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XXXXXX  RXXԀ  0   8I$  XXXXXXRXXԀ  2      47U.S.C.212. 8I$  XXXXXXRXXԀ  3      Id. C 8I$  XXXXXXRXXԀ  4      SeeCongressionalHearingsandReportsonCommunications,73rdCong.288(1934);seealsoH.R.Rep.  No.2540,84thCong.(1956)(statingthatinenactingsection212oftheActCongresssoughttoprevent"theexerciseofindirectcontroloverostensiblycompetingcarriersthroughsuch'interlockingdirectorates.'").Inpertinentpart,section212oftheActstates:8  ItshallbeunlawfulforanypersontoholdthepositionofofficerordirectorofmorethanonecarriersubjecttothisAct,unlesssuchholdingshallhavebeenauthorizedbyorderoftheCommission,upondueshowinginformandmannerprescribedbytheCommission,thatneitherpublicnorprivateinterestswillbeadverselyaffectedthereby:Provided,ThattheCommission  P mayauthorizepersonstoholdthepositionofofficerordirectorinmorethanonesuchcarrier,withoutregardtotherequirementsofthissection,whereithasfoundthatoneofthetwoormorecarriersdirectlyorindirectlyownsmorethan50percentumofthestockoftheotherorothers,orthat50percentumormoreofthestockofallsuchcarriersisdirectlyorindirectlyownedbythesameperson.    47U.S.C.212.ThegeneralprohibitionagainstinterlockingdirectoratesbecameeffectiveinAugust1934.In1956,afterfindingthatmostapplicationstotheCommissiontoholdinterlockingdirectoratesinvolvedcompaniesundercommonownership,Congressamendedsection212oftheActtoincludetheabovequotedcommonownershipprovision.SeeH.R.Rep.No.2540,84thCong.(1956).Seeinfranote26(statingthatintheNotice,we 4 proposedtoforbearonlyfromthoseprovisionsofsection212oftheActaddressinginterlockingdirectorates.Theinterlockingdirectorateprovisionsarethosequotedabove.). 8I$  XXXXXXRXXԀ  5    0  47C.F.R.62.1.26. t 8I$  XXXXXXRXXԀ  6      SeeAmendmentofPart62oftheCommission'sRules,NoticeofProposedRulemaking,CCDocketNo.84  1330,50Fed.Reg.976(1984)(Part62NPRM). s 8I$  XXXXXXRXXԀ  7      SeeAmendmentofPart62oftheCommissionsRules,FirstReportandOrder,CCDocketNo.841330,101  FCC2d495,49596(1985)(Part62Order). 8I$  XXXXXXRXXԀ  8    0  Seeid.  8I$  XXXXXXRXXԀ  9      SeePart62NPRM,50Fed.Reg.at97778;Part62Order,101FCC2dat495;MemorandumOpinionand  Order,59Rad.Reg.2d(P&F)1036(1986)(OrderonReconsideration). 8I$  XXXXXXRXXԀ  10    0  SeePart62NPRM,50Fed.Reg.at97778.  8I$  XXXXXXRXXԀ  11      IntheCompetitiveCarrierproceeding,theCommissiondistinguishedtwokindsofcarriersthosewith  marketpower(dominantcarriers)andthosewithoutmarketpower(non-dominantcarriers).SeePolicyandRules z ConcerningRatesforCompetitiveCarrierServicesandFacilitiesAuthorizationsTherefor,CCDocketNo.79252, D NoticeofInquiryandProposedRulemaking,77FCC2d308(1979);FirstReportandOrder,85FCC2d1(1980); ^ FurtherNoticeofProposedRulemaking,84FCC2d445(1981);SecondFurtherNoticeofProposedRulemaking,FCC82187,47Fed.Reg.17,308(1982);SecondReportandOrder,91FCC2d59(1982);OrderonReconsideration,93FCC2d54(1983);ThirdReportandOrder,48Fed.Reg.46,791(1983);FourthReportand l  Order,95FCC2d554(1983),vacatedAT&TCo.v.FCC,978F.2d727(D.C.Cir.1992),cert.denied,MCI 6  TelecommunicationsCorp.v.AT&TCo.,509U.S.913(1993);FourthFurtherNoticeofProposedRulemaking,96  P FCC2d1191(1984);FifthReportandOrder,98FCC2d1191(1984);SixthReportandOrder,99FCC2d1020    (1985),vacatedMCITelecommunicationsCorp.v.FCC,765F.2d1186(D.C.Cir.1985)(collectivelyreferredtoas    theCompetitiveCarrierproceeding).  8I$  XXXXXXRXXԀ  12    0  SeePart62Order,101FCC2dat49596,para.2.  8I$  XXXXXXRXXԀ  13      SeeOrderonReconsideration,59Rad.Reg.2dat1036,para.2(furtheramendingtherulespertainingto  interlockingdirectoratestoeliminatetherequirementthatinterlocksinvolvingparentcompaniesorcarriersseekCommissionapprovalpriortoassumingsuchinterlock). o 8I$  XXXXXXRXXԀ  14      SeePart62Order,101FCC2dat501,para.14;seealsoOrderonReconsideration,59Rad.Reg.2dat  1036,paras.56(statingthatmonitoringinterlocksinvolvingparentorholdingcompaniesbypostinterlockreports z wasconsistentwiththeCommission'sgoalofemployingtheleastintrusiveorburdensomeproceduretoaccomplishthestatutoryobligations). k 8I$  XXXXXXRXXԀ  15      SeePart62Order,101FCC2dat501,para.14;seealsoOrderonReconsideration,59Rad.Reg.2dat  1036,paras.56.  8I$  XXXXXXRXXԀ  16      SeePart62Order,101FCC2dat498,para.7;seealsoinfrapara.11. ] 8I$  XXXXXXRXXԀ  17      1998BiennialRegulatoryReviewRepealofPart62oftheCommission'sRules,CCDocketNo.98195,  13FCCRcd22,948(1998).  8I$  XXXXXXRXXԀ  18    0  47U.S.C.161;seeNotice,13FCCRcdat22,948,para.1. 8I$  XXXXXXRXXԀ  19    0  47U.S.C.161(a). 8I$  XXXXXXRXXԀ  20    0  Seeid.161(b). ) 8I$  XXXXXXRXXԀ  21    0  SeeNotice,13FCCRcdat22,948,para.1;seealso47U.S.C.161. 8I$  XXXXXXRXXԀ  22    0  47C.F.R.62.1. 8I$  XXXXXXRXXԀ  23    0  Id.62.12,62.25. 8I$  XXXXXXRXXԀ  24    0  Id.62.26.  8I$  XXXXXXRXXԀ  25      Id.62.24.TheNoticespecificallyaddressedwhetherweshouldeliminatetherequirementof  Commissionapprovalpriortointerlockingdirectorates,filingsforfindingsofcommonownership,postinterlockfilings,andchangeofstatusreports.TheNoticeindicatedthateliminationoftheserulesincorporatessections62.11 D and62.21.24byreference,whichgoverntheformandsubstanceoffilingrequirements.SeeNotice,13FCCRcd ^ at22,953n.34.IntheNotice,weinadvertentlyomittedareferencetosection62.2,thedefinitionsectionofPart62. ( Atthistime,wenotethateliminationofPart62alsonecessarilyincorporatessection62.2.See47C.F.R.1.412(c)  (statingthatrulechangesmaybeadoptedwithoutpriornoticeiftheCommissionforgoodcausefindsthatnoticeandpublicprocedureareimpracticable,unnecessary,orcontrarytothepublicinterest).  8I$  XXXXXXRXXԀ  26      47U.S.C.212.TheNoticedidnotaddresstheremainderofsection212oftheAct,whichmakesit  8  unlawfulforanyofficerordirectorofanycarriersubjecttothisActtoreceiveforhisownbenefitdirectlyorindirectly,anymoneyorthingofvalueinrespectofnegotiation,hypothecation,orsaleofsecuritiesissuedortobeissuedbysuchcarriers,ortoshareinanyoftheproceedsthereof,ortoparticipateinthemakingorpayingofanydividendsofsuchcarriersfromanyfundsproperlyincludedinthecapitalaccount.    47U.S.C.212.SeeNotice,13FCCRcdat22,949n.13.Asdiscussedinfra,onecommenterproposesthatwe  P forbearfromapplyingallprovisionssetforthinsection212oftheAct,notjustthoseprovisionsaddressinginterlockingdirectorates.Seeinfrapara.24.Unlessindicatedtothecontrary,referencestoforbearingfrom    enforcingsection212oftheActarelimitedtothoseprovisionsofsection212oftheActthataddressinterlockingdirectoratesonly.Seesupranote4(quotingtheapplicablestatutoryprovisionsatissueinthisorder).  8I$  XXXXXXRXXԀ  27      Seesection10,codifiedat47U.S.C.160,whichwasaddedtotheActthroughsection401ofthe1996  Act;seealsoinfrapara.19(settingforththecriteriaforforbearance).  8I$  XXXXXXRXXԀ  28      SeeNotice,13FCCRcdat22,949,22,95758,paras.2,14. r    8I$  XXXXXXRXXԀ  29      Thecommentersareasfollows:Ameritech;BellAtlantic;GSTTelecomInc.(GST);GTEService X Corporation(GTE);MCIWorldCom;QwestCommunicationsCorporation(Qwest);SBC;SecuritiesIndustryAssociation(SIA);UnitedStatesTelephoneAssociation(USTA);USWESTCommunications,Inc.(USWEST);ViatelInc.(Viatel).OnlyBellAtlanticsubmittedareplycommentinthisproceeding. 8I$  XXXXXXRXXԀ  30    0  47C.F.R.62.1. 8I$  XXXXXXRXXԀ  31    0  Id.62.12,62.25. 8I$  XXXXXXRXXԀ  32    0  Id.62.26. 8I$  XXXXXXRXXԀ  33      Id.62.24. 8I$  XXXXXXRXXԀ  34      SeeNotice,13FCCRcdat22,95354,para.7. 8I$  XXXXXXRXXԀ  35      Seeid. 8I$  XXXXXXRXXԀ  36      Seeid.at22,954,para.8. 8I$  XXXXXXRXXԀ  37      47C.F.R.62.1.  8I$  XXXXXXRXXԀ  38      SeeCongressionalHearingsandReportsonCommunications,73rdCong.288(1934). % 8I$  XXXXXXRXXԀ  39      SeeGTECommentsat3;QwestCommentsat23;USWESTCommentsat2;ViatelCommentsat2. 8I$  XXXXXXRXXԀ  40      USWESTCommentsat2. ^ 8I$  XXXXXXRXXԀ  41      SeeMotionofAT&TtobeReclassifiedasaNondominantCarrier,11FCCRcd3271,3323(1995),  petitionsforreconsiderationdenied,9CommunicationsReg(P&F)1187(Oct.9,1997)(classifyingAT&Tasa z nondominantcarrier).Inaddition,wenotethatnewentrantstothedomestic,interstate,interexchangemarketareclassifiedasnondominantuponentry.  8I$  XXXXXXRXXԀ  42      SeeViatelCommentsat2(statingthat"today'srobustlycompetitivedomesticmarketplaceforinterstate,  interexchangeservice...makesitexceedinglyunlikelythataninterstatecarriercoulduseinterlockingdirectoratestoitscompetitiveadvantage.");seealsoAmeritechCommentsat2(statingthat"sincethereislittlepotentialfor D harmarisingfrominterlocksincompetitivemarkets,Part62regulationisunnecessarytopreventanticompetitiveconduct.");seealsoPart62Order,101FCC2dat496(statingthatnondominantcarriers"donotpossesssufficient ( marketpower,eitheraloneorinconcertwithothernondominantcarriers,toengageinpredatorypricingorotheranticompetitiveorunjustpractices...[andthat]theabilityofsuchcarrierstoengageinanticompetitivebehaviorviainterlockingdirectorateshasbeensubstantiallycurbedbythetelecommunicationsmarketplaceandtheindividuallackofmarketpowerofthesecarriers."). ' 8I$  XXXXXXRXXԀ  43      See,e.g.,ImplementationoftheTelecommunicationsActof1996,ImplementationoftheNonAccounting  SafeguardsofSections271and272oftheCommunicationsActof1934,asamended,CCDocketNo.96149,13 z FCCRcd8061,para.168(1998)(notingthatthelocalexchangemarketisnotyetfullycompetitive).  8I$  XXXXXXRXXԀ  44      SeeRulesandPoliciesonForeignParticipationintheU.S.TelecommunicationsMarket,IBDocketNos.  97142and9522,ReportandOrderandOrderonReconsideration,12FCCRcd23,891,paras.14349(1997).  8I$  XXXXXXRXXԀ  45      See,e.g.,AmeritechCommentsat3;BellAtlanticCommentsat2;GTECommentsat2. K 8I$  XXXXXXRXXԀ  46      Infact,USWESTstatesthattheseregulations"seemmorebenignlyuselessthanharmful."USWEST  Commentsat2.  !  XXXXXX  RXXԀ  47    SeeNotice,13FCCRcdat22,95455,para.9.Thelastfilingseekingpriorapprovaloccurredin1989.  ThenumberofcarriersstillobligatedtofileforpriorapprovalislimitedbythefindingthatAT&Tisanondominantcarrier.SeeMotionofAT&TtobeReclassifiedasaNondominantCarrier,11FCCRcdat3323. 2 8I$  XXXXXXRXXԀ  48      SeeNotice,13FCCRcdat22,95455,para.9;seealsoBellAtlanticCommentsat2(statingthatitfiled  notificationsbyparentholdingcompaniesof"dominant"LECsthatoneormoredirectorsoftheholdingcompany z  alsoheldpositionswithothercommoncarriers.BellAtlanticfurtherstatesthatallofitsfilingswereunopposed,includingthoseinvolvingtheexchangecarriers'parentcompanies.);USWESTCommentsat2(statingthatitdoesnotappearthatourruleshaveaffectedtheoperationsordecisionsmadebytelecommunicationscarriersinthepast). E 8I$  XXXXXXRXXԀ  49      SeeImplementationofSections3(n)and332oftheCommunicationsAct,RegulatoryTreatmentofMobile  Services,SecondReportandOrder,9FCCRcd1411,148485,paras.193,19697(1994).Wenotethatwetook z thisactionpursuanttotheforbearanceauthoritysetforthinsection332(c)(1)(A)oftheAct,asamendedbysection6002(b)oftheOmnibusBudgetReconciliationActof1993.Inthatorder,westatedthat"[f]orbearancefromenforcingSection212[would]reduceregulatoryburdenswithoutadverselyaffectingCMRSrates."Id.at1485, ( para.197. 8I$  XXXXXXRXXԀ  50      Id.at1485,para.197(citationsomitted). [ 8I$  XXXXXXRXXԀ  51      See,e.g.,section8oftheClaytonAct,codifiedat15U.S.C.19,asamendedbytheInterlocking  DirectorateActof1990.Seealso17C.F.R.229.401(requiringcompaniestolistofficersanddirectors).Seeinfra z para.16foramorethoroughdiscussionofPart229.SeealsoAmeritechCommentsat2(statingthat"regardlessof D whetheronebelievesthatlocalexchangemarketsaresufficientlycompetitivesincetheantitrustlaws,BOCseparatesubsidiaryrequirementsintheAct,andgeneralTitleIIprovisionswilldeteranticompetitiveinterlocks,thereisnobasisforconcludingthatPart62shouldcontinuetoapplyto[ILECs].");BellAtlanticCommentsat1(statingthattheCommission'sinterlockingdirectoraterequirementsareredundantwithotherprovisionsoflaw);USWESTCommentsat2.  8I$  XXXXXXRXXԀ  52      TheClaytonActonlyapplieswherethereisapresenceofcompetitionbetweencompanies.Courtshave  lookedtoavarietyoffactorstodeterminewhethercompetitionexistsbetweencompanies.See,e.g.,TRW,Inc.v. z FederalTradeCommission,647F.2d942(9thCir.1981)(statingthat"competitors"are"companiesthatvieforthe D businessofthesameprospectivepurchasers,eveniftheproductstheyoffer,unlessmodified,aresufficientlydissimilartoprecludeasinglepurchaserfromhavingachoiceofasuitableproductfromeach.").The1990amendmentstotheClaytonActdonotaffectthemannerinwhichcourtsconstruewhethercompaniesareincompetitionwithoneanother.SeeS.Rep.No.101286(1990)(statingthat"[i]tisnottheintentionofthe l  [Judiciary]Committeetoalterthewayinwhichthecourtshavedeterminedwhetherproductsorservicesusedby 6   onecorporationareincompetitionwithproductsorservicessoldbyanothercorporation"). w 8I$  XXXXXXRXXԀ  53      See,e.g.,15U.S.C.19.Section8oftheClaytonActrequirestheexistenceofahorizontalmarket  relationship.Accordingly,unlikesection212oftheActandPart62ofourrules,verticalinterlocksarenotcovered.Inpertinentpart,section8providesthat8  (a)(1)Nopersonshall,atthesametime,serveasadirectororofficerinanytwocorporations(otherthanbanks,bankingassociations,andtrustcompanies)thatare(A)engagedinwholeorinpartincommerce;and(B)byvirtueoftheirbusinessandlocationofoperation,competitors,sothattheeliminationofcompetitionbyagreementbetweenthemwouldconstituteaviolationofanyoftheantitrustlaws;ifeachofthecorporationshascapital,surplus,andundividedprofitsaggregatingmorethan$10,000,000asadjustedpursuanttoparagraph(5)ofthissubsection.    15U.S.C.19(a)(1)(A)(B).  8I$  XXXXXXRXXԀ  54      TelecommunicationsActof1996,Pub.L.No.104104,110Stat.56(1996)(1996Act).  8I$  XXXXXXRXXԀ  55      MCIWorldComCommentsat1(statingthatunderthe1996Act,BOCsmaynowobtainatenpercentor  lessequityinterestindownstreamlongdistance,internet,andinformationservicecompanieswithoutbeingsubjecttotherequirementsofsection272). 8I$  XXXXXXRXXԀ  56      Seeid. 8I$  XXXXXXRXXԀ  57      Seeid.at34. J 8I$  XXXXXXRXXԀ  58      Seesupranotes5152(notingthattheClaytonActrequiresthepresenceofcompetitionbetween  companiesandtheexistenceofahorizontalrelationship);seealsoAmericanBakeriesCompanyv.GourmetBakers, z Inc.,515F.Supp.977(D.Md.1981)(statingthattheClaytonActencompasseshorizontal,notvertical,interlocks). 8I$  XXXXXXRXXԀ  59      Seesuprapara.11. 8I$  XXXXXXRXXԀ  60      See47U.S.C.201(b),208.  8I$  XXXXXXRXXԀ  61      See47U.S.C.201(b)(statinginpertinentpart,"Allcharges,practices,classifications,andregulationsfor  andinconnectionwithsuchcommunicationservice,shallbejustandreasonable,andanysuchcharge,practice,classificationthatisunjustorunreasonableisherebydeclaredtobeunlawful...").  8I$  XXXXXXRXXԀ  62      See47U.S.C.208.Section208gives"[a]nyperson...bodypoliticormunicipalorganization,orState  commission"therighttofileacomplaintwiththeCommissionifitbelievesthatacommoncarrieractedorfailedtoactincontraventionoftheActoraCommissionruleororder.Thus,althoughinthisOrderweeliminateourrules D requiringCommissionapprovalpriortoassuminganinterlockingpositionwherecertaintypesofcarriersareinvolved,ifaninterlockweretothreatentoconstraincompetitionorproduceotheranticompetitivepractices,otherstatutoryprovisionssuchas201(b)existtopreventthisharm.Accordingly,actionscouldbebroughtpursuanttosection208oftheActshouldaninterlockingdirectorateraiseanticompetitiveconcerns. 8I$  XXXXXXRXXԀ  63      MCIWorldComCommentsat9.  8I$  XXXXXXRXXԀ  64      SeeNotice,13FCCRcdat22,95556,para.11.Theserulesrequirethat"[a]llpersonsholdinginterlocking  positionsonmorethanonecarriersubjecttotheAct,includingpositionsuponaparentorholdingcompanyofacarrier,shallreporttotheCommissionwithin30daysofassumptionoftheinterlockingpositions."47C.F.R.62.26.Theserulesalsorequirethat"shouldanychangeoccurinthestatusasreportedunder[Part62],theapplicantshallreportsuchchangetotheCommissionwithin30daysaftersuchchangeoccurs."47C.F.R.62.24. t 8I$  XXXXXXRXXԀ  65      MCIWorldComCommentsat5(MCIWorldComsupportstheeliminationoftheremainingreporting  requirementsinvolvinginterlocksfornon-dominantcarriers);see,e.g.,SBCCommentsat2;GSTTelecom z Commentsat5(statingthatthe"concernthatinterlockingdirectoratesamongwhollyownedoperatingsubsidiariesofnondominantcarrierswouldthwartcompetitionisinvalid").  8I$  XXXXXXRXXԀ  66      SeeImplementationofSections3(n)and332oftheCommunicationsAct,RegulatoryTreatmentofMobile  Services,SecondReportandOrder,9FCCRcdat148485,paras.193,19697;seealsosupranote27. 8I$  XXXXXXRXXԀ  67      Seesuprapara.11. 8I$  XXXXXXRXXԀ  68      Seesupraparas.1115.  8I$  XXXXXXRXXԀ  69      See17C.F.R.229.401(discussinginformationtobeincludedinafilingpursuanttoRegulationSK).In  pertinentpart,Item401requiresthatdirectorsbeidentifiedasfollows:8  IdentificationofDirectors.Listthenamesandagesofalldirectorsoftheregistrantandallpersonsnominatedorchosentobecomedirectors;indicateallpositionsandofficeswiththeregistrantheldbyeachsuchperson;statehistermofofficeasdirectorandanyperiod(s)duringwhichhehasservedassuch....    Id.229.401(a).Item401alsocontainssimilardisclosurerequirementsforexecutiveofficersandsignificant  P employees.Seeid.229.401(b)(c). 8I$  XXXXXXRXXԀ  70      See,e.g.,GSTCommentsat12;GTECommentsat3. a 8I$  XXXXXXRXXԀ  71      SeeGSTCommentsat1(statingthatthereportingrequirementsare"acostlyadministrativeburdenthat  servenousefulpurpose."). 8I$  XXXXXXRXXԀ  72      QwestCommentsat3. 8I$  XXXXXXRXXԀ  73      GTECommentsat3. ! 8I$  XXXXXXRXXԀ  74      SeeNotice,13FCCRcdat22,956,para.12;seealsoAmendmentofPart62oftheCommission'sRules,  FirstReportandOrder,101FCC2d495,498(1985)(Part62Order).Thus,intheNotice,theCommissionsought z commentontheindirectcostsassociatedwiththeseregulations,suchaswhethercompliancewithexistinginterlockingdirectoraterequirementsmaytemporarilyimpedecarrierdecisionalflexibilitynecessaryforgrowthandthepromptandinnovativeprovisionofservices.SeeNotice,13FCCRcdat22,956,para.12. 8I$  XXXXXXRXXԀ  75      SeeGTECommentsat3. 8I$  XXXXXXRXXԀ  76      SeeQwestCommentsat3;ViatelCommentsat3. 8I$  XXXXXXRXXԀ  77      QwestCommentsat3. 8I$  XXXXXXRXXԀ  78      Id.;ViatelCommentsat3.  8I$  XXXXXXRXXԀ  79      47U.S.C.160.Section10oftheActprovides,however,that,exceptasprovidedinsection251(f)ofthe  Act,theCommissionmaynotforbearfromapplyingtherequirementsofthenewsections251and271oftheActuntiltheCommissiondeterminesthatthoserequirementshavebeenfullyimplemented.Id. 8I$  XXXXXXRXXԀ  80    0  Id.  8I$  XXXXXXRXXԀ  81      Id.160(b)(statinginpertinentpartthat,"[i]ftheCommissiondeterminesthatsuchforbearancewill  promotecompetitionamongprovidersoftelecommunicationsservices,thatdeterminationmaybethebasisforaCommissionfindingthatforbearanceisinthepublicinterest."). 8I$  XXXXXXRXXԀ  82      SeeNotice,13FCCRcdat22,95758,para.14. 8I$  XXXXXXRXXԀ  83      Seeid.  8I$  XXXXXXRXXԀ  84      Butseesupraparas.1115(discussingMCIWorldCom'ssuggestionthattheCommission'sPart62rulesbe  retainedasappliedtodominantcarriers.MCIWorldComdoesnotspecificallyaddresssection212oftheAct.).  8I$  XXXXXXRXXԀ  85      SeeUSTACommentsat2(statingthattheCommission'sforbearancetestiseasilymet). 8I$  XXXXXXRXXԀ  86      SeeGTECommentsat4. 8 8I$  XXXXXXRXXԀ  87      See,e.g.,47U.S.C.201(b),208.See,e.g.,AmeritechCommentsat3;GTECommentsat4. c 8I$  XXXXXXRXXԀ  88      See,e.g.,ClaytonAct,15U.S.C.19;seealsosuprapara.12;seealsoBellAtlanticCommentsat2  (statingthat"giventhelimitednumberoffilings,thenoncontroversialnatureoftheonesthathavebeenmadeandthealternativetoolstoguardagainstanticompetitivepractices,thestandardforforbearanceundersection10(a)issatisfied.").0 `   8I$  XXXXXXRXXԀ  89      SeeNotice,13FCCRcdat22,95859,para.16;seealsoGTECommentsat4(agreeingwiththe  Commission'stentativeconclusionthatinterlockingdirectoratesrarelyraiseconsumerconcerns).  8I$  XXXXXXRXXԀ  90      See47U.S.C.201(b),208.Wenotethatitisnotnecessarytoretainsection212toprotectagainst  anticompetitivebehavior,seeImplementationofInfrastructureSharingProvisionsoftheTelecommunicationsAct z of1996,12FCCRcd5470,5523,paras.107108(statingthat"anycollusiveagreement[...]wouldlikelybe D againstthepublicinterestandbeunjustandunreasonable,and,therefore,inviteTitleIIsanctions.").  8I$  XXXXXXRXXԀ  91      See47U.S.C.201(b)(statinginpertinentpart,"Allcharges,practices,classifications,andregulationsfor  andinconnectionwithsuchcommunicationservice,shallbejustandreasonable,andanysuchcharge,practice,classificationthatisunjustorunreasonableisherebydeclaredtobeunlawful...").  8I$  XXXXXXRXXԀ  92      See47U.S.C.208;seealsosupranote61. 8I$  XXXXXXRXXԀ  93      Seesupraparas.1115. 8I$  XXXXXXRXXԀ  94      SeeGTECommentsat4. 8I$  XXXXXXRXXԀ  95      Seeid.  8I$  XXXXXXRXXԀ  96      SeeUSWESTCommentsat2(statingthattheCommissionshouldnotretainsection212oftheActunless  theCommissiondemonstratesapublicinterestthatwillbeservedbyretainingtherules). S 8I$  XXXXXXRXXԀ  97      Seeid.(statingthatthestatuteshouldberemovedunlesstheCommissioncandemonstrate"arealpublic  interest."). 8I$  XXXXXXRXXԀ  98      SeeNotice,13FCCRcdat22,949n.13. 8I$  XXXXXXRXXԀ  99      47U.S.C.212. 8 8I$  XXXXXXRXXԀ  100      SeeSIACommentsat2.SIAmadeitsrequestforadditionalforbearancereliefinitscommentsinthis  proceeding.SIAdidnotrequestforbearancefromsection212inaseparatepetitionfiledpursuanttosection10oftheActandtheCommission'srules,thusfurtherjustifyingthedenialoftheforbearancerequestbySIAinthisproceeding. 8I$  XXXXXXRXXԀ  101    0  47C.F.R.62.1. 8I$  XXXXXXRXXԀ  102    0  Id.62.26. 8I$  XXXXXXRXXԀ  103    0  Id.62.12,62.25. 8I$  XXXXXXRXXԀ  104    0  Id.62.24.  !  XXXXXX  RXXԀ  105    See5U.S.C.603.TheRFA,see5U.S.C.601et.seq.XXR<XmXXX< X<XmR < ,hasbeenamendedbytheContractWithAmerica  AdvancementActof1996,Pub.L.No.104121,110Stat.847(1996)(CWAAA).TitleIIoftheCWAAAistheSmallBusinessRegulatoryEnforcementFairnessActof1996(SBREFA).XXR<XmXXX 8I$  XXXXXXRXXԀ  106      SeeNotice,13FCCRcdat22,96067,paras.2039. 8I$  XXXXXXRXXԀ  107      See5U.S.C.604. 8I$  XXXXXXRXXԀ  108      47U.S.C.161. 8I$  XXXXXXRXXԀ  109      See,e.g.,GSTCommentsat13. 8I$  XXXXXXRXXԀ  110    0  5U.S.C.601(6).  8I$  XXXXXXRXXԀ  111      5U.S.C.601(3)(incorporatingbyreferencethedefinitionof"smallbusinessconcern"in5U.S.C.  632).Pursuantto5U.S.C.601(3),thestatutorydefinitionofasmallbusinessapplies"unlessanagencyafterconsultationwiththeOfficeofAdvocacyoftheSmallBusinessAdministrationandafteropportunityforpubliccomment,establishesoneormoredefinitionsofsuchtermwhichareappropriatetotheactivitiesoftheagencyand ^  publishessuchdefinitionintheFederalRegister." g 8I$  XXXXXXRXXԀ  112      15U.S.C.632.See,e.g.,BrownTransportTruckload,Inc.v.SouthernWipers,Inc.,176B.R.82  (N.D.Ga.1994). 8I$  XXXXXXRXXԀ  113    0  13C.F.R.121.201.  8I$  XXXXXXRXXԀ  114      FCC,TelecommunicationsIndustryRevenue:TRSFundWorksheetData,Figure2(NumberofCarriers  PayingIntotheTRSFundbyTypeofCarrier)(Nov.1997)(TelecommunicationsIndustryRevenue). 8I$  XXXXXXRXXԀ  115    0  Id.  8I$  XXXXXXRXXԀ  116      See13C.F.R.121.201,SICcode4813.SincethetimeoftheCommission's1996decision,  ImplementationoftheLocalCompetitionProvisionsintheTelecommunicationsActof1996,FirstReportand z Order,11FCCRcd15499,1614445(1996),61FR45476(Aug.29,1996),theCommissionhasconsistently D addressedinitsregulatoryflexibilityanalysestheimpactofitsrulesonsuchILECs.  8I$  XXXXXXRXXԀ  117      UnitedStatesDepartmentofCommerce,BureauoftheCensus,1992CensusofTransportation,  Communications,andUtilities:EstablishmentandFirmSize,atFirmSize1-123(1995)("1992Census"). 8I$  XXXXXXRXXԀ  118    0  15U.S.C.632(a)(1).  8I$  XXXXXXRXXԀ  119      Seesupranote27(citingImplementationofSections3(n)and332oftheCommunicationsAct,Regulatory  TreatmentofMobileServices,SecondReportandOrder,9FCCRcd1411,148485,paras.193,19697(1994)). 8I$  XXXXXXRXXԀ  120    0  1992Census,supra,atFirmSize1-123.  8I$  XXXXXXRXXԀ  121    0  13C.F.R.121.201,StandardIndustrialClassification(SIC)Code4813. 8I$  XXXXXXRXXԀ  122    0  See47C.F.R.64.601etseq. 8I$  XXXXXXRXXԀ  123    0  TelecommunicationsIndustryRevenueatFig.2. 8I$  XXXXXXRXXԀ  124    0  13C.F.R.121.210,SICCode4813. 8I$  XXXXXXRXXԀ  125    0  TelecommunicationsIndustryRevenueatFig.2. 8I$  XXXXXXRXXԀ  126    0  Id. 8I$  XXXXXXRXXԀ  127    0  13C.F.R.121.201,SICCode4813. 8I$  XXXXXXRXXԀ  128      TelecommunicationsIndustryRevenueatFig.2. 8I$  XXXXXXRXXԀ  129    0  Id. 8I$  XXXXXXRXXԀ  130    0  13C.F.R.121.210,SICCode4813. 8I$  XXXXXXRXXԀ  131    0  TelecommunicationsIndustryRevenueatFig.2.  8I$  XXXXXXRXXԀ  132      UnitedStatesDepartmentofCommerce,BureauoftheCensus,1992CensusofTransportation,  Communications,andUtilities:EstablishmentandFirmSize,atFirmSize1-123(1995)("1992Census"). 8I$  XXXXXXRXXԀ  133    0  13C.F.R.121.201,SICCode4812.     #$%&'()* CyParagraph1. a. i. (1) (a) (i) 1) a)I.A.1.a.(1)(a)i)a) !" 7w}143Right-Aligned Paragraph NumbersI.A.1.a.(1)(a)i)a)  7w}136Right-Aligned Paragraph NumbersI.A.1.a.(1)(a)i)a)3|P \  `*Times New RomanTTC\  P6QP\  `*Times New RomanTTXXP\  P6QXP<6X9`("Courier NewTTTTd6X@ 7@*o> A`ArialTTTTTTCo> PQP" [  `*Times New RomanTTX)a [ PQXP! `>  `6Times New RomanItalicTTX)^ `> XiQXX#~>  *Times New RomanTTcTTT~> p#Qp)o> A`ArialTTomanTTcTTX)ao> P%QXP$ [  `*Times New RomanTTcTTw [ P'QP*X   `*Times New RomanTTcTTXFxX  P]CXPW? A $"ArialItalicTTTTcTTX ? PeX 22AArialBoldTTTTTcTT 2hC H9`("Courier NewTTTTcTTx@k@;9`("Courier NewTTTTcTTb@l@<6X9`("Courier NewTTTTcTTXXx6X@DQX@\  `*Times New RomanTTcTT&&J\  P6Q&P(J$  XXXXXX dHP LaserJet 4,,,,,,03#37=CIQYag1.a.i.(1)(a)(i)1)a)(9 Z 6Times New Roman Regular|x&cU"!UA{&rtyBar,U !  XXXXXX  48XXdd8  RXX  _Beforethe X FEDERALCOMMUNICATIONSCOMMISSIONWashington,D.C.20554 XXR    IntheMatterof    h     ) p   N    `     h     ) p   > 1998BiennialRegulatoryReview    )  . RepealofPart62ofthe   h     ) p CCDocketNo.98195 v  Commission'sRules    h     ) p  f    `     h     ) p  V    REPORTANDORDER  6      Adopted:July7,1999Released:July16,1999  BytheCommission: CommissionerFurchgottRothissuingastatement.     I.INTRODUCTION  n   C 5 $ C    2  1  .3   ` InthisReportandOrder(Order),werepealPart62ofourrulesgoverning N interlockingdirectorates,7 6  1      ׀whichimplementssection212oftheCommunicationsActof1934,as > amended(theAct),9Z 6  2      ׀becauseweconcludethatPart62isnolongernecessaryinthepublic . interest.Wealsoconcludethatweshouldforbearfromapplyingthoseprovisionsinsection212oftheActthatprohibitanypersonfromholdingthepositionofofficerordirectorofmorethanonecarriersubjecttotheActwithoutobtainingpriorCommissionauthorization.: 6  3      ׀Theseactions V willservethepublicinterestbyreducingtheregulatoryburdenoncommoncarriersandotherinterestedpersonsrequiredtofilewiththeCommissionpursuanttoPart62andbyallowingsuchresourcestobedirectedinsteadtowardthedeploymentofservicesandnewtechnologies.  II.BACKGROUND  #       2  2  .3   ` Congressintendedsection212oftheAct,establishedaspartoftheoriginal $   CommunicationsActof1934,toguardagainsttheanticompetitivepotentialarisingfromthe %~! interlockingofcompaniesthroughthesharingofofficersordirectors.; 6  4      ׀TheCommissionadopted X  Part62ofitsrulestoimplementtheCongressionalmandatesetforthinsection212oftheAct.<" 6  5      ׀ H AsoriginallyadoptedbytheCommission,Part62requiredanindividualseekingtoholdpositionswithmorethanonenonaffiliatedcarriertofileanapplicationcontainingdetailedinformationdemonstratingthatneitherprivatenorpublicinterestswouldbeharmedbygrantingauthorizationtoholdinterlockingdirectorates.= 6  6      ׀TheCommissionaddressedeachapplicationon   acasebycasebasisandusuallyfoundthatthe"interlocks"offendedneitherpublicnorprivateinterests.> 6  7      ׀Inaddition,althoughtheCommissionroutinelyplacedeachapplicationonpublic   notice,theapplicationswereusuallyunopposed.?l 6  8      ׀     2  3  .3   ` Inthemid1980s,theCommissioninitiatedarulemakingtoconsiderrevisingits `  rulesrelatingtointerlockingdirectorates.@ 6  9      ׀Duringthecourseofthatrulemaking,the X  Commissionnotedthatinlightofgrowingcompetitionandadvancesintelecommunications,theneedforstringentoversightandinterventioninthefreemarketactivitiesofcarriershadlessened.A$ 6  10      ׀TheCommissionthusmodifiedPart62ofitsrulesbyeliminatingtherequirementof (  priorCommissionapprovalforinterlocksbetweenoramongnondominantcarriersasdefinedintheCompetitiveCarrierProceeding,B 6  11      ׀cellularlicenseesindifferentgeographicmarkets,C 6  12      ׀or   carriersandtheirparentcompanies.D 6  13      ׀TheCommission,concludingthattheseinterlockswould   notadverselyaffectpublicorprivateinterests,E 6  14      ׀requiredonlythatsuchinterlocksbereportedto   theCommissionwithin30daysafteroccurring.F 6  15      ׀TheCommission,however,declinedto  removethepreauthorizationrequirementforthoseinterlocksinvolvingadominantcarrierora carriernotyetfoundtobenondominant,concludingthatmarketpowerorcontrolofessential `  facilitiesmightallowsuchinterlockstoengageinanticompetitiveconduct.G 6  16      ׀ X    2  4  .3  Ԁ ` WeinitiatedthisproceedingbyaNoticeofProposedRulemaking(Notice) 8  releasedonNovember17,1998.HZ 6  17      ׀IntheNotice,wedesignatedthisproceedingaspartofour (  1998biennialreviewofregulationspursuanttosection11oftheAct.I 6  18      ׀Section11requiresthe   Commissiontoconductabiennialreview,ineveryevennumberedyearbeginningin1998,of"allregulations...thatapplytotheoperationsoractivitiesofanyprovideroftelecommunicationsservice"andto"determinewhetheranysuchregulationisnolongernecessaryinthepublicinterestastheresultofmeaningfuleconomiccompetitionbetweenprovidersofsuchservice."JH 6  19      ׀Section11furtherrequirestheCommissiontorepealortomodify p  anyregulationitdeterminesisnolongernecessaryinthepublicinterest.K 6  20      ׀ `      2  5  .3  Ԁ ` IntheNotice,wetentativelyconcludedthatPart62ofourrulesgoverning @  interlockingdirectoratesisnolongernecessarytothepublicinterestandthereforeshouldberepealed.Ll  6  21      ׀Specifically,weproposedtoeliminatetherequirementsthat:(1)applicationbemade x  toholdinterlockingpositionswithmorethanonecarriersubjecttotheActwhereonecarriersoughttobeinterlockediseitheradominantcarrier,oracarriernotyetdeterminedtobenondominant;M  6  22      ׀(2)applicationsforfindingsofcommonownershipbefiledifdominantcarriersare H involved;N  6  23      ׀(3)interlockingpositionsofmorethanonecarriersubjecttotheActinvolvingnon 8 dominantcarriers,connectingcarriers,cellularlicenseesoperatingindifferentgeographicmarkets,andparentsofcarriers,amongothers,bereportedtotheCommissionwithin30days aftersuchinterlockoccurs;O" 6  24      ׀and(4)anychangeinstatusasreportedunderPart62oftherules  bereportedtotheCommissionwithin30daysofsuchchange.P 6  25      ׀ X      2  6  .3  Ԁ ` Additionally,intheNotice,wetentativelyconcludedthatweshouldforbearfrom 8  enforcingthoseprovisionsofsection212oftheActthataddressinterlockingdirectorates.Q 6  26      ׀ (  Section10oftheActrequirestheCommissiontoforbearfromapplyinganyprovisionofthe   Act,oranyregulations,toatelecommunicationscarrierortelecommunicationsservice,orclassthereof,iftheCommissionmakescertainspecifiedfindingswithrespecttosuchprovisionsorregulations.R 6  27      ׀IntheNotice,wetentativelyconcludedthatsection212oftheAct:(1)isnot   necessarytoensurethatcarriers'charges,practices,orclassificationsarejustandreasonable,andarenotunjustlyorunreasonablydiscriminatory;and(2)isnotnecessaryfortheprotectionofconsumers.Wealsotentativelyconcludedthatforbearancefromapplyinginterlockingdirectoraterequirementsisconsistentwiththepublicinterest.SF 6  28       P    2  7  .3  Ԁ ` TheCommissionreceivedelevencommentsandonereplycommentinthis 0  proceeding.T 6  29      ׀Asdiscussedmorethoroughlybelow,allbutonecommentersupportour&  tentative x   conclusionsthatweshouldrepealPart62ofourrulesandforbearfromenforcingtheinterlockingdirectorateprovisionsofsection212oftheAct. '0l,  &  III.DISCUSSION  (    A.  RepealingPart62oftheCommission'sRules      2  8  .3  Ԁ ` WeadoptourtentativeconclusionthatPart62ofourrulesisnolongernecessary   inthepublicinterestandthereforeshouldberepealed.Specifically,'Y-weeliminatetherequirementsthat:(1)applicationbemadetoholdinterlockingpositionswithmorethanonecarriersubjecttotheActwhereonecarriersoughttobeinterlockediseitheradominantcarrier,oracarriernotyetdeterminedtobenondominant;U 6  30      ׀(2)applicationsforfindingsofcommon P  ownershipbefiledifdominantcarriersareinvolved;VJ 6  31      ׀(3)interlockingpositionsofmorethan @  onecarriersubjecttotheActinvolvingnondominantcarriers,connectingcarriers,cellularlicenseesoperatingindifferentgeographicmarkets,andparentsofcarriers,amongothers,bereportedtotheCommissionwithin30daysaftersuchinterlockoccurs;W 6  32      ׀and(4)anychangein h statusasreportedunderPart62oftherulesbereportedtotheCommissionwithin30daysofsuchchange.Xn  6  33      ׀Wefindthatinterlockingdirectoratesrarelythreatentoconstraincompetition. H Moreprecisely,wefinditdifficulttoenvisionaproposedinterlockthattheCommissionwouldconcludetobeanticompetitive,abinitio,suchthattheCommissionwoulddenyapprovalfor ( suchinterlock.Totheextentthatpotentiallyanticompetitiveinterlocksmayoccur,wefurtherfindthatotherTitleIIprovisionsandantitrustlawsadequatelyprotectagainsttheparticularconcernsourPart62rulesseektoaddress.Therefore,wefindthatourrulesarenolongernecessaryinthepublicinterestandshouldberepealed.       2  9  .3  Ԁ ` IntheNotice,wetentativelyconcludedthatotherTitleIIprovisionsandantitrust p  lawswouldbesufficienttoguardagainsttheanticompetitivebehaviorthatmightarisefrom ` interlockingdirectorates.Y 6  34      ׀Wenoted,however,thatnotalltelecommunicationsmarketsarefully X  competitiveand,therefore,soughtcommentonwhetheranysituationexistswhereotherregulatoryorlegalmechanismswouldnotbesufficienttodeteranticompetitiveconduct.ZZ 6  35      ׀We 8  alsosoughtcommentonwhether,giventhevariousproductmarketsandtheexistenceofdifferingdegreesofcompetitionwithinsuchmarkets,ouranalysispertainingtodeletingtheserulesshouldvaryfrommarkettomarket.[ 6  36      ׀Asdiscussedmorethoroughlybelow,althoughwe   soughtcommentonvariousproductmarkets,commentersdidnotdistinguishamongthevarioustelecommunicationsmarkets,withthelimitedexceptionofaddressingtheincumbentlocalexchangemarket.  2   10  .3  Ԁ ` Weadoptourtentativeconclusionthatitwouldservethepublicinterestto `  eliminatetherequirementofpriorCommissionapprovalbeforeconsummatinginterlocksinvolvingdominantcarriersorthosecarriersnotyetfoundtobenondominant.\~ 6  37      ׀Ourrulesset @  forthinPart62aredesignedtoguardagainsttheanticompetitivepotentialarisingfromthe 0  interlockingofcompaniesthroughthesharingofofficersordirectors.] 6  38      ׀WeagreewithGTE, x  Qwest,Viatel,andUSWESTthatthepresenttelecommunicationsmarketplacehaschangedsignificantlysincetheCommissionadoptedPart62,^ 6  39      ׀andthus,as&   X USWEST' ?Ԁstates,thattheserulesare"productsofabygoneera."_4  6  40      ׀TheCommission'srule H requiringauthorizationpriortoassuminganinterlockingpositionwaspromulgatedinanerawhenthetelecommunicationsmarketwasovershadowedbyasingle,dominantprovider.Thepresentdomestic,interstate,interexchangemarketplace,forexample,isdistinctlydifferent,becausetherearenolongerdominantcarriers.`  6  41      ׀Wespecificallyfindthatwherecompetition  existstheriskofanticompetitivebehaviorasaresultofinterlockingdirectoratesisextremely  limited.a 6  42       X   2   11  .3  Ԁ ` Werecognizethatindividualcarrierscontinuetobedominant"andbydefinition 8  possessmarketpower"incertaintelecommunicationsmarkets,particularlythelocalexchange (  marketb 6  43      ׀andcertainindividualinternationalroutes.c  6  44      ׀Weconclude,however,thateveninthese   markets,thedevelopmentofcompetitionandtheexistenceofotherregulatoryandlegalsafeguardsprovideadequateprotectionsagainstthecompetitiveharmssoughttobeaddressedbythePart62rules.Weagreewiththosecommenters,includingAmeritech,BellAtlantic,andGTE,whostatethatweshouldrepealourPart62ruleseveninthosemarketsthatarenotyetfullycompetitive,includingthelocalexchangemarket.d, 6  45      ׀Wefindthatinterlockingdirectorates, p  evenwheredominantcarriersareinvolved,rarelyleadtoanticompetitiveconductorconsumerconcerns.e 6  46      ׀Sinceamendingourrulesin1986,wehavereceivedapproximatelytwodozen P  applicationsseekingpreapprovalofinterlockingdirectorates.f 6  47      ׀Althoughwesoughtpublic @  commentonthoseapplications,fewcommentswerefiled,andtherewerenooppositionstotheproposedinterlocksevenwheresuchinterlocksinvolveddominantcarriers.g@ 6  48      ׀Thisconclusionis x  alsosupportedbyourexperiencesinceourdecisionin1994toforbearfromregulatingpursuanttosection212withrespecttocommercialmobileradioservices(CMRS),eventhoughwefoundthatthecellularmarketwasnotyetfullycompetitive.h 6  49      ׀Indoingso,wenotedthatthe"antitrust 8  concernsthatSection212wasdesignedtoaddressarealreadyaddressedthroughotherTitleIIprovisionsorbyantitrustlaws."ir  6  50      ׀Weareunawareofanyinstanceswhereourdecisiontoforbear   fromenforcingsection212withregardtoCMRShasresultedinanticompetitiveconduct.  2   12  .3  Ԁ ` WefurtherconcludethatourPart62rulesarenolongernecessaryinthepublic   interest,evenwheredominantcarriersareinvolved,becausewefindthatotherTitleIIprovisionsandantitrustlawsadequatelyguardagainstanticompetitivebehaviorthatmightarisefrominterlockingdirectorates.j  6  51      ׀Forexample,theClaytonActpreventsthepotentialforharmarising `  frominterlockingpositionsbyprohibitingapersonfromservingasanofficerordirectoroftwocompetingcorporationsk 6  52      ׀whosesizeexceedscertainstatutorythresholds.lZ 6  53      ׀Therefore,wefind @  thattheharmthatourPart62rulesseektopreventcanbeaddressed,ifnecessary,throughotherstatutoryprovisions.Accordingly,weconcludethatourrulesareduplicativeofotherinterlockingdirectorateprovisions,andtherefore,arenolongernecessaryinthepublicinterest.  2   13  .3  Ԁ ` Pointingtoprovisionsadoptedaspartofthe1996ActallowingBellOperating   Companies(BOCs)toobtainuptoatenpercentinterestinlongdistance,internet,orinformationservicecompanies,m  6  54      ׀MCIWorldComarguesthattheClaytonActisinsufficienttoprevent   "exclusivearrangementsincumbentlocalexchangecompanies(ILECs)may[now]exercisethroughverticalinterlockswithcompanies"inthesemarkets.n, 6  55      ׀Therefore,MCIWorldCom  argues,ourPart62rulesshouldberetainedfordominantcarriers.oR 6  56      ׀MCIWorldComalsoasserts p  thatthelimitednumberoffilingsisnotevidencethatthereislittlepotentialforabuse,arguingthatPart62hasdeterredinterlocksthatpresentanticompetitiverisks.p 6  57      ׀ P    2   14  .3  Ԁ ` WedisagreewithMCIWorldCom'sargumentthatweshouldretainourPart62 0   ruleswheredominantcarriersareinvolved.Werecognizethatsection8oftheClaytonActdoes x  notpreventalltypesofinterlocks.q 6  58      ׀Asstatedabove,however,wefindthat,interlocking X  directoratesrarelyraiseanticompetitiveconcerns.r 6  59      ׀Moreover,wefindthatintheunlikelyevent H thataninterlockingdirectoratethreatenstoconstraincompetition,otherTitleIIprovisions,suchassection201(b)oftheActandthecomplaintprocessofsection208,existtoaddresssuchharm.s 6  60      ׀Section201(b)oftheActaddressestheharmsthatmayarisefromanticompetitive   conductbyrequiringthatcarriers'charges,practices,andclassificationsbejustandreasonable,t 6  61         andtheseprovisionsmaybeenforcedbytheCommissiononitsownmotionorthoughformalcomplaintsfiledpursuanttosection208oftheAct.u8  6  62      ׀Thus,wefindwithoutmeritMCI   WorldCom'sargumentthatthenewownershipprovisionsofthe1996Actcreateanadditionalriskofanticompetitiveinterlocks.  2  15  .3  Ԁ ` WefurtherdisagreewithMCIWorldCom'scontentionthatourPart62rules, P  unlikeotherTitleIIprovisionsorantitrustlaws,aretheonlymeansforus"toidentifythepossibilityofsubtle,hardtodetectabusesinvolvingdominantcarriersandcompetitivefirmsoperatingindownstream,interexchange,internet,andinformationservicesmarkets,beforetheabusesoccur."v 6  63      ׀WeagreewithBellAtlanticthatMCIWorldComdoesnotarticulatewhatthese h subtleabusesmightbenorhowretainingourpriorapprovalrequirementswouldeffectivelyservetopreventsuchabuses.Inparticular,wefindthatitisunlikelythatwewouldbepresentedwithaparticularproposedinterlockthatispatentlyanticompetitive,abinitio,suchthatthe 8 applicationshouldbedenied.Wealsobelievethatanyinterlockthatissopatentlyanticompetitivethatwewoulddenyanapplicationalsowouldbeidentifiedbytheotherstatutory  protectionsidentifiedabove.Accordingly,weconcludethatthePart62rulesprovidelittle,ifany,additionalprotections.    2  16  .3  Ԁ ` Wealsoadoptourtentativeconclusionthatweshouldrepealtheinterlocking (  directoratereportingrequirementssetforthinourPart62rules.w 6  64      ׀Allcommenters,withthe   exceptionofMCIWorldCom,agreewithourtentativeconclusionthatthereportingrequirementssetforthinPart62ofourrulesarenolongerinthepublicinterestandthereforeshouldberepealed.x 6  65      ׀Wenotethatthisconclusionisconsistentwithourpreviousdeterminationtoforbear   fromenforcingsection212withrespecttoCMRSeventhoughthecellularmarketwasnotyetfullycompetitive.yr  6  66      ׀Asstatedabove,wenotethatforbearancefromenforcingsection212with p  regardtoCMRShasnotresultedinanticompetitiveconduct.z  6  67      ׀Asnotedabove,wealsofindthat `  theconcernsthatPart62ofourrulessoughttoaddresscanbeaddressed,ifnecessary,throughothermoregeneralTitleIIprovisionsaswellasthroughantitrustorsecuritieslaws.{`  6  68      ׀In @  particular,wenotethatcertainsecuritiesregulations,suchasthe10KfilingandRegulationSK,requireextensivedisclosureofofficersanddirectors.| 6  69      ׀Wefindthatthesecomprehensivefiling x  requirementsduplicateourPart62postinterlockfilingrequirements,permittingtherepealofthelatter.    2  17  .3  Ԁ ` WeagreewiththosecommenterswhoarguethatrepealingourPart62rules (  wouldservethepublicinterest.} 6  70      ׀GTEandGSTstatethatcomplyingwithourreporting   requirementsisacostlyadministrativeburden.~Z 6  71      ׀Qwestsimilarlystatesthattheproposedrepeal   "willeliminateunnecessaryregulatoryburdens,legalfees,andcosts,directandindirectofcompliance." 6  72      ׀Wefindthatcarriersseekingpermissiontoholdinterlockingdirectoratesincur   notonlycostsinpreparingsuchfilings,butalso"substantialdelaysbeforetheycanimplementapotentiallybeneficialrestructuring."H 6  73      ׀Tothisend,wefindthatrepealingPart62ofourrules p  wouldeliminateasignificantandunnecessaryexpenditureofcarrierresourcesandthatsuchbenefitsubstantiallyoutweighsanyminimalprotectionsaffordedbytheircontinuedenforcement.Wepreviouslyhavefoundthattheeliminationofunnecessaryregulatoryburdensandlegalcostsincurredtofulfillsuchregulatoryrequirementspermitsresourcestobedirectedinsteadtowardthepromptimplementationofservice. 6  74      ׀WealsoagreewithGTEthat x  Commissionresourcesexpendedtoreviewsuchfilingscouldbeusedforotherpurposes.  6  75      ׀ h Therefore,weconcludethatrepealingourPart62ruleswillservethepublicinterestbyallowingunnecessaryexpendituresofboththecarriersandtheCommissiontobedirectedinsteadtowardthepromptimplementationofserviceandthedeploymentofnewtechnologies.    2  18  .3  Ԁ ` WedeclinetoadoptinthisOrdertherecommendationsofQwestandViatelthat  wealsorepealotherprovisionsofourrulesregardinginterlockingdirectorates.Specifically,thesecommentersrequestthatwerepealsections63.18(h)(2)and1.767(a)(6)ofourrules,which requireapplicationsregardingcablelandinglicensestoindicatewhetherthereareinterlocking  directorates. 6  76      ׀ThesecommentersarguethatourproposedrepealofthePart62rules"implicitly X  repealsallotherprovisionsoftheCommission'sruleswhichrequirereportingofinterlockingdirectorates."Z 6  77      ׀Thesecommentersfurtherstatethateliminatingsections63.18(h)(2)and 8  1.767(a)(6)ofourruleswilleliminateunnecessaryregulatoryburdens,legalfees,andcostsofcompliance. 6  78      ׀WeconfinedtheNoticetocommentontheinterlockingdirectoratesprovisionsset   forthinPart62ofourrules.Theinterlockingdirectoratereportingrequirementssetforthinsections63.18(h)(2)and1.767(a)(6)areseparateanddistinctfromthoserequirementssetforthinPart62andservedifferentpolicygoalsfromthosesetforthinPart62.Accordingly,andwithoutregardtothemeritsofthesesuggestions,weconcludethatthereisinsufficientnoticetoadoptcommenters'suggestionsthatwealsorepealsections63.18(h)(2)and1.767(a)(6)ofourrules.󀀀 p   B.  StatutoryForbearance  P      1. ` Background  0    2  19  .3  Ԁ ` The1996ActprovidesforregulatoryflexibilitybyrequiringtheCommissionto h forbearfromapplyinganyregulationoranyprovisionoftheAct,totelecommunicationscarriersortelecommunicationsservices,orclassesthereof,iftheCommissiondeterminesthatcertainconditionsaresatisfied.~ 6  79      ׀Specifically,Section10oftheActrequirestheCommissiontoforbear 8 fromapplicationofitsrulesorprovisionsoftheActifitfindsthat:  8  (1)enforcementofsuchregulationorprovisionisnotnecessarytoensurethatthecharges,practices,classificationsorregulations,by,for,orinconnectionwiththattelecommunicationscarrierortelecommunicationsservicearejustandreasonable,andarenotunjustlyorunreasonablydiscriminatory;    8  (2)enforcementofsuchregulationorprovisionisnotnecessaryfortheprotectionofconsumers;and     8  (3)forbearancefromapplyingsuchprovisionorregulationisconsistentwiththe "0 publicinterest. 6  80      X    Indeterminingwhetherforbearancefromenforcingaparticularprovisionorregulationisinthepublicinterest,theCommissionisrequiredtoconsiderwhetherforbearancewillpromotecompetitivemarketconditions,includingtheextenttowhichforbearancewillenhancecompetitionamongprovidersoftelecommunicationsservices.Z 6  81             2  20  .3  Ԁ ` IntheNotice,wetentativelyconcludedthatweshouldforbearfromenforcingthe   provisionsofsection212oftheActrequiringanypersonseekingtoholdthepositionofofficerordirectorwithmorethanonecarriersubjecttotheActtoseekpriorCommissionapproval. 6  82      ׀ p  Wetentativelyconcludedthattheseprovisionsofsection212oftheAct:(1)arenotnecessarytoensurethatacarrier'scharges,practices,orclassificationsarejustandreasonable,andarenotunjustlyorunreasonablydiscriminatory;and(2)arenotnecessaryfortheprotectionofconsumers.Wealsotentativelyconcludedthatforbearancefromenforcingtheserequirementsisconsistentwiththepublicinterest.WerecognizedintheNoticethatsection212oftheAct x  appliestocarriersintelecommunicationsmarketsthatmaynotyetbefullycompetitive,andtherefore,soughtcommentonwhethertheanalysisundertakentoconsiderforbearancefromenforcingsection212oftheActshouldvaryfrommarkettomarket. 6  83      ׀Nocommenteropposes H ourtentativeconclusionthatweshouldforbearfromsection212oftheActasappliedtoallcarriersinalltelecommunicationsmarkets. 6  84      ׀Forallthereasonsdetailedpreviouslyinsupportof ( eliminatingourPart62rules,weconcludethateachofthestatutorycriteriaforforbearanceissatisfied,andtherefore,thatweshouldforbearfromenforcingtheseprovisionsofsection212oftheActinallmarkets.  6  85          2. ` StatutoryCriteriaforForbearance    p    ` a.  JustandReasonablePractices  X     2  21  .3  Ԁ ` NocommenteropposesourtentativeconclusionintheNoticethatenforcing 8  section212oftheActisnotnecessaryinanyparticulartelecommunicationsmarket,includingthosethatarenotyetfullycompetitive,toensurethatcarriers'charges,practices,regulations,orclassificationsarejustandreasonable,andnotunjustlyorunreasonablydiscriminatory.Thesecommentersassertthatthecompetitivenatureofmostsectorsofthecommunicationsmarketplacewillensurethatacarrier'schargesandpracticesarejustandreasonableandnotunjustlyorunreasonablydiscriminatory. 6  86      ׀    2  22  .3  Ԁ ` ForthereasonsdiscussedaboveinconjunctionwithrepealingourPart62rules, `  wefindthatweshouldforbearfromenforcingsection212oftheActevenwheredominantcarriersareinvolved.Asdiscussedabove,wefindthatinterlocksrarelythreatentoconstraincompetition.Wealsofindthatintheunlikelyeventaninterlockcreatesthepotentialforanticompetitiveconduct,thespecificconcernsthatsection212oftheActsoughttopreventcanbeaddressedbyotherregulatoryandlegalsafeguardssuchasotherTitleIIprovisionsZ 6  87      ׀orby h antitrustlaws. 6  88      ׀Moreimportantly,evenifapotentialthreattocompetitionexists,itisunlikely X thatsuchthreatcouldbeidentified,abinitio,suchthattheCommissionwoulddenyan H application.Therefore,weadoptourtentativeconclusionthatenforcingsection212oftheActisnotnecessaryinanyparticulartelecommunicationsmarket,includingthosethatarenotyetfullycompetitive,toensurethatcarriers'charges,practices,regulations,orclassificationsarejustandreasonable,andnotunjustlyorunreasonablydiscriminatory.     ` b. ConsumerProtection       2  23  .3  Ԁ ` Wealsoadoptourtentativeconclusionthatsection212oftheActisnotnecessary p fortheprotectionofconsumers.Severalcommentersagreewithourtentativeconclusion,based ` onourexperiencereviewinginterlockapplicationsandfilings,thatinterlockingdirectoratesrarelyraiseconsumerconcerns. 6  89      ׀Intheunlikelyeventthataninterlockingdirectoratethreatens !@ toconstraincompetition,otherTitleIIprovisions,suchassection201(b)oftheActandthecomplaintprocess,adequatelyaddresssuchharm. 6  90      ׀Specifically,section201(b)oftheAct H addressestheharmsthatmayarisefromanticompetitiveconductbyrequiringthatcarriers'charges,practices,andclassificationsbejustandreasonable, 6  91      ׀andtheseprovisionsmaybe (  enforcedbytheCommissiononitsownmotionorthoughformalcomplaintsfiledpursuanttosection208oftheAct. 6  92      ׀Therefore,andforthereasonsdiscussedpreviously,weconcludethat   forbearancefromsection212oftheActwillnotdepriveconsumersofprotectionfromunlawfulcarrierpractices.   ` &  c. PublicInterest  p      2  24  .3  Ԁ ` W'8`ealsoadoptourtentativeconclusionthatforbearanceisconsistentwiththe P  publicinterestandwillpromotecompetitioninthevariousmarketsaffectedbytherequirementssetforthinsection212oftheAct.WefoundabovethatourPart62rulesarenolongernecessarytothepublicinterest.p  6  93      ׀WeagreewithGTEthatforbearancewillpromotecompetitivemarket x  conditionsamongprovidersoftelecommunicationsservicesbyrelievingprovidersoftheregulatoryandlegalcoststhatarisefromthefiling,reporting,andauthorizationrequirementsrelatingtointerlockingdirectorates.  6  94      ׀Thus,forbearancewillservethepublicinterestby H allowingprovidersoftelecommunicationsservicestorespondmorequicklytocompetitionandbyallowingcarrierstodedicateresourcestotheimplementationofserviceandthedeploymentofnewtechnologies.  6  95      ׀Wealsofindthatthereisnopublicinterestthatnecessitatesretaining  section212oftheAct.& 6  96      ׀Asdiscussedabove,section212isnotnecessarytoensurejustand  reasonableratesandpracticesortoprotectconsumers. 6  97      ׀Therefore,weconcludethatweshould X forbearfromthoseprovisionsofsection212oftheActaddressinginterlockingdirectorates. C.  Other  (    2  25  .3  Ԁ ` IntheNotice,weproposedtoforbearsolelyfromthoseprovisionssetforthin   section212oftheActthataddressinterlockingdirectorates.$ 6  98      ׀Indoingso,wespecificallystated   thattheNoticedidnotaddresstheremainderofsection212,whichmakesit8 @  x    8  unlawfulforanyofficerordirectorofanycarriersubjecttothisActtoreceiveforhisownbenefitdirectlyorindirectly,anymoneyorthingofvalueinrespectofnegotiation,hypothecation,orsaleofsecuritiesissuedortobeissuedbysuchcarriers,ortoshareinanyoftheproceedsthereof,ortoparticipateinthemakingorpayingofanydividendsofsuchcarriersfromanyfundsproperlyincludedinthecapitalaccount. 6  99      0    Onecommenter,theSecuritiesIndustryAssociation(SIA),however,requeststhattheCommissionforbearfromallofsection212oftheActincludingtheabovequotedprovision,whichmakesitunlawfulforanofficerordirectorofacarriertobenefitfromcertaintransactionsinvolvingthatcarrier'ssecurities.H 6  100      ׀Wedidnotseekcommentastowhetherthisprovision 8 satisfiedthestatutorycriteriaforforbearanceundersection10oftheAct,andtherefore,forbearancefromthisprovisionofsection212oftheActisbeyondthescopeofthisrulemakingproceedingandwedenySIA'srequest.    IV.CONCLUSION  X       2  26  .3  Ԁ ` Basedontheforegoingdeterminations,weconcludethatweshouldrepealPart62 8  ofourrules,whichimplementssection212oftheAct.Specifically,weconcludethatweshoulddeleteourrulesthatrequire:(1)dominantcarriersandthosecarriersnotyetfoundtobenondominanttoseekCommissionapprovalpriortoacceptinganinterlockingdirectorateposition; 6  101         (2)nondominantcarriers,connectingcarriers,parentcompanies,andothercarriersasmayberequiredunderourrules,tofilepostinterlockingdirectoratereports;Z 6  102      ׀(3)carriersdesiring   authorizationtoholdinterlockingdirectoratesbasedonafindingofcommonownershiptomakespecificfilingswiththeCommission; 6  103      ׀and(4)carriersthatundergoachangeinstatuswith p  respecttointerlockingdirectoratestatustofileachangeofstatusreport.~ 6  104      ׀Wealsoconclude `  that,pursuanttosection10oftheAct,weshouldforbearfromenforcingtheinterlockingdirectorateprovisionsofsection212oftheAct.  @    V.FINALREGULATORYFLEXIBILITYACTANALYSIS  x        2  27  .3  Ԁ ` AsrequiredbytheRegulatoryFlexibilityAct(RFA), 6  105      ׀theCommission X incorporatedanInitialRegulatoryFlexibilityAnalysis(IRFA)ofthepossiblesignificanteconomicimpactonsmallentitiesbythepoliciesandrulesproposedintheNotice.6  6  106      ׀The 8 CommissionsoughtwrittenpubliccommentontheproposalsintheNotice,includingcomment ( ontheIRFA.ThispresentFinalRegulatoryFlexibilityAnalysis(FRFA)conformstotheRFA.  6  107      ׀      2  28  .3  Ԁ ` Needfor,andObjectivesof,thisAction:TheCommissioninitiatedits   examinationofitsPart62rulesaspartofits1998biennialreviewofregulationsasrequiredby  section11oftheCommunicationsActof1934,asamended. 6  108      ׀TheCommissionalsoissuedthe X  Noticetoreviewitsregulatoryregimeforinterlockingdirectorates,andtodeterminewhetherin H lightofsection10oftheAct,theCommissionshouldforbearfromapplyingsuchrequirements.ThepurposeofthisOrderistodeletePart62oftheCommission'srules,whichtheCommissionfindsarenolongernecessaryinthepublicinterest.TheCommissionalsohasdeterminedthatitshouldforbearfromaddressingthoseprovisionsinsection212oftheActthataddressinterlockingdirectorates.     2  29  .3  Ԁ ` SummaryofSignificantIssuesRaisedbyPublicCommentsinResponsetothe  IRFA:IntheIRFA,theCommissionsoughtcommentonwhetherrepealingPart62ofitsrules p  andforbearingfromsection212wouldbenefitsmallentities.TheCommissionreceivednocommentsinresponsetotheIRFA.Severalcommenters,includingonesmallentity,however,indicatedthattheproposalsintheNoticewouldbenefitsmallentitiesbyreducingunnecessary @  regulatoryburdens.Z 6  109      ׀ 0    2  30  .3  Ԁ ` Description,potentialimpact,andnumberofsmallentitiesaffected:Inthisorder, h theCommissionhasdecidedtorepealPart62ofitsrules,whichincludeseliminatingthepostinterlockfilingrequirementfornondominantcarriers,manyofwhommaybesmallentities.TheCommissionalsohasdecidedtoforbearfromenforcingthoseprovisionsofsection212oftheActaddressinginterlockingdirectorates.Forbearancefromenforcingtheseruleswillbenefitsmallentitiesbyreducingtheregulatoryburdentowhichsmallbusinesseswouldotherwisebesubject.  2  31  .3  Ԁ ` Toestimatethenumberofsmallentitiesthatwouldbenefitfromthispositive  economicimpact,wefirstconsiderthestatutorydefinitionof"smallentity"undertheRFA.TheRFAgenerallydefines"smallentity"ashavingthesamemeaningastheterm"smallbusiness,""smallorganization,"and"smallgovernmentaljurisdiction." 6  110      ׀Inaddition,theterm"small ` business"hasthesamemeaningastheterm"smallbusinessconcern"undertheSmallBusinessAct,unlesstheCommissionhasdevelopedoneormoredefinitionsthatareappropriatetoitsactivities.~ 6  111      ׀UndertheSmallBusinessAct,a"smallbusinessconcern"isonethat:(1)is "0 independentlyownedandoperated;(2)isnotdominantinitsfieldofoperation;and(3)meetsanyadditionalcriteriaestablishedbytheSmallBusinessAdministration(SBA).Z 6  112      ׀TheSBAhas H definedasmallbusinessforStandardIndustrialClassification(SIC)categories4812(RadiotelephoneCommunications)and4813(TelephoneCommunications,ExceptRadiotelephone)tobesmallentitieswhentheyhavenomorethan1,500employees. 6  113      ׀Wefirst   discussthenumberofsmalltelephonecompaniesfallingwithintheseSICcategories,thenattempttorefinefurtherthoseestimatestocorrespondwiththecategoriesoftelephonecompaniesthatarecommonlyusedunderourrules.  2  32  .3  Ԁ ` Themostreliablesourceofinformationregardingthetotalnumbersofcertain p  commoncarrierandrelatedprovidersnationwide,aswellasthenumbersofcommercialwirelessentities,appearstobedatatheCommissionpublishesannuallyinitsTelecommunications P  IndustryRevenuereport,regardingtheTelecommunicationsRelayService(TRS).H 6  114      ׀According @  todatainthemostrecentreport,thereare3,459interstatecarriers. 6  115      ׀Thesecarriersinclude, 0  interalia,localexchangecarriers,wirelinecarriersandserviceproviders,interexchangecarriers, x  competitiveaccessproviders, operatorserviceproviders,paytelephoneoperators ,providersof h telephonetollservice,providersoftelephoneexchangeservice,andresellers.  X   2   33  .3  Ԁ ` Althoughsomeaffectedincumbentlocalexchangecarriers(ILECs)mayhave 8 1,500orfeweremployees,wedonotbelievethatsuchentitiesshouldbeconsideredsmallentitieswithinthemeaningoftheRFAbecausetheyareeitherdominantintheirfieldofoperationsorarenotindependentlyownedandoperated,andthereforebydefinitionnot"smallentities"or"smallbusinessconcerns"undertheRFA.Accordingly,ouruseoftheterms"smallentities"and"smallbusinesses"doesnotencompasssmallILECs.Outofanabundanceofcaution,however,forregulatoryflexibilityanalysispurposes,wewillseparatelyconsidersmall ILECswithinthisanalysisandusetheterm"smallILECs"torefertoanyILECsthatarguably p mightbedefinedbytheSBAas"smallbusinessconcerns." 6  116       X    2!  34  .3  Ԁ ` TotalNumberofTelephoneCompaniesAffected.TheUnitedStatesBureauofthe 8  Census("theCensusBureau")reportsthat,attheendof1992,therewere3,497firmsengagedinprovidingtelephoneservices,asdefinedtherein,foratleastoneyear. 6  117      ׀Thisnumbercontainsa   varietyofdifferentcategoriesofcarriers,includinglocalexchangecarriers,interexchangecarriers,competitiveaccessproviders,cellularcarriers,mobileservicecarriers,operatorserviceproviders,paytelephoneoperators,andresellers.Itseemscertainthatsomeofthose3,497telephoneservicefirmsmaynotqualifyassmallentitiesorsmallincumbentLECsbecausetheyarenot"independentlyownedandoperated." 6  118      ׀Additionally,wenotethatthenumberofsmall p  entitiesaffectedbythisrulechangeassetforthinthisOrderislessthanthetotalnumberoftelephonecompaniesasstatedherein,becauseasdiscussedabove,theCommissionalreadyhasdecidedtoforbearfromapplyingsection212oftheActwithregardtoCMRSproviders. 6  119      ׀It @  seemsreasonabletoconclude,therefore,thatfewerthan3,497telephoneservicefirmsaresmallentitytelephoneservicefirmsorsmallincumbentLECsthatmaybeaffectedbythisOrder.  2"  35  .3  Ԁ ` WirelineCarriersandServiceProviders.SBAhasdevelopedadefinitionof X smallentitiesfortelephonecommunicationscompaniesotherthanradiotelephonecompanies.TheCensusBureaureportsthat,therewere2,321suchtelephonecompaniesinoperationforatleastoneyearattheendof1992.  6  120      ׀AccordingtoSBA'sdefinition,asmallbusinesstelephone ( companyotherthanaradiotelephonecompanyisoneemployingnomorethan1,500persons.  6  121      ׀  Allbut26ofthe2,321nonradiotelephonecompanieslistedbytheCensusBureauwerereportedtohavefewerthan1,000employees.Thus,evenifall26ofthosecompanieshadmorethan1,500employees,therewouldstillbe2,295nonradiotelephonecompaniesthatmightqualifyassmallentitiesorsmallincumbentLECs.Althoughitseemscertainthatsomeofthesecarriersare  notindependentlyownedandoperated,weareunableatthistimetoestimatewithgreaterprecisionthenumberofwirelinecarriersandserviceprovidersthatwouldqualifyassmallbusinessconcernsunderSBA'sdefinition.Consequently,weestimatethattherearefewerthan2,295smallentitytelephonecommunicationscompaniesotherthanradiotelephonecompaniesthatmaybeaffectedbythedecisionsinthisOrder.  2#  36  .3  Ԁ ` LocalExchangeCarriers.NeithertheCommissionnorSBAhasdevelopeda   definitionofsmallprovidersoflocalexchangeservices(LECs).TheclosestapplicabledefinitionunderSBArulesisfortelephonecommunicationscompaniesotherthanradiotelephone(wireless)companies.ThemostreliablesourceofinformationregardingthenumberofLECsnationwideofwhichweareawareappearstobethedatathatwecollectannuallyinconnectionwiththeTelecommunicationsRelayService(TRS). 6  122      ׀Accordingtoour P  mostrecentdata,1,371companiesreportedthattheywereengagedintheprovisionoflocalexchangeservices.Z 6  123      ׀Althoughitseemscertainthatsomeofthesecarriersarenotindependently 0  ownedandoperated,orhavemorethan1,500employees,weareunableatthistimetoestimatewithgreaterprecisionthenumberofLECsthatwouldqualifyassmallbusinessconcernsunderSBA'sdefinition.Consequently,weestimatethattherearefewerthan1,371smallentityLECsorsmallincumbentLECsthatmaybeaffectedbythedecisionsinthisOrder.  2$  37  .3  Ԁ ` InterexchangeCarriers.NeithertheCommissionnorSBAhasdevelopeda ( definitionofsmallentitiesspecificallyapplicabletoprovidersofinterexchangeservices(IXCs).TheclosestapplicabledefinitionunderSBArulesisfortelephonecommunicationscompaniesotherthanradiotelephonecompanies. 6  124      ׀Themostreliablesourceofinformationregardingthe  numberofIXCsnationwideofwhichweareawareappearstobethedatathatwecollectannuallyinconnectionwithTRS.Accordingtoourmostrecentdata,143companiesreportedthattheywereengagedintheprovisionofinterexchangeservices.~ 6  125      ׀Althoughitseemscertain p thatsomeofthesecarriersarenotindependentlyownedandoperated,orhavemorethan1,500employees,weareunableatthistimetoestimatewithgreaterprecisionthenumberofIXCsthatwouldqualifyassmallbusinessconcernsunderSBA'sdefinition.Consequently,weestimatethattherearefewerthan143smallentityIXCsthatmaybeaffectedbythedecisionsinthisOrder. h$     2%  38  .3   ` CompetitiveAccessProviders.NeithertheCommissionnorSBAhasdeveloped X adefinitionofsmallentitiesspecificallyapplicabletoprovidersofcompetitiveaccessservices(CAPs).TheclosestapplicabledefinitionunderSBArulesisfortelephonecommunicationscompaniesotherthanradiotelephonecompanies.ThemostreliablesourceofinformationregardingthenumberofCAPsnationwideofwhichweareawareappearstobethedatathatwecollectannuallyinconnectionwiththeTRS.Accordingtoourmostrecentdata,109companiesreportedthattheywereengagedintheprovisionofcompetitiveaccessservices. 6  126      ׀Althoughit   seemscertainthatsomeofthesecarriersarenotindependentlyownedandoperated,orhavemorethan1,500employees,weareunableatthistimetoestimatewithgreaterprecisionthenumberofCAPsthatwouldqualifyassmallbusinessconcernsunderSBA'sdefinition.Consequently,weestimatethattherearefewerthan109smallentityCAPsthatmaybeaffectedbythedecisionsinthisOrder.  2&  39  .3  Ԁ ` PayTelephoneOperators.NeithertheCommissionnorSBAhasdevelopeda 0  definitionofsmallentitiesspecificallyapplicabletopaytelephoneoperators.TheclosestapplicabledefinitionunderSBArulesisfortelephonecommunicationscompaniesexceptradiotelephone(wireless)companies.Z 6  127      ׀Themostreliablesourceofinformationregardingthe X numberofpaytelephoneoperatorsnationwideisthedatathatwecollectannuallyinconnectionwiththeTRSWorksheet.Accordingtoourmostrecentdata,441companiesreportedthattheywereengagedintheprovisionofpaytelephoneservices. 6  128      ׀Wedonothaveinformationonthe ( numberofcarriersthatarenotindependentlyownedandoperated,norhavemorethan1,500employees,andthusareunableatthistimetoestimatewithgreaterprecisionthenumberofpaytelephoneoperatorsthatwouldqualifyassmallbusinessconcernsunderSBA'sdefinition.Consequently,weestimatethattherearefewerthan271smallpaytelephoneoperators.  2'  40  .3  Ԁ ` OperatorServiceProviders.NeithertheCommissionnorSBAhasdevelopeda p definitionofsmallentitiesspecificallyapplicabletoprovidersofoperatorservices.TheclosestapplicabledefinitionunderSBArulesisfortelephonecommunicationscompaniesotherthanradiotelephonecompanies.ThemostreliablesourceofinformationregardingthenumberofoperatorserviceprovidersnationwideofwhichweareawareappearstobethedatathatwecollectannuallyinconnectionwiththeTRS.Accordingtoourmostrecentdata,27companiesreportedthattheywereengagedintheprovisionofoperatorservices.~ 6  129      ׀Althoughitseems h$ certainthatsomeofthesecompaniesarenotindependentlyownedandoperated,orhavemorethan1,500employees,weareunableatthistimetoestimatewithgreaterprecisionthenumberofoperatorserviceprovidersthatwouldqualifyassmallbusinessconcernsunderSBA'sdefinition.Consequently,weestimatethattherearefewerthan27smallentityoperatorserviceprovidersthatmaybeaffectedbythedecisionsinthisOrder.  2(  41  .3   ` Resellers.NeithertheCommissionnorSBAhasdevelopedadefinitionofsmall   entitiesspecificallyapplicabletoresellers.TheclosestapplicabledefinitionunderSBArulesisforalltelephonecommunicationscompanies. 6  130      ׀Themostreliablesourceofinformation  regardingthenumberofresellersnationwideofwhichweareawareappearstobethedatathatwecollectannuallyinconnectionwiththeTRS.Accordingtoourmostrecentdata,339companiesreportedthattheywereengagedintheresaleoftelephoneservices.Z 6  131      ׀Althoughit P  seemscertainthatsomeofthesecarriersarenotindependentlyownedandoperated,orhavemorethan1,500employees,weareunableatthistimetoestimatewithgreaterprecisionthenumberofresellersthatwouldqualifyassmallbusinessconcernsunderSBA'sdefinition.Consequently,weestimatethattherearefewerthan339smallentityresellersthatmaybeaffectedbythedecisionsadoptedinthisOrder.  2)  42  .3  Ԁ ` PrivatePaging.Atpresent,thereareapproximately24,000PrivatePaging 8 licenses.Wedonothavedataspecifyingthenumberofthesecarriersthatarenotindependentlyownedandoperatedorhavemorethan1,500employees,andthusareunableatthistimetoestimatewithgreaterprecisionthenumberofpagingcarriersthatwouldqualifyassmallbusinessconcernsundertheSBA'sdefinition.WeestimatethatthemajorityofprivatepagingproviderswouldqualifyassmallentitiesundertheSBAdefinition.Wenotethatprivatepagingdoesnotincludecommoncarrierpaging,forwhichtheCommissionhasadoptedauctionrulesandhasproposedtoSBAaspecialsmallbusinesssizestandarddefinition.  2*  43  .3   ` Wireless(Radiotelephone)Carriers.SBAhasdevelopedadefinitionofsmall  P entitiesforradiotelephone(wireless)companies.TheCensusBureaureportsthattherewere1,176suchcompaniesinoperationforatleastoneyearattheendof1992. 6  132      ׀Accordingto "0  SBA'sdefinition,asmallbusinessradiotelephonecompanyisoneemployingnomorethan1,500 x#  persons. 6  133      ׀TheCensusBureaualsoreportedthat1,164ofthoseradiotelephonecompanieshad X  fewerthan1,000employees.Thus,evenifalloftheremaining12companieshadmorethan1,500employees,therewouldstillbe1,164radiotelephonecompaniesthatmightqualifyassmallentitiesiftheyareindependentlyownedareoperated.Althoughitseemscertainthatsomeofthesecarriersarenotindependentlyownedandoperated,weareunableatthistimetoestimatewithgreaterprecisionthenumberofradiotelephonecarriersandserviceprovidersthatwouldqualifyassmallbusinessconcernsunderSBA'sdefinition.Consequently,weestimatethattherearefewerthan1,164smallentityradiotelephonecompaniesthatmaybeaffectedbythedecisionsadoptedinthisOrder.    2+  44  .3  Ԁ ` Recording,recordkeeping,andothercompliancerequirements:Noadditional `  paperworkwillberequiredbythedecisionsadoptedinthisproceeding.ThisproceedingeliminatesfilingrequirementssetforthinPart62oftheCommission'srules.  2,  45  .3  Ԁ ` StepsTakentoMinimizeSignificantEconomicImpactonSmallEntities,and x  SignificantAlternativesConsidered:Theimpactofthisproceedingshouldbebeneficialtosmall h businesses,becauseeliminatingtheCommission'sPart62ruleswillreducethereportingorrecordkeepingrequirementsonallcommunicationscommoncarriers.    2-  46  .3  Ԁ ` ReporttoCongress: TheCommissionwillsendacopyofthisOrder,including ( thisFRFA,inareporttobesenttoCongresspursuanttotheSmallBusinessRegulatoryEnforcementFairnessActof1996,5U.S.C.801(a)(1)(A).Inaddition,theCommissionwill  sendacopyofthisOrder,includingFRFA,totheChiefCounselforAdvocacyoftheSmall  BusinessAdministration.AcopyoftheOrderandFRFA(orsummariesthereof)willalsobe  publishedintheFederalRegister.  VI.ORDERINGCLAUSES  `       2.  47  .3  Ԁ ` Accordingly,ITISORDEREDthatpursuanttosections1,4,10,11,and212,of !@ theCommunicationsActof1934,asamended,47U.S.C.151,154,160,161,and212,thepolicies,rules,andrequirementssetforthhereinAREADOPTED.  2/  48  .3  Ԁ ` ITISFURTHERORDEREDthatpursuanttosection11oftheCommunications X%  Actof1934,asamended,47U.S.C.161,thatPart62oftheCommission'srules,47C.F.R.Part62,isnolongerinthepublicinterest,andthereforeisREMOVED,effective30daysafterpublicationofthetextthereofintheFederalRegister._ )!$       20  49  .3  Ԁ ` ITISFURTHERORDEREDthatpursuanttosection10oftheCommunications X Actof1934,asamended,47U.S.C.160,theCommissionWILLFORBEARfromthoseprovisionsofsection212addressinginterlockingdirectorates,47U.S.C.212,effective30daysafterpublicationofthetextthereofintheFederalRegister.  21  50  .3  Ԁ ` ITISFURTHERORDEREDthattheCommission'sOfficeofPublicAffairs,   ReferenceOperationsDivision,SHALLSENDacopyofthisOrder,includingtheFinal   &  RegulatoryFlexibilityAnalysis,totheChiefCounselforAdvocacyoftheSmallBusinessAdministration.   `     h   FEDERALCOMMUNICATIONSCOMMISSION   `     h   _Magalie_ԀRoman_Salas_' s   `     h   _Secretary  h  AppendixA:PartsRemoved  X Accordingly,undertheauthority47U.S.C.154,amend47_C.F.R._ԀchapterIbyremovingPart62. +$'  [XX [  StatementofCommissionerHaroldW.FurchtgottRoth#XX ##XXXX4#XXXX  8      Re:8 ` 1998BiennialRegulatoryReviewRepealofPart62ofthe 8  Commission'sRules,ReportandOrder,CCDocketNo.98195$ ` x` x   IsupportadoptionofthisReportandOrderwherein,pursuanttotheCommissionsdutyunderSection11(b)oftheCommunicationsActof1934,asamended,47U.S.C.Sect.161(b),wehaverepealedormodifiedregulationsthatwehavedeterminedtobenolongernecessaryinthepublicinterest.TheregulationsatissueherewerechosenforrepealormodificationaspartoftheCommissions1998BiennialReview,whichwasconductedpursuanttoSection11(a)oftheAct,Id.atSect.161(a).However,asthoroughlydescribedinmyReportonImplementation ,  ofSection11bytheFederalCommunicationsCommission(Dec.21,1998),whichcanbefound p  ontheFCCWWWsiteat,Ibelievethatthe1998Section11(a)reviewwasnotasthoroughasitshouldhavebeen.Ilookforwardtoworkingwiththechairmanandothercommissionersonthe2000BiennialReview,planningforwhichshouldbegininmid1999.   *******   #XXXX#