compliance with the 
Commission's applicable requirements for that equipment. 47 CFR 2.1074; 
47 CFR 2.938. The Commission can specifically request that the 
responsible parties provide such information on particular equipment to 
the Commission. 47 CFR 2.906(a); 2.945(b)(1).
    Discussion. The Commission proposes that any equipment produced or 
provided by any of the entities (or their respective subsidiaries or 
affiliates) that produce or provide ``covered'' equipment, as specified 
on the Covered List, can no longer be authorized pursuant to the 
Commission's SDoC processes, and the equipment of any of these entities 
would have to be processed pursuant to the Commission's certification 
rules and processes as proposed above. Accordingly, responsible parties 
would be prohibited altogether from using the SDoC process with respect 
to any equipment produced or provided, in whole or part, by these 
entities (or their respective subsidiaries or affiliates), and such 
equipment would be prohibited from utilizing the SDoC process. That is 
not to say that all equipment produced or provided by these entities 
currently subject to the SDoC process would be prohibited; as the 
Commission discussed above, under the current rules, responsible 
parties always have the option of seeking equipment authorization 
through the Commission's equipment certification procedures. Under the 
Commission's proposed rules, responsible parties would now be required 
to use the certification procedures for any equipment produced or 
provided by these entities, as the option of using the SDoC processes 
would no longer be available. This proposal will help ensure consistent 
application of the Commission's proposed prohibition on further 
equipment authorization of any ``covered'' equipment by requiring use 
of only one process, which includes the Commission's more active 
oversight and proactive guidance when working directly with TCBs prior 
to any equipment authorization in the first place, and in guiding 
appropriate post-market surveillance after any equipment authorization. 
The Commission finds this approach consistent with the public interest.
    The Commission seeks comment on the specific information that must 
be included in the SDoC compliance statement that will ensure that 
responsible parties do not use the SDoC process for ``covered'' 
equipment. This compliance statement would need to be sufficiently 
complete to require a responsible party to exercise necessary diligence 
with respect to the equipment that it is subjecting to the SDoC process 
that will ensure that it is attesting, in clear terms, that the 
equipment (or any component part thereof) is not produced or provided 
by any entity that has produced or provided ``covered'' equipment on 
the Covered List. This compliance statement should be crafted in such a 
manner as to assist responsible

[[Page 46651]]

parties in identifying equipment that can no longer be processed 
through the SDoC process while also ensuring that responsible parties 
are held accountable, by their compliance statement, for any 
misrepresentations or violation of the prohibition that the Commission 
is proposing. The Commission notes that current rules require that the 
responsible party be located within the United States. 47 CFR 
2.1077(a)(3). As discussed above regarding equipment subject to the 
certification process, should the Commission also require that the 
compliance statement include the name of a U.S. agent for service of 
process (if different from the responsible party)?
    What steps should the Commission take to help inform responsible 
parties that use the SDoC process of this proposed prohibition, as well 
as the requirement that any equipment (including component parts) 
produced or provided by entities (and their subsidiaries and 
affiliates) that produce or provide ``covered'' equipment must be 
subject to the equipment certification process? The Commission notes 
that the rules allow many entities to take on the role of a responsible 
party under the part 2 rules, including retailers and parties 
performing modifications to equipment. The Commission seeks comment on 
how best to ensure that all responsible parties that use the SDoC 
processes to enable importing or marketing of equipment in the United 
States will understand and comply with the Commission's proposed 
revisions with respect to equipment produced or provided by entities 
that produce or provide ``covered'' equipment on the Covered List. What 
types of actions or activities (e.g., outreach and education) to 
equipment manufacturers, assemblers, importers, retailers, parties 
performing modification under certain circumstances, and others that 
serve as responsible parties and use the SDoC process regarding 
particular equipment would be advised and most helpful? Should the 
Commission impose a similar requirement with respect to existing 
authorizations obtained through the SDoC process? If so, how would the 
Commission do so? If not, how should the Commission address the 
difficulty of obtaining service of process on certain foreign-based 
equipment manufacturers?
    As noted above, the Commission can specifically request that the 
responsible parties provide information on any equipment to the 
Commission that has been authorized through the SDoC process. Under the 
Commission's proposal, in an effort to ensure that responsible parties 
are complying with the prohibition, the Commission would exercise its 
equipment authorization oversight, as appropriate, in requesting that 
the responsible parties provide information--e.g., an equipment sample, 
representative data demonstrating compliance, and the compliance 
statement itself--regarding particular equipment to the Commission. The 
Commission seeks comment on what kinds of situations in which such 
requests might be appropriate. What kinds of information might inform 
the Commission's consideration as to whether any equipment may have 
been inappropriately processed through the SDoC process, thus 
triggering the Commission's request for information from the 
responsible party to make sure that no violation of the Commission's 
prohibition has occurred?
    As the Commission has discussed, PSHSB will periodically publish 
updates to identify the ``covered'' equipment on the Covered List. As 
with the equipment certification proposals above, the Commission would 
direct that OET expeditiously take all the appropriate steps (e.g., 
updating as necessary the information that SDoC applicants must make to 
establish that no newly identified ``covered'' equipment is associated 
with the application to reflect those updates), consistent with the 
rules and procedures that the Commission ultimately adopts regarding 
the SDoC rules in this proceeding. The Commission invites comment on 
appropriate means for OET to include updates of the ``covered'' 
equipment in an expeditious fashion in ways that best ensure that 
applicants, responsible parties, and other interested parties will 
comply with the prohibitions that the Commission has proposed.
    Finally, the Commission seeks comment on whether there are other 
rule revisions or clarifications to the SDoC rules and processes that 
the Commission should make consistent with the goals to prohibit 
authorization of ``covered'' equipment. Commenters should explain their 
suggestions in sufficient detail, including the reasoning behind the 
suggestions and associated issues (e.g., implementation).
d. Legal Authority
    Adopting rules that take security into consideration in the 
equipment authorization process would serve the public interest by 
addressing significant national security risks that have been 
identified by this Commission in other proceedings, and by Congress and 
other federal agencies, and doing so would be consistent with the 
Commission's statutory ``purpose of regulating interstate and foreign 
commerce in communication by wire and radio . . . for the purpose of 
the national defense [and] for the purpose of promoting safety of life 
and property through the use of wire and radio communications.'' 47 
U.S.C. 151. The Commission tentatively concludes that doing so is not 
specifically authorized by the Secure Networks Act itself, pursuant to 
which the Commission adopted the Covered List. However, the Commission 
has broad authority to adopt rules, not inconsistent with the 
Communications Act, ``as may be necessary in the execution of its 
functions.'' 47 U.S.C. 154(i). The Commission believes that, in order 
to ensure that the Commission's rules under the Secure Networks Act 
effectively preclude use of equipment on the Covered List by USF 
recipients as contemplated by Congress, it is necessary to rely on the 
Commission's established equipment authorization procedures to restrict 
further equipment authorization, and the importation and marketing, of 
such devices in the first instance. As discussed above, the Commission 
also relies on the equipment authorization process to implement other 
statutory duties, including the duty to promote efficient use of the 
radio spectrum, the duties under the National Environmental Policy Act 
to regulate human RF exposure, the Commission's duty to ensure that 
mobile handsets are compatible with hearing aids, and the duty to deny 
federal benefits to certain individuals who have been convicted 
multiple times of federal offenses related to trafficking in or 
possession of controlled substances. The Commission believes that these 
processes can and should also serve the purpose of fulfilling other 
Commission responsibilities under the Secure Networks Act, and the 
Commission seeks comment on that issue.
    The Commission also believes that other authorities in the 
Communications Act of 1934, as amended, provide authority for the 
Commission to rely on for the proposed modifications to its rules and 
procedures governing equipment authorization. Since Congress added 
section 302 to the Act, the Commission's part 2 equipment authorization 
rules and processes have served to ensure that RF equipment marketed, 
sold, imported, and used in the United States complies with the 
applicable rules governing use of such equipment. See Equipment 
Authorization of RF Devices, Docket No. 19356, Report and Order, 39 FR 
5912, 5912, para. 2 (1970). That section

[[Page 46652]]

authorizes the Commission to, ``consistent with the public interest, 
convenience, and necessity, make reasonable regulations . . . governing 
the interference potential of devices which in their operation are 
capable of emitting radio frequency energy by radiation, conduction, or 
other means in sufficient degree to cause harmful interference to radio 
communications.'' 47 U.S.C. 302(a)(1). Regulations that the Commission 
adopts in implementing that authority ``shall be applicable to the 
manufacture, import, sale, offer for sale, or shipment of such devices 
and . . . to the use of such devices.'' 47 U.S.C. 302(a)(2). The 
authorization processes are primarily for the purpose of evaluating 
equipment's compliance with technical specifications intended to 
minimize the interference potential of devices that emit RF energy. As 
noted above, however, these rules are also designed to implement other 
statutory responsibilities. The Commission seeks comment on the scope 
of the authority to rely on such rules to effectuate other public 
interest responsibilities, including the Commission's section 303(e) 
authority to ``[r]egulate the kind of apparatus to be used with respect 
to its external effects.'' 47 U.S.C. 303(e). Does Congress's inclusion 
of the phrase ``to be used,'' rather than ``used,'' give the Commission 
authority to prevent the marketing and sale of equipment in addition to 
preventing licensees and others from using such equipment?
    Alternatively, does the ``public interest'' phrase in section 302 
itself provide independent authority to deny equipment authorization to 
equipment deemed to pose an unacceptable security risk? Section 302(a) 
directs the Commission to make reasonable regulations consistent with 
the public interest governing the interference potential of devices; it 
would appear to be in the public interest not to approve devices 
capable of emitting RF energy in sufficient degree to cause harmful 
interference to radio communications if such equipment has been deemed, 
pursuant to law, to pose an unacceptable risk to the national security 
of the United States or the security and safety of United States 
persons. The Commission seeks comment on this tentative conclusion.
    The Commission also seeks comment on a potential alternative basis 
for such security rules. The Communications Assistance for Law 
Enforcement Act (CALEA) includes security requirements that apply 
directly to equipment intended for use by providers of 
telecommunications services. 47 U.S.C. 1001-1010. Section 105 requires 
telecommunications carriers to ensure that the surveillance 
capabilities built into their networks ``can be activated only in 
accordance with a court order or other lawful authorization and with 
the affirmative intervention of an individual officer or employee of 
the carrier acting in accordance with regulations prescribed by the 
Commission,'' (47 U.S.C. 1004) and the Commission has concluded that 
its rule prohibiting the use of equipment produced or provided by any 
company posing a national security threat implements that provision. 
Supply Chain First Report and Order, 34 FCC Rcd at 11436-37, paras. 35-
36. The Commission is required to prescribe rules necessary to 
implement CALEA's requirements. 47 U.S.C. 229. Would rules prohibiting 
authorization of equipment on the Covered List, or that otherwise poses 
security risks, be justified as implementation of CALEA?
    As noted above, the Commission believes it has ancillary authority 
under section 4(i) of the Act to adopt these revisions to its part 2 
rules as reasonably necessary to the effective enforcement of the 
Secure Networks Act. The Commission also tentatively concludes that 
such rules would be consistent with the Commission's specific 
statutorily mandated responsibilities under the Communications Act to 
make reasonable regulations consistent with the public interest 
governing the interference potential of electronic devices, to protect 
consumers through the oversight of common carriers under Title II of 
that Act, and to prescribe the nature of services to be rendered by 
radio licensees under section 303(b) of that Act. The Commission seeks 
comment on this reasoning as well. The Commission also seeks comment on 
any other sources of authority for the Commission proposed rules.
e. Cost-Effectiveness Analysis
    The Commission's proposed revisions to the equipment authorization 
rules and processes to prohibit authorization of any ``covered'' 
equipment on the Covered List would apply only to equipment that has 
been determined by other agencies to pose ``an unacceptable risk'' to 
national security. The Commission has already concluded that it has no 
discretion to disregard determinations from these sources, which are 
enumerated in section 1.50002(b) of its rules. Hence, the Commission 
accepts the determination of these expert agencies.
    Because the Commission has no discretion to ignore these 
determinations, the Commission believes that a conventional cost-
benefit analysis--which would seek to determine whether the costs of 
the proposed actions exceed their benefits--is not directly called for. 
Instead, the Commission will consider whether the proposed actions 
would be a cost-effective means to prevent this dangerous equipment 
from being introduced into the nation's communications networks.
    The Commission therefore seeks comment on the cost-effectiveness of 
the proposed revisions to the rules and procedures associated with the 
Commission's equipment authorization rules under part 2. Do the 
Commission's proposed rules promote the goals of ensuring that the 
national security interests are adequately protected from equipment on 
the Covered List, while simultaneously continuing the mission of making 
communications services available to all Americans? Are there 
alternative approaches that would achieve this goal in a more cost-
effective manner?
2. Devices Exempt From the Requirement of an Equipment Authorization
    Background. Under the Commission's rules, certain types of RF 
devices are exempt from demonstrating compliance under one of the 
equipment authorization procedures (either certification or SDoC). This 
exemption applies to specified digital devices in several types of 
products, including many part 15 devices (including incidental and 
unintentional radiators) because they generate such low levels of RF 
emission that they have virtually no potential for interfering with 
authorized radio services. Revision of Part 15 of the Rules Regarding 
the Operation of Radio Frequency Devices without an Individual License, 
GN Docket No. 87-389, Notice of Proposed Rulemaking, 2 FCC Rcd 6135, 
6140, para. 39 (1987). In other services, the Commission has determined 
that because operators must be individually licensed and responsible 
for their stations (e.g., Amateur Radio Service) or the type of 
operation poses low risk of harmful interference, such an exemption is 
warranted. See, e.g., 47 CFR 97.315. Exempt devices are required to 
comply with general conditions of operation, including the requirement 
that if an exempt device causes interference to other radio services 
the operator of that device must cease operating the device upon 
notification from the Commission and must remedy the interference. See 
47 CFR 15.5.
    The most diverse set of exempted devices operate under the part 15 
unlicensed device rules. The categories of part 15 exempt devices 
include

[[Page 46653]]

incidental radiators, unintentional radiators exempt under section 
15.103, and subassemblies exempt under section 15.101. Specifically, 
section 15.103 of the Commission's rules provides that certain 
unintentional radiators, which are subject to the general conditions of 
operation provided in part 15, are exempt from the specific technical 
standards and other requirements of part 15. This includes: (1) Digital 
devices used exclusively in any transportation vehicle as an electronic 
control or power system equipment used by a public utility or in an 
industrial plant, as industrial, commercial, or medical test equipment, 
or in an appliance (e.g., microwave oven, dishwasher, clothes dryer, 
air conditioner, etc.); (2) specialized medical digital devices; (3) 
digital devices that have very low power consumption (i.e., not 
exceeding 6 nW); (4) joystick controllers or similar devices used with 
digital devices; and (5) digital devices that both use and generate a 
very low frequency (i.e. less than 1.705 MHz) and which do not operate 
from the AC power lines or contain provisions for operation while 
connected to the AC power lines. Digital device subassemblies also are 
exempt from equipment authorization under section 15.101. Examples of 
subassemblies include circuit boards, integrated circuit chops, and 
other components that are completely internal to a product that do not 
constitute a final product. These include internal memory expansion 
boards, internal disk drives, internal disk drive controller boards, 
CPU boards, and power supplies. Subassemblies may be sold to the 
general public or to manufacturers for incorporation into a final 
product.
    Discussion. The Commission recognizes that ``covered'' equipment 
potentially could include equipment that currently is exempt from the 
need to demonstrate compliance under the Commission's equipment 
authorization processes, which, to date, has looked only at the RF 
emissions capability of equipment. As noted above, most devices that 
are generally exempt from the Commission's equipment authorization 
requirements typically have such low RF emissions that they present 
virtually no potential for causing harmful interference to the 
authorized radio services. However, the Commission's concerns in 
relation to security considerations that pose unacceptable risks to the 
nation's communications networks are distinct from the concerns related 
to interference to authorized services. As such, the Commission finds 
it necessary to assess the regulation of otherwise exempt devices in 
relation to security concerns.
    Accordingly, the Commission seeks comment on whether the Commission 
should consider possible revisions or clarifications to its rules to 
address issues related to ``covered'' equipment and the potential of 
such equipment, regardless of RF emissions characteristics, to pose an 
unacceptable risk to U.S. networks or users. The Commission seeks 
comment on whether the Commission should revise its rules to no longer 
provide an equipment authorization exemption to ``covered'' equipment. 
The Commission seeks comment on whether such a provision, if adopted, 
should apply only to part 15 unlicensed devices or should include any 
device, regardless of rule part under which it operates, in the 
consideration of possible revisions or clarifications to the 
Commission's rules to address issues related to ``covered'' equipment 
and the potential of such equipment, regardless of RF emissions 
characteristics, to nonetheless pose an unacceptable risk to U.S. 
networks or users. The Commission also asks whether it should require 
that any equipment (in whole or in part), regardless of claim of 
exemption, that is produced or provided by any entity that has produced 
or provided ``covered'' equipment on the Covered List be processed 
pursuant to the Commission's certification rules and processes (similar 
to the proposal requiring use of the certification process for such 
equipment instead of continued use of the SDoC process).
    Currently, devices that are exempt from the equipment authorization 
requirement are not subject to FCC testing, filing, or record retention 
requirements. Such devices ordinarily would come to the attention of 
the Commission only in the event that harmful interference with other 
devices becomes an issue. In order to determine whether otherwise 
exempt ``covered'' equipment may present a security concern, the 
Commission would need to implement some means by which to identify such 
equipment that is in use in the United States. The Commission seeks 
comment on possible methods that the Commission could implement to 
identify otherwise exempt equipment. The Commission could, for 
instance, implement a registration system for otherwise exempt 
equipment produced or provided by any of the entities (or their 
respective subsidiaries or affiliates) that produce or provide 
``covered'' equipment, as specified on the Covered List. Such a system 
could require that relevant responsible parties notify the Commission 
of the marketing, importation, or operation of such otherwise exempt 
equipment. Such notification would include identification of the 
responsible party, manufacturer, or importer and the general operating 
parameters of the equipment. Another example includes an attestation at 
time of marketing or import that the equipment is not ``covered.'' What 
are some potential burdens to responsible parties or other entities 
that would arise in connection with such a registration or attestation 
system? In what ways and to what extent would such burdens be 
acceptable to responsible parties to help protect the U.S. against the 
related security concerns? What type of information, and from which 
entities, should the Commission collect in order to identify otherwise 
exempt ``covered'' equipment? How many responsible parties would be 
impacted by these potential information collections and in what way 
would it impact their ability to conduct business? If the Commission 
were to revise its rules to remove the exemption with respect to 
``covered'' equipment, the Commission seeks comment on any other types 
of action or activity (e.g., outreach and education) that also would be 
helpful to ensure that all parties potentially affected by these 
changes understand the changes and will comply the prohibition 
associated with ``covered'' equipment.
    The Commission discussed above the legal authority associated with 
the Commission's proposal to prohibit authorization of ``covered'' 
equipment in its equipment authorization process. The Commission 
tentatively concludes that the legal bases enunciated above also 
provide, pursuant to section 302 and section 4(i) of the Act, for 
actions that the Commission might take with respect to precluding 
``covered'' equipment from being exempted from the equipment 
authorization process. The Commission seeks comment on this tentative 
conclusion.
    If the Commission were to conclude that the rules should be revised 
to prohibit certain ``covered'' equipment from being exempted from the 
equipment authorization processes, this action would apply only to 
equipment that has been determined by other agencies to pose ``an 
unacceptable risk'' to national security. Because the Commission has no 
discretion to ignore these determinations, it believes that a 
conventional cost-benefit analysis--which would seek to determine 
whether the costs of the proposed actions exceed their benefits--is not 
necessary. Instead, as discussed above, the Commission will consider 
whether the proposed actions would be an effective means to

[[Page 46654]]

prevent this dangerous equipment from being introduced into the 
nation's communications networks.
3. Revoking Equipment Authorizations
    The actions that the Commission proposes above would serve to 
prohibit any prospective authorization of ``covered'' communications 
equipment on the Covered List as posing an unacceptable risk to 
national security. Those proposed actions do not, however, address 
whether the Commission could or should revoke any existing equipment 
authorizations of such ``covered'' communications equipment, and if so, 
the processes for doing so. The Commission addresses those issues here.
    Background. Section 2.939 sets forth the Commission's rules for 
revoking authorizations of equipment. Section 2.939(a)(1) provides that 
the Commission may revoke an equipment authorization ``[f]or false 
statements or representations either in the application or in materials 
or response submitted in connection therewith'' or in records that the 
responsible party is required to maintain about the authorized 
equipment (e.g., drawings and specifications, description of the 
equipment, any test report, equipment compliance information). Section 
2.939(a)(2) states that the Commission may revoke an equipment 
authorization ``[i]f upon subsequent inspection or operation it is 
determined that the equipment does not conform to the pertinent 
technical requirements or to the representations made in the original 
application.'' Section 2.939(a)(3) provides that the Commission may 
revoke an equipment authorization ``[i]f it is determined that changes 
have been made in the equipment other than those authorized by the 
rules or otherwise expressly authorized by the Commission.'' Section 
2.939(a)(4) provides that the Commission may revoke any equipment 
authorization ``[b]ecause of conditions coming to the attention of the 
Commission which would warrant it in refusing to grant an original 
application.'' As set forth in Sec.  2.939(b) of the Commission's 
rules, the procedures for revoking an equipment authorization are the 
same procedures as revoking a radio station license under section 312 
of the Communications Act. See 47 CFR 2.939(b); 47 U.S.C. 312. Finally, 
under Sec.  2.939(c), the Commission also ``may withdraw any equipment 
authorization in the event of changes in its technical standards.''
    Discussion. If the Commission adopts the rules proposed above to 
prohibit any further authorization of ``covered'' equipment on the 
Covered List, the Commission seeks comment here on the extent to which 
the Commission should revoke any existing equipment authorizations of 
such ``covered'' equipment pursuant to the Commission's section 2.939 
revocation rules. The Commission notes that if it revoked an existing 
equipment authorization, the marketing of that equipment would be 
prohibited pursuant to part 2 subpart I, per section 2.803(b), and 
import and marketing would be prohibited pursuant to part 2 subpart K, 
per sections 2.1201(a) and 2.1204(a).
    The Commission tentatively concludes that sections 2.939(a)(1) and 
(2) would apply to ``covered'' equipment, such that the Commission has 
authority to revoke any existing equipment authorizations that may have 
been granted under false statements or representations (including non-
disclosure) concerning whether an equipment authorization application 
that was subsequently granted had in fact included ``covered'' 
equipment (in whole or as a component part). Shenzhen Tangreat 
Technology Co., Ltd., 30 FCC Rcd 3501,3505, paras. 12-14 (EB 2015) 
(Shenzhen) (``substantial and material questions exist as to whether 
the authorization should be revoked because the information in the 
application was false or misleading''). This would enable the 
Commission to revoke any equipment authorizations that are granted 
after adoption of the rules proposed in this NPRM, even if the TCBs or 
the Commission had not acted to set aside the grant within the 30-day 
period following the posting of the grant on the Equipment 
Authorization System (EAS) database. The Commission seeks comment on 
this tentative conclusion.
    To assure that otherwise authorized equipment is not subsequently 
replaced by any ``covered'' equipment (whether in whole or with 
component part(s) of ``covered'' equipment), the Commission also 
tentatively concludes that section 2.939(a)(3) would apply, and that 
the Commission can revoke an existing equipment authorization if 
changes have been made in the equipment other than those authorized by 
the rules or otherwise expressly authorized by the Commission. 
Shenzhen, 30 FCC Rcd at 3505-06, paras. 15-17 (Commission investigation 
demonstrated that the equipment marketed does not match the 
specifications described in the granted application). The Commission 
seeks comment on these and any other scenarios that implicate the need 
to revoke an existing equipment authorization to exclude ``covered'' 
equipment from the U.S. market.
    The Commission also seeks comment on other circumstances that would 
merit Commission action to revoke any existing authorization of 
``covered'' equipment. Under what circumstances should the Commission 
revoke an existing authorization? For instance, to what extent does 
section 2.939(a)(4), which allows revocation ``[b]ecause of conditions 
coming to the attention of the Commission which would warrant it in 
refusing to grant an original application,'' provide guidance? 
Specifically, if the Commission would not have granted an application 
with equipment from an entity on the Covered List under newly adopted 
rules, then could the Commission use section 2.939(a)(4) to revoke an 
equipment authorization with said equipment that had been granted prior 
to the adoption of the rule? Shenzhen, 30 FCC Rcd at 3506, paras. 18-20 
(when Commission investigation determined device was a radio frequency 
jammer, ``substantial and material questions exist as to whether the 
application should have been granted''), see also J Communications Co., 
Ltd., 19 FCC Rcd 10643, 10645, para. 9 (EB 2004) (revoking GMRS radios 
because the Commission could have denied the original equipment 
authorization application for the devices ``had this fact been made 
known to the Commission''). The Commission seeks comment on this 
approach and on any other approach or particular circumstances that 
would merit Commission action to revoke any existing authorization that 
concerns ``covered'' equipment on the Covered List.
    The Commission seeks comment on the applicability of section 
2.939(c), which states that the Commission also ``may withdraw any 
equipment authorization in the event of changes in its technical 
standards,'' with regard to revocation of authorizations that include 
``covered'' equipment. In the event the Commission were to adopt rules 
barring new equipment authorizations for equipment on the Covered List, 
it tentatively concludes that such a change should constitute a change 
to the Commission's technical standards that could warrant withdrawal 
of equipment authorizations that are contrary to these new rules. The 
Commission seeks comment.
    In addition, the Commission seeks comment on the specific 
procedures the Commission should use if and when it seeks to revoke an 
existing equipment authorization. Section 2.939(b) requires that 
revocation of an equipment authorization must be made in the ``same 
manner as revocation of radio

[[Page 46655]]

station licenses,'' and thus presumably would include the requirement 
that the Commission serve the grantee/responsible party with an order 
to show cause why revocation should not be issued and must provide that 
party with an opportunity for a hearing. See 47 U.S.C. 312(c). The 
Commission seeks comment on this requirement. What precisely are the 
procedures that the Commission should employ if seeking to revoke 
particular ``covered'' equipment? As the Commission discussed above, 
Sec.  2.939(c) authorizes the Commission to ``withdraw any equipment 
authorization in the event of changes in its technical standards.'' 
Pursuant to this provision, should the Commission provide a suitable 
amortization period for equipment already in the hands of users or in 
the manufacturing process? If so, what would that be? What other 
factors should the Commission consider that might warrant revocation 
under the new rules, such as those applicable to Title III licenses 
under section 312 of the Communications Act? 47 U.S.C. 312. Should the 
Commission revise or clarify the existing requirements to enable the 
Commission to revoke authorizations of this ``covered'' equipment given 
that it already has been determined that the equipment poses an 
unacceptable risk?
    In considering whether any existing equipment authorizations of 
``covered'' equipment should be revoked, is there some process in which 
the Commission should engage to help identify particular equipment 
authorizations that should be considered for revocation? What process 
should the Commission use to identify equipment authorizations for 
revocation? For example, to what extent might the Commission rely on 
others' reports of a violation, and to what extent might such reports 
need to be supported in the record or independently verified? If the 
Commission were to conclude that revocation may be appropriate 
regarding particular ``covered'' equipment, this action would apply 
only to equipment that has been determined by other agencies to pose 
``an unacceptable risk'' to national security. The Commission 
nonetheless recognizes the need to avoid taking actions that are 
overbroad in terms of affecting users of the equipment or would require 
removal of this equipment faster than it reasonably can be replaced. If 
the Commission concludes that revocation may be appropriate regarding 
particular ``covered'' equipment, the Commission seeks comment on the 
appropriate and reasonable transition period for removing that 
particular equipment. This could include a transition period for non-
conforming equipment to make any necessary modifications to 
communications equipment or services, including removing the ``covered 
equipment'' (in whole or as a component) from that equipment or 
service. To what extent should the Commission apply different 
transition periods to different equipment authorizations that the 
Commission revokes? Are there any situations that might merit immediate 
compliance with the new equipment restrictions? Pursuant to section 
503(b)(5) of the Act, the Commission must issue citations against non-
regulatees for violations of FCC rules before proposing any monetary 
penalties. 47 U.S.C. 503(b)(5). Such citations ``provide notice to 
parties that one or more actions violate the Act and/or the FCC's 
rules--and that they could face a monetary forfeiture if the conduct 
continues.'' See Federal Communications Commission, Enforcement Bureau, 
``Enforcement Overview'' at 10 (April 2020), https://www.fcc.gov/sites/default/files/public_enforcement_overview.pdf. Given this requirement, 
what enforcement policy would be appropriate for the continued 
marketing, sale, or operation of equipment by such parties during this 
transition period? What, if any, educational and outreach efforts 
should the Commission undertake to inform the public regarding any such 
revocations and their legal effect?
    Finally, the Commission seeks comment on whether the Commission 
should make any revisions to Sec.  2.939. Should this section be 
revised and/or clarified to specifically include ``covered'' equipment 
or whether the rule should be clarified to better encompass the intent 
in this rulemaking? What other specific revisions might be appropriate 
for consideration?

B. Competitive Bidding Certification

    Background. The Commission's competitive bidding process requires 
each applicant to make various certifications as a prerequisite for 
participation in an auction. Requiring certifications as a condition of 
participation guards against potential harms to the public interest 
before the harms could occur.
    As described above, the Commission has designated Huawei and ZTE, 
and their subsidiaries, parents, or affiliates, as companies that pose 
a national security threat to the integrity of communications networks 
and the communications supply chain. See generally Huawei Designation 
Order, 35 FCC Rcd 6604, ZTE Designation Order, 35 FCC Rcd 6633. As a 
result of this determination, funds from the Commission's Universal 
Service Fund may no longer be used to purchase, obtain, maintain, 
improve, modify, or otherwise support any equipment or services 
produced or provided by these covered companies.
    In reaching this determination, the Commission noted Huawei's and 
ZTE's ties to the Chinese government and military apparatus, along with 
Chinese laws obligating it to cooperate with requests by the Chinese 
government to use or access its systems. Huawei Designation Order, 35 
FCC Rcd at 6609, paras. 13-14. However, it also is well-established 
that the Chinese government helps fuel Huawei's growth by deploying 
powerful industrial policies to make Huawei equipment cheaper to deploy 
than the alternatives. Chuin-Wei Yap, State Support Helped Fuel 
Huawei's Global Rise, Wall Street Journal (Dec. 25, 2019), https://www.wsj.com/articles/state-support-helped-fuel-huaweis-global-rise-11577280736. These policies include both direct subsidies to Huawei and 
state-funded export financing.
    To illustrate, a recent report by the Center for American Progress 
found that China's state-owned banks have provided billions of dollars 
to Huawei's customers. Melanie Hart and Jordan Link, Center for 
American Progress, There Is a Solution to the Huawei Challenge (Oct. 
14, 2020), https://www.americanprogress.org/issues/security/reports/2020/10/14/491476/solution-huawei-challenge/. According to the report, 
these loans ``can make Huawei impossible to beat--even if competitors 
can match the company's state-subsidized prices--because China's state 
banks offer packages that commercial banks generally cannot match.'' 
Id. at para. 25. These loans may be run through Huawei or provided 
directly to Huawei's customers.
    The Commission notes that the nature of state support for Huawei 
and ZTE has shifted over time. Recently, the Commission has observed 
how state-funded export financing may provide substantial funding to 
mobile operators already using equipment from Huawei or ZTE prior to 
national spectrum auctions in other countries. In one recent case, a 
Huawei customer was able to substantially outbid a rival new entrant in 
a spectrum auction--thereby denying entry to a new competitor that was 
planning on using trustworthy equipment in its 5G build-out.
    Distortionary financing intended to support participation in 
spectrum auctions of network operators who then deploy covered 
equipment and services

[[Page 46656]]

may raise concerns about risks to the national security of the United 
States and the security and safety of United States persons. The 
Commission considers here the benefits of protecting against such risks 
prior to the start of a Commission auction.
    Discussion. Given recent developments internationally, the 
Commission seeks comment on whether the Commission should require an 
applicant to participate in competitive bidding to certify that its 
bids do not and will not rely on financial support from any entity that 
the Commission has designated under section 54.9 of its rules as a 
national security threat to the integrity of communications networks or 
the communications supply chain. Could such support implicate the kinds 
of influence over the applicant that would pose risks to national 
security? Or could it distort auction outcomes in ways that would pose 
risks to national security? What challenges would an applicant have in 
satisfying such a certification, given potential uncertainties 
regarding the ultimate origin of financial support? Can the 
certification be crafted to address these challenges? Do these 
uncertainties present difficulties for the Commission in enforcing the 
certification? How can these difficulties be mitigated?
    If the Commission adopts a requirement that an applicant certify 
that its bids do not and will not rely on financial support by an 
entity designated by the Commission as a national security threat, 
should the certification be limited to just the entities so designated 
by the Commission under section 54.9 or be more expansive? What are the 
challenges with including indirect provision of financing in the 
certification and how can they be mitigated to ensure it accomplishes 
its purpose? Should the certification be expanded to include an 
identified set of related entities, e.g., entities subject to control 
by an entity designated by the Commission? What entities should such a 
set include? How does the fungibility of financial resources complicate 
compliance? How can enforcement challenges be alleviated?

IV. Initial Regulatory Flexibility Analysis

    As required by the Regulatory Flexibility Act of 1980, as amended 
(RFA), the Commission has prepared this present Initial Regulatory 
Flexibility Analysis (IRFA) of the possible significant economic impact 
on a substantial number of small entities by the policies and rules 
proposed in this Notice of Proposed Rule Making (Notice). 5 U.S.C. 603. 
(The RFA, 5 U.S.C. 601-612, has been amended by the Small Business 
Regulatory Enforcement Fairness Act of 1996 (SBREFA), Public Law 104-
121, Title II, 110 Stat. 857 (1996)). Written public comments are 
requested on this IRFA. Comments must be identified as responses to the 
IRFA and must be filed by the deadlines for comments on the Notice, 
including this IRFA, to the Chief Counsel for Advocacy of the Small 
Business Administration (SBA). 5 U.S.C. 603(a). In addition, the Notice 
and IRFA (or summaries thereof) will be published in the Federal 
Register. 5 U.S.C. 603(a).

A. Need for, and Objectives of, the Proposed Rules

    In this Notice of Proposed Rulemaking, we propose prohibiting the 
authorization of any equipment on the list of equipment and services 
(Covered List) that the Commission maintains pursuant to the Secure and 
Trusted Communications Networks Act of 2019. Secure and Trusted 
Communications Networks Act of 2019, Public Law 116-124, 133 Stat. 158 
(2020) (codified as amended at 47 U.S.C. 1601-1609) (Secure Networks 
Act). (The Commission's Public Safety and Homeland Security Bureau 
maintains the list at https://www.fcc.gov/supplychain/coveredlist). 
Such equipment has been found to pose an unacceptable risk to the 
national security of the United States or the security and safety of 
United States persons. We also seek comment on whether and under what 
circumstances we should revoke any existing authorizations of such 
``covered'' communications equipment. Finally, we invite comment on 
whether we should require additional certifications relating to 
national security from applicants who wish to participate in Commission 
auctions.

B. Legal Basis

    The proposed action is taken under authority found in sections 
4(i), 301, 302, 303, 309(j), 312, and 316 of the Communications Act of 
1934, as amended, 47 U.S.C. 154(i), 301, 302, 303, 309(j), 312 and 316; 
and Sec.  1.411 of the Commission's rules, 47 CFR 1.411.

C. Small Businesses, Small Organizations, and Small Governmental 
Jurisdictions

    Our actions, over time, may affect small entities that are not 
easily categorized at present. We therefore describe here, at the 
outset, three broad groups of small entities that could be directly 
affected herein. See 5 U.S.C. 601(3)-(6). First, while there are 
industry specific size standards for small businesses that are used in 
the regulatory flexibility analysis, according to data from the Small 
Business Administration's (SBA) Office of Advocacy, in general a small 
business is an independent business having fewer than 500 employees. 
See SBA, Office of Advocacy, ``What's New With Small Business?'' 
https://cdn.advocacy.sba.gov/wp-content/uploads/2019/09/23172859/Whats-New-With-Small-Business-2019.pdf (Sept. 2019). These types of small 
businesses represent 99.9% of all businesses in the United States, 
which translates to 30.7 million businesses. Id.
    Next, the type of small entity described as a ``small 
organization'' is generally ``any not-for-profit enterprise which is 
independently owned and operated and is not dominant in its field.'' 5 
U.S.C. 601(4). The Internal Revenue Service (IRS) uses a revenue 
benchmark of $50,000 or less to delineate its annual electronic filing 
requirements for small exempt organizations. Nationwide, for tax year 
2018, there were approximately 571,709 small exempt organizations in 
the U.S. reporting revenues of $50,000 or less according to the 
registration and tax data for exempt organizations available from the 
IRS. See Exempt Organizations Business Master File Extract (E.O. BMF), 
``CSV Files by Region,'' https://www.irs.gov/charities-non-profits/exempt-organizations-business-master-file-extract-eo-bmf.
    Finally, the small entity described as a ``small governmental 
jurisdiction'' is defined generally as ``governments of cities, 
counties, towns, townships, villages, school districts, or special 
districts, with a population of less than fifty thousand.'' 5 U.S.C. 
601(5). U.S. Census Bureau data from the 2017 Census of Governments 
(see 13 U.S.C. 161) indicate that there were 90,075 local governmental 
jurisdictions consisting of general purpose governments and special 
purpose governments in the United States. See U.S. Census Bureau, 2017 
Census of Governments--Organization Table 2. Local Governments by Type 
and State: 2017 [CG1700ORG02]. https://www.census.gov/data/tables/2017/econ/gus/2017-governments.html. (Local governmental jurisdictions are 
made up of general purpose governments (county, municipal and town or 
township) and special purpose governments (special districts and 
independent school districts). See also Table 2. CG1700ORG02 Table 
Notes_Local Governments by Type and State_2017). Of this number there 
were 36,931

[[Page 46657]]

general purpose governments (county, municipal and town or township) 
with populations of less than 50,000 and 12,040 special purpose 
governments--independent school districts with enrollment populations 
of less than 50,000. Accordingly, based on the 2017 U.S. Census of 
Governments data, we estimate that at least 48,971 entities fall into 
the category of ``small governmental jurisdictions.''
    Satellite Telecommunications. This category comprises firms 
``primarily engaged in providing telecommunications services to other 
establishments in the telecommunications and broadcasting industries by 
forwarding and receiving communications signals via a system of 
satellites or reselling satellite telecommunications.'' See U.S. Census 
Bureau, 2017 NAICS Definition, ``517410 Satellite Telecommunications,'' 
https://www.census.gov/cgi-bin/sssd/naics/naicsrch?input=517410&search=2017+NAICS+Search&search=2017. Satellite 
telecommunications service providers include satellite and earth 
station operators. The category has a small business size standard of 
$35 million or less in average annual receipts, under SBA rules. See 13 
CFR 121.201, NAICS Code 517410. For this category, U.S. Census Bureau 
data for 2012 show that there were a total of 333 firms that operated 
for the entire year. See U.S. Census Bureau, 2012 Economic Census of 
the United States, Table ID: EC1251SSSZ4, Information: Subject Series--
Estab and Firm Size: Receipts Size of Firms for the U.S.: 2012, NAICS 
Code 517410, https://data.census.gov/cedsci/table?text=EC1251SSSZ4&n=517410&tid=ECNSIZE2012.EC1251SSSZ4&hidePreview=false&vintage=2012. Of this total, 299 firms had annual receipts of 
less than $25 million. Consequently, we estimate that the majority of 
satellite telecommunications providers are small entities.
    All Other Telecommunications. The ``All Other Telecommunications'' 
category is comprised of establishments primarily engaged in providing 
specialized telecommunications services, such as satellite tracking, 
communications telemetry, and radar station operation. See U.S. Census 
Bureau, 2017 NAICS Definition, ``517919 All Other Telecommunications,'' 
https://www.census.gov/naics/?input=517919&year=2017&details=517919. 
This industry also includes establishments primarily engaged in 
providing satellite terminal stations and associated facilities 
connected with one or more terrestrial systems and capable of 
transmitting telecommunications to, and receiving telecommunications 
from, satellite systems. Id. Establishments providing internet services 
or voice over internet protocol (VoIP) services via client-supplied 
telecommunications connections are also included in this industry. Id. 
The SBA has developed a small business size standard for ``All Other 
Telecommunications'', which consists of all such firms with annual 
receipts of $35 million or less. See 13 CFR 121.201, NAICS Code 517919. 
For this category, U.S. Census Bureau data for 2012 show that there 
were 1,442 firms that operated for the entire year. See U.S. Census 
Bureau, 2012 Economic Census of the United States, Table ID: 
EC1251SSSZ4, Information: Subject Series--Estab and Firm Size: Receipts 
Size of Firms for the U.S.: 2012, NAICS Code 517919, https://data.census.gov/cedsci/table?text=EC1251SSSZ4&n=517919&tid=ECNSIZE2012.EC1251SSSZ4&hidePreview=false. Of those firms, a total of 1,400 had annual receipts less than 
$25 million and 15 firms had annual receipts of $25 million to 
$49,999,999. Id. Thus, the Commission estimates that the majority of 
``All Other Telecommunications'' firms potentially affected by our 
action can be considered small.
    Fixed Satellite Transmit/Receive Earth Stations. There are 
approximately 4,303 earth station authorizations, a portion of which 
are Fixed Satellite Transmit/Receive Earth Stations. We do not request 
nor collect annual revenue information and are unable to estimate the 
number of the earth stations that would constitute a small business 
under the SBA definition. However, the majority of these stations could 
be impacted by our proposed rules.
    Fixed Satellite Small Transmit/Receive Earth Stations. There are 
approximately 4,303 earth station authorizations, a portion of which 
are Fixed Satellite Small Transmit/Receive Earth Stations. We do not 
request nor collect annual revenue information and are unable to 
estimate the number of fixed small satellite transmit/receive earth 
stations that would constitute a small business under the SBA 
definition. However, the majority of these stations could be impacted 
by our proposed rules.
    Mobile Satellite Earth Stations. There are 19 licensees. We do not 
request nor collect annual revenue information and are unable to 
estimate the number of mobile satellite earth stations that would 
constitute a small business under the SBA definition. However, it is 
expected that many of these stations could be impacted by our proposed 
rules.
    Wireless Telecommunications Carriers (except satellite). This 
industry comprises establishments engaged in operating and maintaining 
switching and transmission facilities to provide communications via the 
airwaves. Establishments in this industry have spectrum licenses and 
provide services using that spectrum, such as cellular services, paging 
services, wireless internet access, and wireless video services. See 
U.S. Census Bureau, 2017 NAICS Definition, ``517312 Wireless 
Telecommunications Carriers (except Satellite),'' https://www.census.gov/naics/?input=517312&year=2017&details=517312. The 
appropriate size standard under SBA rules is that such a business is 
small if it has 1,500 or fewer employees. See 13 CFR 121.201, NAICS 
Code 517312 (previously 517210). For this industry, U.S. Census Bureau 
data for 2012 show that there were 967 firms that operated for the 
entire year. See U.S. Census Bureau, 2012 Economic Census of the United 
States, Table ID: EC1251SSSZ5, Information: Subject Series: Estab and 
Firm Size: Employment Size of Firms for the U.S.: 2012, NAICS Code 
517210, https://data.census.gov/cedsci/table?text=EC1251SSSZ5&n=517210&tid=ECNSIZE2012.EC1251SSSZ5&hidePreview=false&vintage=2012. Of this total, 955 firms employed fewer than 1,000 
employees and 12 firms employed of 1000 employees or more. Id. Thus 
under this category and the associated size standard, the Commission 
estimates that the majority of Wireless Telecommunications Carriers 
(except Satellite) are small entities.
    Wireless Carriers and Service Providers. Neither the SBA nor the 
Commission has developed a size standard specifically applicable to 
Wireless Carriers and Service Providers. The closest applicable is 
Wireless Telecommunications Carriers (except Satellite) (see U.S. 
Census Bureau, 2017 NAICS Definition, ``517312 Wireless 
Telecommunications Carriers (except Satellite),'' https://www.census.gov/naics/?input=517312&year=2017&details=517312), which the 
SBA small business size standard is such a business is small if it 
1,500 persons or less. Id. For this industry, U.S. Census Bureau data 
for 2012 show that there were 967 firms that operated for the entire 
year. See U.S. Census Bureau, 2012 Economic Census of the United 
States, Table ID: EC1251SSSZ5, Information: Subject Series: Estab and 
Firm Size: Employment Size of Firms for the U.S.: 2012, NAICS Code 
517210,

[[Page 46658]]

https://data.census.gov/cedsci/table?text=EC1251SSSZ5&n=517210&tid=ECNSIZE2012.EC1251SSSZ5&hidePreview=false&vintage=2012. Of this total, 955 firms had employment of 999 or 
fewer employees and 12 had employment of 1000 employees or more. Thus 
under this category and the associated size standard, the Commission 
estimates that the majority of Wireless Carriers and Service Providers 
are small entities.
    According to internally developed Commission data for all classes 
of Wireless Service Providers, there are 970 carriers that reported 
they were engaged in the provision of wireless services. See Federal 
Communications Commission, Wireline Competition Bureau, Industry 
Analysis and Technology Division, Trends in Telephone Service at Table 
5.3 (Sept. 2010) (Trends in Telephone Service), https://apps.fcc.gov/edocs_public/attachmatch/DOC-301823A1.pdf. Of this total, an estimated 
815 have 1,500 or fewer employees, and 155 have more than 1,500 
employees. See id. Thus, using available data, we estimate that the 
majority of Wireless Carriers and Service Providers can be considered 
small.
    Wired Telecommunications Carriers. The U.S. Census Bureau defines 
this industry as ``establishments primarily engaged in operating and/or 
providing access to transmission facilities and infrastructure that 
they own and/or lease for the transmission of voice, data, text, sound, 
and video using wired communications networks. Transmission facilities 
may be based on a single technology or a combination of technologies. 
Establishments in this industry use the wired telecommunications 
network facilities that they operate to provide a variety of services, 
such as wired telephony services, including VoIP services, wired 
(cable) audio and video programming distribution, and wired broadband 
internet services. By exception, establishments providing satellite 
television distribution services using facilities and infrastructure 
that they operate are included in this industry.'' See U.S. Census 
Bureau, 2017 NAICS Definition, ``517311 Wired Telecommunications 
Carriers,'' https://www.census.gov/naics/?input=517311&year=2017&details=517311. The SBA has developed a small 
business size standard for Wired Telecommunications Carriers, which 
consists of all such companies having 1,500 or fewer employees. See 13 
CFR 121.201, NAICS Code 517311 (previously 517110). U.S. Census Bureau 
data for 2012 show that there were 3,117 firms that operated that year. 
See U.S. Census Bureau, 2012 Economic Census of the United States, 
Table ID: EC1251SSSZ5, Information: Subject Series--Estab & Firm Size: 
Employment Size of Firms for the U.S.: 2012, NAICS Code 517110, https://data.census.gov/cedsci/table?text=EC1251SSSZ5&n=517110&tid=ECNSIZE2012.EC1251SSSZ5&hidePreview=false. Of this total, 3,083 operated with fewer than 1,000 employees. 
Id. Thus, under this size standard, the majority of firms in this 
industry can be considered small.
    Licenses Assigned by Auctions. Initially, we note that, as a 
general matter, the number of winning bidders that qualify as small 
businesses at the close of an auction does not necessarily represent 
the number of small businesses currently in service. Also, the 
Commission does not generally track subsequent business size unless, in 
the context of assignments or transfers, unjust enrichment issues are 
implicated.
    Private Land Mobile Radio (``PLMR''). PLMR systems serve an 
essential role in a range of industrial, business, land transportation, 
and public safety activities. Companies of all sizes operating in all 
U.S. business categories use these radios. Because of the vast array of 
PLMR users, the Commission has not developed a small business size 
standard specifically applicable to PLMR users. The closest applicable 
SBA category is Wireless Telecommunications Carriers (except Satellite) 
which encompasses business entities engaged in radiotelephone 
communications. See U.S. Census Bureau, 2017 NAICS Definition, ``517312 
Wireless Telecommunications Carriers (except Satellite),'' https://www.census.gov/naics/?input=517312&year=2017&details=517312. The 
appropriate size standard for this category under SBA rules is that 
such a business is small if it has 1,500 or fewer employees. See 13 CFR 
121.201, NAICS Code 517312 (formerly 517210). For this industry, U.S. 
Census Bureau data for 2012 show that there were 967 firms that 
operated for the entire year. See U.S. Census Bureau, 2012 Economic 
Census of the United States, Table ID: EC1251SSSZ5, Information: 
Subject Series: Estab and Firm Size: Employment Size of Firms for the 
U.S.: 2012, NAICS Code 517210, https://data.census.gov/cedsci/table?text=EC1251SSSZ5&n=517210&tid=ECNSIZE2012.EC1251SSSZ5&hidePreview=false&vintage=2012. Of this total, 955 firms had employment of 999 or 
fewer employees and 12 had employment of 1000 employees or more. Id. 
Thus under this category and the associated size standard, the 
Commission estimates that the majority of PLMR Licensees are small 
entities.
    According to the Commission's records, a total of approximately 
400,622 licenses comprise PLMR users. This figure was derived from 
Commission licensing records as of September 19, 2016. (Licensing 
numbers change on a daily basis. This does not indicate the number of 
licensees, as licensees may hold multiple licenses. There is no 
information currently available about the number of PLMR licensees that 
have fewer than 1,500 employees). There are a total of approximately 
3,577 PLMR licenses in the 4.9 GHz band; 19,359 PLMR licenses in the 
800 MHz band; and 3,374 licenses in the frequencies range 173.225 MHz 
to 173.375 MHz. The Commission does not require PLMR licensees to 
disclose information about number of employees, and does not have 
information that could be used to determine how many PLMR licensees 
constitute small entities under this definition. The Commission however 
believes that a substantial number of PLMR licensees may be small 
entities despite the lack of specific information.
    Radio and Television Broadcasting and Wireless Communications 
Equipment Manufacturing. This industry comprises establishments 
primarily engaged in manufacturing radio and television broadcast and 
wireless communications equipment. See U.S. Census Bureau, 2017 NAICS 
Definition, ``334220 Radio and Television Broadcasting and Wireless 
Communications Equipment Manufacturing,'' https://www.census.gov/naics/?input=334220&year=2017&details=334220. Examples of products made by 
these establishments are: Transmitting and receiving antennas, cable 
television equipment, GPS equipment, pagers, cellular phones, mobile 
communications equipment, and radio and television studio and 
broadcasting equipment. Id. The SBA has established a small business 
size standard for this industry of 1,250 employees or less. See 13 CFR 
121.201, NAICS Code 334220. U.S. Census Bureau data for 2012 show that 
841 establishments operated in this industry in that year. See U.S. 
Census Bureau, 2012 Economic Census of the United States, Table ID: 
EC1231SG2, Manufacturing: Summary Series: General Summary: Industry 
Statistics for Subsectors and Industries by Employment Size: 2012, 
NAICS Code 334220, https://data.census.gov/cedsci/table?text=EC1231SG2&n=334220&tid=ECNSIZE2012.EC1231SG2&

[[Page 46659]]

hidePreview=false. Of that number, 828 establishments operated with 
fewer than 1,000 employees, 7 establishments operated with between 
1,000 and 2,499 employees and 6 establishments operated with 2,500 or 
more employees. Id. Based on this data, we conclude that a majority of 
manufacturers in this industry are small.
    Auxiliary Special Broadcast and Other Program Distribution 
Services. This service involves a variety of transmitters, generally 
used to relay broadcast programming to the public (through translator 
and booster stations) or within the program distribution chain (from a 
remote news gathering unit back to the station). Neither the SBA nor 
the Commission has developed a size standard applicable to broadcast 
auxiliary licensees. The closest applicable SBA category and small 
business size standard falls under two SBA categories--Radio Stations 
and Television Broadcasting. The SBA size standard for Radio Stations 
is firms having $41.5 million or less in annual receipts. See 13 CFR 
121.201, NAICS Code 515112. U.S. Census Bureau data for 2012 show that 
2,849 radio station firms operated during that year. See U.S. Census 
Bureau, 2012 Economic Census of the United States, Table ID: 
EC1251SSSZ4, Information: Subject Series--Estab and Firm Size: Receipts 
Size of Firms for the U.S.: 2012, NAICS Code 515112, https://data.census.gov/cedsci/table?text=EC1251SSSZ4&n=515112&tid=ECNSIZE2012.EC1251SSSZ4&hidePreview=false. Of that number, 2,806 firms operated with annual receipts of 
less than $25 million per year and 17 with annual receipts between $25 
million and $49,999,999 million. Id. For Television Broadcasting the 
SBA small business size standard is such businesses having $41.5 
million or less in annual receipts. See 13 CFR 121.201, NAICS Code 
515120. U.S. Census Bureau data show that 751 firms in this category 
operated in that year. See U.S. Census Bureau, 2012 Economic Census of 
the United States, Table ID: EC1251SSSZ4, Information: Subject Series--
Estab and Firm Size: Receipts Size of Firms for the U.S.: 2012, NAICS 
Code 515120, https://data.census.gov/cedsci/table?text=EC1251SSSZ4&n=515120&tid=ECNSIZE2012.EC1251SSSZ4&hidePreview=false. Of that number, 656 had annual receipts of $25,000,000 or less, 
25 had annual receipts between $25,000,000 and $49,999,999 and 70 had 
annual receipts of $50,000,000 or more. Id. Accordingly, based on the 
U.S. Census Bureau data for Radio Stations and Television Broadcasting, 
the Commission estimates that the majority of Auxiliary, Special 
Broadcast and Other Program Distribution Services firms are small.
    Radio Frequency Equipment Manufacturers (RF Manufacturers). Neither 
the Commission nor the SBA has developed a small business size standard 
applicable to Radio Frequency Equipment Manufacturers (RF 
Manufacturers). There are several analogous SBA small entity categories 
applicable to RF Manufacturers--Fixed Microwave Services, Other 
Communications Equipment Manufacturing, and Radio and Television 
Broadcasting and Wireless Communications Equipment Manufacturing. A 
description of these small entity categories and the small business 
size standards under the SBA rules are detailed below.
    Other Communications Equipment Manufacturing. This industry 
comprises establishments primarily engaged in manufacturing 
communications equipment (except telephone apparatus, and radio and 
television broadcast, and wireless communications equipment). See U.S. 
Census Bureau, 2017 NAICS Definitions, ``334290 Other Communications 
Equipment Manufacturing,'' https://www.census.gov/cgi-bin/sssd/naics/naicsrch?input=334290&search=2017+NAICS+Search&search=2017. Examples of 
such manufacturing include fire detection and alarm systems 
manufacturing, Intercom systems and equipment manufacturing, and 
signals (e.g., highway, pedestrian, railway, traffic) manufacturing. 
Id. The SBA has established a size standard for this industry as all 
such firms having 750 or fewer employees. See 13 CFR 121.201, NAICS 
Code 334290. U.S. Census Bureau data for 2012 show that 383 
establishments operated in that year. See U.S. Census Bureau, 2012 
Economic Census of the United States, Table ID: EC1231SG2, 
Manufacturing: Summary Series: General Summary: Industry Statistics for 
Subsectors and Industries by Employment Size: 2012, NAICS Code 334290, 
https://data.census.gov/cedsci/table?text=EC1231SG2&n=334290&tid=ECNSIZE2012.EC1231SG2&hidePreview=false&vintage=2012. Of that number, 379 operated with fewer than 500 
employees and 4 had 500 to 999 employees. Id. Based on this data, we 
conclude that the majority of Other Communications Equipment 
Manufacturers are small.
    Fixed Microwave Services. Microwave services include common 
carrier, private-operational fixed, and broadcast auxiliary radio 
services. They also include the Upper Microwave Flexible Use Service, 
Millimeter Wave Service, Local Multipoint Distribution Service (LMDS), 
the Digital Electronic Message Service (DEMS), and the 24 GHz Service, 
where licensees can choose between common carrier and non-common 
carrier status. There are approximately 66,680 common carrier fixed 
licensees, 69,360 private and public safety operational-fixed 
licensees, 20,150 broadcast auxiliary radio licensees, 411 LMDS 
licenses, 33 24 GHz DEMS licenses, 777 39 GHz licenses, and five 24 GHz 
licenses, and 467 Millimeter Wave licenses in the microwave services. 
(These statistics are based on a review of the Universal Licensing 
System on September 22, 2015). The Commission has not yet defined a 
small business with respect to microwave services. The closest 
applicable SBA category is Wireless Telecommunications Carriers (except 
Satellite) and the appropriate size standard for this category under 
SBA rules is that such a business is small if it has 1,500 or fewer 
employees. See 13 CFR 121.201, NAICS Code 517312 (previously 517210). 
For this industry, U.S. Census Bureau data for 2012 show that there 
were 967 firms that operated for the entire year. See U.S. Census 
Bureau, 2012 Economic Census of the United States, Table ID: 
EC1251SSSZ5, Information: Subject Series, Estab and Firm Size: 
Employment Size of Firms for the U.S.: 2012, NAICS Code 517210, https://data.census.gov/cedsci/table?text=EC1251SSSZ5&n=517210&tid=ECNSIZE2012.EC1251SSSZ5&hidePreview=false&vintage=2012. Of this total, 955 firms had employment of 999 or 
fewer employees and 12 had employment of 1,000 employees or more. Id. 
Thus under this SBA category and the associated size standard, the 
Commission estimates that a majority of fixed microwave service 
licensees can be considered small.
    The Commission does not have data specifying the number of these 
licensees that have more than 1,500 employees, and thus is unable at 
this time to estimate with greater precision the number of fixed 
microwave service licensees that would qualify as small business 
concerns under the SBA's small business size standard. Consequently, 
the Commission estimates that there are up to 36,708 common carrier 
fixed licensees and up to 59,291 private operational-fixed licensees 
and broadcast auxiliary radio licensees in the microwave services that 
may be small and may be affected by the rules and policies discussed 
herein. We note, however, that the microwave fixed

[[Page 46660]]

licensee category includes some large entities.

D. Description of Projected Reporting, Recordkeeping, and Other 
Compliance Requirements for Small Entities

    The proposals being made in this Notice may require additional 
analysis and mitigation activities to the part 2 rules that include 
various provisions to help ensure the integrity of the equipment 
authorization process. The Commission is authorized to dismiss or deny 
an application where that application is not in accordance with 
Commission requirements or the Commission is unable to make the finding 
that grant of the application would serve the public interest. The 
rules also require the TCB to perform ``post market surveillance'' of 
equipment that has been certified, with guidance from OET, as may be 
appropriate.
    The Supplier's Declaration of Conformity (SDoC) process is 
available with respect to certain types of RF devices that have less 
potential to cause interference. The SDoC procedure requires the party 
responsible for compliance (``responsible party'') to make the 
necessary measurements and complete other procedures found acceptable 
to the Commission to ensure that the particular equipment complies with 
the appropriate technical standards for that device. At this time, the 
Commission's current equipment authorization rules do not include 
specific provisions addressing the ``covered'' equipment on the Covered 
List. This Covered List identifies communications equipment and 
services that pose an unacceptable risk to the national security of the 
United States or the security and safety of United States persons. The 
Commission is required to include communications equipment and services 
on the list based exclusively on determinations made by Congress and by 
other U.S. government agencies. Currently, the list includes equipment 
and services produced or provided by five entities.
    In this Notice we examine our rules relating to equipment 
authorization and participation in Commission auctions to help advance 
the Commission's goal of protecting national security and public 
safety. This builds on other actions the Commission recently has taken 
to protect and secure our nation's communications systems.

E. Steps Taken To Minimize the Significant Economic Impact on Small 
Entities, and Significant Alternatives Considered

    The RFA requires an agency to describe any significant, 
specifically small business, 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 such 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 such small 
entities.'' 5 U.S.C. 603(c). In this proceeding, our proposals are 
consistent with (2), in that our goal is to seek comment on various 
steps that the Commission could take in its equipment authorization 
program, as well as its competitive bidding program, to reduce threats 
posed to our nation's communications system by ``covered'' equipment 
and services on the Covered List. We also seek comment on whether the 
Commission should revoke equipment authorizations of ``covered'' 
equipment, and if so under what conditions and procedures.

F. Federal Rules That May Duplicate, Overlap, or Conflict With the 
Proposed Rules

    None.

List of Subjects

    Communications, Communication equipment, Reporting and 
recordkeeping requirements, Telecommunications, and Wiretapping and 
electronic surveillance.

Federal Communications Commission.
Marlene Dortch,
Secretary.

Proposed Rules

    For the reasons discussed in the preamble, the Federal 
Communications Commission proposes to amend 47 CFR part 2 as follows:

PART 2--FREQUENCY ALLOCATIONS AND RADIO TREATY MATTERS; GENERAL 
RULES AND REGULATIONS

0
1. The authority citation for part 2 continues to read as follows:

    Authority:  47 U.S.C. 154, 302a, 303, and 336, unless otherwise 
noted.

0
2. Add Sec.  2.903 to subpart J to read as follows:


Sec.  2.903  Prohibition on equipment authorization of equipment on the 
Covered List.

    Any equipment on the Covered List, as defined in Sec.  1.50002 of 
this chapter, is prohibited from obtaining an equipment authorization 
under this subpart. This includes:
    (a) Equipment subject to certification procedures: 
Telecommunication Certification Bodies and the Federal Communications 
Commission are prohibited from issuing a certification under this 
subpart for any equipment on the Covered List; and
    (b) Equipment subject to Supplier's Declaration of Conformity 
procedures.
0
3. Amend Sec.  2.906 by adding paragraph (d) to read as follows:


Sec.  2.906  Supplier's Declaration of Conformity.

* * * * *
    (d) All equipment produced or provided by any of the entities, or 
their respective subsidiaries or affiliates, that produce or provide 
``covered'' equipment on the Covered List established pursuant to Sec.  
1.50002 of this chapter, is prohibited from obtaining equipment 
authorization through the Supplier's Declaration of Conformity process.
0
4. Amend Sec.  2.907 by adding paragraph (c) to read as follows:


Sec.  2.907  Certification.

* * * * *
    (c) All equipment produced or provided by any of the entities, or 
their respective subsidiaries or affiliates, that produce or provide 
``covered'' equipment, as specified on the Covered List established 
pursuant to Sec.  1.50002 of this chapter, must obtain equipment 
authorization through the certification process.
0
5. Amend Sec.  2.909 by revising paragraph (a) to read as follows:


Sec.  2.909  Responsible Party.

    (a) For equipment that requires the issuance of a grant of 
certification, the party to whom that grant of certification is issued 
is responsible for the compliance of the equipment with the applicable 
standards. If the radio frequency equipment is modified by any party 
other than the grantee and that party is not working under the 
authorization of the grantee pursuant to Sec.  2.929(b), the party 
performing the modification is responsible for compliance of the 
product with the applicable administrative and technical provisions in 
this chapter. In either case, the responsible party must be located in 
the United States (see Sec.  2.1033).
* * * * *

[[Page 46661]]

0
6. Amend Sec.  2.911 by adding paragraph (d)(5) to read as follows:


Sec.  2.911  Application requirements.

* * * * *
    (d) * * *
    (5) The applicant shall provide a written and signed certification 
that, as of the date of the filing of the application, the equipment 
for which the applicant seeks equipment authorization through 
certification is not ``covered'' equipment on the Covered List 
established pursuant to Sec.  1.50002 of this chapter.
* * * * *
0
7. Amend Sec.  2.1033 by revising paragraph (b)(1) to read as follows:


Sec.  2.1033  Application for certification.

* * * * *
    (b) * * *
    (1) The identification, by name, mailing address and telephone 
number or internet contact information, of the manufacturer of the 
device, the applicant for certification, and the responsible party as 
defined in Sec.  2.909. The responsible party must be located within 
the United States.
* * * * *
[FR Doc. 2021-16085 Filed 8-18-21; 8:45 am]
BILLING CODE 6712-01-P


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