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BACKGROUND p>"(# 3  Xd4XX` ` A.` ` Statutory Provisions ` p>"(# 3  XM4XX` ` B.` ` Commission's Regulations ` p>"(# 5  X64XX` ` C.` ` Procedural History ` p>"(# 6  X 4XX` ` X ` ` 1. LTD's Petition for Arbitration Before the Illinois Commission p>"(# 6  X!4XX` ` X ` ` 2. LTD's Petition for Arbitration Before the Georgia Commission p!(# 11  X!4XX` ` X ` ` 3. LTD's Petition for Arbitration Before the South Carolina Commission p"(# 15  X#4XX` ` D.` ` LTD's Petitions for Commission "Assumption of Jurisdiction" ` p"(# 19  X$4XX` ` E.` ` Responses of the State Commissions and the Incumbent LECs ` p"(# 24 X\III. DISCUSSION p"(# 31 "g', * *%"ԌX\IV. CONCLUSION p"(# 40 X\V. ORDERING CLAUSES p"(# 41 ś  X4M: I. INTRODUCTION ă  Xv41.` ` This Memorandum Opinion and Order addresses three petitions Low Tech Designs, Inc. (LTD) filed with the Commission on July 11, 1997, for "assumption of  XJ4jurisdiction" of arbitration proceedings,xJ=: yO 'ԍPetition for Commission Assumption of Jurisdiction of Low Tech Designs, Inc.'s Petition for Arbitration with Ameritech Illinois Before the Illinois Commerce Commission, CC Docket No. 97163 (LTD Illinois Petition); Petition for Commission Assumption of Jurisdiction of Low Tech Designs, Inc.'s Petition for Arbitration with BellSouth Before the Georgia Public Service Commission, CC No. Docket 97164 (LTD Georgia Petition); Petition for Commission Assumption of Jurisdiction of Low Tech Designs, Inc.'s Petition for Arbitration with GTE South Before the Public Service Commission of South Carolina, CC Docket No. 97165 (LTD South Carolina Petition).  pursuant to section 252(e)(5) of the Communications  X34Act of 1934, as amended.$3=: {O'ԍTelecommunications Act of 1996, Pub. L. No. 104104, 110 Stat. 56 (1996 Act), codified at 47 U.S.C.  {O' 151 et seq. Hereafter, all citations to the 1996 Act will be to the 1996 Act as it is codified in the United States Code. The 1996 Act amended the Communications Act of 1934. We will refer to the Communications Act of 1934, as amended, as "the Communications Act" or "the Act."  Section 252(e)(5) authorizes the Commission to preempt a state commission in any proceeding or matter in which the state commission "fails to act to carry  X 4out its responsibility" under section 252.J =: yO'ԍ47 U.S.C.  252(e)(5).J Section 252 sets out the procedures by which telecommunications carriers may request and obtain interconnection, resale services or unbundled network elements from an incumbent local exchange carrier (LEC) either through  X 4voluntary negotiations or through mediation or arbitration by state commissions.X =: {O'ԍSee generally 47 U.S.C.  252.X  X42.` ` LTD contends that the Illinois Commerce Commission (Illinois Commission), the Georgia Public Service Commission (Georgia Commission), and the Public Service Commission of South Carolina (South Carolina Commission) each failed to fulfill its duty under section 252(b) to arbitrate failed negotiations between LTD and Illinois Bell Telephone Company d/b/a Ameritech Illinois (Ameritech), BellSouth Telecommunications, Inc. (BellSouth), and GTE South, Inc. (GTE), respectively. Each of the three state commissions dismissed or denied LTD's arbitration petition on the ground that LTD did not satisfy a  X4statutory prerequisite to invoke compulsory arbitration under section 252(b).=: yO$'ԍThe Illinois and Georgia commissions dismissed LTD's arbitration petitions, and the South Carolina Commission denied LTD's arbitration petition. For the reasons discussed below, we find that LTD has not proven that the Illinois, Georgia, or South Carolina commissions "failed to act" on its requests for arbitration, within the meaning of our"n,(($"  X4rules implementing section 252(e)(5).N=: {Oy'ԍImplementation of the Local Competition Provisions in the Telecommunications Act of 1996, First  {OC'Report and Order, CC Docket No. 96-98, 11 FCC Rcd 15499, 16128 (1996), para. 1285 (Local Competition  {O 'Order), aff'd in part and vacated in part sub nom. Competitive Telecommunications Ass'n v. FCC, 117 F.3d  {O'1068 (8th Cir. 1997), aff'd in part and vacated in part sub nom. Iowa Utils. Bd. v. FCC, 120 F.3d 753 (8th Cir.  {O'1997) (Iowa Utils. Bd.), Order on Reconsideration, 11 FCC Rcd 13042 (1996), Second Order on  {Ok'Reconsideration, 11 FCC Rcd 19738 (1996), Third Order on Reconsideration and Further Notice of Proposed  {O5'Rulemaking, FCC 97295 (rel. Aug. 18, 1997), further recon. pending; see also 47 C.F.R.  51.801(b), 51.803(b). We therefore deny LTD's petitions and do not preempt the jurisdiction of these state commissions. As the petitions raise common issues for  X4the Commission's consideration, we address LTD's three petitions in this Memorandum  X4Opinion and Order.=: yOL 'ԍLTD requests in its petitions that the Commission consolidate the three arbitration proceedings, on the assumption that the Commission would preempt the state commission proceedings.  X4g< II. BACKGROUND ă  Xc' A.` ` Statutory Provisions  X543.` ` Congress adopted sections 251 and 252 of the Act to foster local exchange competition by imposing certain requirements on incumbent LECs that are designed to facilitate the entry of competing telecommunications carriers. Section 251 describes the various requirements designed to promote market entry, including incumbent LECs' obligations to provide to requesting telecommunications carriers interconnection, unbundled  X 4network elements and services for resale.oZ 6 =: {O'ԍSee generally 47 U.S.C.  251(c). For purposes of this order, the interconnection, access to unbundled elements, services for resale and other items for which incumbent local exchange carriers have a duty to negotiate pursuant to section 251(c)(1) are sometimes referred to collectively as "interconnection."o Section 252 sets forth the procedures by which telecommunications carriers may request and obtain interconnection, unbundled network  X4elements and services for resale from an incumbent LEC pursuant to section 251.X X =: {O'ԍSee generally 47 U.S.C.  252.X Specifically, section 252 establishes a scheme whereby telecommunications carriers may obtain interconnection with the incumbent according to agreements fashioned through (1) voluntary negotiations among the carriers, (2) mediation by state commissions, and (3)  X84arbitration by state commissions.V 8=: {O"'ԍSee 47 U.S.C.  252(a), (b).V These interconnection agreements must then be submitted  X!4for approval to the appropriate state commission.J !|=: yON%'ԍ47 U.S.C.  252(e)(1).J "   ,(("Ԍ X44.` ` Section 252(e)(5) directs the Commission to assume responsibility for any proceeding or matter in which the state commission "fails to act to carry out its responsibility" under section 252: X` ` (5) COMMISSION TO ACT IF STATE WILL NOT ACT. If a State commission fails to act to carry out its responsibility under this section in any proceeding or other matter under this section, then the Commission shall issue an order preempting the State commission's jurisdiction of that proceeding or matter within 90 days after being notified (or taking notice) of such failure, and shall assume the responsibility of the State commission under this section with  X 4respect to the proceeding or matter and act for the State commission.J  =: yO 'ԍ47 U.S.C.  252(e)(5).J   X ' B.Commission's Regulations  X 45.` ` In our Local Competition Order, we adopted "interim procedures" to exercise our preemption authority under section 252(e)(5) in order to "provide for an efficient and fair transition from state jurisdiction should we have to assume the responsibility of the state  X{4commission . . . ." ${X=: {O'ԍLocal Competition Order, 11 FCC Rcd at 16127, para. 1283. We adopted the procedures for exercising our section 252(e)(5) preemption authority on an interim basis in order to allow us "to learn from the initial experiences and gain a better understanding of what types of situations may arise that require Commission  {O'action." Id. at 16128, para. 1284. We concluded that we would not take an "expansive view" of what  Xd4constitutes a state commission's "failure to act" for purposes of section 252(e)(5).PdD=: {OY'ԍId. at 16128, para. 1285.P Rather, we interpreted "failure to act" to mean a state's failure to complete its duties in a timely manner. We limited the instances under which Commission preemption pursuant to section 252(e)(5) is appropriate to "where a state commission fails to respond, within a reasonable time, to a request for mediation or arbitration, or fails to complete arbitration within the time  X4limits of section 252(b)(4)(C)."$=: {Ox'ԍId. at 16128, para. 1285; see also 47 C.F.R.  51.801(b). Such instances would not encompass those in which an interconnection agreement is "deemed approved" under section 252(e)(4) as a result of state  {O 'commission inaction. Local Competition Order, 11 FCC Rcd at 16128, para. 1285; see also 47 C.F.R.  51.801(c). Under our rules, "[t]he party seeking preemption [pursuant to section 252(e)(5)] must prove that the state [commission] has failed to act to carry out its  X4responsibilities under section 252 of the Act." =: {O6$'ԍ47 C.F.R.  51.803(b); see also Local Competition Order, 11 FCC Rcd at 16128, para. 1285. Further, we concluded that once we assume jurisdiction of a matter pursuant to section 252(e)(5), "any and all further action regarding that proceeding or matter will be before the Commission," rather than before the state commission"T ,(("  X4that has failed to act.=: {Oy'ԍLocal Competition Order, 11 FCC Rcd at 16129, para. 1289; see also 47 C.F.R.  51.805(a). The United States Court of Appeals for the Eighth Circuit, in its  X4review of the Local Competition Order, acknowledged that the Commission has authority, pursuant to section 252(e)(5), to preempt a state commission's jurisdiction if that commission  X4fails to fulfill its duties under section 252 of the Act.XZ=: {O'ԍIowa Utils. Bd., 120 F.3d at 804.X  X' C.Procedural History  Xa' 1.` ` LTD's Petition for Arbitration Before the Illinois Commission  X346.` ` LTD asked Ameritech to commence negotiations for interconnection on August  X 423, 1996.L =: yO'ԍLTD Illinois Petition at 2.L Ameritech acknowledged LTD's request on August 27, 1996.: |=: {OI'ԍId.: LTD maintains that it was a "new entrant telecommunications carrier not certificated in Illinois" at the time it  X 4initiated negotiations with Ameritech.: =: {O'ԍId.:  X 47.` `  ILL1 On January 30, 1997, following unsuccessful negotiations with Ameritech, LTD  X 4filed a petition for arbitration with Ameritech before the Illinois Commission.: =: {O'ԍId.: LTD stated therein that it initially intended to enter the local exchange market under the resale provisions of the Act and that it also intended to offer enhanced call processing services by utilizing  Xd4unbundled network elements."d2 =: yOG'ԍResponse of the Illinois Commerce Commission at 1 (Illinois Commission Response). It was the Illinois Commission's understanding that LTD intended to offer enhanced call processing services by obtaining access to Ameritech's Advanced Intelligent Network (AIN) and by interconnecting LTD's software with Ameritech's AIN.  {O'Id.   ILL3 LTD's Illinois petition set forth six issues related to access to and interconnection with Ameritech's AIN. The seventh issue related to Ameritech's duty  X64under the Act to negotiate in good faith.@6=: {O"'ԍId. at 2.@ The arbitration petition did not set forth any issues relating to resale, and noted that resale issues, and other issues that the parties had not yet",((" discussed, would be presented at a later time if the parties were unable to negotiate an  X4agreement.=: {Ob'ԍLow Tech Designs, Inc. Petition for Arbitration Pursuant to Sec. 252(b) of the Telecommunications Act of 1996 to Establish Wholesale Rates and an Interconnection Agreement for Access to and Rates for Unbundled  {O'Network Elements with Illinois Bell Telephone Company d/b/a/ Ameritech Illinois, No. 97AB001, Arbitration Decision (March 31, 1997) at 1 (Illinois Commission Arbitration Decision) (Exhibit 2 to Illinois Commission Response).  X48.` ` The Hearing Examiner appointed to consider the dispute scheduled an initial prehearing conference for February 11, 1997, at which a detailed schedule for the arbitration  X4was established._|=: yO 'ԍIllinois Commission Arbitration Decision at 1._ On February 14, 1997, the Hearing Examiner granted Ameritech's motion  Xv4to strike the issue in the petition relating to Ameritech's duty to negotiate in good faith.:v =: {O3'ԍId.: One week later, the parties presented oral arguments and the Hearing Examiner directed LTD  XH4to respond to two data requests from Ameritech.:H=: {O'ԍId.:  X 49.` `  ILL4 On February 24, 1997, Ameritech filed its response to the arbitration petition, as well as a motion to deny the petition. Ameritech argued that LTD lacked standing to arbitrate pursuant to section 252 because LTD was not a "telecommunications carrier" as  X 4defined in the Act.T 0 =: yO'ԍIllinois Commission Response at 2. T Ameritech further asserted that LTD's petition was not a request for interconnection, access to unbundled elements network elements, resale, or any other matter  X 4that can be arbitrated under the Act. =: {O'ԍId. at 2; see also Illinois Commission Arbitration Decision at 12; Opposition of Ameritech Illinois To Petition For Commission Assumption of Jurisdiction at 23 (Ameritech Opposition). On February 28, 1997, the Illinois Commission staff and LTD each filed a response to Ameritech's motion to deny the petition; the Illinois  Xy4Commission staff supported the motion, and LTD opposed it.zy=: yOD'ԍIllinois Commission Arbitration Decision at 1; Ameritech Opposition at 2.z Ameritech filed a reply and  Xb4proposed order on March 4, 1997._ b=: yO!'ԍIllinois Commission Arbitration Decision at 2._ The Hearing Examiner issued a Proposed Order on March 10, 1997 that recommended that the Illinois Commission dismiss LTD's arbitration petition on the ground that LTD was not a "telecommunications carrier" as defined by the  X4Act.\!:=: {O&'ԍId. at 2; Ameritech Opposition at 3.\ Briefs and reply briefs were filed on March 17 and 21, 1997, respectively.|"=: yO''ԍIllinois Commission Arbitration Decision at 2; Ameritech Opposition at 23.|"\",(("Ԍ  X4 10.` `  ILL2 The Illinois Commission issued an arbitration decision on March 31, 1997  X4dismissing LTD's petition.#=: {OK'ԍSee Illinois Commission Arbitration Decision, Exhibit 2 to Illinois Commission Response. It dismissed the petition on the ground that LTD was not a "telecommunications carrier," as defined in the Act, and, therefore, was not entitled to  X4compulsory arbitration with Ameritech under section 252(b).@$Z=: {O'ԍId. at 5.@ Although LTD was not certified to operate in Illinois, the Illinois Commission concluded that this was not dispositive  Xv4of the case.@%v=: {O 'ԍId. at 2.@ Rather, the Illinois Commission concluded that LTD was not a "telecommunications carrier," as defined in section 3(44) of the Act, because it did not provide, at the time of the arbitration, "telecommunications service," as defined in section  X143(46) of the Act.&"1~=: {O`'ԍId. at 45. Section 3(44) of the Act defines a "telecommunications carrier" as "any provider of telecommunications services . . . ." Section 3(46), in turn, defines "telecommunications service" as "the offering of telecommunications for a fee directly to the public, or to such classes of users as to be effectively available to the public, regardless of the facilities used." 47 U.S.C.  3(44), 3(46). The Illinois Commission concluded that "[i]t is not a burdensome requirement under the 1996 Act for an entity to show some evidence that it has the financial, managerial, and technical ability to serve the public, by showing that at least somewhere in this country the entity is a telecommunications carrier actively engaged in the provision of  X 4telecommunications service.":' h =: {O'ԍId.: The Illinois Commission did not address the other issues  X 4raised in Ameritech's motion to deny the petition.B( =: {Oi'ԍId. at 57.B  X' 2.` ` LTD's Petition for Arbitration Before the Georgia Commission  Xb4 11.` ` LTD asked BellSouth to commence negotiations for interconnection in Georgia  XK4pursuant to the 1996 Act on August 12, 1996.K)K =: yO'ԍLTD Georgia Petition at 2.K BellSouth acknowledged LTD's request on August 19, 1996, and stated that it was ready to begin negotiations with LTD. LTD maintains that it was a "new entrant telecommunications carrier not certificated in Georgia" at  X4the time that it initiated negotiations with BellSouth.;*=: {O#'ԍId. ; "*,(("Ԍ X4 12.` ` GA1On January 16, 1997, after unproductive negotiations with BellSouth, LTD  X4filed a petition for arbitration with BellSouth before the Georgia Commission.:+=: {Ob'ԍId.: BellSouth  X4filed an answer and motion to dismiss the arbitration petition on February 14, 1997.,$Z=: {O'ԍ In re Petition by Low Tech Designs, Inc. for Arbitration of Rates, Terms and Conditions with BellSouth  {O'Telecommunications, Inc. Under the Telecommunications Act of 1996, Docket No. 7270, Order Dismissing Arbitration (May 19, 1997) at 2 (Georgia Commission Order) (Appendix A to Comments of the Georgia Public Service Commission in Opposition to Low Tech's Petition (Georgia Commission Opposition)). A prearbitration conference was held on March 10, 1997, at which the question of whether LTD  X4was a "telecommunications carrier" proposing a "telecommunications service" was discussed.:-F=: {O 'ԍId.: The Hearing Officer issued a prehearing order on March 28, 1997, ruling, among other things, that the issue of whether LTD was a "telecommunications carrier" proposing a "telecommunications service" had not been resolved and would be among the issues decided  XH4by the Georgia Commission.:.H=: {O'ԍId.: The parties next engaged in discovery and filed written  X14testimony in late March and early April.:/1j =: {OL'ԍId.:  X 4 13.` ` GA3On April 9, 1997, BellSouth filed a second motion to dismiss the arbitration, in  X 4which it challenged LTD's status as a "telecommunications carrier."0  =: yO'ԍGeorgia Commission Order at 2. According to LTD, BellSouth had previously acknowledged that LTD was a "telecommunications carrier" under the Act in its initial response to LTD's Petition for Arbitration. LTD Georgia Petition at 2 n.1. LTD did not provide the Commission with a copy of that response in its petition for preemption under section 252(e)(5).  LTD filed its response on April 11, 1997, and the Georgia Commission heard oral argument on this issue at the  X 4outset of the arbitration hearing on April 17, 1997.O1 =: yOS'ԍGeorgia Commission Order at 2.O The parties filed supplemental briefs on this issue. On May 19, 1997, the Georgia Commission issued an order dismissing the  X4arbitration.J2t=: yO 'ԍGeorgia Commission Order.J The Georgia Commission dismissed without prejudice LTD's arbitration petition on the ground that LTD was not a telecommunications carrier in Georgia and, therefore, was  Xb4not entitled to initiate arbitration before the Georgia Commission under section 252(b).E3b=: {O$'ԍId. at 1, 36.E The Georgia Commission stated that it would not consider an entity to be a telecommunications carrier in Georgia until that entity obtains a certificate of authority from the Georgia Commission, pursuant to a provision in Georgia's Telecommunications and Competition Development Act of 1996 that prohibits a telecommunications company from providing"3,(("  X4telecommunications service without a certificate of authority from the state commission.4=: {Oy'ԍId. at 3; see also Ga. Code Ann.  465163(a). The Georgia Commission concluded that Georgia's certification requirement is not preempted by the Act and is consistent with 47 U.S.C.  253(b). Georgia Commission Order at 3. The Georgia Commission acknowledged that under FCC rules, a telecommunications carrier may initiate negotiations with an incumbent LEC without first obtaining a state certificate of authority,  {O'but noted that the Commission issued no such rule with respect to arbitrations. Id. at 4; see also Local  {Oe'Competition Order, 11 FCC Rcd 15577, para. 154; 47 C.F.R.  51.301(c)(4). The Georgia Commission also concluded that an entity must propose to offer a telecommunications service in order to be eligible to enforce section 251 and 252's  X4requirements through compulsory arbitration.O5F=: yO 'ԍGeorgia Commission Order at 4.O The Georgia Commission noted that LTD's proposed service did not appear to be a telecommunications service, but that LTD would have an opportunity in the hearing on its application for a certificate of authority to establish that  Xv4its proposed service is a telecommunications service.?6v=: {O'ԍId. at 56. LTD explained at the arbitration hearing that it proposed a least cost routing service in which the customer places a longdistance call relying upon LTD to identify and select the lowest price longdistance provider. The local exchange service would be provided by another carrier (such as BellSouth), and the interexchange service would be provided by the carrier to which LTD routed the call. LTD might place a charge on the customer's bill for the routing service, but the customer still would be billed for local and interexchange service by the other carriers. Based on the Act's definition of "telecommunications service" as the transmission, between or among points specified by the user, of information of the user's choosing, to the public for a fee, the Georgia Commission determined that LTD would not be providing a telecommunications service, because it  {O?'would not be providing any transmission for the call. Georgia Commission Order at 5; see also 47 U.S.C.  3(43), (46). ?  XH4 14.` ` GA2On May 27, 1997, LTD filed with the Georgia Commission a Motion for Reconsideration, Rehearing and Oral Argument of Commission Order Dismissing the  X 4Arbitration.7" r=: yO='ԍIn re Petition by Low Tech Designs, Inc. for Arbitration of Rates, Terms and Conditions with BellSouth Telecommunications, Inc. Under the Telecommunications Act of 1996, Docket No. 7270, Order Denying Motion for Reconsideration, Rehearing and Oral Argument (July 7, 1997) at 2 (Georgia Commission Reconsideration  {O'Order) (Appendix B to Georgia Commission Opposition); see also Georgia Commission Opposition at 3.  LTD asked for a complete arbitration or, alternatively, a formal rehearing and oral argument. Further, LTD asked the Georgia Commission to approach the Commission jointly with LTD, to obtain rulings regarding eligibility for arbitration of the least cost routing  X 4service LTD proposed to offer, should the Georgia Commission deny LTD's other requests._8 \=: yO!'ԍGeorgia Commission Reconsideration Order at 2._ On July 7, 1997, the Georgia Commission issued an order denying LTD's motion, and affirming the May 19, 1997 order dismissing LTD's arbitration petition for lack of jurisdiction because LTD has not obtained a certificate of authority in Georgia, and therefore, is not a  Xy4telecommunications carrier.@9y=: {O''ԍId. at 3.@ The Georgia Commission also adopted in the Reconsideration"y ~9,((/" Order a recommendation of the Consumers' Utility Counsel Division of the Governor's Office of Consumer Affairs that if and when LTD obtains a certificate of authority to provide telecommunications service in Georgia, it will not have to wait an additional 135 days, after  X4becoming certificated, to file a new petition for arbitration pursuant to section 252(b)(1).@:=: {O4'ԍId. at 4.@   X' 3.` ` LTD's Petition for Arbitration Before the South Carolina Commission  X_415.` ` LTD filed for certification by the South Carolina Commission in March 1996,  XH4shortly after passage of the 1996 Act.R;HZ=: yOS 'ԍLTD South Carolina Petition at 1.R The South Carolina Commission rejected LTD's  X14application for failure to file proposed tariffs, and LTD did not refile its application.N<~1=: {O 'ԍ DELAY Id. LTD alleges that it was advised in a conversation with South Carolina Commission staff following  {O'the release of the Local Competition Order that the state commission would not adopt the Commission's 17 to 25 percent proxy discount rates for resold incumbent LEC retail services. Based on this information, LTD decided to delay offering resold telecommunications services, since GTE was only proposing an approximate 10 percent wholesale discount, and to concentrate on its unbundled network element negotiations with GTE and other incumbent LECs. Because LTD determined that it would not immediately be offering resold telecommunications  {O'services, it decided to delay refiling its certification application. Id. at 2.N  X 416.` ` LTD asked GTE to commence negotiations for interconnection on August 12,  X 41996.@= 0 =: {O'ԍId. at 2.@ GTE acknowledged LTD's request on August 19, 1996, and stated that it was ready  X 4to begin interconnection negotiations with LTD in South Carolina.;> =: {OH'ԍId. ; LTD maintains that it was a "new entrant telecommunications carrier not certificated in South Carolina" at the time  X 4it initiated negotiations with GTE.;? T =: {O'ԍId. ;  Xy417.` `  SCAR1 On or about January 17, 1997, after unsuccessful negotiations with GTE, LTD  Xb4filed a petition for arbitration with the South Carolina Commission.B@b=: {O 'ԍId. at 23.B The petition requested that the South Carolina Commission arbitrate several issues between LTD and GTE to  X44establish an interconnection agreement.A4x=: {O]$'ԍ See Arbitration to Establish Wholesale Rates and an Interconnection Agreement for Access to and Rates  {O'%'for Unbundled Network Elements with GTE South, Inc. Docket No. 97152C, Order No. 97153, Order Denying Petition (March 4, 1997) at 1 (South Carolina Commission Order) (attached to Response of Public Service Commission of South Carolina to Petition For Commission (FCC) Assumption of Jurisdiction (South Carolina Commission Response)). LTD was aware of a provision of South Carolina"4 ,A,(("  X4law, passed in May, 1996,_B=: yOy'ԍS.C. Code Ann.,  58910(13) (Supp. 1996)._ that defined a "new entrant LEC" as a "telecommunications company holding a certificate of public convenience and necessity issued by the commission pursuant to Section 589280(B) after December 31, 1995, to provide local exchange service  X4within a certificated geographic service area of the State."RCX=: yO'ԍLTD South Carolina Petition at 3.R LTD admitted in its arbitration petition that it was not certificated in South Carolina and asked for relief, for arbitration  X4purposes, from South Carolina's certification requirement.:D=: {O& 'ԍId.:  X_418.` `  SCAR2 GTE filed a response in opposition to the arbitration petition on or about February 3, 1997, and LTD filed an answer to GTE's response on or about February 7,  X141997._E1z=: yO\'ԍSouth Carolina Commission Order at 1.q_ On March 4, 1997, the South Carolina Commission issued an order denying LTD's  X 4arbitration petition, on the basis that LTD lacked the required state certification.[F =: {O'ԍSee South Carolina Commission Order.[ It rejected LTD's argument that the South Carolina statutory certification requirement was a "barrier to  X 4entry" under section 253(a)G =: yO9'ԍAccording to the South Carolina Commission, S.C. Code Ann.  589280(B) authorizes it to grant certification to applicants that propose to furnish local telephone service in the service territory of an incumbent LEC. The "applicants" who propose to operate as a telephone utility are defined as "new entrant local exchange carriers" in S.C. Code Ann.  58910(13), and LTD would be a "new entrant LEC." South Carolina Commission Order at 3. and instead maintained that the statutory provision was a "requirement[ ] necessary to . . . protect the public safety and welfare, ensure the continued quality of telecommunications services, and safeguard the rights of consumers," consistent  X 4with section 253(b).BH L =: {O'ԍId. at 2. B  Xy' D.LTD's Petitions for Commission "Assumption of Jurisdiction"  XK419.` `  SUBST1 LTD requests in its petitions that the Commission "assume jurisdiction" of the arbitration proceedings it requested before the Illinois, Georgia, and South Carolina commissions, pursuant to section 252(e)(5). It alleges that the three state commissions "failed to fulfill [their] duty to arbitrate failed negotiations" between LTD and Ameritech, BellSouth,  X4and GTE, respectively, pursuant to section 252(b).I=: yO~%'ԍLTD Illinois Petition at 1; LTD Georgia Petition at 1; LTD South Carolina Petition at 1. It does not allege, however, that any of the state commissions "failed to act" upon its arbitration request in a timely manner, nor that" nI,(("  X4any of the arbitration decisions were untimely rendered.J$=: {Oy'ԍState commissions are required to respond to a request for arbitration within a "reasonable time," Local  {OC'Competition Order, 11 FCC Rcd 16128, para. 1285; 47 C.F.R.  51.801(b), and to conclude an arbitration no later than nine months after the date on which the LEC receives a request for negotiation under section 252. 47 U.S.C.  252(b)(4)(C). Rather, it challenges the substantive bases upon which each state commission determined that LTD was not entitled to invoke compulsory arbitration with the relevant incumbent LEC under the Act.  X420.` `  LTD4 LTD describes itself in each of the petitions as a "new entrant requesting telecommunications carrier attempting to enter the local telecommunications services  Xv4market."Kv=: yO 'ԍLTD Illinois Petition at 1; LTD Georgia Petition at 1; LTD South Carolina Petition at 1. Its stated intention is to offer resold local exchange services and new  X_4telecommunications services using unbundled network elements.L_D=: yOT'ԍLTD Illinois Petition at 1; LTD Georgia Petition at 1; LTD South Carolina Petition at 1. Specifically, LTD represents that it intends to utilize unbundled network elements with call related databases, for the purpose of providing a least cost routing service for long distance calls, available without presubscription and accessed by using an abbreviated dialing code. LTD Illinois Petition at 4; LTD Georgia Petition at 5; LTD South Carolina Petition at 6. LTD maintains in the petitions filed with the Commission, as it did in its arbitration petitions, that it is a "telecommunications carrier," as "defined and anticipated by Sections 3(49) [sic] and  X 4252(a)(1) of the Act, respectively, and applicable FCC rules and interpretations."JMX =: yO'ԍLTD Illinois Petition at 1; LTD Georgia Petition at 1; LTD South Carolina Petition at 1. LTD referenced in each petition section 3(49), which defines "transmission of energy by radio." We assume LTD intended to reference section 3(44), which defines "telecommunications carrier."J   X 421.` `  LTD1 LTD raises identical arguments in its petitions requesting that the Commission preempt the Georgia and South Carolina arbitration proceedings, as the Georgia and South Carolina commissions dismissed or denied LTD's arbitration petition based on its failure to obtain certification pursuant to state statutory requirements. LTD states that "entities" entitled to negotiate with an incumbent LEC under sections 251 and 252 of the Act should have the right to arbitrate with the incumbent LEC in the event the negotiations are not successful,  Xb4regardless of whether a carrier has complied with a state's certification requirements.mNb=: yO' 'ԍLTD Georgia Petition at 3; LTD South Carolina Petition at 3.m It contends that the Commission agreed with LTD's view that the right to negotiate and arbitrate should not be dependent upon state certification requirements when the Commission  X4concluded in the Local Competition Order that state certification was not a preliminary requirement for good faith negotiations between requesting telecommunications carriers and  X4incumbent LECs.O=: {OF&'ԍLTD Georgia Petition at 3; LTD South Carolina Petition at 34; see also Local Competition Order, 11 FCC Rcd at 15577, para. 154. LTD further maintains that, because arbitrations result from the failure to" O,((]" obtain a negotiated interconnection agreement, state laws denying arbitration to a new entrant  X4that has been in negotiations with an incumbent LEC violate section 253(a) of the Act.P =: yOb'ԍLTD Georgia Petition at 3; LTD South Carolina Petition at 4. Section 253(a) provides: "No State or local statute or regulation, or other State or local legal requirement, may prohibit or have the effect of prohibiting the ability of any entity to provide any interstate or intrastate telecommunications service." 47 U.S.C.  253(a). LTD contends that such state laws "ha[ve] the effect of prohibiting 'any entity,' such as an uncertificated new entrant telecommunications carrier, [from] the ability to offer  X4telecommunications services."oQ=: yO 'ԍLTD Georgia Petition at 34; LTD South Carolina Petition at 4.o LTD also asserts that the Georgia and South Carolina commissions' practice of approving negotiated agreements between incumbent LECs and new entrant telecommunications companies, without requiring the new entrant companies to be certificated, but refusing to arbitrate an unsuccessfully negotiated agreement between an incumbent LEC and an uncertificated entity, violates the "competitively neutral basis"  X14requirement of section 253(b). R@1@=: yO"'ԍLTD Georgia Petition at 4; South Carolina Petition at 4. Section 253(b) provides:xxX  XNothing in this section shall affect the ability of a State to impose, on a competitively neutral basis and consistent with section 254, requirements necessary to preserve and advance universal service, protect the public safety and welfare, ensure the continued quality of telecommunications services, and safeguard the rights of consumers.  47 U.S.C.  253(b).   X 422.` `  LTD3 Finally, LTD offers several "business reasons" why small "new entrant telecommunications carriers," such as LTD, should not be required to obtain state certification in advance of arbitration. LTD claims that it cannot say with certainty that it has a complete and viable business plan and will be able to offer a full range of telecommunications services in a particular state until it is able to obtain, through arbitration, the unbundled network elements and rates it needs. Further, it contends that its inability to finalize a business plan  Xy4prior to the completion of arbitration will negatively affect its ability to attract investors.oSyH =: yOr'ԍLTD Georgia Petition at 45; LTD South Carolina Petition at 5.o LTD maintains that it should not be required to incur the expense of obtaining certification until it is certain that it can obtain the unbundled network elements necessary for the  X44provisioning of services.oT4=: yO"'ԍLTD Georgia Petition at 45; LTD South Carolina Petition at 5.o  X423.` `  LTD2  SUBST2 LTD's petition with respect to the Illinois arbitration alleges that the Illinois Commission's decision is "flawed" because the Illinois Commission dismissed the petition on" hT,((]"  X4the ground that LTD was not providing telecommunications services in another state.NU=: yOy'ԍLTD Illinois Petition at 34.N LTD argues that the Illinois Commission would not consider LTD to be a "telecommunications carrier" under the Act until LTD is providing a telecommunications service somewhere, but that LTD, as a new entrant, is unable to provide telecommunications service until it can reach  X4an interconnection agreement with an incumbent LEC.BVX=: {O'ԍId. at 34.B It maintains that the requirement that a new entrant must be offering services in order to arbitrate precludes new entrants from  Xv4entering the market in violation of section 253(a).@Wv=: {O 'ԍId. at 4.@ LTD also contends that the  X_4Commission's definition of "telecommunications carrier" in the Local Competition Order  XJ4supports its contention that new entrant requesting carriers such as LTD, that have engaged in negotiations with incumbent LECs for the purpose of offering public telecommunications for a  X 4fee, are "telecommunications carriers" under the Act.X |=: {OI'ԍId. at 4, citing Local Competition Order, 11 FCC Rcd 15988, para. 992.  X ' E.Responses of the State Commissions and the Incumbent LECs  X 424.` ` The Georgia, South Carolina, and Illinois commissions urge the Commission to dismiss or deny LTD's petition involving their state proceeding. They contend that they carried out their responsibility with respect to LTD's arbitration petitions, that they did not "fail[] to act" for purposes of section 252(e)(5), and that the Commission lacks jurisdiction to  Xd4conduct an arbitration on LTD's behalf.Yd=: yO#'ԍGeorgia Commission Opposition at 4; South Carolina Commission Response at 1, 4; Illinois Commission Response at 24. The Illinois Commission asserts that, under the  XM4Commission's interpretation of "failure to act" in the Local Competition Order, LTD has the burden of establishing that the Illinois Commission failed to respond to LTD's request for  X!4arbitration within a reasonable time frame.SZ!f =: yO8'ԍIllinois Commission Response at 3.S It specifically contends that LTD has not met this burden and that a "disagreement with a state commission over an interpretation of the law  X4is not a 'failure to act' as that term is used in 252(e)(5)."B[ =: {O!'ԍId. at 34.B  X425.` ` The Georgia and South Carolina commissions also respond to LTD's section 253 argument. They contend that their state certification requirements do not constitute "barriers to entry" under section 253 and that these requirements are consistent with the Act" [,(("  X4and the Commission's rules.g\@=: yOy'ԍ COMPLY Georgia Commission Opposition at 45; South Carolina Commission Response at 23. The Georgia Commission notes that LTD filed its application for a certificate of authority to provide local exchange service two days before the scheduled arbitration hearing, but that LTD was required to resubmit its application because it failed to comply with a rule regarding the submission of trade secret information. Georgia Commission Opposition at 4 n.3. The South Carolina Commission notes that LTD failed to provide copies of proposed tariffs with its application for certification, and that denial of the application was not a barrier to entry because LTD could have satisfied the South Carolina Commission's application requirements by filing an "illustrative tariff." South Carolina Commission Response at 3.g In response to LTD's argument that it is inconsistent for the state commission to approve negotiated agreements when the requesting party is noncertificated, but to dismiss or deny LTD's arbitration petition, both state commissions contend that they are required to expend a substantially greater amount of time and administrative  X4resources to conduct an arbitration, than to approve a negotiated agreement.]=: yO% 'ԍGeorgia Commission Opposition at 6; South Carolina Commission Response at 34. They contend that they are entitled to ascertain whether a company can qualify to provide the proposed  Xv4service before undertaking a costly and potentially lengthy arbitration.^v` =: yO'ԍGeorgia Commission Opposition at 6; South Carolina Commission Response at 34. The South Carolina Commission further notes that all entities eventually must file a certification application and  XH4undergo examination before they can provide local service.\_H =: yO'ԍSouth Carolina Commission Response at 34. \  X 426.` ` The Georgia Commission also states that LTD's motion for reconsideration was based, in part, on the argument that it should be considered a reseller and that the dismissal of  X 4its arbitration petition violates section 251(b).T` =: yO'ԍGeorgia Commission Opposition at 6.T The Georgia Commission asserts that it properly determined that LTD is not certificated as a local service reseller in Georgia, and that its arbitration petition was premised upon its request that certain AIN and related items be  X 4made available as unbundled network elements under section 251(c).:a =: {Oh'ԍId.: Further, the Georgia Commission was not persuaded that arbitration may be pursued under section 252(b) by a noncertificated entity even if that entity pressed claims solely under section 251(b)'s resale obligations. It states that the Commission, pursuant to section 253(b), must defer to Georgia's  XK4statutory requirement that a reseller of local exchange services must obtain a certificate.:bK=: {O"'ԍId.: Finally, the Georgia Commission reiterated the commitment in its arbitration decision to treat"44b,((" a new petition for arbitration filed by LTD as timely if LTD obtains a certificate to provide  X4telecommunications services in Georgia.Bc~=: {Ob'ԍId. at 67. The Georgia Commission stated that LTD will not have to wait an additional 135 to 160 days, after becoming certificated, to file a new petition for arbitration pursuant to section 252(b)(1) of the Act. Although the statutory period cannot be waived, in view of the fact that the case presented a jurisdictional issue of first impression and that LTD has been in ongoing negotiations with BellSouth, the Georgia Commission determined that LTD's request for negotiations should be deemed a continuing request sufficient to meet the 135  {OL'to 160 day period in section 252(b)(1). Id. Alternatively, the Georgia Commission stated that LTD's remedy is  {O'to seek judicial review of the arbitration decision. Id. at 2 n.1.B  X427.` ` Ameritech, BellSouth, and GTE also contend that there is no basis for Commission preemption of the Georgia, South Carolina and Illinois arbitration proceedings, respectively, under section 252(e)(5) of the Act or section 51.801(b) of the Commission's  Xv4rules.&dZv=: {O5'ԍSee Opposition of Ameritech Illinois to Petition for Commission Assumption of Jurisdiction (Ameritech Opposition); Opposition of BellSouth (BellSouth Opposition); Opposition of GTE Service Corporation and GTE South, Inc. (GTE Opposition). & They state that the state commissions neither failed to initiate an arbitration proceeding in a timely manner, nor failed to reach a decision within the time limit established  XH4by the Act.eH0 =: yO)'ԍAmeritech Opposition at 46; BellSouth Opposition at 56; GTE Opposition at 2. BellSouth and GTE further state that LTD's sole remedy is to seek review of  X14the arbitration decision in the United States District Court, pursuant to section 252(b)(6).f1 =: yO'ԍBellSouth Opposition at 67; GTE Opposition at 3. Section 252(e)(6) provides, in pertinent part: "In any case in which a State commission makes a determination under this section, any party aggrieved by such determination may bring an action in an appropriate Federal district court to determine whether the agreement or statement meets the requirements of section 251 and this section." 47 U.S.C.  252(e)(6). BellSouth states that  {O'the Eighth Circuit "recently held that a Federal district court action is the exclusive means of reviewing state commissions applying Sections 251 and 252." BellSouth Opposition at 7 (emphasis in original).  They argue that the Commission should not address the merits of the arbitration decisions, but if it does so, that it lacks authority to preempt Georgia and South Carolina's certification  X 4requirements.dg :=: yO'ԍBellSouth Opposition at 78; GTE Opposition at 34.d They urge the Commission to reject LTD's argument that the certification requirement is not "competitively neutral." BellSouth also advances the argument that a state commission should not be required to devote its resources to arbitrate a dispute at the request  X 4of a person who may never qualify to offer telecommunications services in that state.Mh =: yO""'ԍBellSouth Opposition at 79.M BellSouth contends that this reasoning is consistent with the Act's definition of  Xy4"telecommunications carrier."BiyZ=: {O%'ԍId. at 78.B "bi,((@"Ԍ X428.` ` LTD, in response to the oppositions of the state commissions and the incumbent LECs to its petitions, states that none of the parties produced evidence that the arbitration decisions resolved the differences between LTD and the relevant incumbent LEC, nor did they contend that LTD's petition was defective in any matter that would justify its  X4dismissal or denial.j=: {O'ԍLTD filed Ex Parte Comments in each of the three dockets on August 12, 1997. We will refer to these  {O'comments as LTD Ex Parte Illinois Comments; LTD Ex Parte Georgia Comments; and LTD Ex Parte South  {O'Carolina Comments). See LTD Ex Parte Illinois Comments at 1; LTD Ex Parte Georgia Comments at 1; LTD  {O{'Ex Parte South Carolina Comments at 1. LTD also claims that the Illinois Commission "failed to complete  {OE 'it's[sic] federally mandated arbitration duty within the time limits established in Section 252(b)(4)(C)." LTD Ex  {O 'Parte Illinois Comments at 12.  It contends that the basis upon which the Georgia Commission  X4dismissed and the South Carolina Commission denied its petition, i.e., its alleged failure to satisfy state certification requirements, "is at odds with the procompetitive intent of the  Xa4Act."kaL=: {O^'ԍLTD Ex Parte Georgia Comments at 2; LTD Ex Parte South Carolina Comments at 2. It summarily asserts that these state commissions should not be permitted to use their  XJ4section 253(b) authority as a tool to dismiss or deny "properly filed arbitration requests."lJ=: {O'ԍLTD Ex Parte Georgia Comments at 2; LTD Ex Parte South Carolina Comments at 2.  X 4 29.` ` LTD states that section 252(a)(1) supports its contention that it is a  X 4"telecommunications carrier" entitled to arbitration under section 252(b).m p =: yO&'ԍLTD relies upon the following language in section 252(a)(1): "Upon receiving a request for interconnection, services, or network elements pursuant to section 251, an incumbent local exchange carrier may  {O'negotiate and enter into a binding agreement with the requesting telecommunications carrier . . . ." LTD Ex  {O'Parte Illinois Comments at 3; LTD Ex Parte Georgia Comments at 2; LTD Ex Parte South Carolina Comments at 3.  Specifically, it contends that a party requesting interconnection, services or network elements from an incumbent LEC is necessarily a "requesting telecommunications carrier." It further relies on the following sentence in the legislative history of the Act to support its view that arbitration should be available to a new entrant such as LTD if negotiations with the relevant incumbent LEC fail: "the duties imposed under new section 251(b) make sense only in the context of a  X{4specific request from another telecommunications carrier or any other person who actually  Xf4seeks to connect with or provide services using the LEC's network."?nZf$=: {O; 'ԍLTD Ex Parte Georgia Comments at 3; LTD Ex Parte South Carolina Comments at 3; LTD Ex Parte  yO!'Illinois Comments at 3 (all quoting Joint Statement of Managers S. Conf. Rep. No. 104230, 104th Cong. 2d Sess. 121 (1996) (emphasis added).?  X8430.` ` LTD disputes the Georgia Commission, BellSouth and GTE's contention that it is required to seek review of the state commissions' arbitration decisions in federal district court. It maintains that section 252(e)(6) only requires district court review for parties that have been aggrieved by a state commission determination involving an interconnection agreement or a statement of generally available terms, and that Commission assumption of"Fn,((:"  X4jurisdiction over LTD's arbitrations is the only remedy available to it.Ao =: {Oy'ԍLTD Ex Parte Georgia Comments at 3; LTD Ex Parte South Carolina Comments at 4. LTD bases its argument on the language of section 252(e)(6), which provides, in relevant part: XIn any case in which a State commission makes a determination under this section, any party aggrieved by such determination may bring an action in an appropriate Federal district court to determine whether the agreement or statement meets the requirements of section 251 and this section.  47 U.S.C.  252(e)(6). A It also states that the parties "ignore" 47 C.F.R.  51.301(c)(4), which precludes an incumbent LEC from conditioning negotiation on a requesting telecommunications carrier first obtaining state certification, and repeats its argument that state commissions should likewise be required to  X4arbitrate failed negotiations even if the requesting party is not certificated.p=: {O 'ԍLTD Ex Parte Georgia Comments at 4; LTD Ex Parte South Carolina Comments at 4; LTD Ex Parte Illinois Comments at 4. LTD further  X4contends that the Eighth Circuit's decision in Iowa Utils. Bd. supports its position to the extent that it describes the entities that are able to avail themselves of arbitration as "competing companies, requesting new entrant, and competing telecommunications carriers," and recognizes that a final agreement, whether accomplished through negotiation or  X34arbitration, "must" be approved by the state commission.q3 =: {O'ԍLTD Ex Parte Georgia Comments at 45; LTD Ex Parte South Carolina Comments at 45; LTD Ex  {O'Parte Illinois Comments at 45 (emphasis added). LTD states that the Eighth Circuit uses the terms "competing companies," "requesting new entrant," and then "competing telecommunications carrier" to describe the entities that are able to avail themselves of the local competition provisions of the Act. It further states that the Eighth Circuit affirms that LTD has "followed the entry path provided in the Act by deciding to be a competing  {O'company, becoming a requesting new entrant, and then a competing telecommunications carrier." Id.  X 4#Xj\  P6G;+XP##Xj\  P6G;+XP#C III. DISCUSSION ă  X 431.` ` Section 252(e)(5) directs the Commission to preempt the jurisdiction of a state commission in any proceeding or matter in which a state commission "fails to act to carry out  X 4its responsibility under [section 252]."r& r=: yO'ԍ47 U.S.C.  252(e)(5). The United States Court of Appeals for the Eighth Circuit, in its review of the  {O 'Local Competition Order, acknowledged that the Commission has authority, pursuant to section 252(e)(5), to  {O`!'preempt a state commission's jurisdiction if it fails to fulfill its duties under section 252 of the Act. Iowa Utils.  {O*"'Bd., 120 F.3d at 804. Pursuant to our preemption jurisdiction under section 252(e)(5), we adopted rules to implement this statutory provision. For the reasons discussed below, we conclude that LTD has not proven that, because the Illinois, Georgia, and South Carolina commissions dismissed or denied LTD's arbitration petitions on the basis that LTD did not satisfy a statutory prerequisite to invoke compulsory arbitration under section 252(b), these state commissions "failed to act" on its arbitration requests. We find, based on the record before us, that these three state commissions did not "fail to act" under our rules"!`r,((" implementing section 252(e)(5), because they responded to LTD's requests for arbitration and rendered a final decision in each arbitration in a timely manner. We therefore deny LTD's petitions for Commission preemption of the Illinois, Georgia, and South Carolina arbitration proceedings.  X432.` ` LTD advances essentially two arguments in each of its petitions for Commission preemption pursuant to section 252(e)(5). First, LTD contends that the Georgia, Illinois, and South Carolina commissions "failed to act," because they did not conduct an  XH4arbitration that resolved the issues raised in the arbitration petitions.3s\H=: {O 'ԍLTD Illinois Petition at 1; LTD Ex Parte Illinois Comments at 1, 2, 45; LTD Georgia Petition at 1;  {O 'LTD Ex Parte Georgia Comments at 1, 5; LTD South Carolina Petition at 1; LTD Ex Parte South Carolina Comments at 1, 5. 3 Second, LTD challenges the substantive bases upon which each state commission determined that LTD has  X 4not satisfied a statutory prerequisite to invoke arbitration under section 252(b).pt =: {O'ԍSee supra paras. SUBST119שSUBST223. p  X 4 33.` `  BASIS Neither of these arguments provides a basis for preemption under our rules implementing section 252(e)(5). With respect to the first argument, we conclude that these three state commissions have not "failed to act" under our rules implementing section 252(e)(5) solely because they dismissed or denied LTD's arbitration request on the ground  X4that LTD is not entitled to invoke arbitration under section 252(b).u~=: yO'ԍAlthough each of these three state commissions determined that LTD was not a telecommunications carrier entitled to invoke arbitration under section 252(b), the three state commissions characterized in different ways what they viewed as the fundamental defect in the arbitration requests. The Illinois Commission dismissed LTD's petition on the ground that LTD lacked standing to arbitrate, because the Illinois Commission concluded that LTD was not a "telecommunications carrier," as defined by the Act. Illinois Commission Arbitration Decision at 1, 4. The Georgia Commission dismissed LTD's arbitration petition for lack of jurisdiction, because the Georgia Commission concluded that LTD was not a telecommunications carrier, and therefore, did not satisfy a state requirement to be deemed a telecommunications carrier entitled to invoke arbitration under section 252(b). Georgia Commission Order at 6. The South Carolina Commission indicated only that LTD had not met a threshold state statutory requirement for invoking arbitration under section 252(b). South Carolina Commission Order at 4. In the Local  X{4Competition Order, we stated that we would not take an "expansive view" of what constitutes a state commission's failure to act, noting our belief that "states [would] meet their  XO4responsibilities and obligations under the 1996 Act."vO=: {O!'ԍLocal Competition Order, 11 FCC Rcd at 16128, para. 1285. Of course, the Commission may revisit its rules, should the need arise, although we do not do so at this time. We therefore determined that we would preempt a state commission's jurisdiction for "failure to act" under section 252(e)(5) only in those "instances where a state commission fails to respond, within a reasonable time, to a request for mediation or arbitration, or fails to complete arbitration within the time limits" 8v,((f"  X4of section 252(b)(4)(C)."zw=: {Oy'ԍId. at 16128, para. 1285; see also 47 C.F.R.  51.801(b). z Thus, under our current rules, a state commission does not "fail to act" when it dismisses or denies an arbitration petition on the ground that it is procedurally defective, the petitioner lacks standing to arbitrate, or the state commission lacks jurisdiction over the proceeding.  X4!34.` ` Applying our rules in these instances, we find that the Illinois, Georgia, and South Carolina commissions responded to LTD's request for arbitration by immediately initiating proceedings. After establishing pleading cycles and affording the parties an opportunity to present their arguments on the issue of whether LTD is entitled to invoke arbitration under section 252(b), each of the state commissions considered the issue and determined that LTD had not satisfied the statutory requirements to proceed with  X 4arbitration. x Z=: yO'ԍIn South Carolina, LTD raised the issue of its lack of state certification in its arbitration request, asking for relief from South Carolina's certification requirement. Given LTD's lack of state certification, the South Carolina Commission established a pleading schedule to give the parties the opportunity to address the question  {Of'of whether LTD may invoke arbitration under section 252 prior to issuing its decision on this question. See  {O0'supra paras.  SCAR117 ש SCAR218 . LTD did not raise the issue of whether it had met the statutory prerequisites to invoke arbitration in its requests for arbitration in Illinois and Georgia. In those states, a hearing examiner was appointed to the case, a prearbitration conference was held, and a schedule for the arbitration was established.  {O'See supra paras.  ILL37 ,  GA112 . After the relevant incumbent LEC raised the issue of whether LTD met the statutory requirements to invoke arbitration, the parties were afforded an opportunity to present their arguments on the  {O'issue. See supra paras.  ILL49 ש ILL210 ,  GA313 ש GA214 .   X 4"35.` ` Moreover, LTD does not claim that the Georgia and South Carolina commissions acted outside of any statutory time frame. Although LTD contends that the Illinois Commission failed to complete its arbitration duty within the statutory time limits of  X4section 252(b)(4)(C),]y =: {O;'ԍLTD Illinois Ex Parte Comments at 12.] we note that the Illinois Commission issued its Arbitration Decision approximately seven months after Ameritech received LTD's request for interconnection, well  Xb4within any statutory deadline.zb =: {O'ԍSee supra paras. 610. LTD's argument appears to be essentially that a state commission has not acted until it has ruled on the merits of the issues raised in the arbitration petition. As discussed above, this argument  {O1 'does not provide a ground for preemption under our rules. See supra para.  BASIS33 . We further note that the Georgia and South Carolina commissions issued their decisions approximately eight months and seven months,  {O!'respectively, after the relevant incumbent LEC received LTD's request for interconnection. See supra paras. 1118.   X44#36.` ` We further conclude that LTD's second argument does not provide a ground for preemption under our rules implementing section 252(e)(5). Because section 51.801 of our rules does not focus on the validity of state commission decisions, we do not see a basis under our rules for examining the underlying reasoning of these state commissions' decisions. " z,((C" We therefore cannot conclude that the Illinois, Georgia, and South Carolina commissions have "failed to act" under our rules implementing section 252(e)(5). Accordingly, we do not preempt the state commissions' jurisdiction and assume responsibility for these arbitrations.  X4$37.` ` We also reject LTD's argument that it has no forum in which to challenge the substantive bases of the state commissions' decisions that LTD is not entitled to invoke compulsory arbitration under section 252(b). LTD's argument is based on its interpretation of the language in section 252(e)(6), which it interprets to mean that federal district court review is available only "for parties that have been aggrieved by a State Commission determination  X14involving an actual interconnection agreement or statement of generally available terms."{ 1=: {O 'ԍLTD Georgia Ex Parte Comments at 3; LTD South Carolina Ex Parte Comments at 4. Section 252(e)(6), which provides, in relevant part: XIn any case in which a State commission makes a determination under this section, any party aggrieved by such determination may bring an action in an appropriate Federal district court to determine whether the agreement or statement meets the requirements of section 251 and this section.  47 U.S.C.  252(e)(6).   X 4The Eighth Circuit, in its review of the Local Competition Order, recently stated that an aggrieved party should seek federal district court review pursuant to section 252(e)(6) "to  X 4attain review of state commission determinations under the Act."Z| =: {O9'ԍIowa Utils. Bd., 120 F.3d at 804. Z Thus, under the Eighth  X 4Circuit's holding in Iowa Utils. Bd., LTD still may challenge these state commission determinations in federal district court pursuant to section 252(e)(6).  X4%38.` ` Finally, we note that, among its arguments, LTD contends that the legal  X}4requirements imposed by these state commissions violate section 253(a) and section 253(b).}}, =: {OZ'ԍ47 U.S.C.  253(a), (b); see also supra paras.  LTD121 ,  LTD223 . LTD's petitions, however, do not seek preemption of these legal requirements pursuant to  XO4section 253(d). ~O =: yO'ԍSection 253(d) directs the Commission to preempt, to the extent necessary, the enforcement of "any statute, regulation, or legal requirement that violates subsection (a) or (b) [of section 253]." 47 U.S.C.  253(d).  Rather, LTD's petitions request only that the Commission assume responsibility for these arbitration proceedings pursuant to section 252(e)(5). We find that LTD has not set forth adequate record evidence that demonstrates that the legal requirements imposed by the Illinois, Georgia, and South Carolina commissions "prohibit or have the effect of prohibiting the ability of [LTD] to provide any interstate or intrastate telecommunications  X4service."G=: yO%'ԍ47 U.S.C.  253(a).G For instance, LTD simply asserts that these state legal requirements are barriers to entry, but offers no record evidence to demonstrate that it cannot comply with the",(("  X4requirements.5=: {Oy'ԍSee California Payphone Association Petition for Preemption of Ordinance No. 576 NS of the City of  {OC'Huntington Park, California Pursuant to Section 253(d) of the Communications Act of 1934, CCB Pol 9626,  {O 'Memorandum Opinion and Order, FCC 97251, at paras. 35, 40 (rel. Jul. 17, 1997) (Huntington Park Order) (concluding that mere assertions, without supporting evidence, are not adequate to invoke the Commission's preemption authority under section 253(d)).5 LTD merely alleges in its Georgia and South Carolina preemption petitions,  X4for example, that it has chosen not to obtain state certification for its own business reasons.V~=: {O'ԍSee supra note 60 and para. 22.V LTD has not provided a sufficient factual basis to demonstrate that these legal requirements materially inhibit or limit the ability of any competitor or potential competitor to compete in a  X4fair and balanced legal and regulatory environment.x=: {Oe 'ԍSee, e.g., Huntington Park Order, at para. 31. x Accordingly, we do not express any  X4views in this Memorandum Opinion and Order on the merits of LTD's section 253 arguments. Nevertheless, we note our concern about state requirements that "prohibit or have the effect of prohibiting the ability of any entity to provide any interstate or intrastate  XJ4telecommunications service."GJ=: yO'ԍ47 U.S.C.  253(a).G If LTD chooses to file a section 253 petition, we would place  X34such a petition on public notice pursuant to section 253(d). |32 =: yO'ԍSection 253 petitions ordinarily are placed on public notice so that any party may file comments and reply comments. In contrast, our rules permit only the applicable state commission and the parties to the state commission's proceeding to file responses to a section 252(e)(5) preemption petition. 47 C.F.R.  51.803(a)(3);  {On'see also Common Carrier Bureau Announces Comment Deadline Regarding Low Tech Designs, Inc. Petitions for Assumption of Jurisdiction Pursuant to Section 252(e)(5) of Communications Act and Declares Those  {O'Proceedings "PermitButDisclose" for Ex Parte Purposes, CC Docket Nos. 97163, 97164, 97165, Public Notice, DA 971573 (rel. July 24, 1997).  Upon review of the record  X 4received from all interested parties, we would take appropriate action under section 253(d). v=: {OC'ԍSee, e.g., Silver Star Telephone Company, Inc., Petition for Preemption and Declaratory Ruling, CCB Pol 971, Memorandum Opinion and Order, FCC 97336 (rel. Sep. 24, 1997).  X 4&39.` ` In sum, we conclude that LTD has not met its burden of demonstrating that the Illinois Commission, Georgia Commission, or South Carolina Commission has "failed to act" within the meaning of our rules implementing section 252(e)(5). Rather, these three state commissions have met the requirements of our rules by responding in a timely manner to LTD's request for arbitration and rendering a final decision in the arbitration, dismissing or denying the petitions on the basis that LTD did not satisfy a statutory prerequisite to invoke arbitration under section 252(b). We therefore do not preempt the jurisdiction of these state commissions pursuant to the authority granted us in section 252(e)(5). "6,(("Ԍ X4}? IV. CONCLUSION ă  X4'40.` ` For the foregoing reasons, we deny LTD's petitions for Commission assumption of jurisdiction of LTD's arbitration proceedings with Ameritech in Illinois, BellSouth in Georgia, and GTE in South Carolina.  Xv46% V. ORDERING CLAUSES ă  XH4(41.` ` Accordingly, IT IS ORDERED that, pursuant to section 252 of the Communications Act of 1934, as amended, and section 51.801(b) of the Commission's rules, 47 U.S.C.  252 and 47 C.F.R.  51.801(b), the three petitions for Commission assumption of jurisdiction filed by Low Tech Designs, Inc. on July 11, 1997, are DENIED. ` `  hhCFEDERAL COMMUNICATIONS COMMISSION ` `  hhCWilliam F. Caton ` `  hhCActing Secretary