Click here for Microsoft Word Version
******************************************************** 
                      NOTICE
********************************************************

This document was converted from
WordPerfect or Word to ASCII Text format.

Content from the original version of the document such as
headers, footers, footnotes, endnotes, graphics, and page numbers
will not show up in this text version.

All text attributes such as bold, italic, underlining, etc. from the
original document will not show up in this text version.

Features of the original document layout such as
columns, tables, line and letter spacing, pagination, and margins
will not be preserved in the text version.

If you need the complete document, download the
Word or WordPerfect version or Adobe Acrobat version (above).

*****************************************************************



                            Before the
                Federal Communications Commission
                      Washington, D.C. 20554

In the Matter of                )  File No. EB-01-IH-0035
                                )  TRS Company Code: 819100
PTT Telekom, Inc.               )  NAL/Acct.             No. 
200132080025
                                 

         NOTICE OF APPARENT LIABILITY FOR FORFEITURE

   Adopted: March 26, 2001              Released:  March 29, 
2001

By the Commission:

                      I.  INTRODUCTION

     1.   In this Notice of Apparent Liability for 
Forfeiture ("NAL"), we find that PTT Telekom, Inc. (``PTT'') 
has apparently violated 47 U.S.C.  254(d) and 47 C.F.R.  
54.706 by willfully and repeatedly failing to contribute to 
universal service support programs.  Based on our review of 
the facts and circumstances in this case, we conclude that 
PTT is apparently liable for a forfeiture in the amount of 
$137,000.

                       II.  BACKGROUND

     2.   In 1996, Congress amended the Communications Act 
of 1934 (the ``Act'') to require that:

     Every telecommunications carrier that provides 
     interstate telecommunications services shall 
     contribute, on an equitable and nondiscriminatory 
     basis, to the specific, predictable, and 
     sufficient mechanisms established by the 
     Commission to preserve and advance universal 
     service.1
       
In implementing that section, we authorized the Universal 
Service Administrative Company (``USAC'') to administer 
universal service support mechanisms and to perform billing 
and collection functions.2  As to these matters, we directed 
USAC to distribute, receive and process the Universal 
Service Worksheet (now the Telecommunications Reporting 
Worksheet) (``Worksheet''), which is used to report certain 
categories of revenue for the purpose of calculating a 
carrier's universal service contribution, and to adjust 
carriers' contributions in accordance with factors 
established by the Commission.3  In addition, we gave USAC 
the authority to bill carriers monthly, with the first 
payment being due in February 1998.4  To foster compliance 
with universal service requirements, our rules provide that 
a carrier's failure ``to submit required . . . contributions 
may subject the contributor to the enforcement provisions of 
the Act and any other applicable law.''5   

     3.   PTT did not file its first Worksheet until August 
30, 1999, nearly two years after it was due.  At that time, 
PTT filed Worksheets not only for 1997 but also for 1998 and 
for the first six months of 1999.  Based upon information in 
the 1997 and 1998 Worksheets, USAC sent PTT an invoice dated 
September 15, 1999, which set forth PTT's liability to the 
universal service funds for high cost and low income areas, 
school and libraries, and rural health care.  The amount 
billed was $189,257.83, which represented all of the 
contributions PTT should have made in 1998 as well as those 
already due in 1999.  Although a PTT representative called 
USAC to inquire about payment arrangements, PTT never made 
any payments to USAC.  USAC has continued to send out 
monthly invoices to PTT, and in November 2000 and January 
2001 attempted unsuccessfully to speak with someone at PTT 
to inform it of its delinquency. 

     4.   On February 1, 2001, the Enforcement Bureau sent a 
letter to PTT, which explained that PTT was potentially the 
subject of an enforcement action.6  PTT failed to respond to 
the Bureau's letter.7  As of February 2001, PTT owes a 
balance of approximately $925,000, which represents required 
contributions and late payment penalties billed through 
January 2001.

                      III.  DISCUSSION

     5.   We conclude that PTT is apparently liable for 
forfeiture for willful and repeated violations of 47 U.S.C. 
 254 and the Commission's rules governing universal service 
contributions.  According to USAC's records, PTT has not 
paid any of its required universal service contributions.  
Consequently, PTT's unpaid contribution balance has grown to 
approximately $925,000.  As noted above, 47 U.S.C.  254(d) 
and 47 C.F.R.  54.706 and 54.709 require that interstate 
telecommunications carriers make universal service 
contributions in the amounts calculated by USAC.  PTT has 
not done so, and we find that PTT's failures to make the 
required contributions are not only apparently willful and 
repeated but also apparently egregious and intentional.  The 
term ``willful'' means that the violator knew that it was 
taking the action in question, irrespective of any intent to 
violate the Commission's rules,8 and ``repeated'' means more 
than once.9  The record before us indicates that PTT knew of 
its obligation to contribute to universal service programs 
on a monthly basis but chose repeatedly not to meet that 
obligation.      6.   Section 503(b)(1)(B) of the Act provides that any 
person who willfully or repeatedly fails to comply with the 
Act or the Commission's rules shall be liable for a 
forfeiture penalty.10  If the violator is a common carrier, 
47 U.S.C.  503(b)(2)(B) authorizes us to assess a 
forfeiture of up to $110,000 for each violation, or each day 
of a continuing violation, up to a statutory maximum of 
$1,100,000 for a single act or failure to act.11  In 
assessing a forfeiture, 47 U.S.C.  503(b)(2)(D) requires us 
to consider the nature, circumstances, extent and gravity of 
the violation, and, with respect to the violator, the degree 
of culpability, any history of prior offenses, ability to 
pay, and such other matters as justice may require.12  

     7.   Taking into account the statutory factors, as well 
as precedent, we find PTT apparently liable for a forfeiture 
of $137,000.  This forfeiture consists of three components.  
First, we have assessed a base figure of $40,000, $20,000 
for each of two apparent violations, i.e., the failures to 
pay the November and December 2000 invoices.13  The 
Commission established such a base figure in order to deter 
delinquencies regardless of their amount.14  Second, 
consistent with our recent actions in this area, 15 we have 
added an amount that is approximately one half of the unpaid 
universal service contributions for two representative 
months.  In this case, we have chosen the months of November 
and December 2000, which results in an addition of $51,500 
to the base figure.  This second component of the forfeiture 
illustrates that a delinquent carrier's culpability and the 
consequential damage it causes to the goal of universal 
service may vary with the size of the contributions it fails 
to make.16  Finally, we have applied an upward adjustment of 
$45,500, slightly less than 50 percent of the sum of the 
first two components to account for the egregious nature of 
PTT's violations.  As noted, PTT has paid nothing toward 
universal service for more than three years and has apparently ignored 
Commission correspondence on the subject.  We cannot and 
will not countenance this kind of behavior on the part of 
those we regulate.17  

     8.   Although PTT's failures to pay its contributions 
in months other than November and December 2000 represent 
separate violations of the Act and our rules, we do not find 
apparent liability for these apparent violations at this 
time.  Nevertheless, we warn PTT that these violations could 
form the basis for additional notices of apparent 
liability.18  If PTT continues to violate our universal 
service rules, such violations could result in future NALs 
proposing substantially greater forfeitures, or could result 
in issuance of a show cause order to revoke PTT's operating 
authority.19  
      
                    IV.  ORDERING CLAUSES

     9.   Accordingly, IT IS ORDERED THAT, pursuant to 47 
U.S.C.  503(b), and 47 C.F.R.  1.80, PTT Telekom, Inc. is 
hereby NOTIFIED of its APPARENT LIABILITY FOR A FORFEITURE 
in the amount of one hundred thirty-seven thousand dollars 
($137,000) for violating the Act and our rules requiring 
regular contributions for universal service. 

     10.  IT IS FURTHER ORDERED THAT, pursuant to 47 C.F.R. 
 1.80, within thirty days of this NOTICE OF APPARENT 
LIABILITY, PTT Telekom, Inc. SHALL PAY the full amount of 
the proposed forfeiture or SHALL FILE a written statement 
seeking reduction or cancellation of the proposed 
forfeiture.

Payment of the forfeiture may be made by mailing a check or 
similar instrument, payable to the order of the Federal 
Communications Commission, to the Forfeiture Collection 
Section, Finance Branch, Federal Communications Commission, 
P.O. Box 73482, Chicago, Illinois 60673-7482.  The payment 
should note the NAL/Acct. No. referenced above.

     11.  The response, if any, must be mailed to Charles W. 
Kelley, Chief, Investigations and Hearings Division, 
Enforcement Bureau, Federal Communications Commission, 445 
12th Street, S.W, Room 3-B443, Washington D.C. 20554 and 
MUST INCLUDE the file number listed above.

     12.  The Commission will not consider reducing or 
canceling a forfeiture in response to a claim of inability 
to pay unless the petitioner submits: (1) federal tax 
returns for the most recent three-year period; (2) financial 
statements prepared according to generally accepted 
accounting practices (``GAAP''); or (3) some other reliable 
and objective documentation that accurately reflects the 
petitioner's current financial status.  Any claim of 
inability to pay must specifically identify the basis for 
the claim by reference to the financial documentation 
submitted.

     13.  Requests for payment of the full amount of this 
Notice of Apparent Liability under an installment plan 
should be sent to: Chief, Revenue and Receivables Operations 
Group, 445 12th Street, S.W., Washington, D.C. 20554.  See 
47 C.F.R.  1.1914.IT IS FURTHER ORDERED that a copy of this Notice of Apparent 
Liability for Forfeiture shall be sent by Certified 
Mail/Return Receipt Requested, to Ron Kiser, PTT Telekom, 
Inc., 1000 N. Orlando Avenue, Winter Park, Florida 32789; 
and to National Registered Agents, Inc., 1090 Vermont 
Avenue, N.W., Washington, D.C. 20005.
     

                         FEDERAL COMMUNICATIONS COMMISSION
                    

     

                         Magalie Roman Salas
                         Secretary
_________________________

1  47 U.S.C.  254(d). 

2  See Amendment of Parts 54 and 69 - Changes to Board of 
NECA, Inc., 12 FCC Rcd 18400, 18415 (1997) (``NECA Changes 
Order''); 47 C.F.R.  54.702(b).

3  See NECA Changes Order, 12 FCC Rcd at 18424-25; 47 C.F.R. 
 54.709(a)(1-3), 54.711(a). 

4  See Amendment of Part 54 - Universal Service, 12 FCC Rcd 
22423, 22425 (1997); 47 C.F.R.  54.709(a)(4-5). 

5  47 C.F.R.  54.713. 

6  Letter from Charles W. Kelley, Chief, Investigations and 
Hearings Division, Enforcement Bureau, to PTT Telekom, Inc. 
dated February 1, 2001. 

7  The Enforcement Bureau mailed the February 1, 2000 letter 
to PTT by certified mail, return receipt requested.  The 
return receipt reflects that PTT received the Bureau's 
letter on February 9, 2001.

8  See Jerry Szoka, 14 FCC Rcd 9857, 9865 (1999); Southern 
California Broadcasting Co., 6 FCC Rcd 4387 (1991). 

9  See Hale Broadcasting Corp., 79 FCC 2d 169, 171 (1980). 

10  47 U.S.C.  503(b)(1)(B).  See also 47 C.F.R.  
1.80(a)(2).  Recently, we amended section 1.80(b) of our 
rules to increase the maximum penalties that may be imposed.  
Accordingly, for a common carrier, the forfeiture limit for 
each violation is now $120,000, with a maximum potential 
forfeiture of $1,200,000 for a continuing violation 
involving a single act or failure to act.  See Amendment of 
Section 1.80(b) of the Commission's Rules, 15 FCC Rcd 18221 
(2000).   

11  See also 47 C.F.R.  1.80(b)(2). 

12  See also The Commission's Forfeiture Policy Statement 
and Amendment of Section 1.80 of the Rules to Incorporate 
the Forfeiture Guidelines, 12 FCC Rcd 17087, 17100-01 
(1997), recon. denied, 15 FCC Rcd 303 (1999) (``Forfeiture 
Guidelines''). 

13  See ConQuest Operator Services Corp., 14 FCC Rcd 12518, 
12527 (1999) (``ConQuest Forfeiture Order'') (We determined 
that $20,000 should be the general base amount for failure 
to pay the assessed universal service contribution in a 
timely manner). 

14  See id.

15  See America's Tele-Network Corp., 15 FCC Rcd 20903 
(2000) (Notice of Apparent Liability), 15 FCC Rcd 24391 
(2000) (Forfeiture Order); Intellicall Operator Services, 15 
FCC Rcd 15359 (2000) (Notice of Apparent Liability), 15 FCC 
Rcd  21771 (2000) (Forfeiture Order); Matrix Telecom, Inc., 
15 FCC Rcd 15344 (2000) (Notice of Apparent Liability), FCC 
01-48, released February 20, 2001 (Forfeiture Order).  See 
also North American Telephone Network, LLC, 15 FCC Rcd 14022 
(Enf. Bureau 2000) (Notice of Apparent Liability); DA 01-
540, released March 2, 2001 (Forfeiture Order).

16  See ConQuest Forfeiture Order, 14 FCC Rcd at 12527.

17  See America's Tele-Network Corp., 15 FCC Rcd 20903 
(2000) (Notice of Apparent Liability), 15 FCC Rcd 24391 
(2000) (Forfeiture Order) (50 percent upward adjustment for 
intentional and egregious non-payment of universal service 
contributions).  

18  ConQuest Forfeiture Order, 14 FCC Rcd at 12527. 

19  See CCN, Inc. et al., 12 FCC Rcd 8547 (1997) (the 
``Fletcher Companies'').