American regulator introduces changes affecting international carriers

The chief American telecom regulator has reduced the tariffs on international interexchange services and revised its rules on foreign carrier affiliation. The Federal Communications Commission believes the moves will be beneficial to American and international telcos and to consumers. Under a Notice of Proposed Rulemaking (NPRM), the FCC has decided tariffs are not necessary to ensure that carriers offer international service at fair rates and conditions and are not required to protect consumers. "The Commission also tentatively concludes that complete detariffing is in the public interest and will promote competition," the FCC writes in a news release. Only carriers classified as dominant will be forced to file tariffs. The FCC has also issued five other changes in its NPRM. It will make limited exception for permissive detariffing, for the first 45 days of service to new customers. Non-dominant interexchange carriers must have at least one location where information regarding rates, terms and conditions for international services is available. Companies having web sites would be required to post the data online. The information on supporting price and service must be made available to the commission upon request. Commercial mobile radio services will be completely detariffed under the new rules. The filing of carrier-to-carrier contracts would be restricted to two groups: interexchange carriers classified as dominant for reasons other than a foreign affiliation and carriers, regardless of classification, that contract directly for services with foreign carriers that possess market power. Bell Canada is currently applying for non-dominant status (NL, Mar. 8/00). One FCC commissioner gave the new rules his qualified support. "Tariffs are anachronistic regulatory tools that have outlived their usefulness," Harold Furchtgott-Roth writes. "Eliminating the burdensome requirement that companies file monumental tariff documents and that the FCC reviews them is a step in the right direction. " But the Tennessee-born economist has reservations about some changes. The notice is designed to create symmetry with a 1997 decision to detariff domestic LD service. Furchtgott-Roth rejects the notion of extending the requirements to international service, favouring the elimination of tariffs internationally and the call for domestic change. "In a fast changing technological environment, our rules need to evolve as well," he adds. "Waiting until the 2002 biennial review or later—as some have proposed—to revisit this requirement reflects regulation on ‘rotary dial’ time not ‘Internet’ time." Furchtgott-Roth also worries that consumers are ill-served by the changes. The notice allows tariffs for dial-around services and new customers of international carriers and suggests consumers cannot receive information on rates and terms because no relationship exists between the carrier and the customer. This is the material that must be made available on request. "Placing hundreds of pages of long documents in some government building in Washington DC is a far cry from the meaningful notice that can be placed on an Internet website," he suggests. "Yet, in the NPRM, for services where it matters most, the Commission chooses to allow the 1950s style notice of federal tariffs over the 21st Century notice of the Internet." The FCC also made changes in rules about foreign carrier affiliations. Previously, a carrier had to provide 60 days notice of a foreign carrier investment if the authorized carrier (or its holding company) acquired a controlling interest in a foreign carrier or if a foreign carrier (or its holding company) bought more than 25 per cent interest in an authorized carrier.

American regulator introduces changes affecting international carriers

News | November 20, 2000

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