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A. 1. a.(1)(a) i) a) I. 1. 1. a.(1)(a) i) a)By the Commission:  X4  X41. ` ` By letter dated April 17, 1998,̆ yO='ԍ Startec Global Communications Corporation Request for Forbearance/Exemption from Universal Service Fund as stated in FCC Docket 9645 (filed April 17, 1998) (Startec Request). Startec Global Communications Corporation (Startec) requests that the Commission waive, or forbear from enforcing, the universal service  X4contribution requirement set forth in section 54.706 of the Commission's rules. ̆ yOg'ԍ Startec requests waiver or forbearance of section 54.703 of the Commission's rules; however, as a result of  {O/'the Eighth Reconsideration Order, section 54.703 became section 54.706, and is currently codified at 47 C.F.R.   {O'54.706.  Changes to the Board of Directors of the National Exchange Carrier Association, Inc., FederalState  {O'Joint Board on Universal Service,  Third Report and Order and Fourth Order on Reconsideration, and Eighth  {O'Order on Reconsideration, CC Docket Nos. 9645, 9721, FCC 98306 (rel. Nov. 20, 1998) (Eighth  {OW'Reconsideration Order). For the reasons discussed below, we deny Startec's request.  XQ4` I. BACKGROUND  X:4  X#42.` ` In the Telecommunications Act of 1996 (1996 Act),L#̆ yOv$'ԍ Pub. L. No. 104104, 110 Stat. 56.L Congress amended the"#2 0*''="  X4Communications Act of 1934 (Act) {Oy'ԍ 47 U.S.C.  151, et seq. Hereinafter, all citations to the 1996 Act and the Act will be to the relevant section of the United States Code, unless otherwise noted. by, among other things,  &Q adding section 254 to the Act. Section 254(b) states that "[a]ll providers of telecommunications services should make an equitable and nondiscriminatory contribution to the preservation and advancement of universal  X4service,"C" yO'ԍ 47 U.S.C.  254(b)(4).C through "specific, predictable and sufficient Federal and State mechanisms."C yO 'ԍ 47 U.S.C.  254(b)(5).C To accomplish these goals, the Act mandates that "[e]very telecommunications carrier that provides interstate telecommunications services shall contribute, on an equitable and nondiscriminatory basis, to the specific, predictable, and sufficient mechanisms established by  X_4the Commission to preserve and advance universal service."@_B yOR'ԍ 47 U.S.C.  254(d).@ The Act authorizes the Commission to exempt a mandatory contributor from contributing to the universal service support mechanisms only "if the carrier's telecommunications activities are limited to such an extent that the level of such carrier's contribution to the preservation and advancement of  X 4universal service would be de minimis."3  {O'ԍ Id.3   X 43.` ` On May 8, 1997, the Commission released the Universal Service Order  X 4implementing section 254 of the Act. ( d  {O'ԍ Federal-State Joint Board on Universal Service, CC Docket No. 96-45, Report and Order, 12 FCC Rcd  {O'8776 (1997) (Universal Service Order), as corrected by Federal-State Joint Board on Universal Service, Errata,  {Ok'CC Docket No. 96-45, FCC 97-157 (rel. June 4, 1997), consolidated appeal pending sub nom Texas Office of  {O5'Public Utility Counsel v. FCC, No. 97-60421 (5th Cir.). As required in the Act, the resulting Commission rules generally require all telecommunications carriers providing interstate telecommunications  X4service to contribute to universal service.@ T  yO'ԍ 47 C.F.R.  54.706.@ The Commission found that carriers that provide only international telecommunications services are not "telecommunications carriers that provide interstate telecommunications services," and, therefore, are exempt from the  XO4mandatory universal service contribution obligation.g O {O!'ԍ Universal Service Order, 12 FCC Rcd at 9174, para. 779.g Carriers who provide both interstate and international telecommunications, however, are required to contribute to the universal"8v 0*%%U"  X4service support mechanism based on their total revenue from both categories of service.n  yOy'ԍ Specifically, for the high cost, rural and insular areas, and lowincome consumers programs, carriers must contribute in proportion to their total interstate and international enduser telecommunications revenues.  {O 'Universal Service Order, 12 FCC Rcd at 9203, para. 836. For the schools, libraries, and health care providers program, carriers must contribute in proportion to their total interstate, intrastate, and international enduser  {O'telecommunications revenues. Universal Service Order, 12 FCC Rcd at 9203, para. 837. n Carriers are required to calculate their contributions by multiplying their total enduser revenues by the universal service contribution percentage announced by the Commission  X4quarterly.i | {O 'ԍ Universal Service Order, 12 FCC Rcd at 9211, para. 854. i In addition, pursuant to the authority to exempt mandatory contributors whose  X4contributions would be de minimis, the Commission exempted from the contribution  X4requirement all entities whose annual contribution would be less than $10,000.r {ON 'ԍ 47 C.F.R.  54.708. The de minimis level was originally set at $100. Universal Service Order, 12 FCC  {O'Rcd at 9186, para. 801. In its Fourth Reconsideration Order, the Commission revised its approach to setting a  {O'threshold for the de minimis exemption, and concluded that the de minimis threshold should be increased to  {O'$10,000. Federal-State Joint Board on Universal Service, Access Charge Reform, Price Cap Performance  {Ov'Review for Local Exchange Carriers, Transport Rate Structure and Pricing, End User Common Line Charge, Fourth Order on Reconsideration, CC Docket Nos. 96-45, 96-262, 94-1, 91-213, 95-72, 13 FCC Rcd 5318, 5465  {O'at paras. 295297 (1997) (Fourth Reconsideration Order).r  Xa44.` ` Startec describes itself as a newlypublic, minorityrun "dialaround" international long distance carrier, that also provides a limited amount of interstate  X34telecommunications service.3Z  yO>'ԍ Startec Global Response to AT&T's Opposition at 12 (filed June 1, 1998) (Startec Reply). Startec contends that, because very little of its enduser revenues comes from the provision of interstate telecommunications service, the Commission should consider Startec to be a purely international telecommunications service carrier that  X 4need not contribute to universal service.?  yO'ԍ Startec Reply at 23.? Startec requests, in the alternative, that the  X 4Commission limit the contribution requirement to revenue derived from domestic calls.EX z yO'ԍ Undated letter from Anthony A. Das, Senior Vice President for Corporate and International Affairs, Startec Global Communications Corporation, to William E. Kennard, Chairman, Federal Communications  yO'Commission (filed March 25, 1999) (Startec Proposal).E Startec claims that its customers are lowincome, first generation immigrants who, but for  X 4Startec, would not have access to long distance telecommunications service.=  yO"'ԍ Startec Reply at 1.= Startec argues" *0*%% "  X4that neither it, nor its customers, can afford to contribute to universal service.? yOy'ԍ Startec Request at 1.? Finally, Startec argues that, because it has no corporate customer base from which it can recover its contribution, the requirement to contribute to universal service amounts to a barrier to open  X4competition.>X yO'ԍ Startec Reply at 2. > Accordingly, Startec requests that the Commission either exempt Startec from the requirement, or refrain from enforcing the provisions of section 54.706 of the  X4Commission's rules.? yO& 'ԍ Startec Request at 1.?  X_45.` ` The Commission issued a public notice seeking comment on Startec's request  XH4and two other petitions,&Hx {Oq'ԍ Petitions for Waiver of Section 54.703 Filed by: Gateway USA Holding Company, Inc.; Cosmos Telecom  {O;'Marketing, Inc.; Sitel, Inc.; Microdevices Worldwide Inc.; Startec Global communications Corporation, Public  {O'Notice, DA 98865 (Accounting Policy Division rel. May 8, 1998) (Public Notice). The other two petitions will be addressed in a separate Memorandum Opinion and Order. and AT&T responded with comments in opposition.MHf  yO_'ԍ AT&T Comments (filed May 22, 1998).M Startec filed a reply, and submitted a letter to the Chairman proposing a formula for the Commission to  X 4use to identify international carriers.B  yO'ԍ Startec Reply at 1; Startec Proposal at 1. Although both the Startec reply and proposal were received  {O'after the due date established by the Commission in the Public Notice, in the interest of establishing a complete  {OS'record, and because this request is being addressed in a permitbutdisclose proceeding in which ex parte  {O'communications are permitted subject to disclosure, we consider all submissions. See Public Notice at 2; 47 C.F.R.  1.1206. B  X 4f II. DISCUSSION ă  X 4 A. Waiver  X46.` ` Generally the Commission's rules may be waived for good cause shown.= yO'ԍ 47 C.F.R.  1.3.= But, as noted by the Court of Appeals for the D.C. Circuit, agency rules are presumed valid, and  Xb4"an applicant for waiver faces a high hurdle even at the starting gate."b< {OO#'ԍ WAIT Radio v. FCC, 418 F.2d 1153, 1157 (D.C. Cir. 1969), cert. denied, 409 U.S. 1027 (1972). The Commission may exercise its general discretion to waive a rule where the particular facts make strict"K0*%%"  X4compliance inconsistent with the public interest.x {Oy'ԍ Northeast Cellular Telephone Co. v. FCC, 897 F.2d 1164 (D.C. Cir. 1990).x In addition, the Commission may take into account considerations of hardship, equity, or more effective implementation of overall policy  X4on an individual basis.LZ {O'ԍ WAIT Radio 418 F.2d at 1157.L Waiver is, therefore, appropriate if special circumstances warrant a deviation from the general rule, and such deviation would better serve the public interest than  X4strict adherence to the general rule.T {OA 'ԍ Northeast Cellular 897 F.2d at 1166.T As further discussed below, we conclude that Startec has failed to justify grant of a waiver.  X_47. ` ` Section 254(d) specifies that universal service support "should be explicit," and mandates that "every telecommunications carrier that provides interstate telecommunications  X14services shall contribute, on an equitable and non-discriminatory basis, to the specific, predictable, and sufficient mechanisms established by the Commission to preserve and  X 4advance universal service."Q ~ yO4'ԍ 47 U.S.C.  254(d) (emphasis added).Q The statute defines the term "telecommunications carrier" as  X 4"any provider of telecommunications services,"A  yO'ԍ 47 U.S.C.  153(44).A and the term "telecommunications service" as "the offering of telecommunications for a fee directly to the public, or to such classes of users  X 4as to be effectively available directly to the public, regardless of the facilities used."A  yO'ԍ 47 U.S.C.  153(46).A Telecommunications are 'interstate' when the communication or transmission originates in any state, territory, possession of the United States, or the District of Columbia and terminates in  X{4another state, territory, possession, or the District of Columbia.A!{.  yOZ'ԍ 47 U.S.C.  153(22).A  XM48.` ` The statute does not permit us to treat Startec as if it were a purely international telecommunications service provider that is not subject to the statutory universal service contribution requirement. Startec does not dispute that it is a "telecommunications  X4carrier that provides interstate telecommunications service.""  Xw!4#Xj\  P6G;ynXP#э#X\  P6G;ɒP# See Startec Reply at 23.#Xj\  P6G;ynXP# The Act authorizes the Commission to exempt a "telecommunications carrier that provides interstate telecommunications services" from contributing to the universal service support mechanisms only "if the carrier's contribution to the preservation and advancement of universal service"o "0*%%"  X4would be de minimis."#{ Xy4#Xj\  P6G;ynXP#э#X\  P6G;ɒP# 47 U.S.C.  254(d). Pursuant to the authority to exempt mandatory contributors whose contributions  {Ob'would be de minimis, the Commission's rules exempt from the contribution requirement all entities whose annual  yO,'contribution would be less than $10,000. 47 C.F.R.  54.708.#Xj\  P6G;ynXP# Startec does not claim, and we do not find, that Startec's  X4contributions are de minimis. Moreover, there is no basis in the record to determine that Startec's level of interstate activities and/or revenues are sufficiently unique to warrant  X4deviation from our de minimis standard. Nor do we find, as discussed below, that Startec's public interest arguments affect our conclusion here.  X|49.` ` Startec argues in the alternative that the Commission should permit carriers with less than fifteen percent of their revenue from interstate telecommunications services to base their contributions solely on the enduser revenue from the provision of interstate telecommunications services. We are not persuaded that Startec's argument is substantially different from the arguments that we have already carefully considered and rejected in the  X 4rulemaking.J$  {O'ԍ See Startec proposal at 1.J A waiver applicant traditionally has a heavy burden to demonstrate that the arguments advanced in support of the waiver request are substantially different from those that  X 4have been carefully considered at the rulemaking stage.%  {O)'ԍ Industrial Broadcasting Co. v. FCC, 437 F.2d 680, 683 (D.C. Cir. 1970); see also, e.g., Wait Radio 418 F.2d at 1156. Generally, the Commission need not restudy a matter and reconsider policy every time it receives an application for a  X 4waiver.L&  {OU'ԍ Wait Radio 418 F.2d at 1157.L The Commission, in the rulemaking proceeding that implemented the statutory contribution requirement, considered and rejected the proposition that revenue from the  X4provision of international telecommunications service should be excluded."'(   yO'ԍ In adopting the section 54.706 requirement that interstate carriers include the revenues derived from  yO'international services in the assessment base, the Commission explained the underlying policy as follows:  XAlthough we agree with PanAmSat that by definition, foreign or international telecommunications are not "interstate" because they are not carried between states, territories, or possessions of the United States, we find that, pursuant to our statutory authority to assess contributions to universal service on an equitable and nondiscriminatory basis, we shall include the foreign telecommunications revenues of interstate carriers within the revenue base. Contributors that provide international telecommunications services benefit from universal service because they must either terminate or originate telecommunications on the domestic PSTN [public switched telephone network]. Therefore, we find that contributors that provide international telecommunications services should contribute to universal service on the basis of revenues derived from those services. "$&0*%%#"Ԍ {O'ԙUniversal Service Order, 12 FCC Rcd at 9174, para. 779 (citations omitted). " Startec does not"Z'0*%%I" explain why the Commission should now adopt a proposal to exclude that revenue from the calculation base of carriers that receive less than fifteen percent of their revenue from interstate telecommunications services. Thus, we find no reason to deviate from our previous conclusion.  X4 10.` ` Moreover, we note that "[t]he very essence of waiver is the assumed validity of  Xv4the [agency's] general rule,"L(vZ {O 'ԍ Wait Radio 481 F.2d at 1158.L and Startec has failed to establish the existence of any special circumstances warranting waiver of the rule. Although Startec does not provide a substantial amount of interstate telecommunications service in comparison to its total enduser revenues, it is, nonetheless, an interstate telecommunications service provider. Accordingly, we find that Startec should contribute to universal service on the basis of revenues derived from providing international telecommunications services. While it is Startec's relatively minimal amount of domestic revenue that triggers its statutory obligation to contribute to the universal service mechanisms, we note that Startec's substantial international revenues depend upon the integrity of universal service, because Startec's international calls "must either terminate or  X 4originate ...on the domestic PSTN"g)  {OD'ԍ Universal Service Order, 12 FCC Rcd at 9174, para. 779.g that universal service supports.  Xy4 11.` ` We disagree with Startec that, the public interest would be better served by granting the petition, because it would preserve Startec's ability to provide "low cost telecommunications services to the very communities that the USF [universal service fund]  X44was designed to assist."A*4~ yOc'ԍ Startec Request at 12.A In the Act, Congress directed the Commission and states to take the steps necessary to establish support mechanisms to ensure the delivery of affordable telecommunications service to all regions of the nation, including lowincome consumers,  X4those living in highcost areas, eligible schools and libraries, and rural health care providers.=+ yO'ԍ 47 U.S.C.  254.= To accomplish these goals, the Act mandates that "[e]very telecommunications carrier that provides interstate telecommunications services shall contribute, on an equitable and nondiscriminatory basis, to the specific, predictable, and sufficient mechanisms established by  X4the Commission to preserve and advance universal service."@, yO"'ԍ 47 U.S.C.  254(d).@ As the Commission has repeatedly stated, we believe it is in the public interest to construe broadly this statutory mandate to encompass an expansive class of contributors, so as to ensure the sufficiency of"e. ,0*%%"  X4the fund and to lessen the burden on each contributor.-^ {Oy'ԍ FederalState Joint Board on Universal Service, CC Docket No. 9645, Report to Congress, 13 FCC Rcd  {OC'11501, 11565, para. 132 (1998) (April 10 Report to Congress); see also Universal Service Order, 12 FCC Rcd  {O 'at 9177, 9183, paras. 783, 795; Fourth Reconsideration Order, 13 FCC Rcd at 5465, para. 263. Consistent with section 254, all interstate telecommunications service providers must contribute to universal service. In light of the underlying purpose of the contribution rules, mere allegations that service to Startec's customers might be foreclosed will not suffice. We find that, in this case, given the diverse purposes of the Act, the public interest is better served by adherence to the general rule.  Xv4 12.` ` Finally, we are not persuaded by Startec's claim that it should not have to contribute to universal service because it cannot recover its contributions from its customers,  XH4and absorbing the costs would jeopardize the viability of the company.?.H yO 'ԍ Startec Request at 1.? We agree with AT&T that Startec's ability to recover, or absorb, the cost of its contributions is not a special circumstance warranting waiver of section 54.706 of our rules. Section 54.706 of the Commission's rules is intended to carry out the statutory mandate that every telecommunications carrier that provides interstate telecommunications service "contribute, on an equitable and nondiscriminatory basis, to the specific, predictable, and sufficient  X 4mechanisms established by the Commission to preserve and advance universal service."@/ ~ yO'ԍ 47 U.S.C.  254(d).@ Although the Commission's rules permit carriers to pass through all or part of their universal service contributions to their endusers in customer bills, the statutory requirement to  Xy4contribute is not dependent upon a carrier's ability successfully to do so.T0\y {O8'ԍ See Universal Service Order, 12 FCC Rcd at 921012, paras. 853857; FederalState Joint Board on  {O'Universal Service, United Native American Telecommunications, Inc. Request for Waiver, CC Docket No. 9645, Memorandum Opinion and Order, 13 FCC Rcd. 22438 (1998).T Carriers have the  Xb4flexibility to decide how they recover their contributions.k1b2  {OE'ԍ Universal Service Order, 12 FCC Rcd at 921012, para. 853. k Moreover, the record on these claims are little more than mere assertions, and thus, insufficient for finding special circumstances. Accordingly, we reject Startec's contention that its claimed inability to pass through its contribution requirement is a special circumstance justifying grant of a waiver.  X' B. Forbearance   X4 13.` ` Although the Commission has the authority to refrain from enforcing the contribution requirements of section 54.706 of the Commission's rules, pursuant to the forbearance authority of section 10 of the Act, we decline to do so in this instance because" 10*%%"  X4Startec has not met the statutory standard for the grant of forbearance.G2 {Oy'ԍ See 47 U.S.C.  160.G Section 10(a) of the Act sets forth a three-part standard to be applied in addressing petitions for forbearance. A carrier may petition the Commission for forbearance from any statutory provision or regulation, and the Commission shall grant such petition if it determines that: (1) enforcement of the requirement is not necessary to ensure that rates are just and reasonable, and are not unjustly and unreasonably discriminatory; (2) the regulation is not necessary to  Xv4protect consumers; and (3) forbearance is consistent with the public interest.33vZ {O 'ԍ Id.3 In evaluating whether forbearance is consistent with the public interest, we must consider whether forbearance from enforcing the provision or regulation will promote competitive market conditions, including the extent to which forbearance will enhance competition among  X 4providers.J4  {O'ԍ See 47 U.S.C.  160(b).J In making this assessment, we may consider the benefits a regulation bestows upon the public, along with any potential detrimental effects or costs of enforcing a provision.  X 4 14.` ` Startec's petition does not address specifically any of the standards for forbearance, nor set forth any substantive showing that would support the findings required by section 10 to justify exercise of our forbearance authority. Startec generally claims that, because it is a minorityrun business that caters to underserved minority residential  Xy4communities, the public interest would be served by granting its request.?5y~ yO'ԍ Startec Request at 2.? As discussed above, Startec has failed to establish that granting its request for waiver is in the public interest; for the same reasons we also find that Startec has failed to establish that granting forbearance is consistent with the public interest. Given that Startec has failed to show that forbearance from application of section 54.706 would serve the public interest, we find that it  X4is not necessary to provide an analysis of the remaining requirements of section 10 of the Act. Based upon the foregoing, we conclude that Startec does not meet the requirements for waiver or forbearance.  X4  ` `  X4V ORDERING CLAUSE ă  X|415.` ` Accordingly, IT IS ORDERED, that, pursuant to the authority contained in sections 14, 10, 201205, 254, 303(r), and 405 of the Communications Act of 1934, as amended, 47 U.S.C.  151154, 160, 201205, 254, 303(r), and 405, and section 1.3 of the Commission's rules, 47 C.F.R.  1.3 , the Request for Forbearance or Exemption from the Universal Service Contribution Requirement filed by Startec Global Communications"  50*%%I" Corporation, IS DENIED.   ` `  ,hh]FEDERAL COMMUNICATIONS COMMISSION ` ` ,hh]Magalie Roman Salas ` ` ,hh]Secretary