Federal Register / Vol. 61, No. 88 / Monday, May 6, 1996 / Rules and Regulations 20155

SS SURFACE COATING: LARGE

APPLIANCES

TT METAL COIL SURFACE COATING

UU ASPHALT PROCESSING

ROOFING

VV EQUIPMENT LEAKS OF VOC IN

SOCMI

WW BEVERAGE CAN SURFACE

COATING

XX BULK GASOLINE TERMINALS

BBB RUBBER TIRE

MANUFACTURING

DDD VOC EMISSIONS FROM

POLYMER MANUFACTURING

INDUSTRY

FFF FLEXIBLE VINYL AND

URETHAN COATING AND

PRINTING

GGG EQUIPMENT LEAKS OF VOC IN

PETROLEUM REFINERIES

HHH SYNTHETIC FIBER

PRODUCTION

III VOC FROM SOCMI AIR

OXIDATION UNIT

JJJ PETROLEUM DRY CLEANERS

NNN VOC FROM SOCMI

DISTILLATION

OOO NONMETALLIC MINERAL

PLANTS

PPP WOOL FIBERGLASS

INSULATION

QQQ VOC FROM PETROLEUM

REFINERY WASTEWATER

SYSTEMS

SSS MAGNETIC TAPE COATING

TTT SURFACE COATING OF

PLASTIC PARTS FOR BUSINESS

MACHINES

UUU CALCINERS & DRYERS IN THE

MINERAL INDUSTRY

VVV POLYMERIC COATING OF

SUPPORTING SUBSTRATES

List of Subjects in 40 CFR Part 70

Environmental protection,

Administrative practice and procedure,

Air pollution control, Intergovernmental

relations, Operating permits, Reporting

and recordkeeping requirements.

Dated: April 19, 1996.

John P. DeVillars,

Regional Administrator, Region I.

Part 70, title 40 of the Code of Federal

Regulations is amended as follows:

PART 70—[AMENDED]

1. The authority citation for part 70

continues to read as follows:

Authority: 42 U.S.C. 7401, et seq.

2. Appendix A to part 70 is amended

by adding the entry for Rhode Island in

alphabetical order to read as follows:

Appendix A to Part 70—Approval

Status of State and Local Operating

Permits Programs

* * * * *

Rhode Island

(a) Department of Environmental

Management: submitted on June 20,

1995; interim approval effective on July

5, 1996; interim approval expires July 6,

1998.

(b) (Reserved)

* * * * *

[FR Doc. 96–11081 Filed 5–03–96; 8:45 am]

BILLING CODE 6560–50–P

FEDERAL COMMUNICATIONS

COMMISSION

47 CFR Part 3

[MD Docket No. 93–297; FCC 96–110]

Administration of U.S. Certified

Accounting Authorities in Maritime

Mobile and Maritime Mobile-Satellite

Radio Services

AGENCY: Federal Communications

Commission.

ACTION: Final rule.

SUMMARY: This Report and Order

establishes final rules related to the

administration of U.S. certified

accounting authorities in the maritime

mobile and maritime mobile-satellite

radio services except for distress and

safety communications. The rules are

required in order to ensure adherence to

international settlement procedures.

This Report and Order contains

modified information collections

requirements subject to the Paperwork

Reductions Act of 1995.

EFFECTIVE DATE: This regulation is

effective July 5, 1996 subject to the

review of information collection

requirements by the Office of

Management and Budget. Upon

approval of the information collections

requirement from the Office of

Management and Budget (OMB). The

Commission will publish a public

notice to notify the public of the

effective date.

ADDRESSES: Comments on the

information collections contained in

this Report and Order should be

directed to Office of The Secretary,

Federal Communications Commission,

1919 M Street, N.W., Washington, DC

20554. In addition to filing comments

with the Secretary, a copy of any

comments on the information

collections contained herein should be

submitted to Dorothy Conway, Federal

Communications Commission, Room

234, 1919 M Street, N.W., Washington,

DC 20554, or via the Internet to

dconway@fcc.gov and to Timothy Fain,

OMB Desk Officer, 10236 NEOB, 725

17th Street, N.W., Washington, DC

20503 or via the Internet to

fainl t@al.eop.gov.

FOR FURTHER INFORMATION CONTACT:

Shirley F. Wood, Office of the Managing

Director, Financial Analysis Branch,

Telephone: (202) 418–1990 or via the

Internet at swood@fcc.gov.

SUPPLEMENTARY INFORMATION:

Synopsis of Commission’s Report and

Order Adopted March 13, 1996 and

Released April 23, 1996

1. The Federal Communications

Commission’s International

Telecommunications Settlements

Section, located in Gettysburg,

Pennsylvania, acts as a national

clearinghouse for the settlement of

international maritime mobile service

and maritime mobile-satellite service

accounts. In this capacity, the FCC is

known as an accounting authority and

settles accounts for messages

transmitted or received by U.S. licensed

vessels via foreign coast station

facilities.

2. The FCC has also allowed private

entities to settle accounts with foreign

administrations. By approving these

additional ‘‘accounting authorities’’, the

FCC has, in effect, delegated a portion

of its traditional responsibilities

regarding settlement of maritime

accounts to private enterprise, at least in

those instances where the accounting

authority is settling accounts of U.S.

licensed ship stations.

3. The FCC is issuing final rules

regarding the approval and/or

operations of accounting authorities.

This Report and Order delineates rules

for (a) determining the eligibility for

granting/revoking certification as a U.S.

accounting authority, (b) settlement

operational procedures, (c) reporting

requirements, and (d) enforcement

procedures.

4. Further, the Report and Order

establishes rules to ensure compliance

by ship station licensees to make proper

and timely payments and declares the

ship station licensee to be ultimately

responsible for settlement of their

accounts.

5. The complete text of this

rulemaking may be purchased from the

Commission’s copy contractor,

International Transcription Service, Inc.

(202) 857–3800, 2100 M Street, N.W.,

Suite 140, Washington, DC 20037.

Paperwork Reduction Act

The Commission, as part of its

continuing effort to reduce paperwork

burdens, invites the general public and

OMB to comment on the information

collections contained in this Report and
20156 Federal Register / Vol. 61, No. 88 / Monday, May 6, 1996 / Rules and Regulations

1 ‘‘CCITT’’ is the French acronym for the

International Telegraph and Telephone

Consultative Committee within the International

Telecommunication Union (ITU). ‘‘CCITT’’ was,

nevertheless, the recognized acronym used in most

languages—including English. At the ITU

Additional Plenipotentiary Conference (APP) in

Geneva (December 1992), the structure, working

methods, and construct of the basic ITU treaty

instrument was modified. The result is that the

names of the sub-entities of the ITU have changed

(e.g., the CCITT has become the Telecommunication

Standardization Sector—ITU–T and the primary

treaty instruments have become the ITU

Constitution and the ITU Convention with

consequential renumbering of all provisions). We

note the changes coming from the APP were placed

into provisional effect on March 1, 1993, with the

formal entry into force of these changes being July

1, 1994 (as between those ITU Member countries

who have ratified or acceded to the new

instruments). We will, subsequently, refer to the

new nomenclatures within this proceeding

wherever practicable.

Order, as required by the Paperwork

Reduction Act of 1995, Pub. L. No. 104–

13. OMB notification of action is due

July 5, 1996; public and agency

comments are due at the same time.

Comments should address: (a) whether

the proposed collection of information

is necessary for the proper performance

of the functions of the Commission,

including whether the information shall

have practical utility; (b) the accuracy of

the Commission’s burden estimates; (c)

ways to enhance the quality, utility, and

clarity of the information collected; and

(d) ways to minimize the burden of the

collection of information on the

respondents, including the use of

automated collection techniques or

other forms of information technology.

OMB Approval Number: 3060–0584.

Title: Administration of U.S. certified

accounting authorities in maritime

mobile and maritime mobile-satellite

radio services.

Form No.: FCC Form 44 and FCC

Form 45.

Type of Review: Revision to an

existing collection to consolidate three

information collection requirements.

Respondents: Individuals and

households; businesses and other forprofit.

Number of Respondents: 25.

Estimated Time Per Response: Three

hours per response for Application for

Certification of Accounting Authority

form; one hour per response for the

Annual Statistical Report of Settlement

Operations form; and one hour per

response for the Report of Additions/

Modifications/Deletions to Inventory.

Needs and Uses: The Commission

will use the information in this

information collection to determine

eligibility of applicant; to create internal

studies and to ensure compliance. The

Commission will also use the

information to identify the accounting

authorities of U.S. licensed vessels and

to update the reporting of changes in

accounting authority functions to the

International Telecommunication Union

for inclusion in their List of Ship

Stations Report. The Report and Order

is modified to reduce a monthly

reporting of changes to the inventory of

ships for which the accounting

authority performs settlements to a

semi-annual requirement. A

requirement for this information was

included in the Notice of Proposed

Rulemaking, 58 FR 246, December 27,

1993, however, the burden of the

requirement was not adequately

addressed at that time.

Adopted: March 13, 1996.

Released: April 23, 1996.

By the Commission.

Table of Contents

Topic

Paragraph

No.

I. Introduction .................................. 1–2

II. Background .................................. 3–12

III. Issues Analysis ........................... 13

A. Eligibility ................................. 14–22

B. Application Procedures ........... 23–33

C. Settlement Operations ............. 34–44

D. Reporting Requirements .......... 45–50

E. Enforcement ............................. 51–53

F. Conclusion ............................... 54

IV. Procedural Matters.

A. Ex Parte .................................... 55

B. Final Regulatory Flexibility

Analysis .................................... 56

V. Ordering Clauses ..................... 57–58

I. Introduction

1. By this Report and Order, the

Commission adopts rules governing the

administration of accounting authorities

in the maritime mobile and the

maritime mobile-satellite radio services,

except for distress and safety

communications. The Report and Order

establishes a certification process and

settlement procedures within a

regulatory framework that is flexible

enough to invite participation by many

diverse entities. The rules clarify

accounting authority responsibilities

and strengthen the settlement process

while promoting the improvement of

standards and settlement operations in

industry.

2. The rules we adopt below establish

an application and approval process for

becoming an accounting authority to

ensure that only qualified applicants

perform this function. The application

process and procedural rules also apply

to entities currently settling accounts

under interim Commission certification.

The interim certification will be

cancelled 60 days after the effective date

of these rules if these entities do not

follow the application process. The

Report and Order also establishes

standardized operational procedures

and reporting requirements that will

assist the FCC in monitoring the overall

settlement function. The rules establish

the accounting authority’s receipt date

of accounts for purposes of determining

the appropriate conversion rate for the

Special Drawing Rights (SDRs) and sets

forth enforcement procedures for both

accounting authorities who are not

operating in accordance with FCC and

established international procedures

and for ship station licensees where the

licensee fails to remit proper and timely

payment for public correspondence

communications to the Commission or

to another accounting authority. Finally,

the rules declare that the ship station

licensee is ultimately liable for proper

and timely payment of accounts.

II. Background

3. International telecommunications

settlements involve the collection and

payment by various accounting entities

of charges due foreign administrations

for messages transmitted at sea by or

between maritime mobile stations

located on board ships subject to U.S.

registry and utilizing foreign coast and

coast earth station facilities. The United

States Government has performed

accounting settlements for maritime

mobile service message charges since

1913 and, more recently, for maritime

mobile-satellite service messages.

4. On June 10, 1934, the Federal Radio

Commission was absorbed by the

Federal Communications Commission

(FCC), which had been created by the

Communications Act of 1934. At that

time the international radio accounts

were transferred to the jurisdiction of

the FCC, where they are now

maintained.

5. The subjects of international

telecommunications accounting and

settlements are addressed in the

International Telecommunication

Convention (Nairobi, 1982), in the

International Telecommunication

Regulations (Melbourne, 1988) (ITR), in

the ITU Radio Regulations and in the

ITU–T (formerly CCITT)

Recommendations.1 The ITU–T

develops technical, operational and

service recommendations applicable to

essentially all international

telecommunications services via wire

and radio. Provisions of Conventions

and Regulations have treaty status and

are therefore binding on the parties

thereto. The ITU–T Recommendations

do not have treaty status and are not

legally binding. However, as a practical

matter, the ITU–T Recommendations are
Federal Register / Vol. 61, No. 88 / Monday, May 6, 1996 / Rules and Regulations 20157

2The ITU Voluntary Group of Experts (VGE),

charged with simplifying the Radio Regulations has,

indeed, made such a recommendation. Once

adopted by a competent World

Radiocommunication Conference, the VGE

recommendation would result in Article 66 simply

stating that: ‘‘The provisions of the ITR, taking into

account ITU–T Recommendations, shall apply [to

charging and accounting for Maritime

Radiocommunications].’’

3 Besides the FCC, the accounting authorities

assigned a ‘‘US’’ code are: Mackay

Communications, Inc.; Radio-Holland

Communications, Inc.; SAIT Communications, Inc.;

Mobile Marine Radio, Inc.; Exxon Communications

Company; Raytheon Service Company and Global

Communications, Inc.

4The following foreign companies have been

approved as accounting authorities: Kelvin Hughes,

Ltd. (England); Peninsular Electronics, Ltd.

(England); STC International Marine, Ltd.

(England); Marconi International Marine Co., Ltd.

(England); E.B. Communications, Ltd. (England);

International Radio Traffic Services (Ireland) and

ANDgate, Ltd. (Gibraltar).

effectively the standards that govern

international telecommunications.

6. The World Administrative Radio

Conference (Geneva, 1979) changed the

procedures governing accounting

practices in the maritime mobile and

maritime mobile-satellite services,

partly in response to the perceived need

to improve the efficiency of the

international telecommunication

settlements system. The Final Acts of

the Conference, ratified by the U.S.

Senate on October 27, 1983, revised

Chapter IX of the international Radio

Regulations by establishing a new

Article 66 which set forth the following

general principles to govern the

international accounting for public

correspondence in the maritime mobile

and maritime mobile-satellite services:

5086 § 2. Charges for

radiocommunications from ship to

shore shall in principle, and subject to

national law and practice, be

collected from the maritime mobile

station licensee:

5087 (a) by the administration that has

issued the license; or

5088 (b) by a recognized private

operating agency; or

5089 (c) by any other entity or entities

designated for this purpose by the

administration referred to in No.

5087.

7. The Mobile World Administrative

Radio Conference in 1987 passed a

resolution (contained in the Regulations

as Resolution No. 334) providing that

the provisions of Article 66 should

merely refer to the International

Telecommunication Regulations (ITR),

assuming that the World Administrative

Telegraph and Telephone Conference

(WATTC–88) placed the substance of

the Article 66 provisions into the ITR.

The WATTC–88 did incorporate these

provisions into the ITR, effective July 1,

1990 (ITR, Appendix 2). We assume a

future competent Radiocommunication

Conference will eventually implement

the provisions of Resolution No. 334.2 In

any event, both the current Radio

Regulations and the ITR provide that the

ITU–T Recommendations are to be

taken into account when applying the

international regulatory provisions. As

it now stands, the implementing

recommendations developed by the

ITU–T include: (1) Rec. D.90 on

charging, accounting and refunds; (2)

Rec. D.195 on settlement of

international telecommunication

balances of accounts; (3) Rec. E.200 on

operational provisions for maritime

mobile services; (4) Rec. F.100 on

mobile operational provisions; and (5)

the newest recommendation adopted,

Rec. F.111 on principles of service for

mobile systems.

8. The organization within the FCC

responsible for the settlement of

maritime mobile and maritime mobilesatellite accounts with foreign

administrations is the International

Telecommunications Settlements (ITS)

Section of the Financial Operations

Division, Office of the Managing

Director. The settlement operation

basically consists of examining and

processing invoices received from

foreign administrations to ensure the

validity of the charges and, in turn,

billing U.S. ship station licensees for the

charges due the foreign country. The

accounts generally contain the ship call

sign and name, the date the message

was transmitted, the number of words or

minutes, the cost per word or minute in

gold francs or Special Drawing Rights

(SDRs) and the amount due shown in

either gold francs or SDRs. Collections

are then processed and appropriate

payments made to the foreign countries

or their agents through the U.S.

Treasury.

The settlement clearinghouse service

was performed by the FCC at no cost to

licensees until December 19, 1989 when

Public Law 101–239 established a $2.00

per line item administrative fee

applicable to all ITS billings.

9. The FCC, in accordance with

international procedures described

within this document, has also

permitted private entities, called

‘‘accounting authorities’’, to settle

accounts between U.S. registered ships

and foreign administrations just as ITS

does. (See In The Matter of Accounting

and Operating Procedures in the

Maritime Mobile Service, FCC 80–741,

Mimeo No. 28600 (released December

12, 1980).) The accounting authority

may settle accounts of foreign licensed

vessels in addition to settling U.S.

accounts. Vessel operators/licensees

choosing to have these private entities

settle their accounts are generally also

charged a fee under a contractual

arrangement. In certain cases, the

vessels are owned and/or operated by

the same company that is acting as an

accounting authority.

10. Accounting authorities have been

established or certified by the FCC in

accordance with the procedures

delineated in the ITU–T

Recommendations. Those procedures

allow administrations to establish up to

25 accounting authorities per country.

Specifically, accounting authorities are

designated by the assignment of an

individual Accounting Authority

Identification Code (AAIC). This code is

used by ships and foreign coast stations

to identify where charges for messages

transmitted through foreign facilities are

to be sent for collection. All accounting

authorities approved by the FCC to

settle maritime accounts for U.S.

licensed vessels are assigned a discrete

four-character alpha-numeric code.

Accounting authorities operating in the

U.S. are assigned codes with a ‘‘US’’

prefix. Currently, only eight codes

beginning with the prefix ‘‘US’’ are

authorized, including US01 which is

used by the Commission’s ITS Section

in its settlement activities.3 Foreignbased accounting authorities may also

be certified to settle accounts of U.S.

licensed vessels. If approved, they use

the AAIC originally assigned to them by

their country of origin. The Commission

has currently certified seven foreignbased accounting authorities 4 to settle

accounts for U.S. flag vessels. Although

all certifications have technically been

interim certifications, fifteen years have

elapsed since the original interim

assignments.

11. There are currently no rules,

formal guidance or procedures issued by

the Commission for determining who

should be certified as an accounting

authority. There are no FCC standards

of conduct for accounting authorities

nor any requirement to keep the

Commission informed of their activities.

There are no rules to ensure that the

overall United States settlement activity

is conducted uniformly. We believe that

at least minimal regulations should be

in place to assist current and future

accounting authorities in adhering to

those international procedures as a

matter of public interest and in

fulfillment of U.S. treaty interests.

12. On November 9, 1993, the

Commission adopted a Notice of

Proposed Rulemaking (NPRM) that

invited comment on our proposed rules

governing the administration of
20158 Federal Register / Vol. 61, No. 88 / Monday, May 6, 1996 / Rules and Regulations

accounting authorities (2FCC Record,

Volume 8, No. 26, December 13–23,

1993). The NPRM proposed rules

providing for: (1) a certification process,

(2) settlement procedures, (3)

compliance procedures, and (4)

determining responsibility for proper

and timely settlement of accounts.

III. Issues Analysis

13. The NPRM proposed rules and

raised many issues regarding the

administration of accounting

authorities. Comments and Reply

Comments were received from eleven

(11) entities and are discussed in the

paragraphs below where we review each

of the categories and consider the

comments. The commenters are listed in

Appendix 2 of the Report and Order.

A. Eligibility

14. The NPRM proposed no U.S.

citizenship requirements, but did

propose certain restrictions regarding

the physical location of settlement

facilities for those accounting

authorities wishing to be assigned an

AAIC with a ‘‘US’’ prefix. The NPRM

proposed that prior experience in

accounting or settlement activities will

be considered but is not a prerequisite

to becoming an accounting authority;

and, that applicants must (1) be willing

and able to accept clients at a reasonable

charge; (2) agree to accept accounts in

both gold francs and Special Drawing

Rights (SDRs) and to use the conversion

rate as directed by the International

Monetary Fund; and (3) agree to

conduct operations in accordance with

applicable FCC policies and rules, the

International Telecommunication

Regulations and other international

rules, regulations, agreements, and,

where appropriate, ITU–T

Recommendations. Finally, the NPRM

proposed that all entities intending to

settle accounts of U.S. licensed vessels

obtain prior Commission authorization

to do so.

15. Comments. Mackay

Communications (Mackay) urged that

we prohibit the Commission from

‘‘operating as a Recognized Private

Operating Agency’’ so that it can be

neutral and enforce compliance of

regulations without creating potential

conflicts of interest. In reply comments,

COMSAT Corporation (COMSAT) stated

that the Commission can still be an

impartial administrator and questioned

Mackay’s suggestion that the

Commission remove itself from the

accounting authority function.

Response. The Commission cannot

operate as a Recognized Private

Operating Agency because (1) we are a

Federal government agency and (2) we

do not operate telecommunications

installations nor do we provide

telecommunications services. However,

we believe that Mackay meant

‘‘accounting authority’’ and address this

response in that context. The

Commission has a dual role in the

administration of settlement of accounts

for international telecommunications.

First, as the administration responsible

for settlement of accounts of U.S.-flag

vessels, we are establishing rules for

non-U.S. governmental accounting

authorities. Second, the Commission

provides a valuable function in that ship

station licensees who do not select an

accounting authority, simply ‘‘default’’

to US01, the AAIC of the Commission’s

International Telecommunications

Settlements Section (ITS) which

performs the FCC’s accounting authority

function. We believe that the functions

are separate and can be administered

without any conflict of interest.

16. Comments. Mackay urged the

Commission to consider a requirement

that the applicant must offer services to

all U.S.-flagged vessels—not just vessels

owned directly or indirectly by the

applicant. EXXON Communications

Company (EXXON) stated their

objection to any proposal that

accounting authorities ‘‘be required to

serve as common carriers offering

service indiscriminately to the public.’’

They pointed out that they serve as an

accounting authority for their vessels

only, they are not a revenue generating

endeavor and, ‘‘were the Commission to

require EXXON to hold itself out to the

general public indiscriminately, it

would no longer be in a position to

serve as an accounting authority.’’ In

reply comments, the American Institute

of Merchant Shipping (AIMS) agreed

with EXXON’s proposal that accounting

authorities should not be required to act

as a common carrier and COMSAT

opposed a ban on accounting authorities

who process settlements exclusively for

their own vessels. COMSAT further

stated that ‘‘the Commission may

consider imposing conditions on the

certifications awarded to these entities,

e.g., the Commission may wish to

reserve the right to require such

accounting authorities to serve all

customers or relinquish their AAIC

when there are no * * *. codes

available and there is a demonstrable

need for broader-based services.’’

Response. We believe the function of

accounting authorities should be such

that the public’s best interests are served

by the organizations. Such is not the

case when an accounting authority

settles accounts for themselves only.

Thus, the rules we have adopted require

that accounting authorities settle

accounts for any qualified ship station

licensees who request it. Accounting

authorities may require credit checks,

and clients must accept the terms of

settlement charges, deposits, etc.

However, it is not the Commission’s

intent in establishing these rules to

place additional requirements on the

interim accounting authorities nor to

establish a requirement in the

application process that could not be

overcome. We acknowledge COMSAT’s

workable suggestions and we are

waiving this requirement for accounting

authorities who are ‘‘grandfathered’’

with the provision that, should all 25

AAICs be assigned and the need for

additional codes become necessary,

these same organizations will be

required to extend their services to the

public or to relinquish their

certification. Should these

grandfathered accounting authorities

cease their settlement activities, the new

accounting authorities assigned the

AAICs will be required to serve the

general public. 47 CFR, Part 3, section

3.10 is amended to add this waiver

information.

17. Comments. Mobile Marine Radio,

Inc. (MMR) requested that the

Commission impose requirements that

accounting authorities verify the

creditability of its clients and ‘‘another

means of guarantee for the provider

could be a requirement that the

accounting authority * * * share in a

loss should it occur.’’ COMSAT

supported the recommendation that

accounting authorities be required to

verify the credit worthiness of their

customers and that accounting

authorities should be able to reject

customers they determine are credit

risks and further suggest a rule to

require a deposit from customers before

contracting to settle accounts.

Response. The rules we are adopting

below declare that the ship station

licensee is ultimately responsible for the

proper and timely payment of their

accounts (47 CFR Part 3, section 3.76).

However, this in no way relieves the

accounting authority from performing

their settlement activities timely and

accurately. We have purposely left out

regulations which would prevent

accounting authorities from verifying

the credit standings of potential clients

or requiring deposits. The contractual

agreement between accounting

authorities and clients should be

entered into mutually without further

regulation. Ship station licensees who

do not enter into such an arrangement

will default to US01, the International

Telecommunications Settlement Section

at Gettysburg, Pennsylvania.
Federal Register / Vol. 61, No. 88 / Monday, May 6, 1996 / Rules and Regulations 20159

18. Comments. Mackay raised the

issue of foreign accounting authorities

settling traffic for U.S.-flagged vessels.

Mackay does not object, provided U.S.-

flagged vessels of foreign accounting

authorities are required to pay the same

‘‘federal excise taxes’’ that vessels

represented by U.S. accounting

authorities are required to pay.

Response. This subject is beyond the

scope of this proceeding and is not

addressed in the Report and Order.

19. Comments. Mackay urged

considering that owners of coast stations

or coast earth stations not be allowed as

accounting authorities. In reply

comments, EXXON stated that Mackay

has no rationale for their suggestion and

COMSAT opposes any limitation on

land earth station operators stating the

‘‘operators * * * are more at risk to

justify their involvement * * * than

many other entities * * *’’

Response. Our experience has been

that we have encountered no problems

in the past with accounting authorities

who are also owners and/or operators of

coast stations that lead us to believe

there is a potential problem. Thus, the

final rule will not ban coast stations,

coast earth stations or any other entity

from becoming accounting authorities as

long as they meet the eligibility

requirements.

20. Comments. Radio Holland USA

B.V. (Radio Holland) recommended that

prior relevant experience be a

mandatory requirement. In reply

comments, COMSAT stated that prior

experience as an accounting authority

should not be the sole determining

factor for qualification.

Response. The Commission, in this

final rule, has purposely declined to

adopt regulations requiring specific

prior relevant experience. We believe

the rule at Part 3, section 3.10(c) is clear

that related prior experience will be

reviewed favorably, however, this

experience or lack of experience will

not be the sole determinant in granting

certification. COMSAT appears to be

referring to the ‘‘grandfathering’’ process

directed toward the interim accounting

authorities. In that case, experience will

not be the sole determining factor,

either, but will be evaluated along with

other requirements.

21. Comments. Mackay urges the

Commission to consider prohibiting

‘‘foreign-based RPOAs’’ from settling for

U.S.-flagged vessels unless their

administration has a reciprocal

agreement allowing U.S. accounting

authorities to operate in their

administration. In reply comments,

COMSAT agreed with Mackay that the

Commission should consider whether

foreign administrations permit U.S.

entities to apply for accounting

authority identification codes in their

country.

Response. Based on our past

experience where no problems of this

nature have occurred, we do not think

it is necessary to adopt a policy of

reciprocity. At most, only ten of the

AAICs will be available to foreign-based

organizations. We have not addressed

this issue in the rules adopted below,

however, should the situation change,

the Commission could revisit the issue.

22. Comments. MMR commented that,

in the case of assignment of a U.S.

accounting authority identification

code, all settlements should be

processed and made from the physical

location of the accounting authority

from its U.S. address. COMSAT stated

there is no ‘‘rule section providing the

standard of evidence for establishing

that an accounting authority will

conduct operations in the United

States’’ and recommended the

submission of partnership or corporate

documents demonstrating where the

entity intends to do business. COMSAT

further suggested imposing a

jurisdictional requirement on foreignbased accounting authorities settling for

U.S. vessels requiring the accounting

authorities to be subject to the

jurisdiction of the U.S. courts.

Response. We will assign a ‘‘US’’

AAIC to those accounting authorities

who demonstrate they are operating

from a physical U.S. location. As the

administration responsible, the FCC will

be in a better position to monitor

operations and perform audits, as

applicable. Title 47 CFR, Part 3, section

3.11(a) is revised to state this explicitly.

Further, we believe the reporting

requirements will assist the Commission

in assuring the accounting authority is

continuing to settle from a U.S. location.

We do not think it is necessary to

subject foreign-based accounting

authorities to the jurisdiction of the U.S.

courts. We have concluded that such a

requirement would be complex,

unwieldy, and time consuming, far

beyond the regulatory structure we are

establishing. At this time, it appears that

disputes can be satisfactorily resolved

without judicial intervention.

B. Application Procedures

23. The NPRM proposed rules

requiring the filing of an original FCC

application form in order to be

considered as an accounting authority.

The NPRM requested only basic

information identifying the applicant

and describing the applicant’s objectives

and capabilities with respect to the

accounting authority function. The

NPRM stated our intention to request

that any relevant experience of an

applicant be detailed, that the

applicant’s proposed settlement plans

be provided and documents

demonstrating financial responsibility

should provide an adequate basis for

determining whether to issue a

certification. We intend to process

applications on a first-come, first-served

basis, however, we proposed to

‘‘grandfather’’ current accounting

authorities as long as they are otherwise

qualified and follow the procedures

established by the final rule (Report and

Order) to obtain permanent accounting

authority authorizations. Existing

accounting authorities are not exempt

from the new application procedures

and would be required to apply for

permanent accounting authority

certifications within 60 days of the

effective date of these rules or risk

losing their status as accounting

authorities. The NPRM established an

FCC policy that a minimum of 15 of the

available 25 Accounting Authority

Identification Codes (AAICs) be

reserved for use by accounting

authorities conducting settlement

operations in the United States.

Accounting authorities conducting

settlement operations within the United

States will be assigned a ‘‘US’’ AAIC

prefix if approved. Certified accounting

authorities, who maintain their

settlement operations outside the U.S.,

would retain the AAIC originally

assigned by the country of origin.

24. The NPRM included language in

the application and rules which would

make clear to applicants the

requirement to adhere to applicable FCC

policies and rules, the International

Telecommunication Regulations (ITR),

and other international rules,

regulations, agreements, and, where

appropriate, ITU–T Recommendations.

We invited comment as to the types of

documents acceptable for proving

financial responsibility as well as the

specific criteria for evaluation. The

NPRM proposed that, although the

United States is not a guarantor of

payments by its citizens, our proposed

rules sought to minimize potential

financial risks that might be present if

settlement operations are performed by

other accounting authorities. Further,

the NPRM documented the FCC policy

that the ship station licensee has final

responsibility for settlement should

their selected accounting authority be

unable or unwilling to make valid

payments to foreign entities.

25. The NPRM also detailed the

procedures the Commission will utilize

to obtain public comment on

applications received by the

Commission. Comments received during
20160 Federal Register / Vol. 61, No. 88 / Monday, May 6, 1996 / Rules and Regulations

the informal public comment period

will be taken into consideration in

making a determination as to whether to

approve the applicant as an accounting

authority. The NPRM further states that,

if the applicant is found to be qualified,

the Commission will inform the

applicant, in writing, that the

application has been approved.

26. Comments. Mackay stated that

they encourage the proposed

‘‘grandfathering’’ of interim accounting

authorities. EXXON commented that the

proposed formal application process is

unnecessary for the grandfathering

process. COMSAT stated they do not

understand how the grandfathered

applications will participate in the

licensing process, that the grandfathered

applications will limit the number of

new entrants to ten and the public

interests will not be served by limiting

the number of new applicants. IDB

Mobile Communications, Inc. (IDB)

agreed with COMSAT that ‘‘all

applicants should be considered equally

in the applicant process and should be

subject to the same criteria for

approval.’’ In reply comments, EXXON

stated that all applicants do have an

equal opportunity to apply and ‘‘there is

no shortage of available accounting

authority identification codes.’’ EXXON

further commented it is only fair to

allow grandfathered accounting

authorities to retain their status and

‘‘action to the contrary would prove

extremely disruptive to existing

accounting procedures.’’ In reply

comments, AIMS stated their agreement

with EXXON’s position, but COMSAT

disagreed with commenters who would

restrict the certification process by

exempting interim accounting

authorities from the application filing

requirements.

Response. The Commission does not

intend to hinder the current operations

of interim accounting authorities and

the final rule has provided for the

‘‘grandfathering’’ of such applicants,

provided they meet the eligibility

requirements. Applicants will be subject

to the same criteria and considered

equally. It should be noted that,

although only ten accounting authority

identification codes will be available

provided all interim accounting

authorities are approved, this is not a

new limitation. Additionally, the

interim rules for granting certification

did not provide the Commission with

the same information requested in this

rule, and, since there have been no

reporting requirements, the Commission

has little information about the

settlement activities of the interim

accounting authorities. Information

provided in response to the Report and

Order should assist the Commission in

its role as administrator of accounting

authorities.

27. Comments. Mackay urged the

Commission to give ‘‘existing U.S.-based

RPOAs’’ preference in order of

consideration regardless of when the

application was received in relation to

other applications. In reply comments,

COMSAT opposed any ban on foreignbased settlement entities, but proposed

that the Commission reserve the right to

process U.S.-based accounting authority

applications before foreign-based

applicants, should the Commission

receive more applications than the

available number of accounting

authority identification codes.

Response. The rules we are adopting

will not place a ban on foreign-based

settlement entities, however, it should

be noted that, although the rule states

(47 CFR, Part 3, section 3.21(b)) that a

minimum of 15 identification codes will

be retained for ‘‘US’’ codes, that does

not mean we will withhold certification

of U.S. entities and await applications

from foreign-based entities until a quota

of ten is certified. In cases where U.S.

applicants apply and no foreign-based

applications are on-hand, the U.S.

applications could be approved.

28. Comments. Mackay commented

they want to ensure there is sufficient

notification to enable existing

accounting authorities to complete the

application process. COMSAT stated

there is no mention of the triggering

date for filing.

Response. This final rule establishes

the effective date of the rules, which is

30 days following the publication of the

Report and Order in the Federal

Register. Interim accounting authorities

will be required to apply for permanent

accounting authority certifications

within 60 days of the effective date.

Others seeking certification may submit

their applications at any time following

the release date. They cannot usurp

those requesting ‘‘grandfathering’’ but

they will be considered on a first-come,

first-served basis for the remaining

codes.

29. Comments. Radio Holland

recommended the retention of their

existing accounting authority

identification code for interim

accounting authorities approved for a

permanent ‘‘license.’’ Further, Radio

Holland seeks clarification of the term

‘‘entity’’.

Response. The Commission believes

the implementation of these rules

should make little disruption to the

manner in which interim accounting

authorities are currently conducting

business. Title 47 CFR, Part 3, section

3.22 is amended to state that those

interim accounting authorities approved

for permanent certification will retain

their existing accounting authority

identification code.

In addressing the request to define

‘‘entity’’, the following definition is

provided: An entity is an individual or

a business that is self-contained,

separate and independent of other

organizations. An entity may exist

within or be a part of an overall, widely

diversified organization.

30. Comments. Radio Holland pointed

out their perceived consequences if an

application for an accounting authority

with interim certification was not

approved. They pointed out that

communications from/to vessels would

cease and a change in code might

involve huge costs. Radio Holland

stated that certain countries mention the

accounting authority identification code

on their registrations and that, changes

can cost up to $500 per vessel. Radio

Holland proposed, in case of nonapproval, the Commission extend the

period to include time for resolution of

problems including a 6-month period to

satisfy requirements. SAIT

Communications (SAIT) recommended

a procedure for resolution of problems

before a final decision. In reply

comments, EXXON agreed with SAIT

that the rules should provide

procedures for appeal. IDB disagreed, in

reply comments, with Radio Holland’s

proposal of additional time to meet the

requirements and proposed ‘‘the

Commission only consider * * *

applicants which meet the requirements

at the time of application and that the

Commission subject every applicant to

the same level of scrutiny.’’ In reply

comments, COMSAT Corporation

agreed with commenters requesting a

clarification of the process for

evaluating applications and the appeal

rights of applicants denied certification.

Further, COMSAT proposed a ‘‘thirtyday petition to deny process for

reviewing * * *.’’

Response. The Commission

recognizes the consequences of not

approving a permanent certification to

an interim accounting authority.

However, we anticipate that interim

accounting authorities will have no

problem completing the application

process. Inasmuch as possible, we

propose to work through these

situations during the comment period to

prevent unusual delays. 47 CFR, Part 3,

section 3.29 is amended in the Report

and Order to provide procedures for

seeking review when the application for

certification is denied. We do

emphasize, however, that all comments

resulting from the public notice will be
Federal Register / Vol. 61, No. 88 / Monday, May 6, 1996 / Rules and Regulations 20161

*We note that the latest (ITU–T Study Group 3,

December 1994) accepted version of ITU–T

Recommendation D.90 provides that bills be paid

by the accounting authority without delay and

within 3 months of receipt or within 4 months after

dispatch, whichever is the shortest period.

However, the Revised Rec. D.90 also recognizes that

the ITR period of 6 months after dispatch is

controlling.

considered in granting/denying

certifications.

31. Comments. Mackay raised the

issue of continued use of an accounting

authority identification code if a

business is acquired, merged or sold.

Radio Holland proposed that codes not

be canceled automatically in case of

transfer or change of control of an

accounting authority. Radio Holland is

concerned that the new application of

the new controlling entity might not be

considered due to the ‘‘first come-first

served’’ clause and the limitation of

total codes. In reply comments,

COMSAT supported commenters who

propose a modification of the rule to

permit the transfer of accounting

authority identification codes pursuant

to the sale or transfer of control. EXXON

recommended that the Commission

develop procedures for the pro-forma

transfer of control of accounting

authorities.

Response. The final rules adopted

below will allow the continued use of

accounting authority codes in these

cases provided the new entity can meet

the eligibility qualifications. 47 CFR

Part 3, section 3.51 is amended to

require the transferee to comply with

the same application process including

public comment and Commission

scrutiny that all applicants do. The rules

also require the transferee to certify to

the Commission that all accounts are

accepted and to provide a list of the

accounts. In the case of a merger of

accounting authorities, the merged

entity will be allowed to decide which

AAIC to keep.

32. Comments. Mackay stated the

Commission should define what

constitutes sound financial status and

how the status will be monitored in the

future. Mackay suggested requiring the

applicant to be a business with

established accounting procedures and

formal audited statements. Radio

Holland recommended that a sound

financial track record be made a

mandatory requirement. Marconi

Marine asks if a copy of their statutory

accounts would be acceptable as

evidence of financial status. COMSAT

recommended fairly strict financial

requirements and offered several

options: (1) requiring a bond, (2)

requiring accounting authorities to

demonstrate and maintain an asset

value of a certain percentage in relation

to outstanding debts, (3) requiring

accounting authorities to put deposits in

escrow, (4) dollar requirements for cashon-hand amounts, (5) limits on the

number of outstanding loans and the

amount of risk undertaken, and/or (6)

requiring accounting authorities to take

deposits from customers under certain

circumstances. COMSAT further

recommended the rules be revised to

require the initial (and annual)

submission of independently ‘‘audited

financial statements’’ and cite

requirements in the rural cellular radio

services (47 CFR 22.917(c)(6)). EXXON

commented that a formal financial

showing should not be required of

accounting authorities with interim

authority during the ‘‘grandfathering’’

process and, in reply comments,

EXXON disagreed with COMSAT’s

proposal for stricter financial

requirements for accounting authorities.

Global Communications (Global)

recommended accounting authorities

require a deposit from vessels to be

placed in an escrow account to assure

some company reserve in case of

default.

Response. The Commission is

interested in ensuring that accounting

authorities have a sound financial

background with a reputation for good

business practices. Any comments

received following the public notice

announcing the application will be

carefully considered. However, we

believe our objective can be met by

requiring formal financial statements

from applicants who are business

entities and other documents, e.g., tax

statements, statements proving assets

and liabilities from individuals. These,

coupled with any forthcoming

comments, will provide adequate

information for making a sound

decision. Marconi Marine’s statutory

accounts will probably be adequate to

prove financial responsibility. However,

47 CFR, section 3.24 is amended in the

final rule to include a requirement to

provide additional information to the

Commission, as required. As to whether

accounting authorities who will be

grandfathered should provide financial

responsibility evidence, as stated

elsewhere, the interim accounting

authorities, although not subject to any

formal FCC rules in the past, must now

prove their eligibility by complying

with the application process.

33. Comments. Mackay asked what

method will be used to obtain public

comment and who will evaluate the

comments. Mackay is concerned that

significant time and money could be

spent while responding to

unsubstantiated comments or

accusations. COMSAT requested that

applicants ‘‘be subject to petitions to

deny filed within 30 days of the public

notice identifying the applicant. Radio

Holland recommended consideration of

consultation with selected U.S. coast

stations and foreign administrations

involved in international

telecommunication settlements in

assessing the qualifications and actual

performance of applicants. In reply

comments, COMSAT supported Radio

Holland’s comment ‘‘that the

Commission consider foreign-based

applicant’s record in dealing with U.S.

service providers.’’

Response. The public notice/comment

process is discussed in Part 3, section

3.29 of the final rule. The comments and

application will be evaluated by

Commission employees designated by

the Managing Director and including the

Accounting Authority Certification

Officer. As to whether consultations

with U.S. service providers will be

necessary, these organizations will have

an opportunity to comment as discussed

in the same rule cite.

C. Settlement Operations

34. The NPRM proposed several

operational requirements for accounting

authorities. Basically, the operational

requirements parallel applicable ITR

and other international rules,

regulations, agreements, and applicable

ITU–T Recommendations and require

adherence to established international

procedures. The NPRM proposed that

accounting authorities be allowed a full

six months following certification as an

accounting authority to commence

settlement operations. The NPRM also

proposed a settlement period within

which individual settlements must be

accomplished, consistent with ITU

procedures. This provision requires

accounting authorities to make timely

payment to foreign administrations and

to accept accounts both in gold francs

and in Special Drawing Rights (SDRs).

The proposed rules are in accord with

existing international procedure and

FCC policy, as is the requirement to

settle accounts taking into consideration

ITU–T Recommendation D.90.* In

addition, the NPRM proposed rules to

establish the requirement that

accounting authorities cooperate fully

with the Commission concerning

maritime settlements issues. Since the

United States government is required,

upon request, to take all possible steps,

within the limits of applicable national

law, to ensure settlement of the

accounts of the licensee, (Radio

Regulations, Geneva 1979, Article 66,

Section III Accounting, paragraph 10,

number 5097; and, International
20162 Federal Register / Vol. 61, No. 88 / Monday, May 6, 1996 / Rules and Regulations

Telecommunication Regulations,

Melbourne 1988, Appendix 2—

Additional Provisions Relating to

Maritime Telecommunications,

paragraph 4.2) this requirement is

intended to ensure that the Commission

is kept aware of potential problems or

issues which could affect the national

interest or which could have a

significant impact on overall settlement

operations. The proposed rules also

made accounting authorities subject to

audit by the Commission or its

representative.

35. Comments. One commenter,

Global, responded both as an accounting

authority and a radiotelephone station.

Global recommended providing detailed

requirements for the day-to-day

operation of accounting authorities.

They commented that detailed rules

would eliminate confusion in

identifying accounts, promote the

dissemination of mutual information

and the timeliness of settlements and

produce better records and internal

accounting. Global recommended

requiring accounting authorities with

more than 100 vessels to maintain an

‘‘800’’ number 24 hours a day that coast

stations can call for information. They

further stated that accounting

authorities should acknowledge receipt

of invoices, should notify coast stations

of rejections within 30 days and clearly

identify invoices being paid. When

invoices are paid by bank draft, a

separate notice should be sent to coast

stations detailing the paid invoices.

Response. Global’s recommendations

are good, sound business practices

which we hope accounting authorities

will consider. However, the final rules

do not provide detailed requirements for

day-to-day operation because the

Commission believes that organizations

should not be limited in methodology as

long as they achieve timely and accurate

settlements.

36. Comments. Marconi Marine

referred to rules in the NPRM stating

that payments should be made in U.S.

dollars. They stated that most of their

payments are made in Sterling.

Response. The final rules, Part 3,

sections 3.46 and 3.47, provide for

payment in other currencies. However,

it should be noted that, although

payments can be made in currency other

than U.S. dollars, the rules require a

written agreement between the foreign

administration(s) and the accounting

authority to be approved by the

Commission. This agreement can be a

part of the original certification process

or it can be presented to the

Commission at anytime.

37. Comments. COMSAT suggested

the consideration of permitting

maritime customers to select direct

billing payment methods from their

service providers. COMSAT further

states that, although Article 66 provides

for collection of charges for

radiocommunications by RPOAs, that,

‘‘in order for RPOAs to settle accounts

with foreign administrations on behalf

of their customers, the Commission

requires that the service provider be

certified as an accounting authority.’’

Response. There is no legal bar

preventing service providers from

engaging in direct billing. (Radio

Regulations, Geneva 1979, Article 66,

Section II, Accounting Authority, para.

2, numbers 5086–5089; see also ITR,

Appendix 2) Neither do we believe the

adopted rules contain language that

prevent a service provider from entering

into contractual agreements with their

clients to include direct billing. The

issue of requiring RPOAs to become

accounting authorities arises when the

RPOA settles debtor accounts for their

clients.

38. Comments. Peninsular Electronics

(Peninsular) commented that most ship

licensing administrations for which they

are an accounting authority require

them to confirm acceptance of total

accounting responsibilities before they

issue the Ship Radio Station license.

Their services cover settlement of all

communications originated by clients.

They stated that the proposed rules only

refer to settlement with foreign

administrations. Peninsular asks if U.S.

settlements are also covered by FCC

regulations.

Response. These rules apply to

settlements of accounts for U.S. flag

vessels for messages transmitted via

foreign coast and coast earth station

facilities only. The final rules are

amended, at 3.1 to explain ‘‘[Accounting

authorities] settle accounts due foreign

administrations for messages

transmitted at sea by or between

maritime mobile stations located on

board ships subject to U.S. registry and

utilizing foreign coast and coast earth

station facilities.’’

39. Comments. MMR commented that

they were instrumental in establishing

the current 4-month settlement time

frame, they are a strong advocate for

reducing the settlement time frame and

they suggest that settlements not

handled within the allotted time frame

should have interest penalties applied

and enforced. COMSAT Corporation

urged the Commission to ‘‘consider

expediting the settlement procedures

down to four months, or shorter * * *’’

In reply comments, IDB recommended a

three-month settlement period and

referred to the NPRM which requires a

6-month settlement period. In reply

comments, COMSAT agreed with MMR

that accounting authorities who do not

make timely settlements should be

assessed an interest penalty by the

Commission.

Response. The Commission

recognizes that many organizations have

up-to-date technology and can effect

settlements well ahead of the 6-month

settlement period. This can be an

advantage in soliciting clients; however,

it is not our intention to place

additional burdens on existing

accounting authorities but to provide a

structure within which they can

continue to function. The final rules do

not adopt a requirement that is more

stringent than Radio Regulations,

Article 66, and ITR, Appendix 2 which

require a 6-month settlement period

(See note to paragraph 34, above.). As to

the issue of interest penalties, we will

not impose such a rule; however, the

rules in 47 CFR, Part 3 establish a

number of sanctions including

cancellation of their certification for

those accounting authorities who

repeatedly fail to settle accounts timely.

40. Comments. Mackay commented

that the Commission should be more

specific regarding the extent, time and

scope of proposed audits. Marconi

Marine commented that they do not see

the necessity for audit since they are

regularly audited internally and

externally. COMSAT requested

clarification of audit authority to

describe events that could ‘‘trigger the

audit process.’’

Response. Routine audits are not a

part of this rulemaking, rather, an audit

would normally be precipitated only in

the event of a disagreement as to

amounts of accounts, late payments, etc.

The audits will be strictly related to

accounting authority activities.

41. Comments. Peninsular pointed out

that the NPRM states that ITU–T

recommendations are not legally

binding, but it is indicated they must be

taken into account together with FCC

rules and regulations. Peninsular further

commented that it is not clear whether

compliance with D.90 is an FCC

requirement or if parallel FCC rules

exist. Marconi Marine expressed

concern about references regarding

‘‘abiding by FCC rules’’ and commented

that ‘‘this seems somewhat open ended

to us, as we do not know what rules we

would be agreeing to abide by.’’ Marconi

recommended altering the wording of

the text to reflect agreement to abide by

rules relating to accounting authorities

only.

Response. The Commission believes

that accounting authorities should

follow the ITU–T recommendations

which are generally considered to
Federal Register / Vol. 61, No. 88 / Monday, May 6, 1996 / Rules and Regulations 20163

govern international

telecommunications, and they should

always be considered in technical,

operational and service decisions. Any

references to FCC rules within this

Report and Order refer to 47 CFR, Part

3, the new rules being established by

this proceeding and related to the

oversight and administration of

accounting authorities. 47 CFR, Part 3,

section 3.43(f) is amended to add the

CFR reference.

42. Comments. MMR commented

there are presently no guidelines

whereby accounting authorities can

enlist assistance from its administration

‘‘when conflicts arise between the

provider and the accounting authority.’’

In reply comments, COMSAT endorses

MMR’s suggestion for enlisting the

Commission’s assistance in attempting

to resolve bad debt * * *’’

Response. The Commission believes

that each administration has a

responsibility to assist in resolving

outstanding issues between accounting

authorities and clients or foreign

administrations. The Commission

proposes to respond through all

available methods to resolve issues and

are prepared to follow through by

enforcing applicable rules (Part 3,

3.52(b), 3.70–3.76).

43. Comments. COMSAT commented

that the rules should make it clear that

the accounting authority is a guarantor

of payment.

Response. In the rules adopted below,

the non-governmental accounting

authorities, by virtue of their contractual

agreement with their clients and their

signed application wherein they agree to

perform settlements in accordance with

47 CFR, Part 3, must perform their

settlement activities properly or be

subjected to a number of sanctions and/

or cancellation of their certification.

However, the Report and Order does

not state that any accounting authority

is a guarantor of payment. Rather, at

Part 3, section 3.76, the ship station

licensee is declared responsible for final

payment of its accounts. Because the

ship station licensee has the most to

lose for non-payment of accounts, the

Commission believes care will be given

to the selection of an accounting

authority.

44. Comments. Marconi Marine

recommends the rules define more

clearly the complaint/inquiry resolution

procedures and there should be a clearly

defined arbitration procedure.

Response. These rules, section 3.52,

are purposely presented in general

terms because we believe complaints

and arguments must be addressed on a

case-by-case basis. By leaving these

rules ‘‘general’’ in tone, the Commission

will be able to respond to issues without

restrictions. We think this approach will

be an advantage to applicants and/or

accounting authorities. Section 3.52(a)

is amended in the final rule to require

that a copy of complaint/inquiry

resolution procedures be sent, upon

request, to the Commission.

D. Reporting Requirements

45. The NPRM proposed several new

reporting requirements for accounting

authorities. These reports should enable

the Commission to monitor accounting

authority operations to ensure

adherence to the adopted rules and to

appropriate international settlement

procedures. Currently, the Commission

submits monthly reports to the ITU in

Geneva detailing the inventory of U.S.

licensed ship stations operating in

international waters. The NPRM

proposed that accounting authorities

provide the Commission with a detailed

report of additions, deletions, or

modifications to their inventory of

serviced vessels each month. The

Commission would use this information

to maintain the ITU database and to

assure efficient settlement operations.

The proposed rules also required an end

of year inventory of vessels for which

the accounting authority is the

settlement entity and an annual

statistical report which would provide

information to the Commission

regarding settlement operations.

Comments will be addressed

separately for each of the reports, as

follows:

Annual Statistical Report of Operations

46. Comments. Peninsular stated that

their settlement operation does not

require identifying the actual number of

settlements and this information would

not be readily available. They asked if

the necessity for this information could

be reexamined. Marconi Marine

commented they would have difficulty

providing both the number of line items

and payments to individual

administrations. MMR asked what

purpose the collection of monetary

statistics serves.

Response. The Commission is

delegating a portion of its settlement

responsibility to the certified nongovernmental accounting authorities.

Our oversight responsibilities require

that we ensure that settlements for U.S.

licensees are being performed properly

and timely. The information will assist

us in monitoring the volume and aging

of accounts. We have reviewed

statements from foreign administrations

and observe the billings have sufficient

detail (a line-by-line listing of

individual calls to a specific ship for a

specific service) to comply with this

requirement. Therefore, the final rule

will require accounting authorities to

comply with this reporting requirement.

47. Comments. COMSAT

recommended modifying the rules to

require additional evidence of financial

responsibility and recommended

quarterly statistical reports filed within

one month of the end of each quarter,

showing an aging of liabilities. In reply

comments, EXXON opposed the

proposals to require the annual reports

on a quarterly basis. EXXON further

commented that if the report is required,

it should apply to accounting

authorities settling for unaffiliated

entities and on an annual basis only. In

reply comments, AIMS supported

EXXON’s proposal that the reporting

requirement apply only to accounting

authorities settling accounts for

unaffiliated entities. In reply comments,

COMSAT supported ‘‘the adoption of

streamlined reporting requirements

which provide the Commission and the

public with an accurate * * *

mechanism for monitoring the aging of

accounts and assessing the financial

performance of accounting authorities.’’

COMSAT opposed any limitation of the

annual statistical report and commented

that the report can be used to assess the

accounting authority’s settlement

performance, determine whether the

accounting authority is meeting its

obligations to customers and service

providers * * *’’

Response. The Commission will

retain the reporting requirement and

believes the usefulness of the

information outweighs our desire to

minimize the burden of reporting. The

NPRM, Part 3, 3.60(d) states that the

information will provide statistical data

for Commission use. Subsequently, we

have determined that the data can be

useful in determining whether

accounting authorities are performing

settlements, the volume of settlements

and the timeliness of settlements. The

report, FCC Form 45 states ‘‘provide

statistical information to the

Commission for overall program

monitoring purposes.’’ Lines 2, 3, and 4

referenced by Peninsular address the

average number of unprocessed

settlements on hand, the number

processed to completion more than 180

days after dispatch from foreign

administration and the percent of

settlements processed to completion

more than 180 days after dispatch. This

information will be helpful in

determining whether settlements are

being accomplished timely. Rule section

3.60 (d) is amended to include the

additional uses of the report.
20164 Federal Register / Vol. 61, No. 88 / Monday, May 6, 1996 / Rules and Regulations

Inventory of Vessels

48. Comments. MMR questioned the

proposed requirement to report an

inventory of vessels. MMR believes this

information is available through the

Private Radio Bureau’s Licensing

Division. Global, who is both an

accounting authority and a high-seas

radiotelephone station, cited the

difficulty in using ITU’s List of Ship

Stations, saying it is published once a

year and is often out of date because of

delays in reporting changes to ITU.

Response. As background, the

Commission/ITS has a responsibility to

provide a report of accounting authority

information to ITU. ITS has experienced

the same problems that Global has in

identifying the accounting authorities of

vessels. This reporting is accomplished

in the following manner: The Wireless

Telecommunications Bureau maintains

a database of ships in the maritime

service. That database is used to prepare

a report of changes in accounting

authority functions to ITU, however, the

database can only be updated by ITS

when current information becomes

available. By requiring accounting

authorities to provide the initial

inventory of vessels and the end-of-year

inventory, the List of Ship Stations

Report will provide more accurate, upto-date information. Additionally, the

title of Part 3, section 3.60(a) is changed

to ‘‘Initial Inventory of Vessels.’’

Report of Additions/Modifications/

Deletions

49. Comments. EXXON stated that

they settle only for their own vessels

and their inventory remains relatively

constant and a monthly report would

serve no useful purpose and be unduly

burdensome. In reply comments, AIMS

agreed with commenters who feel it is

unnecessary to require monthly

inventories when there is no change.

COMSAT agreed with EXXON regarding

the modification of inventory reporting

so that only commercial accounting

authorities are required to submit

monthly inventory reports. Global

recommended that accounting

authorities should publish lists of ships

accepted quarterly or monthly.

Response. We have considered the

requests for a less burdensome

requirement. Part 3, section 3.60(b) is

revised to require a semi-annual report.

However, we believe there is merit in

requiring a ‘‘no-change’’ report, as

applicable. The report will assure a

‘‘status-quo’’ in inventory.

50. Comments. Marconi Marine stated

that some information reported would

be commercially sensitive and should

be kept confidential.

Response. The rules adopted below

do not automatically offer

confidentiality because we do not

believe that the information requested is

commercially sensitive. The application

form states that ‘‘Information requested

by this form will be available to the

public.’’ Nonetheless, any entity

submitting information to the

Commission may submit a request that

such information not be made routinely

available for public inspection. We will

consider requests as discussed in 47

CFR, section 0.459. A new rule section,

Part 3, section 3.62, addresses this issue.

E. Enforcement

51.The NPRM set forth the procedures

the Commission will use to investigate

and to resolve complaints or infractions

of the Commission’s rules or established

international settlement procedures.

The proposed rules specified grounds

for enforcement sanctions, including

forfeiture, and/or cancellation of an

accounting authority’s certification and

also specified that the Commission will

afford an accounting authority notice

and an opportunity to present its side of

any issue involving cancellation of its

accounting authority privilege. The

proposed rules also provide that any

ship station licensee affected by the

cancellation of an accounting

authority’s privilege must find another

accounting authority to settle its

accounts. The Commission will notify

the ship stations, via a Public Notice, of

any cancellations, and, inasmuch as

possible, list individual shipowners

serviced by the cancelled accounting

authority as identified from the required

reports of vessel inventories. Finally,

the proposed rules provided for

forfeiture or other sanction action,

should a ship operator or licensee not

remit full and timely payment to the

Commission or to an approved

accounting authority when properly

billed or in the event that the

accounting authority fails in their

responsibility to forward payment to the

foreign entity. The Commission reserves

the right to cooperate with foreign

administrations in restricting public

correspondence communications to and

from vessels for which valid payments

have not been received or made as

required (Distress and safety

communications must be carried

without charge.) and to utilize available

debt collection procedures to collect

amounts owed.

52. Comments. Mackay stated that

there is no mention of a procedure to be

followed or the opportunity for appeal

if the Commission denies privilege, Part

3, section 3.28, [and] further, Mackay

commented that a procedure and appeal

process should be available under a rule

section.

Response. Part 3, section 3.29 is

amended in the final rule to provide

time frames for problems encountered

during the application process. Every

effort will be made to remedy any

problems during the timeframes. As to

any format for appeal, we are purposely

presenting this rule section in general

terms only because we believe these

situations would need to be addressed

on a case-by-case basis. Part 3, section

3.72(b) is also amended in the final rule

to include timeframes for appeal of

sanctions and to include the address for

filing an appeal.

53. Comments. COMSAT urged the

Commission to clarify that U.S.

approved accounting authorities may be

sanctioned by the Commission for

failing to perform settlement operations

here, or abroad, involving either U.S.-

registered or foreign vessels.

Response. The rules adopted below

address settlement of accounts of U.S.

ship station licensees and do not

address the settlement of foreign

vessels.

F. Conclusion

54. In this Report and Order, we are

adopting rules that establish basic

qualifications and requirements for

individuals or entities who may wish to

serve as accounting authorities for the

settlement of international radio

maritime accounts involving U.S.

registered vessels operating in foreign or

international waters. These rules also

establish requirements to ensure that

accounting authorities operate in

accordance with established

international procedures. There are few

changes in this final rule from the

related Notice of Proposed Rulemaking.

All comments and changes are

discussed in III, Issues Analysis,

paragraphs 13–53.

IV. Procedural Matters

A. Ex Parte

55. This is a non-restricted Report and

Order rulemaking proceeding. Ex parte

presentations are permitted, except

during the Sunshine Agenda period,

provided they are disclosed as provided

in Commission rules. See generally 47

CFR Sections 1.1202, 1.1203, and

1.1206(a).

B. Final Regulatory Analysis

56. Pursuant to the Regulatory

Flexibility Act of 1980, the

Commission’s final analysis is as

follows:

(a) Purpose of this action: This Report

and Order sets forth the final rules
Federal Register / Vol. 61, No. 88 / Monday, May 6, 1996 / Rules and Regulations 20165

concerning the administration of

accounting authorities in the maritime

mobile and the maritime mobilesatellite services except for distress and

safety communications.

(b) Summary of the issues raised by

the public comments in response to the

Initial Regulatory Flexibility analysis:

There were no comments submitted in

response to the Initial Regulatory

Flexibility Analysis.

(c) Significant alternatives considered:

The Notice of Proposed Rulemaking

(November 9, 1993) in this proceeding

presented standards for the approval/

cancellation of accounting authority

certifications and set forth guidelines for

settlement operations, reporting

requirements and enforcement. The

commenters supported the

Commission’s intent to provide an

effective regulatory framework which

permits markets for communications

services to function effectively while

eliminating unnecessary regulations.

There were several requests for more

stringent guidelines. Upon review, we

determined the public interest would be

better served by allowing accounting

authorities to perform settlements in an

environment that allows them to operate

as closely as possible to the manner in

which interim accounting authorities

have performed in previous years.

Because the system has worked

relatively trouble-free with no

established FCC rules in the past, we

intend to minimize any regulations/

additional burden on accounting

authorities in this Order.

V. Ordering Clauses

57. Accordingly, it is ordered that the

rules specified below are adopted.

58. It is further ordered that the rules

herein will be effective immediately

upon approval of the information

collection requirements by the Office of

Management and Budget. The

Commission will publish a public

notice to notify the public of the

effective date.

List of Subjects in 47 CFR Part 3

Accounting, Administrative practice

and procedure, maritime carriers,

Penalties, Reporting and recordkeeping

requirements, Telecommunications.

Federal Communications Commission.

William F. Caton,

Acting Secretary.

Rule Changes

Title 47 of the Code of Federal

Regulations is amended by adding a

new Part 3 as follows:

PART 3—AUTHORIZATION AND

ADMINISTRATION OF ACCOUNTING

AUTHORITIES IN MARITIME AND

MARITIME MOBILE-SATELLITE RADIO

SERVICES

General

Sec.

3.1 Scope, basis, purpose.

3.2 Terms and definitions.

Eligibility

3.10 Basic qualifications.

3.11 Location of settlement operation.

Application Procedures

3.20 Application form.

3.21 Order of consideration.

3.22 Number of accounting authority

identification codes per applicant.

3.23 Legal applicant.

3.24 Evidence of financial responsibility.

3.25 Number of copies.

3.26 Where application is to be mailed.

3.27 Amended application.

3.28 Denial of privilege.

3.29 Notifications.

Settlement Operations

3.40 Operational requirements.

3.41 Amount of time allowed before initial

settlements.

3.42 Location of processing facility.

3.43 Applicable rules and regulations.

3.44 Time to achieve settlements.

3.45 Amount of charges.

3.46 Use of gold francs.

3.47 Use of SDRs.

3.48 Cooperation with the Commission.

3.49 Agreement to be audited.

3.50 Retention of settlement records.

3.51 Cessation of operations.

3.52 Complaint/inquiry resolution

procedures.

3.53 FCC notification of refusal to provide

telecommunications service to U.S.

registered vessel(s).

3.54 Notification of change in address.

Reporting Requirements

3.60 Reports.

3.61 Reporting address.

3.62 Request for confidentiality.

Enforcement

3.70 Investigations.

3.71 Warnings.

3.72 Grounds for further enforcement

action.

3.73 Waiting period after cancellation.

3.74 Ship stations affected by suspension,

cancellation or relinquishment.

3.75 Licensee’s failure to make timely

payment.

3.76 Licensee’s liability for payment.

Authority: 47 U.S.C. 154(i), 154(j) and

303(r).

General

§ 3.1 Scope, basis, purpose.

By these rules the Federal

Communications Commission (FCC) is

delineating its responsibilities in

certifying and monitoring accounting

authorities in the maritime mobile and

maritime mobile-satellite radio services.

These entities settle accounts for public

correspondence due to foreign

administrations for messages

transmitted at sea by or between

maritime mobile stations located on

board ships subject to U.S. registry and

utilizing foreign coast and coast earth

station facilities. These rules are

intended to ensure that settlements of

accounts for U.S. licensed ship radio

stations are conducted in accordance

with the International

Telecommunication Regulations (ITR),

taking into account the applicable ITU–

T Recommendations.

§ 3.2 Terms and definitions.

(a) Accounting Authority. The

Administration of the country that has

issued the license for a mobile station or

the recognized operating agency or other

entity/entities designated by the

Administration in accordance with ITR,

Appendix 2 and ITU–T

Recommendation D.90 to whom

maritime accounts in respect of mobile

stations licensed by that country may be

sent.

(b) Accounting Authority Certification

Officer. The official designated by the

Managing Director, Federal

Communications Commission, who is

responsible, based on the coordination

and review of information related to

applicants, for granting certification as

an accounting authority in the maritime

mobile and maritime mobile-satellite

radio services. The Accounting

Authority Certification Officer may

initiate action to suspend or cancel an

accounting authority certification if it is

determined to be in the public’s best

interest.

(c) Accounting Authority

Identification Codes (AAICs). The

discrete identification code of an

accounting authority responsible for the

settlement of maritime accounts (Annex

A to ITU–T Recommendation D.90).

(d) Administration. Any governmental

department or service responsible for

discharging the obligations undertaken

in the Convention of the International

Telecommunication Union and the

Radio Regulations. For purposes of

these rules, ‘‘Administration’’ refers to a

foreign government or the U.S.

Government, and more specifically, to

the Federal Communications

Commission.

(e) Authorization. Approval by the

Federal Communications Commission

to operate as an accounting authority.

Synonymous with ‘‘certification’’.

(f) CCITT. The internationally

recognized French acronym for the

International Telegraph and Telephone

Consultative Committee, one of the
20166 Federal Register / Vol. 61, No. 88 / Monday, May 6, 1996 / Rules and Regulations

1At the ITU Additional Plenipotentiary

Conference in Geneva (December, 1992), the

structure, working methods and construct of the

basic ITU treaty instrument were modified. The

result is that the names of the sub-entities of the

ITU have changed (e.g., the CCITT has become the

Telecommunication Standardization Sector—ITU–T

and Recognized Private Operating Agency has

become Recognized Operating Agency-ROA). The

changes were placed into provisional effect on

March 1, 1993 with the formal entry into force of

these changes being July 1, 1994. We will refer to

the new nomenclatures within these rules,

wherever practicable. 2 Id.

former sub-entities of the International

Telecommunication Union (ITU). The

CCITT (ITU–T)1 is responsible for

developing international

telecommunications recommendations

relating to standardization of

international telecommunications

services and facilities, including matters

related to international charging and

accounting principles and the

settlement of international

telecommunications accounts.

Such recommendations are,

effectively, the detailed implementation

provisions for topics addressed in the

International Telecommunication

Regulations (ITR).

(g) Certification. Approval by the FCC

to operate as an accounting authority.

Synonymous with ‘‘authorization’’.

(h) Coast Earth Station. An earth

station in the fixed-satellite service or,

in some cases, in the maritime mobilesatellite service, located at a specified

fixed point on land to provide a feeder

link for the maritime mobile-satellite

service.

(i) Coast Station. A land station in the

maritime mobile service.

(j) Commission. The Federal

Communications Commission. The FCC.

(k) Gold Franc. A monetary unit

representing the value of a particular

nation’s currency to a gold par value.

One of the monetary units used to effect

accounting settlements in the maritime

mobile and the maritime mobilesatellite services.

(l) International Telecommunication

Union (ITU). One of the United Nations

family organizations headquartered in

Geneva, Switzerland along with several

other United Nations (UN) family

organizations. The ITU is the UN agency

responsible for all matters related to

international telecommunications. The

ITU has over 180 Member Countries,

including the United States, and

provides an international forum for

dealing with all aspects of international

telecommunications, including radio,

telecom services and telecom facilities.

(m) Linking Coefficient. The ITU

mandated conversion factor used to

convert gold francs to Special Drawing

Rights (SDRs). Among other things, it is

used to perform accounting settlements

in the maritime mobile and the

maritime mobile-satellite services.

(n) Maritime Mobile Service. A mobile

service between coast stations and ship

stations, or between ship stations, or

between associated on-board

communication stations. Survival craft

stations and emergency positionindicating radiobeacon stations may

also participate in this service.

(o) Maritime Mobile-Satellite Service.

A mobile-satellite service in which

mobile earth stations are located on

board ships. Survival craft stations and

emergency position-indicating

radiobeacon stations may also

participate in this radio service.

(p) Public Correspondence. Any

telecommunication which the offices

and stations must, by reason of their

being at the disposal of the public,

accept for transmission. This usually

applies to maritime mobile and

maritime mobile-satellite stations.

(q) Recognized Operating Agencies

(ROAs).2 Individuals, companies or

corporations, other than governments or

agencies, recognized by administrations,

which operate telecommunications

installations or provide

telecommunications services intended

for international use or which are

capable of causing interference to

international telecommunications.

ROAs which settle debtor accounts for

public correspondence in the maritime

mobile and maritime mobile-satellite

radio services must be certified as

accounting authorities.

(r) Ship Station. A mobile station in

the maritime mobile service located on

board a vessel which is not permanently

moored, other than a survival craft

station.

(s) Special Drawing Right (SDR). A

monetary unit of the International

Monetary Fund (IMF) currently based

on a market basket of exchange rates for

the United States, West Germany, Great

Britain, France and Japan but is subject

to IMF’s definition. One of the monetary

units used to effect accounting

settlements in the maritime mobile and

maritime mobile-satellite services.

(t) United States. The continental

U.S., Alaska, Hawaii, the

Commonwealth of Puerto Rico, the

Virgin Islands or any territory or

possession of the United States.

Eligibility

§ 3.10 Basic qualifications.

(a) Applicants must meet the

requirements and conditions contained

in these rules in order to be certified as

an accounting authority. No individual

or other entity, including accounting

authorities approved by other

administrations, may act as a United

States accounting authority and settle

accounts of U.S. licensed vessels in the

maritime mobile or maritime mobilesatellite services without a certification

from the Federal Communications

Commission. Accounting authorities

with interim certification as of the

effective date of this rule must submit

to the application process discussed in

Section 3.20. They will be

‘‘grandfathered’’, i.e, granted permanent

certification provided they demonstrate

their eligibility and present a proper

application.

(b) U.S. citizenship is not required of

individuals in order to receive

certification from the Commission to be

an accounting authority. Likewise, joint

ventures need not be organized under

the laws of the United States in order to

be eligible to perform settlements for

U.S. licensed vessels. See, however,

Section 3.11.

(c) Prior experience in maritime

accounting, general commercial

accounting, international shipping or

any other related endeavor will be taken

into consideration by the Commission

in certifying accounting authorities. The

lack of such expertise, however, will not

automatically disqualify an individual,

partnership, corporation or other entity

from becoming an accounting authority.

(d) Applicants must provide formal

financial statements or documentation

proving all assets, liabilities, income

and expenses.

(e) Applicants must be willing to offer

their services to the public at a

reasonable charge. This requirement

will be waived for applicants who settle

their own accounts only and are eligible

to be ‘‘grandfathered’’ during the initial

application period. However, should the

need for additional accounting

authorities be proven, these accounting

authorities will be required to offer their

services to the public or relinquish their

certification.

§ 3.11 Location of settlement operation.

(a) Within the United States. A

certified accounting authority

maintaining all settlement operations, as

well as associated documentation,

within the United States will be

assigned an AAIC with a ‘‘US’’ prefix.

(b) Outside the United States. A

certified accounting authority

maintaining settlement operations

outside the United States will be

assigned the same AAIC as that

originally assigned to such entity by the

administration of the country of origin.

However, in no case will an entity be
Federal Register / Vol. 61, No. 88 / Monday, May 6, 1996 / Rules and Regulations 20167

certified as an accounting authority for

settlement of U.S. licensed vessel

accounts unless the entity is requesting

to conduct a settlement operation in the

United States or has already been issued

an AAIC by another administration.

Application Procedures

§ 3.20 Application form.

Written application must be made to

the Federal Communications

Commission on FCC Form 44,

‘‘Application For Certification As An

Accounting Authority’’ in order to be

considered for certification as an

accounting authority. No other

application form may be used. No

consideration will be given to

applicants not submitting applications

in accordance with these rules or in

accordance with any other instructions

the Commission may issue. FCC Form

44 may be obtained from the

Commission by writing to the address

shown in Section 3.61.

§ 3.21 Order of consideration.

(a) Accounting Authority applications

will be processed on a first-come, firstserved basis. When applications are

received on the same day, the

application with the earliest mailing

date, as evidenced by the postmark, will

be processed first. Interim accounting

authorities seeking permanent

certifications through the

‘‘grandfathering’’ process will not

compete with other applicants during

the first 60 days following the effective

date of these rules which is allowed for

submission of their applications. After

the ‘‘grandfathering’’ process is

completed, all other applicants will be

processed as in paragraph (a) of this

section.

(b) At any given time, there will be no

more than 25 certified accounting

authorities with a minimum of 15 ‘‘US’’

AAICs reserved for use by accounting

authorities conducting settlement

operations within the United States. The

Commission will retain all valid

applications received after the

maximum number of accounting

authorities have been approved and will

inform such applicants that should an

AAIC become available for reassignment

in the future, the Commission will

conditionally certify as an accounting

authority the oldest of the qualified

pending applicants, as determined by

the order of receipt. Final certification

would be conditional upon filing of an

amended application (if necessary). The

Commission will inform the applicant

of his/her conditional selection in

writing to confirm the applicant’s

continued interest in becoming an

accounting authority.

§ 3.22 Number of accounting authority

identification codes per applicant.

(a) No entity will be entitled to or

assigned more than one AAIC.

(b) AAICs may not be reassigned,

sold, bartered or transferred and do not

convey upon sale or absorption of a

company or firm without the express

written approval of the Commission.

Only the FCC may certify accounting

authorities and assign U.S. AAICs for

entities settling accounts of U.S.

licensed vessels in the maritime mobile

and maritime mobile-satellite services.

(c) Accounting authorities who are

‘‘grandfathered’’ during the initial

application period may retain their

interim AAIC.

§ 3.23 Legal applicant.

The application shall be signed by the

individual, partner or primary officer of

a corporation who is legally able to

obligate the entity for which he or she

is a representative.

§ 3.24 Evidence of financial responsibility.

All applicants must provide evidence

of sound financial status. To the extent

that the applicant is a business, formal

financial statements will be required.

Other applicants may submit

documentation proving all assets,

liabilities, income and expenses which

supports their ability to meet their

personal obligations. Applicants must

provide any additional information

deemed necessary by the Commission.

§ 3.25 Number of copies.

One original and one copy of FCC

Form 44, ‘‘Application For Certification

As An Accounting Authority’’ will be

required. Only applications mailed to

the Commission on official, Commission

approved application forms will be

considered. Applications should be

mailed at least 90 days prior to planned

commencement of settlement activities

to allow time for the Commission to

review the application and to allow for

the informal public comment period.

§ 3.26 Where application is to be mailed.

All applications shall be mailed to the

Accounting Authority Certification

Officer in Washington, D.C. The

designated address will be provided on

the FCC Form 44, ‘‘Application for

Certification As An Accounting

Authority’’.

§ 3.27 Amended application.

Changes in circumstances that cause

information previously supplied to the

FCC to be incorrect or incomplete and

that could affect the approval process,

require the submission of an amended

application. The amended application

should be mailed to the Commission

immediately following such change. See

also Sections 3.24 and 3.51.

§ 3.28 Denial of privilege.

(a) The Commission, in its sole

discretion, may refuse to grant an

application to become an accounting

authority for any of the following

reasons:

(1) Failure to provide evidence of

acceptable financial responsibility;

(2) If the applicant, in the opinion of

the FCC reviewing official, does not

possess the qualifications necessary to

the proper functioning of an accounting

authority;

(3) Application is not personally

signed by the proper official(s);

(4) Applicant does not provide

evidence that accounting operations

will take place in the United States or

its territories and the applicant does not

already possess an AAIC issued by

another administration;

(5) Application is incomplete, the

applicant fails to provide additional

information requested by the

Commission or the applicant indicates

that it cannot meet a particular

provision; or

(6) When the Commission determines

that the grant of an authorization is

contrary to the public interest.

(b) These rules provide sufficient

latitude to address defects in

applications. Entities seeking review

should follow procedures set forth in

Sections 1.106 or 1.115 of this chapter.

§ 3.29 Notifications.

(a) The Commission will publish the

name of an applicant in a Public Notice

before granting certification and will

invite informal public comment on the

qualifications of the applicant from any

interested parties. Comments received

will be taken into consideration by the

Commission in making its

determination as to whether to approve

an applicant as an accounting authority.

Thirty days will be allowed for

submission of comments.

(b) The Commission will notify each

applicant in writing as to whether the

applicant has been approved as an

accounting authority. If the application

is not approved, the Commission will

provide a brief statement of the grounds

for denial.

(c) The names and addresses of all

newly certified accounting authorities

will be published in a Public Notice

issued by the Commission.

Additionally, the Commission will

notify the ITU within 30 days of any

changes to its approved list of

accounting authorities.
20168 Federal Register / Vol. 61, No. 88 / Monday, May 6, 1996 / Rules and Regulations

Settlement Operations

§ 3.40 Operational requirements.

All accounting authorities must

conduct their operations in

conformance with the provisions

contained in this section and with

relevant rules and guidance issued from

time to time by the Commission.

§ 3.41 Amount of time allowed before

initial settlements.

An accounting authority must begin

settling accounts no later than six

months from the date of certification.

Failure to commence settlement

operations is cause for suspension or

cancellation of an accounting authority

certification.

§ 3.42 Location of processing facility.

Settlement of maritime mobile and

maritime mobile-satellite service

accounts must be performed within the

United States by all accounting

authorities possessing the ‘‘US’’ prefix.

Other accounting authorities approved

by the Commission may settle accounts

either in the U.S. or elsewhere. See also

Sections 3.11 and 3.21(b).

§ 3.43 Applicable rules and regulations.

Accounting authority operations must

be conducted in accordance with

applicable FCC rules and regulations,

the International Telecommunication

Regulations (ITR), and other

international rules, regulations,

agreements, and, where appropriate,

ITU–T Recommendations. In particular,

the following must be adhered to or

taken into account in the case of ITU–

T.

(a) The latest basic treaty

instrument(s) of the International

Telecommunication Union (ITU);

(b) Binding agreements contained in

the Final Acts of World Administrative

Radio Conferences and/or World

International Telecommunication

Conferences;

(c) ITU Radio Regulations;

(d) ITU International

Telecommunication Regulations (ITR);

(e) ITU–T Recommendations

(particularly D.90 and D.195); and

(f) FCC Rules and Regulations (47 CFR

Part 3).

§ 3.44 Time to achieve settlements.

All maritime telecommunications

accounts should be timely paid in

accordance with applicable ITU

Regulations, Article 66 and

International Telecommunication

Regulations (Melbourne, 1988).

Accounting authorities are deemed to be

responsible for remitting, in a timely

manner, all valid amounts due to

foreign administrations or their agents.

§ 3.45 Amount of charges.

Accounting Authorities may charge

any reasonable fee for their settlement

services. Settlements themselves,

however, must adhere to the standards

set forth in these rules and must be in

accordance with the International

Telecommunication Regulations (ITR)

taking into account the applicable ITU–

T Recommendations and other guidance

issued by the Commission.

§ 3.46 Use of gold francs.

An accounting authority must accept

accounts presented to it from foreign

administrations in gold francs. These

gold francs must be converted on the

date of receipt of the bill to the

applicable Special Drawing Right (SDR)

rate (as published by the International

Monetary Fund) on that date utilizing

the linking coefficient of 3.061 gold

francs = 1 SDR. An equivalent amount

in U.S. dollars must be paid to the

foreign administration. Upon written

concurrence by the FCC, an accounting

authority may make separate

agreements, in writing, with foreign

administrations or their agents for

alternative settlement methods, in

accordance with ITU–T

Recommendation D.195.

§ 3.47 Use of SDRs.

An accounting authority must accept

accounts presented to it from foreign

administrations in Special Drawing

Rights (SDRs). These SDRs must be

converted to dollars on the date of

receipt by the accounting authority and

an equivalent amount in US dollars

must be paid to the foreign

administration. The conversion rate will

be the applicable rate published by the

International Monetary Fund (IMF) for

the date of receipt of the account from

the foreign administration. Upon

written concurrence by the FCC, any

accounting authority may make separate

agreements, in writing, with foreign

administrations or their agents for

alternative settlement methods,

provided account is taken of ITU–T

Recommendation D.195.

§ 3.48 Cooperation with the Commission.

Accounting authorities must

cooperate fully with the FCC in all

respects concerning international

maritime settlements issues, including

the resolution of questions of fact or

other issues arising as a result of

settlement operations.

§ 3.49 Agreement to be audited.

Accounting authorities accept their

certifications on condition that they are

subject to audit of their settlement

activities by the Commission or its

representative. Additionally, the

Commission reserves the right to verify

any statement(s) made or any materials

submitted to the Commission under

these rules. Verification may involve

discussions with ship owners or others

as well as the requirement to submit

additional information to the

Commission. Failure to respond

satisfactorily to any audit findings is

grounds for forfeiture or suspension or

cancellation of authority to act as an

accounting authority for U.S. vessels.

§ 3.50 Retention of settlement records.

Accounting authorities must

maintain, for the purpose of compliance

with these rules, all settlement records

for a period of at least seven years

following settlement of an account with

a foreign administration or agent.

§ 3.51 Cessation of operations.

The FCC must be notified

immediately should an accounting

authority plan to relinquish its

certification or cease to perform

settlements as authorized. Additionally,

the Commission must be advised in

advance of any proposed transfer of

control of an accounting authority’s firm

or organization, by any means, to

another entity.

(a) When an accounting authority is

transferred, merged or sold, the new

entity must apply for certification in its

own right if it is interested in becoming

an accounting authority. Provided the

new applicant is eligible and completes

the application process satisfactorily,

the AAIC will be transferred to the new

applicant. In the case of a merger of two

accounting authorities, the merged

entity must decide which AAIC to

retain.

(b) Section 3.21(a) will be waived for

these applicants.

(c) The applicant must comply with

application process including public

comment.

(d) The applicant must certify

acceptance of all accounts and must

furnish a list of the accounts to the

Commission at the time of application.

§ 3.52 Complaint/inquiry resolution

procedures.

(a) Accounting authorities must

maintain procedures for resolving

complaints and/or inquiries from its

contractual customers (vessels for which

it performs settlements), the FCC, the

ITU, and foreign administrations or

their agents. These procedures must be

available to the Commission upon

request.

(b) If a foreign administration requests

assistance in collection of accounts from

ships licensed by the FCC, the
Federal Register / Vol. 61, No. 88 / Monday, May 6, 1996 / Rules and Regulations 20169

appropriate accounting authority will

provide all information requested by the

Commission in a timely manner to

enable the Commission to determine the

cause of the complaint and to resolve

the issue. If accounts are in dispute, the

Commission will determine the amount

due the foreign administration,

accounting authority or ROA, and may

direct the accounting authority to pay

the accounts to the foreign

administration. If the accounting

authority does not pay the disputed

accounts within a reasonable timeframe,

the Commission may take action to levy

a forfeiture, cancel the AAIC privilege

and/or to revoke any operating authority

or licenses held by that accounting

authority. (See also Section 3.72).

§ 3.53 FCC notification of refusal to

provide telecommunications service to U.S.

registered vessel(s).

An accounting authority must inform

the FCC immediately should it receive

notice from any source that a foreign

administration or facility is refusing or

plans to refuse legitimate public

correspondence to or from any U.S.

registered vessel.

§ 3.54 Notification of change in address.

The Commission must be notified in

writing within 15 days of any change in

address of an accounting authority.

Such written notification should be sent

to the address shown in Section 3.61.

Reporting Requirements

§ 3.60 Reports.

(a) Initial Inventory of Vessels. Within

60 days after receiving final approval

from the FCC to be an accounting

authority, each certified accounting

authority must provide to the FCC an

initial list of vessels for which it is

performing settlements. This list should

contain only U.S. registered vessels.

Such list shall be typewritten or

computer generated, be annotated to

indicate it is the initial inventory and be

in the general format of the following

and provide the information shown:

Vessel Name Call Sign

(b) Semi-Annual Additions/

Modifications/Deletions to Vessel

Inventory. Beginning with the period

ending on the last day of March or

September following submission of an

accounting authority’s Initial Inventory

of Vessels (See paragraph (a) of this

section.) and each semi-annual period

thereafter, each accounting authority is

required to submit to the FCC a report

on additions, modifications or deletions

to its list of vessels for which it is

performing or intending to perform

settlements, whether or not settlements

actually have taken place. The list

should contain only U.S. registered

vessels. The report shall be typewritten

or computer generated and be in the

following general format:

ADDITIONS TO CURRENT VESSEL

INVENTORY

Vessel Name Call Sign Effective

Date

MODIFICATIONS TO CURRENT

VESSEL INVENTORY

Previous

Vessel

Name

Previous

Call

Sign

New

Vessel

Name

New

Call

Sign

Effective

Date

DELETIONS TO CURRENT VESSEL

INVENTORY

Vessel Name Call Sign Effective

Date

The preceding report must be received

by the Commission no later than 15

days following the end of the period

(March or September) for which the

report pertains. Modifications refer to

changes to call sign or ship name of

vessels for which the accounting

authority settles accounts and for which

basic information has previously been

provided to the Commission. Reports

are to be submitted even if there have

been no additions, modifications or

deletions to vessel inventories since the

previous report. If there are no changes

to an inventory, this should be indicated

on the report.

(c) End of Year Inventory. By

February 1st of each year, each

accounting authority must submit an

end-of-year inventory report listing

vessels for which the accounting

authority performed settlements as of

the previous December 31st. The list

should contain only U.S. registered

vessels. The report must be typewritten

or computer generated and prepared in

the same general format as that shown

in paragraph (a) of this section except it

should be annotated to indicate it is the

End of Year inventory.

(d) Annual Statistical Report of

Settlement Operations. By February 1st

of each year, each accounting authority

settling accounts for U.S. registered

vessels must submit to the FCC an

Annual Statistical Report, FCC Form 45,

which details the number and dollar

amount of settlements, by foreign

administration, during the preceding

twelve months. Information contained

in this report provides statistical data

that will enable the Commission to

monitor operations to ensure adherence

to these rules and to appropriate

international settlement procedures.

FCC Form 45 can be obtained by writing

to the address in 3.61 of these rules.

§ 3.61 Reporting address.

All reports must be received at the

following address no later than the

required reporting date:

Accounting Authority Certification Officer,

Financial Operations Division, Stop

1110A, Federal Communications

Commission, 1919 M Street NW.,

Washington, D.C. 20554

§ 3.62 Request for confidentiality.

Applicants should comply with

Section 0.459 of this chapter when

requesting confidentiality and cannot

assume that it will be offered

automatically.

Enforcement

§ 3.70 Investigations.

The Commission may investigate any

complaints made against accounting

authorities to ensure compliance with

the Commission’s rules and with

applicable ITU Regulations and other

international maritime accounting

procedures.

§ 3.71 Warnings.

The Commission may issue written

warnings or forfeitures to accounting

authorities which are found not to be

operating in accordance with

established rules and regulations.

Warnings will generally be issued for

violations which do not seriously or

immediately affect settlement functions

or international relations. Continued or

unresolved violations may lead to

further enforcement action by the

Commission, including any or all legally

available sanctions, including but not

limited to, forfeitures (Communications

Act of 1934, Sec. 503), suspension or

cancellation of the accounting authority

certification.

§ 3.72 Grounds for further enforcement

action.

(a) The Commission may take further

enforcement action, including forfeiture,

suspension or cancellation of an

accounting authority certification, if it is

determined that the public interest so

requires. Reasons for which such action

may be taken include, inter alia:

(1) Failure to initiate settlements

within six months of certification or

failure to perform settlements during

any subsequent six month period;
20170 Federal Register / Vol. 61, No. 88 / Monday, May 6, 1996 / Rules and Regulations

(2) Illegal activity or fraud;

(3) Non-payment or late payment to a

foreign administration or agent;

(4) Failure to follow ITR requirements

and procedures;

(5) Failure to take into account ITUT Recommendations;

(6) Failure to follow FCC rules and

regulations;

(7) Bankruptcy; or

(8) Providing false or incomplete

information to the Commission or

failure to comply with or respond to

requests for information.

(b) Prior to taking any of the

enforcement actions in paragraph (a) of

this section, the Commission will give

notice of its intent to take the specified

action and the grounds therefor, and

afford a 30-day period for a response in

writing; provided that, where the public

interest so requires, the Commission

may temporarily suspend a certification

pending completion of these

procedures. Responses must be

forwarded to the Accounting Authority

Certification Officer. See Section 3.61.

§ 3.73 Waiting period after cancellation.

An accounting authority whose

certification has been cancelled must

wait a minimum of three years before

reapplying to be an accounting

authority.

§ 3.74 Ship stations affected by

suspension, cancellation or relinquishment.

(a) Whenever the accounting authority

privilege has been suspended, cancelled

or relinquished, the accounting

authority is responsible for immediately

notifying all U.S. ship licensees for

which it was performing settlements of

the circumstances and informing them

of the requirement contained in

paragraph (b) of this section.

(b) Those ship stations utilizing an

accounting authority’s AAIC for which

the subject accounting authority

certification has been suspended,

cancelled or relinquished, should make

contractual arrangements with another

properly authorized accounting

authority to settle its accounts.

(c) The Commission will notify the

ITU of all accounting authority

suspensions, cancellations and

relinquishments, and

(d) The Commission will publish a

Public Notice detailing all accounting

authority suspensions, cancellations

and relinquishments.

§ 3.75 Licensee’s failure to make timely

payment.

Failure to remit proper and timely

payment to the Commission or to an

accounting authority may result in one

or more of the following actions against

the licensee:

(a) Forfeiture or other authorized

sanction.

(b) The refusal by foreign countries to

accept or refer public correspondence

communications to or from the vessel or

vessels owned, operated or licensed by

the person or entity failing to make

payment. This action may be taken at

the request of the Commission or

independently by the foreign country or

coast station involved.

(c) Further action to recover amounts

owed utilizing any or all legally

available debt collection procedures.

§ 3.76 Licensee’s liability for payment.

The U.S. ship station licensee bears

ultimate responsibility for final payment

of its accounts. This responsibility

cannot be superseded by the contractual

agreement between the ship station

licensee and the accounting authority.

In the event that an accounting

authority does not remit proper and

timely payments on behalf of the ship

station licensee:

(a) The ship station licensee will

make arrangements for another

accounting authority to perform future

settlements, and

(b) The ship station licensee will

settle any outstanding accounts due to

foreign entities.

(c) The Commission will, upon

request, take all possible steps, within

the limits of applicable national law, to

ensure settlement of the accounts of the

ship station licensee. As circumstances

warrant, this may include issuing

warnings to ship station licensees when

it becomes apparent that an accounting

authority is failing to settle accounts.

See also Sections 3.70 through 3.74.

[FR Doc. 96–10974 Filed 5–03–96; 8:45 am]

BILLING CODE 6712–01–P

DEPARTMENT OF TRANSPORTATION

National Highway Traffic Safety

Administration

49 CFR Part 571

[Docket No. 95–42; Notice 2]

RIN 2127–AF67

Federal Motor Vehicle Safety

Standards; Seat Belt Assemblies;

Child Restraint Systems

AGENCY: National Highway Traffic

Safety Administration (NHTSA), DOT.

ACTION: Final rule.

SUMMARY: This document rescinds the

colorfastness requirements for seat belt

assemblies. The purpose of those

requirements is to ensure that motorists

are not discouraged from using safety

belts out of a concern that the belts will

transfer their coloring to the motorists’

clothing. NHTSA concludes that

manufacturer concerns about public

acceptance are sufficient by themselves

to ensure that manufacturers will

continue to make their belts colorfast.

Therefore, retention of the requirements

is not necessary.

DATES: Effective Date: The amendments

made in this rule are effective June 20,

1996.

Applicability Date: Seat belt

assemblies manufactured after June 20,

1996 are not required to meet the

colorfastness requirements.

Petition Date: Any petitions for

reconsideration must be received by

NHTSA no later than June 20, 1996.

ADDRESSES: Any petitions for

reconsideration should refer to the

docket and notice number of this notice

and be submitted to: Administrator,

National Highway Traffic Safety

Administration, 400 Seventh Street,

SW., Washington, DC 20590.

FOR FURTHER INFORMATION CONTACT: The

following persons at the National

Highway Traffic Safety Administration,

400 Seventh Street, SW, Washington,

DC 20590:

For non-legal issues: Clarke Harper,

Office of Vehicle Safety Standards,

NPS–12, telephone (202) 366–4916,

facsimile (202) 366–4329, electronic

mail ‘‘charper@nhtsa.dot.gov’’.

For legal issues: Mary Versailles,

Office of the Chief Counsel, NCC–20,

telephone (202) 366–2992, facsimile

(202) 366–3820, electronic mail

‘‘mversailles@nhtsa.dot.gov’’.

SUPPLEMENTARY INFORMATION: Pursuant

to the March 4, 1995 directive,

‘‘Regulatory Reinvention Initiative,’’

from the President to the heads of

departments and agencies, NHTSA

undertook a review of all its regulations

and directives. During the course of that

review, the agency identified several

requirements and regulations as being

potential candidates for rescission. On

June 19, 1995, the agency published an

NPRM proposing the rescission of

several of those candidate requirements,

including the colorfastness

requirements in Standard No. 209, ‘‘Seat

Belt Assemblies’’ (60 FR 31946).

In the NPRM, NHTSA noted that it

had included the colorfastness

requirements in Standard No. 209 out of

concern that occupants would be less

likely to wear their seat belt if a lack of

colorfastness of the webbing damaged

their clothing. Paragraphs S4.2 (g) and

(h) of the Standard require seat belt

webbing to resist transferring color to a

wet or dry crock cloth and to resist