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Proposed Rule2023-13040

Review of International Authorizations To Assess Evolving National Security, Law Enforcement, Foreign Policy, and Trade Policy Risks; Amendment of the Schedule of Application Fees

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Published

August 1, 2023

Issuing agencies

Federal Communications Commission

Abstract

The Federal Communications Commission (Commission) takes another important step to protect the nation's telecommunications infrastructure from threats in an evolving national security and law enforcement landscape by proposing comprehensive changes to the Commission's rules that allow carriers to provide international telecommunications service. The Commission proposes rules that would require carriers to renew, every 10 years, their international authorizations. In the alternative, the Commission seeks comment on adopting rules that would require all international authorization holders to periodically update information enabling the Commission to review the public interest and national security implications of those authorizations based on that updated information. Through these proposals, the Commission seeks to ensure that the Commission is exercising appropriate oversight of international authorization holders to safeguard U.S. telecommunications networks.

Full Text

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[Federal Register Volume 88, Number 146 (Tuesday, August 1, 2023)]
[Proposed Rules]
[Pages 50486-50532]
From the Federal Register Online via the Government Publishing Office [<a href="http://www.gpo.gov">www.gpo.gov</a>]
[FR Doc No: 2023-13040]

[[Page 50485]]

Vol. 88

Tuesday,

No. 146

August 1, 2023

Part IV

Federal Communications Commission

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47 CFR Parts 1 and 63

Review of International Authorizations To Assess Evolving National
Security, Law Enforcement, Foreign Policy, and Trade Policy Risks;
Amendment of the Schedule of Application Fees; Proposed Rule

Federal Register / Vol. 88 , No. 146 / Tuesday, August 1, 2023 /
Proposed Rules

[[Page 50486]]

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FEDERAL COMMUNICATIONS COMMISSION

47 CFR Parts 1 and 63

[IB Docket No. 23-119, MD Docket No. 23-134; FCC 23-28; FR ID 143248]

Review of International Authorizations To Assess Evolving
National Security, Law Enforcement, Foreign Policy, and Trade Policy
Risks; Amendment of the Schedule of Application Fees

AGENCY: Federal Communications Commission.

ACTION: Proposed rule.

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SUMMARY: The Federal Communications Commission (Commission) takes
another important step to protect the nation's telecommunications
infrastructure from threats in an evolving national security and law
enforcement landscape by proposing comprehensive changes to the
Commission's rules that allow carriers to provide international
telecommunications service. The Commission proposes rules that would
require carriers to renew, every 10 years, their international
authorizations. In the alternative, the Commission seeks comment on
adopting rules that would require all international authorization
holders to periodically update information enabling the Commission to
review the public interest and national security implications of those
authorizations based on that updated information. Through these
proposals, the Commission seeks to ensure that the Commission is
exercising appropriate oversight of international authorization holders
to safeguard U.S. telecommunications networks.

DATES: Comments are due on or before August 31, 2023; and reply
comments are due on or before October 2, 2023. Written comments on the
Paperwork Reduction Act proposed information collection requirements
must be submitted by the public, Office of Management and Budget (OMB),
and other interested parties on or before October 2, 2023.

ADDRESSES: You may submit comments, identified by IB Docket No. 23-119
and MD Docket No. 23-134, by any of the following methods:
<bullet> Federal Communications Commission's Website: <a href="http://apps.fcc.gov/ecfs/">http://apps.fcc.gov/ecfs/</a>. Follow the instructions for submitting comments.
<bullet> Mail: Parties who choose to file by paper must file an
original and one copy of each filing.
[cir] Filings can be sent by commercial overnight courier, or by
first-class or overnight U.S. Postal Service mail. All filings must be
addressed to the Commission's Secretary, Office of the Secretary,
Federal Communications Commission. Commercial overnight mail (other
than U.S. Postal Service Express Mail and Priority Mail) must be sent
to 9050 Junction Drive, Annapolis Junction, MD 20701. U.S. Postal
Service first-class, Express, and Priority mail must be addressed to 45
L Street NE, Washington, DC 20554.
<bullet> People with Disabilities: Contact the FCC to request
reasonable accommodations (accessible format documents, sign language
interpreters, CART, etc.) by email: <a href="/cdn-cgi/l/email-protection#d0969393e5e0e490b6b3b3feb7bfa6">[email&#160;protected]</a> or phone: 202-418-
0530 or TTY: 202-418-0432.
For detailed instructions for submitting comments and additional
information on the rulemaking process, see the SUPPLEMENTARY
INFORMATION section of this document.
Find this particular information collection by selecting
``Currently under 60-day Review--Open for Public Comments'' or by using
the search function. Your comment must be submitted into
<a href="http://www.reginfo.gov">www.reginfo.gov</a> per the above instructions for it to be considered. In
addition to submitting in <a href="http://www.reginfo.gov">www.reginfo.gov</a> also send a copy of your
comment on the proposed information collection to Cathy Williams, FCC
or Nicole Ongele, via email to <a href="/cdn-cgi/l/email-protection#68383a29280e0b0b460f071e">[email&#160;protected]</a> and to
<a href="/cdn-cgi/l/email-protection#662507120e1f48310f0a0a0f070b152600050548010910">[email&#160;protected]</a> or <a href="/cdn-cgi/l/email-protection#56183f35393a3378193831333a331630353578313920">[email&#160;protected]</a>. Include in the
comments the OMB control number 3060-0686.

FOR FURTHER INFORMATION CONTACT: Gabrielle Kim, Office of International
Affairs, Telecommunications and Analysis Division, at (202) 418-0730 or
via email at <a href="/cdn-cgi/l/email-protection#c285a3a0b0aba7aeaea7ec89abaf82a4a1a1eca5adb4">[email&#160;protected]</a>. For additional information
concerning the Paperwork Reduction Act information collection
requirements contained in this document, send an email to <a href="/cdn-cgi/l/email-protection#7f2f2d3e3f191c1c51181009">[email&#160;protected]</a>
or contact Cathy Williams, Office of Managing Director, at (202) 418-
2918 or <a href="/cdn-cgi/l/email-protection#b3f0d2c7dbca9de4dadfdfdad2dec0f3d5d0d09dd4dcc5">[email&#160;protected]</a>.

SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Notice
of Proposed Rulemaking, FCC 23-28, adopted on April 20, 2023, and
released on April 25, 2023. The full text of this document is available
on the Commission's website at <a href="https://docs.fcc.gov/public/attachments/FCC-23-28A1.pdf">https://docs.fcc.gov/public/attachments/FCC-23-28A1.pdf</a>. This Notice of Proposed Rulemaking is adopted pursuant
to sections 4(i), 4(j), 201, 214, 218, 219, 403, and 413 of the
Communications Act of 1934, as amended, 47 U.S.C. 154(i), 154(j), 201,
214, 218, 219, 403, and 413.
To request materials in accessible formats for people with
disabilities, send an email to <a href="/cdn-cgi/l/email-protection#5a1c19196f6a6e1a3c3939743d352c">[email&#160;protected]</a> or call the Consumer &
Governmental Affairs Bureau at (202) 418-0530 (voice), (202) 418-0432
(TTY).
Pursuant to Sec. Sec. 1.415 and 1.419 of the Commission's rules,
47 CFR 1.415, 1.419, interested parties may file comments and reply
comments on or before the dates indicated on the first page of this
document. Comments may be filed using the Commission's Electronic
Comment Filing System (ECFS). See Electronic Filing of Documents in
Rulemaking Proceedings, 63 FR 24121 (1998).
<bullet> Electronic Filers: Comments may be filed electronically
using the internet by accessing the ECFS: <a href="http://apps.fcc.gov/ecfs/">http://apps.fcc.gov/ecfs/</a>.
<bullet> Paper Filers: Parties who choose to file by paper must
file an original and one copy of each filing.
<bullet> Filings can be sent by commercial overnight courier, or by
first-class or overnight U.S. Postal Service mail. All filings must be
addressed to the Commission's Secretary, Office of the Secretary,
Federal Communications Commission.
<bullet> Commercial overnight mail (other than U.S. Postal Service
Express Mail and Priority Mail) must be sent to 9050 Junction Drive,
Annapolis Junction, MD 20701. U.S. Postal Service first-class, Express,
and Priority mail must be addressed to 45 L Street NE, Washington, DC
20554.
<bullet> Effective March 19, 2020, and until further notice, the
Commission no longer accepts any hand or messenger delivered filings.
This is a temporary measure taken to help protect the health and safety
of individuals, and to mitigate the transmission of COVID-19. See FCC
Announces Closure of FCC Headquarters Open Window and Change in Hand-
Delivery Policy, Public Notice, DA 20-304 (March 19, 2020). <a href="https://www.fcc.gov/document/fcc-closes-headquarters-open-window-and-changes-hand-delivery-policy">https://www.fcc.gov/document/fcc-closes-headquarters-open-window-and-changes-hand-delivery-policy</a>.
The proceeding this Notice initiates shall be treated as a
``permit-but-disclose'' proceeding in accordance with the Commission's
ex parte rules.\1\ Persons making ex parte presentations must file a
copy of any written presentation or a memorandum summarizing any oral
presentation within two business days after the presentation (unless a
different deadline applicable to the Sunshine period applies). Persons
making oral ex parte presentations are reminded that memoranda
summarizing the

[[Page 50487]]

presentation must (1) list all persons attending or otherwise
participating in the meeting at which the ex parte presentation was
made, and (2) summarize all data presented and arguments made during
the presentation. If the presentation consisted in whole or in part of
the presentation of data or arguments already reflected in the
presenter's written comments, memoranda or other filings in the
proceeding, the presenter may provide citations to such data or
arguments in his or her prior comments, memoranda, or other filings
(specifying the relevant page and/or paragraph numbers where such data
or arguments can be found) in lieu of summarizing them in the
memorandum. Documents shown or given to Commission staff during ex
parte meetings are deemed to be written ex parte presentations and must
be filed consistent with rule 1.1206(b). In proceedings governed by
rule 1.49(f) or for which the Commission has made available a method of
electronic filing, written ex parte presentations and memoranda
summarizing oral ex parte presentations, and all attachments thereto,
must be filed through the electronic comment filing system available
for that proceeding, and must be filed in their native format (e.g.,
.doc, .xml, .ppt, searchable .pdf). Participants in this proceeding
should familiarize themselves with the Commission's ex parte rules.
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\1\ 47 CFR 1.1200 et seq.
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Initial Paperwork Reduction Act of 1995 Analysis

This document contains proposed information collection
requirements. The Commission, as part of its continuing effort to
reduce paperwork burdens, invites the general public and the Office of
Management and Budget (OMB) to comment on the information collection
requirements contained in this document, as required by the Paperwork
Reduction Act of 1995, Public Law 104-13. Public and agency comments
are due October 2, 2023.
Comments should address: (a) whether the proposed collection of
information is necessary for the proper performance of the functions of
the Commission, including whether the information shall have practical
utility; (b) the accuracy of the Commission's burden estimates; (c)
ways to enhance the quality, utility, and clarity of the information
collected; (d) ways to minimize the burden of the collection of
information on the respondents, including the use of automated
collection techniques or other forms of information technology; and (e)
ways to further reduce the information collection burden on small
business concerns with fewer than 25 employees. In addition, pursuant
to the Small Business Paperwork Relief Act of 2002, Public Law 107-198,
see 44 U.S.C. 3506(c)(4), the Commission seeks specific comment on how
the Commission might further reduce the information collection burden
for small business concerns with fewer than 25 employees.

Synopsis

I. Notice of Proposed Rulemaking

1. This document seeks comment on proposed rules and possible
alternative approaches, including alternatives for small entities, that
will further the Commission's goal of ensuring that the Commission
continually accounts for evolving public interest considerations
associated with international section 214 authorizations following an
initial grant of the authority. First, the Commission proposes to
cancel the authorizations of those international section 214
authorization holders that fail to respond to the one-time collection
requirement adopted in the Order. Second, the Commission proposes to
adopt a 10-year renewal framework for the Commission's reassessment of
all authorizations or, in the alternative, seek comment on a formalized
periodic review of such authorizations. Third, the Commission proposes
to adopt a process that prioritizes renewal applications with foreign
ownership to regularly reassess any evolving national security, law
enforcement, foreign policy, and/or trade policy concerns, as opposed
to reviewing international section 214 authorizations only on an ad hoc
basis. The Commission intends to continue to collaborate with the
relevant Executive Branch agencies and to refer matters to the
Executive Branch agencies, including the Committee, where warranted.
The Commission seeks comment on categorizing applications to minimize
burdens on the relevant Executive Branch agencies, including the
Committee. Fourth, the Commission proposes or seeks comment on new
application rules to capture critical information from all applicants
with and without reportable foreign ownership not currently collected
and to require additional certifications. Fifth, to further ensure that
carriers' use of their international section 214 authority is in the
public interest, the Commission proposes and seeks comment on
modifications to related Parts 1 and 63 rules. Finally, the Commission
invites comment on the costs and benefits of the proposed rules and any
alternatives.

A. Failure To Timely Respond to One-Time Information Collection

2. In the Order, the Commission directs each authorization holder
to identify its 10% or greater direct or indirect foreign interest
holders (reportable foreign ownership), as of thirty (30) days prior to
the filing deadline. If an international section 214 authorization
holder fails to timely respond to the information collection required
in the Order, the Commission proposes to cancel its authorization. The
Commission would deem the failure to respond to the Order as
presumptive evidence that the authorization holder is no longer in
operation. The Commission proposes to publish a list of non-responsive
authorization holders in the Federal Register and provide an additional
30 days from that publication for those authorization holders to
respond to the information collection requirement or surrender the
authorization. If an authorization holder has not responded within 30
days of the publication of the notice in the Federal Register, the
Commission proposes that those authorizations would be automatically
cancelled. The Commission notes that authorization holders that fail to
comply with the information collection required in the Order are
subject to forfeitures in addition to cancellation. The Commission
tentatively finds this proposal is reasonable and necessary to ensure
the accuracy of the Commission's records regarding international
section 214 authorization holders and in consideration of the
Commission's need to implement a renewal or, in the alternative,
periodic review process with administrative efficiency.
3. The Commission proposes that any authorization holder whose
authorization is cancelled for failure to timely respond to the
information collection may file a petition for reinstatement nunc pro
tunc of the authorization. The Commission proposes that a petition for
reinstatement will be considered: (1) if it is filed within six months
after publication of the Federal Register notice; (2) if the petition
demonstrates that the authorization holder is currently in operation
and has customers; and (3) if the petition demonstrates good cause for
the failure to timely respond. The Commission proposes that an
authorization holder whose authorization is cancelled under these
procedures would be able to file an application for a new international

[[Page 50488]]

214 authorization in accordance with the Commission's rules, which
would be subject to full review. The Commission seeks comment on the
cancellation process generally and if there are any proposals to assist
small entities. Should there be any other procedural requirements if an
authorization holder does not file a petition for reinstatement within
six months after publication of the Federal Register notice? The
Commission seeks comment whether these procedures would provide non-
responsive authorization holders with sufficient due process and notice
and opportunity to respond.

B. International Section 214 Renewal or Periodic Review Requirements

1. Legal Authority
4. Legal Authority. As described below, the Commission proposes to
adopt a 10-year renewal requirement for all international section 214
authorization holders, whereby those authorization holders must
periodically demonstrate that their authorization continues to serve
the public interest, and such authorization would expire following
appropriate proceedings if the holder fails to meet that burden. In the
alternative, the Commission seeks comment on adopting a periodic review
process whereby international section 214 authorization holders must
periodically submit similar information demonstrating that their
authorization continues to serve the public interest, and the
Commission or the Office of International Affairs could institute a
revocation proceeding if the holder fails to meet that burden. As a
threshold matter, the Commission tentatively finds that it has the
authority to require the renewal of international section 214
authorizations. The Commission also tentatively concludes that it has
the authority to adopt a periodic review process as an exercise of its
power to revoke authorizations.
5. The Commission tentatively concludes that it has direct and
ancillary authority under sections 4(i), 201(b), and 214 of the Act--
individually and collectively--to adopt terms and conditions of service
for international section 214 authorizations, including time limits on
an authorization, and to cancel an authorization through non-renewal of
the international section 214 authority where the Commission determines
that the public interest so requires. Section 214 of the Act does not
expressly require the renewal of section 214 authorizations unlike
section 307(c), which permits the Commission to prescribe license terms
by rule, except that broadcast license terms may not exceed eight
years. Although section 214 does not expressly provide for renewal of
authorizations, section 214(c) affords the Commission discretion to
grant the authority requested or ``refuse'' to do so, and the
Commission may condition any grant on ``such terms and conditions as in
its judgment the public convenience and necessity may require.'' In
addition, under section 4(i), the Commission has broad authority to
adopt rules, not inconsistent with the Act, ``as may be necessary in
the execution of its functions.'' Under section 201(b) the Commission
has broad general grant of rulemaking authority to ``prescribe such
rules and regulations as may be necessary in the public interest to
carry out the provisions of this [Act].'' \2\
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\2\ 47 U.S.C. 201(b). Indeed, in upholding Commission's exercise
of ancillary jurisdiction pursuant to section 201(b), the Supreme
Court stated in AT&T v. Iowa Utilities Board that ``[w]e think that
the grant in Sec. 201(b) means what it says: The FCC has rulemaking
authority to carry out the `provisions of this Act.' '' 525 U.S.
366, 378 (1999).
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6. Section 214(a) of the Act prohibits any carrier from
constructing, acquiring, or operating any line, and from engaging in
transmission through any such line, without first obtaining a
certificate from the Commission ``that the present or future public
convenience and necessity require or will require the construction, or
operation, or construction and operation, of such . . . line . . . .''
Thus, the Act requires the Commission to ensure that not only the
``construction'' of the line, but also its ``operation,'' further the
public convenience and necessity. In addition, the Act requires the
Commission to ensure that not only the present, but also the future
operations of a telecommunications carrier authorized to provide
service under section 214, further the public convenience and
necessity. Promotion of national security is an integral part of the
Commission's public interest responsibility, including its
administration of section 214 of the Act and one of the core purposes
for which Congress created the Commission.\3\ In recent revocation
actions, the Commission has found, given established statutory
directives and longstanding Commission determinations, that it has
authority to revoke section 214 authority. By the same reasoning, the
Commission tentatively finds that it has the authority to require the
renewal and/or periodic review of a carrier's international section 214
authority to ensure that the public convenience and necessity continues
to be served by the carrier's operations.
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\3\ Section 1 of the Act provides that Congress created the
Commission, among other reasons, ``for the purpose of the national
defense [and] for the purpose of promoting safety of life and
property through the use of wire and radio communications . . . .''
47 U.S.C. 151; see, e.g., China Telecom Americas Order on Revocation
and Termination, 36 FCC Rcd at 15968, paragraph 3, aff'd, China
Telecom (Americas) Corp. v. FCC; China Unicom Americas Order on
Revocation at *2, paragraph 3; Pacific Networks/ComNet Order on
Revocation and Termination at *2, paragraph 3; Protecting Against
National Security Threats Order, 34 FCC Rcd 11423, aff'd, Huawei
Technologies USA, Inc. v. FCC, 2 F.4th 421, 439; 2022 Protecting
Against National Security Threats Order.
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7. In addition, section 214(c) of the Act permits the Commission to
``attach to the issuance of the [section 214] certificate such terms
and conditions as in its judgment the public convenience and necessity
may require.'' In granting all telecommunications carriers blanket
domestic section 214 authority, the Commission found that the ``present
and future public convenience and necessity require the construction
and operation of all domestic new lines pursuant to blanket
authority,'' subject to the Commission's ability to revoke a carrier's
section 214 authority when warranted to protect the public interest.\4\
Likewise, when the Commission opened the U.S. telecommunications market
to foreign participation in the late 1990s, it delineated a non-
exhaustive list of circumstances where it reserved the right to
designate for revocation an international section 214 authorization
based on public interest considerations and stated that it considers
``national security'' and ``foreign policy'' concerns when granting
authorizations under section 214 of the Act.\5\ Thus, carriers

[[Page 50489]]

are granted a section 214 authorization subject to the Commission's
reserved power to revoke those authorizations if later circumstances
warrant. Likewise, the Commission tentatively finds that under section
214(c) the Commission has reserved the power to adopt terms and
conditions for authorizations granted under section 214 of the Act,
such as requiring the renewal or other review of carriers'
international section 214 authority, as the public convenience and
necessity may require in order to provide the Commission the
opportunity to assess whether an authorized telecommunications carrier
and its operations raise national security, foreign policy, and/or
trade policy concerns.
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\4\ China Telecom Americas Order on Revocation and Termination,
36 FCC Rcd at 15968 through 69, paragraph 4, aff'd, China Telecom
(Americas) Corp. v. FCC; China Unicom Americas Order on Revocation
at *2, 9, paragraphs 4, 24; Pacific Networks/ComNet Order on
Revocation and Termination at *2, paragraph 4; Domestic 214 Blanket
Authority Order, 14 FCC Rcd at 11374, paragraph 16. The Commission
has explained that it grants blanket section 214 authority, rather
than forbearing from application or enforcement of section 214
entirely, in order to remove barriers to entry without relinquishing
its ability to protect consumers and the public interest by
withdrawing such grants on an individual basis. Id. at 11372 through
73, 11374, paragraphs 12 through 14, 16.
\5\ China Telecom Americas Order on Revocation and Termination,
36 FCC Rcd at 15968 through 99, paragraph 4, aff'd, China Telecom
(Americas) Corp. v. FCC; China Unicom Americas Order on Revocation
at *2, 9, paragraphs 4, 24; Pacific Networks/ComNet Order on
Revocation and Termination at *2, paragraph 4; Foreign Participation
Order, 12 FCC Rcd at 23896, 23919 through 20, paragraphs 9, 61
through 63. With regard to revocation of an international section
214 authorization, the Commission in the Foreign Participation Order
and the Reconsideration Order delineated a non-exhaustive list of
circumstances where it reserved the right to designate for
revocation an international section 214 authorization based on
public interest considerations. See, e.g., Foreign Participation
Order, 12 FCC Rcd at 24023, paragraph 295; Reconsideration Order, 15
FCC Rcd at 18173, 18175 through 76, paragraphs 28, 35; see also 47
CFR 63.11(g)(2); 2014 Foreign Carrier Entry Order, 29 FCC Rcd at
4259, 4266, paragraphs 6, 22. In the Foreign Participation Order,
the Commission also stated it considers ``national security'' and
``foreign policy'' concerns when granting authorizations under
section 214 of the Act. Foreign Participation Order, 12 FCC Rcd at
23919 through 20, paragraphs 61 through 63 (in regulating foreign
participation in the U.S. telecom market in the late 1990s, the
Commission recommitted to considering ``national security'' and
``foreign policy'' concerns when granting licenses under section
310(b)(4) and authorizations under section 214(a) of the Act,
stating it would also continue to ``accord deference'' to expert
Executive Branch views on these issues that would inform its
``public interest analysis'').
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8. The Commission tentatively finds that section 4(i) of the Act
provides further support for the Commission's authority to require
renewal, or periodic review, of international section 214
authorizations. Section 4(i) authorizes the Commission to ``perform any
and all acts, make such rules and regulations, and issue such orders,
not inconsistent with this Act, as may be necessary in the execution of
its functions.'' The Commission has long found that section 4(i)
``supports revocation authority, as reasonably ancillary to the
Commission's authority to authorize common carrier service in the first
instance.'' As the Commission explained, revocation authority ``is
necessary to ensure not only compliance with the Commission's rules and
its requirements for truthfulness, but also that circumstances with
serious national security and law enforcement consequences that would
have been relevant in determining whether to authorize service remain
relevant in light of significant developments since the time of such
authorization.'' For these same reasons, the Commission tentatively
finds that the authority to refuse renewal of or require periodic
review of carriers' international section 214 authority is at least
``reasonably ancillary'' to the performance of the Commission's
responsibilities under section 214 of the Act to ensure that a
carrier's operations remain consonant with the ``public convenience and
necessity.''
9. The Commission seeks comment on its legal analysis and whether
these statutory provisions give the Commission broad flexibility to
promulgate regulations--such as a renewal or, in the alternative, a
periodic review process for international section 214 authorizations--
that may not be expressly identified in precise terms where necessary
to carry out the Commission's regulatory responsibilities under section
214 consistent with the purposes of the Act, such as promoting national
security.\6\ At a minimum, would such rules be ``reasonably ancillary
to the effective performance of the Commission's various
responsibilities . . . .''? \7\ The Commission also seeks comment on
whether other statutory provisions provide a legal basis for adopting
the renewal or in the alternative, a periodic review process outlined
below. Would the Commission have authority to institute one of the
proposals--period renewal or periodic review--but not the other?
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\6\ See, e.g., United States v. Southwestern Cable Co., 392 U.S.
157, 178 (1968) (upholding the Commission's authority to regulate
cable television).
\7\ Southwestern Cable, 392 U.S. at 178; see also AT&T v. Iowa
Utilities Board, 525 U.S. at 380 (noting that `` `ancillary'
jurisdiction . . . could exist even where the Act does not `apply'
'') (emphasis in original).
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10. Due Process and Retroactivity. As noted below, the Commission
seeks comment on whether all international section 214 authorizations
regardless of issuance date and ownership should be subject to renewal
or, in the alternative, periodic review process. Because the renewal
framework the Commission proposes to adopt will affect both existing
authorization holders and authorizations held pursuant to applications
granted, after the effective date of the renewal rules, the Commission
seeks comment on due process and retroactivity concerns--including
``primary'' versus ``secondary'' retroactivity--that may arise from
this proposal.\8\ Specifically, the Commission seeks comment on the
interplay between renewal standards and retroactivity concerns.
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\8\ See, e.g., Mobile Relay Assocs. v. FCC, 457 F.3d 1, 11 (D.C.
Cir. 2006) (non-renewal resulting from a new regulatory framework
may ``upset[ ] expectations based on prior law,'' but that is not
primarily retroactive).
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11. The courts have established a distinction for rules between
``primary'' retroactivity and ``secondary'' retroactivity. A rule is
primarily retroactive if it (1) ``increase[s] a party's liability for
past conduct''; (2) ``impair[s] rights a party possessed when he
acted''; or (3) ``impose[s] new duties with respect to transactions
already completed.'' The standard for primary retroactivity assesses
whether a rule has changed the past legal consequences of past actions.
In contrast, a rule would be ``secondarily'' retroactive if it
``affects a regulated entity's investment made in reliance on the
regulatory status quo before the rule's promulgation.'' Secondary
retroactivity will be upheld ``if it is reasonable.''
12. The Commission tentatively concludes that the renewal framework
the Commission proposes here is not ``primarily'' retroactive as
applied to applications granted after the effective date of any new
rules, as the mere adoption of such a requirement would not make past
conduct unlawful, alter rights the carrier had at the time an
application was granted, or impose new duties with respect to completed
transactions. For the same reasons, the Commission does not believe a
renewal requirement as applied to existing authorization holders would
be primarily retroactive--for example, because the Commission may
revoke a section 214 authorization, grant of an application does not
confer a permanent authorization. The Commission recognizes, however,
that such a requirement could upset the expectations of existing
authorization holders. To the extent the Commission's proposed renewal
process constitutes ``secondary'' retroactivity, the Commission
tentatively concludes it is reasonable and does not violate the
Administrative Procedure Act as, among other things, the proposed
renewal framework would simply provide for a more systematic review
process that focuses on evolving national security, law enforcement,
foreign policy, and/or trade policy concerns. The Commission seeks
comment on its tentative conclusions. When and under what circumstances
would denial of a renewal application trigger primary or secondary
retroactivity concerns? For example, would non-renewal of an
international section 214 authorization based on evolving national
security, law enforcement, foreign policy, and/or trade policy risks,
regardless of that authorization holder's ongoing compliance with the
Commission's rules, have primary or secondary

[[Page 50490]]

retroactive effect? Additionally, would the application of renewal or,
in the alternative, periodic review procedures to existing
authorization holders require different standards or procedures based
on retroactivity, reliance interests, or fair notice concerns?
2. Need for International Section 214 Renewal Requirements
13. The Commission's principal goal in this proceeding is to adopt
a renewal process or, in the alternative, a formalized periodic review
of international section 214 authorizations to assess evolving national
security, law enforcement, foreign policy, and/or trade policy risks.
As the Senate Subcommittee noted in the PSI Report, ``[n]ational
security and law enforcement concerns, as well as trade, and foreign
policy concerns . . . are ever evolving, meaning that an authorization
granted in one year may not continue to serve the public interest years
later.'' The PSI Report stated, ``[a]uthorizations effectively exist in
perpetuity despite evolving national security implications,'' yet
``[t]he FCC does not require a foreign carrier's authorization to be
periodically reassessed to confirm the services continue to serve the
public interest.''
14. The Commission tentatively concludes that adopting a systemized
renewal or, in the alternative, formalized periodic review process for
international section 214 authorizations would better enable the
Commission to ensure that an authorization, once granted, continues to
serve the public interest. While neither the proposed renewal process
nor a formalized periodic review process would supplant the
Commission's existing authority to conduct ad hoc review of whether a
carrier's retention of international section 214 authority presents
national security, law enforcement, foreign policy, and/or trade policy
risks that warrant revocation or termination of its international
section 214 authority, this ad hoc review based on current information
collection requirements does not allow the Commission to systematically
and continually account for evolving risks.
15. The Commission tentatively concludes that the proposals in the
Notice would help to ensure that the Commission and the Executive
Branch agencies can continually account for evolving national security,
law enforcement, foreign policy, and/or trade policy risks associated
with the authorizations. As discussed above, the Executive Branch
agencies may recommend that the Commission modify or revoke an existing
authorization if they at any time identify unacceptable risks to
national security, law enforcement, foreign policy, and/or trade
policy.\9\ For instance, in recent years, the Executive Branch agencies
filed a recommendation requesting that the Commission revoke and
terminate a carrier's international section 214 authorizations, stating
that ``[t]his recommendation reflects the substantial and unacceptable
national security and law enforcement risks associated with [China
Telecom (Americas) Corporation's] continued access to U.S.
telecommunications infrastructure pursuant to its international
[s]ection 214 authorizations.''
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\9\ See Executive Branch Recommendation to the Federal
Communications Commission to Revoke and Terminate [China Telecom
(Americas) Corporation's] International Section 214 Common Carrier
Authorizations, File Nos. ITC-214-20010613-00346, ITC-214- 20020716-
00371, ITC-T/C-20070725-00285, at 1-2 (filed Apr. 9, 2020)
(Executive Branch Recommendation to Revoke and Terminate). The
Executive Branch agencies that jointly made this recommendation are
DOJ, DHS, DOD, the Departments of State and Commerce, and USTR. Id.
at 1, n.1. See also Executive Order 13913, 85 FR at 19646 (Sec.
9(b)); see also id. at 19645 (Sec. 6(a)).
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16. With regard to the Executive Branch agencies' oversight of all
authorization holders with mitigation agreements, the PSI Report
nonetheless observed, ``older [mitigation] agreements contained few
provisions, were broad in scope, and provided little for Team Telecom
to verify,'' and ``[w]here Team Telecom did reserve for itself the
right to monitor a foreign carrier's operations in the United States,
it exercised that authority in an ad hoc manner.'' The PSI Report
further noted that although Executive order 13913 ``allows [the
Committee] to review existing authorizations, it does not mandate
periodic review or renewal.'' In view of these concerns, the Commission
believes that a renewal or, in the alternative, periodic review process
would better enable the Commission and the Executive Branch agencies to
reassess and account for evolving national security, law enforcement,
foreign policy, and/or trade policy risks presented by international
section 214 authorization holders in light of updated information about
both the holder and the foregoing risks.
17. While the Commission could simply adopt a basic reporting
mechanism for authorization holders to regularly inform the Commission
of select information such as their current ownership, the Commission
tentatively concludes that a formalized system of renewal or, in the
alternative, periodic review would better ensure that the Commission
conduct periodic and comprehensive review of all authorizations,
including reassessment of any national security, law enforcement,
foreign policy, and/or trade policy concerns. The Commission's review
would be based on the totality of the circumstances presented by each
situation, including additional information as necessary, to determine
whether the public interest continues to be served by an authorization
holder's international section 214 authority. The Commission's proposed
renewal framework would include rule-based conditions as well as any
other appropriate conditions, the breach of which could warrant
revocation or termination. In addition, a carrier's failure to file a
renewal application would cause the authorization to expire
automatically. Thus, a renewal framework is more efficient than case-
by-case review of periodic reports followed by revocation proceedings
where necessary. Additionally, a periodic and systemized reassessment
framework is consistent with Commission's practice in other contexts,
such as broadcast or wireless license renewals. The Commission
tentatively concludes that establishing a similar process will assist
the Commission's ongoing efforts to protect the nation's
telecommunications infrastructure from potential national security, law
enforcement, foreign policy, and/or trade policy threats and ensure
that only those individuals or entities with the requisite character
qualifications have access to this critical infrastructure.
3. Renewal Requirement Applicable to All International Section 214
Authorization Holders
18. The Commission proposes to adopt a renewal framework or, in the
alternative, a formalized periodic review process for all international
section 214 authorization holders, with or without foreign ownership,
to ensure the Commission fully reassesses public interest
considerations associated with all authorization holders. Under this
proposal, all authorization holders would be subject to a renewal
requirement, including authorization holders that have been granted
international section 214 authority prior to the effective date of the
renewal rules and authorization holders that are granted international
section 214 authority after the effective date of the rules. The
Commission proposes, as discussed below, to structure the periodic
reassessment by prioritizing review of authorization holders with
reportable foreign ownership, consistent

[[Page 50491]]

with the Commission's long held view that foreign ownership in the U.S.
telecommunications sector implicates national security, law
enforcement, foreign policy, and/or trade policy considerations. The
Commission also recognizes, in view of evolving and heightened threats
to U.S. telecommunications infrastructure, that national security, law
enforcement, foreign policy, and/or trade policy risks may also be
raised irrespective of whether an authorization holder has foreign
ownership.
19. In this document, the Commission proposes to capture critical
information and require certifications of all applicants for
international section 214 authority and modification, assignment, and
transfer of control of international section 214 authority. The
Commission further proposes to refer to the Executive Branch agencies,
including the Committee, matters that may raise national security, law
enforcement, foreign policy, and/or trade policy concerns to assist the
Commission's public interest determination. The Commission has a
continuing interest in ensuring that all authorization holders, not
only those with reportable foreign ownership, maintain the requisite
character qualifications and continue to comply with the Commission's
rules. Furthermore, as discussed above, it is important for the
Commission to have complete and accurate information concerning all
international section 214 authorization holders, including
identification of those authorization holders that no longer exist or
provide service under their international section 214 authority. The
Commission seeks comment on its proposed approach.
20. The Commission does not address in this proceeding blanket
domestic section 214 authority. Applying a renewal or, in the
alternative, a periodic review process to domestic section 214
authority at this time would delay the implementation of solutions to
the Commission's evolving concerns about international section 214
authorizations given, among other things, that the Commission has
granted blanket section 214 authority for domestic service based on
policy determinations that are beyond the scope of the Commission's
current concerns. The Commission believes the public interest would be
better served by implementing a new framework for review of
international section 214 authorizations as expeditiously as possible.
21. The Commission seeks comment generally on its proposal to
implement a renewal or, in the alternative, periodic review process for
international section 214 authorizations and whether the Commission
should exempt certain authorization holders from either framework. What
would be the justifications for excluding any authorization holders? Do
these justifications outweigh the concerns raised by the Commission,
other U.S. government agencies, and Congress regarding threats to the
security of U.S. telecommunications infrastructure in an evolving
national security and law enforcement environment? Are there any
special considerations applicable to small businesses offering services
pursuant to international section 214 authority? The Commission also
seeks comment on how best to structure a periodic review process to the
extent the Commission decides to apply this alternative to some or all
authorization holders.
4. 10-Year Renewal Timeframe
22. The Commission proposes to adopt a renewal timeframe of 10
years and seeks comment on this proposal. The Commission tentatively
finds that a renewal timeframe of 10 years--in conjunction with the
proposal in this Notice to require authorization holders to provide
updated ownership information, cross border facilities information, and
other information every three years--would ensure that the Commission
and the relevant Executive Branch agencies can continually reassess and
account for evolving national security, law enforcement, foreign
policy, and/or trade policy concerns associated with international
section 214 authorizations. The Commission tentatively concludes that a
10-year timeframe is reasonable under the renewal framework that the
Commission proposes in this document for structuring a formalized and
systemic reassessment of carriers' international section 214 authority.
Moreover, a 10-year timeframe minimizes burdens on authorization
holders and balances the Commission's policy considerations with
administrative efficiency for the Commission and the relevant Executive
Branch agencies, including the Committee.
23. The Commission seeks comment on the Commission's proposed 10-
year renewal timeframe. Would a different timeframe better enable the
Commission to periodically reassess international section 214
authorization holders in consideration of evolving risks and for
compliance with the Act and its implementing rules? The Commission
notes that wireless and broadcast licensees have various renewal terms.
With regard to Miscellaneous Wireless Communications Services (WCS),
the term of a license varies according to different spectrum bands,
which results in different license periods such as 10, 12, or 15 years.
In the context of broadcast licensing, each license granted for the
operation of a broadcasting station is limited to a term not to exceed
eight years. Would a renewal timeframe similar to broadcast or wireless
license renewals, such as 8, 12, or 15 years be more appropriate, and
if so, why? Or would a shorter renewal timeframe, such as 5 years,
better enable the Commission to reassess and account for evolving
risks? The Commission also seeks comment on whether the 10-year period
should reset if an international section 214 authorization holder
undergoes a complete review, such as during the review of a substantive
assignment or transfer of control application.\10\ Commenters should
address the burdens that will be placed on authorization holders based
on the length of the license term. The Commission also proposes below
ongoing reporting requirements in the context of a 10-year renewal
timeframe.
---------------------------------------------------------------------------

\10\ For example, if an entity that is granted an international
section 214 authorization in 2025, so that its 10-year renewal
period would be 2035, files a substantive transfer of control
application which is granted in 2030, should the 10-year renewal
period be reset to 2040?
---------------------------------------------------------------------------

24. The Commission also seeks comment on whether it should adopt a
rule reserving its discretion to issue a shorter renewal timeframe on a
case-by-case basis where the Commission deems it appropriate to require
the authorization holder to seek renewal sooner than otherwise would be
required, or to adopt conditions on renewal where the Commission
determines that renewal otherwise would not be in the public
interest.\11\
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\11\ The Commission notes that its rules expressly preserve the
Commission's discretion to grant individual broadcast station
licenses for less than the standard license term if the public
interest, convenience, and necessity would be served by such action.
See 47 CFR 73.1020(a) (``Both radio and TV broadcasting stations
will ordinarily be renewed for 8 years. However, if the FCC finds
that the public interest, convenience and necessity will be served
thereby, it may issue either an initial license or a renewal thereof
for a lesser term.''); id. 74.15(d) (``Lower power TV and TV
translator station and FM translator station licenses will
ordinarily be renewed for 8 years. However, if the FCC finds that
the public interest, convenience or necessity will be served, it may
issue either an initial license or a renewal thereof for a lesser
term. The FCC may also issue a license renewal for a shorter term if
requested by the applicant.''); 1997 Broadcast License Terms Order,
12 FCC Rcd at 1729, 1739, n.24, Appx. A. See also 47 U.S.C.
309(k)(2) (where applicant fails to meet the standards for renewal,
the Commission may grant the application ``on terms and conditions
as are appropriate, including renewal for a term less than the
maximum otherwise permitted.'').
---------------------------------------------------------------------------

25. The Commission tentatively affirms that, regardless of the
renewal

[[Page 50492]]

timeframe, the Commission would continue to be able to exercise its
existing authority, as it deems necessary, to conduct ad hoc reviews of
international section 214 authorizations at any time during the renewal
period. In other words, adoption of renewal rules does not mean that
the Commission would only review authorizations at such periodic
intervals. For instance, if the Commission were to adopt a renewal
timeframe of 10 years, the Commission might still elect to exercise its
existing authority to review and, if necessary, revoke authorizations
at any time in between the scheduled 10-year renewal proceedings.
26. Periodic Review Alternative. In the alternative, the Commission
seeks comment on whether it should adopt a three-year formalized system
of periodic review. Under this approach, the Commission would
systematically and continually review all authorization holders at
regular intervals to reassess whether their retention of international
section 214 authority continues to serve the public interest or raises
concerns that may warrant revocation of the international section 214
authority. To the extent circumstances in any particular situation
raised such concerns, the Commission could initiate a revocation
proceeding. Thus, in contrast to the renewal framework, an
authorization would not be cancelled if the Commission determined that
retention of the authorization was not in the public interest. Instead,
the authorization would continue by default subject to the Commission
instituting a revocation proceeding.
27. The Commission seeks comment generally on this approach and on
the appropriate timeframe. The Commission seeks comment on whether it
should adopt this approach for all authorization holders, regardless of
whether their international section 214 authority is granted prior to
or after the effective date of new rules adopted in this proceeding.
What other options should the Commission consider with regard to a
periodic review process given evolving national security, law
enforcement, foreign policy, and/or trade policy risks? As noted with
respect to the renewal approach, the Commission also tentatively
affirms that it retains discretion to review international section 214
authorizations at any time the Commission deems such action to be
necessary in the public interest, regardless of when a carrier's
authorization may be scheduled for periodic review.
28. Bifurcated Process. The Commission also seeks comment on
whether it should adopt a bifurcated process for authorization holders
depending on whether their international section 214 authority is
granted prior to or after the effective date of new rules adopted in
this proceeding. Specifically, should the Commission adopt a 10-year
renewal framework, as proposed above, for authorization holders whose
international section 214 application is granted after the effective
date of new rules adopted in this proceeding? At the same time, should
the Commission adopt a three-year formalized periodic review process
for authorization holders whose international section 214 authority was
or is granted prior to the effective date of rules adopted in this
proceeding?
5. Application of New Framework
29. Authorizations Granted After Effective Date of Rules. With
respect to authorization holders whose international section 214
authority is granted after the effective date of new rules adopted in
this proceeding, the Commission tentatively finds that it may implement
a renewal requirement, if adopted, pursuant to its statutory authority
under section 214 of the Act to attach terms and conditions to the
grant of international section 214 authority. Section 214(c) of the Act
permits the Commission to ``attach to the issuance of the [section 214]
certificate such terms and conditions as in its judgment the public
convenience and necessity may require.'' If the Commission were to
adopt a renewal framework, these authorization holders would be subject
to a renewal requirement as a condition of their international section
214 authority. The Commission would either grant or deny an application
to renew the international section 214 authority. The Commission seeks
comment on this proposed approach.
30. Authorization Holders With Existing Authorizations Before
Effective Date of Rules. With respect to authorization holders whose
international section 214 authority was or is granted prior to the
effective date of new rules adopted in this proceeding, the Commission
tentatively finds that it may apply a similar renewal requirement
pursuant to its statutory authority under sections 214, 201, and 4(i)
of the Act, but that a denial of an application to renew a carrier's
existing international section 214 authority granted prior to the
effective date of any new rules would entail the same process that is
due in a case of revocation. If the Commission were to apply a renewal
requirement to these authorization holders, the Commission would either
grant or deny an application to renew the international section 214
authority. A denial of such renewal application, however, would
functionally be a revocation of an authorization holder's existing
authority and require the same process that is due in a case of
revocation, including notice and opportunity to respond. The Commission
seeks comment on this proposed approach.
31. Other Matters. The Commission seeks comment on whether an
existing authorization that is subject to a substantial and/or pro
forma assignment or transfer of control should be considered a new
authorization for purposes of adopting terms and conditions for that
authorization, such as requiring the renewal of the international
section 214 authority. The Commission also seeks comment as to whether
and/or how a carrier's domestic blanket section 214 authority should be
affected if the Commission were to deny the renewal of the carrier's
international section 214 authority or revoke the carrier's
international section 214 authority.
6. Public Interest Standard
32. Renewals. The Commission tentatively concludes that it will
apply the same standard of review for applications for renewal of
international section 214 authority as that applied to initial
applications for international section 214 authority and to
applications for modification, assignment, or transfer of control of
international section 214 authority. Consistent with the Commission's
public interest review of these applications, the Commission's grant of
an application for renewal of international section 214 authority will
be based on a finding by the Commission that the public interest,
convenience, and necessity would be served by the renewal of that
authority. The Commission also proposes to codify the same standard of
review for initial applications for international section 214 authority
and to applications for modification, assignment, or transfer of
control of international section 214 authority. As discussed above, the
Commission has long found that national security, law enforcement,
foreign policy, and trade policy concerns are important to its public
interest analysis of international section 214 authority, and these
concerns warrant continued consideration of the public interest in view
of evolving and heightened threats to the nation's telecommunications
infrastructure. Accordingly, the Commission proposes

[[Page 50493]]

that it, as part of its public interest analysis, will examine the
totality of the circumstances in each renewal application and consider,
as its primary concerns, national security, law enforcement, foreign
policy, and/or trade policy concerns, including in relation to an
applicant's reportable foreign ownership as reflected by the
Commission's proposal to structure the renewal process based on
reportable foreign ownership.\12\ Furthermore, the Commission has found
that although a section 214 application from a World Trade Organization
(WTO) Member applicant is entitled to a rebuttable presumption that
grant of the application is in the public interest on competition
grounds, ``no such presumption applies to national security and law
enforcement concerns, which are separate, independent factors the
Commission considers in its public interest analysis.'' The Commission
tentatively finds that consideration of these issues is consistent with
its longstanding practice and its ongoing responsibility to evaluate
all aspects of the public interest, including any national security,
law enforcement, foreign policy, and/or trade policy concerns
associated with potential renewal of international section 214
authority. The Commission further proposes that examination of
competition and any other relevant issues that come to the Commission's
attention is not foreclosed by its continuing assessment of the
aforementioned concerns.
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\12\ The Commission finds that none of the proposals in this
document, including its proposal to adopt periodic renewal
requirements, affects the Committee's review of an authorization
holder's section 214 authority. Consistent with the Commission's
formal review process, the Commission will refer to the Executive
Branch those renewal applications where an applicant has reportable
foreign ownership, pursuant to the rules adopted in the Executive
Branch Process Reform Order. Executive Branch Process Reform Order,
35 FCC Rcd at 10934 through 35, paragraph 17; 47 CFR 1.40001. The
Commission also proposes in this Notice to routinely refer to the
Committee certain renewal applications where the applicant does not
have reportable foreign ownership but other aspects of the
application may raise national security or law enforcement concerns
that require the input of the Committee to assist the Commission's
public interest determination.
---------------------------------------------------------------------------

33. As with other applications involving international section 214
authority, the Commission proposes that it will also consider whether
an applicant seeking renewal of its international section 214 authority
has the requisite character qualifications, including whether the
applicant has violated the Act, Commission rules, or U.S. antitrust or
other competition laws, has engaged in fraudulent conduct before
another government agency, has been convicted of a felony, or has
engaged in other non-FCC misconduct the Commission has found to be
relevant in assessing the character qualifications of a licensee or
authorization holder.\13\ The Commission has found that such conduct
demonstrates that a carrier may fail to comply with the Commission's
rules and policies as well as any conditions on its authorization. The
public interest may therefore require, in a particular case, that the
Commission denies the application of a carrier that has violated
Commission rules, the Act, or other laws that may be indicative of a
carrier's truthfulness and reliability. The Commission believes
consideration of an authorization holder's regulatory compliance and
adherence to other relevant laws is also consistent with the
Commission's review of renewal applications in other contexts and is
important to the Commission's assessment as to whether the public
interest, convenience, and necessity would be served by the renewal of
international section 214 authority.
---------------------------------------------------------------------------

\13\ See generally Policy Regarding Character Qualifications in
Broadcast Licensing, 102 FCC 2d 1179 (1986) (Character
Qualifications), modified, 5 FCC Rcd 3252 (1990) (Character
Qualifications Modification). The term ``non-FCC misconduct'' refers
to misconduct other than a violation of the Rules or the Act.
Character Qualifications, 102 FCC 2d at 1183 n.11, paragraph 7. The
Commission and the courts have recognized that ``[t]he FCC relies
heavily on the honesty and probity of its licensees in a regulatory
system that is largely self-policing.'' See Contemporary Media,
Inc., v. FCC, 214 F.3d 187, 193 (D.C. Cir. 2000). Reliability is a
key, necessary element to operating a broadcast station in the
public interest. See Character Qualifications, 102 F.C.C.2d at 1195,
paragraph 35. An applicant or licensee's propensity to comply with
the law generally is relevant because a willingness to be less than
truthful with other government agencies, to violate other laws, and,
in particular, to commit felonies, is potentially indicative of
whether the applicant or licensee will in the future conform to the
Commission's rules or policies. See Character Qualifications
Modification, 5 FCC Rcd at 3252, paragraph 3.
---------------------------------------------------------------------------

34. The Commission seeks comment on the standard that the
Commission proposes to adopt for the renewal of international section
214 authority. Should the Commission consider factors in addition to
those identified above, in determining whether to grant or deny a
renewal application for international section 214 authority? Should the
Commission consider a standard similar to that of broadcast station
renewals, that renewal would serve ``the public interest, convenience,
and necessity'' and the renewal applicant has had no serious violations
of the Act or the Commission's rules or multiple violations that would
constitute a ``pattern of abuse''? In the alternative, the Commission
seeks comment on whether an applicant seeking renewal of international
section 214 authority should be granted a renewal expectancy in any
circumstance as long it can make a specific showing, and if so, what
factors should be included in such a showing. The Commission's existing
rules provide for any interested party to file a petition to deny an
application. The Commission proposes to afford the same opportunity
with respect to renewal applications. What showings must an opposing
party make in support of its position?
35. Failure to Meet Public Interest Standard. The Commission
tentatively concludes that it would institute appropriate proceedings
to deny an application seeking renewal of international section 214
authority if the Commission determines that an applicant has failed to
meet the public interest standard. The Commission proposes that if it
denies the renewal of an authorization holder's international section
214 authority, the international section 214 authorization will be
treated as expired without further administrative action by the
Commission. Should the Commission apply the same approach to
authorization holders whose authorization was or is granted prior to
the effective date of new rules? The Commission seeks comment on these
approaches.
36. Periodic Review Alternative. In the event the Commission adopts
a periodic review process, the Commission seeks comment on the extent
such framework should incorporate the same public interest standards
and processes as those proposed herein, or those the Commission might
ultimately adopt, for renewal applications. For example, should the
public interest standard for determining whether to revoke an
authorization be the same as the standard for renewal? Should the
Commission apply the same approach to authorization holders whose
authorization was or is granted prior to the effective date of new
rules?
37. Failure to Meet Public Interest Standard. The Commission
tentatively concludes that it would institute appropriate proceedings
to revoke an international section 214 authorization if the Commission
determines that an authorization holder has failed to meet the public
interest standard under a periodic review process. The Commission seeks
comment on this tentative conclusion.

[[Page 50494]]

C. Renewal Process and Implementation

1. Prioritizing the Renewal Applications and Other National Security
and Law Enforcement Concerns
38. The Commission proposes to adopt a renewal schedule that
prioritizes the filing and review of renewal applications based on
whether the carrier currently has reportable foreign ownership,\14\ the
length of the time since the Commission's most recent review of the
authorization, and whether the authorization is subject to a mitigation
agreement. The Commission also proposes to prioritize the filing and
review of renewal applications where the authorization holder does not
have reportable foreign ownership but the application raises other
issues that require coordination with the Executive Branch agencies,
including the Committee, to assist the Commission's public interest
review, as discussed below. This should simplify the renewal process
and minimize administrative burdens while prioritizing the Commission's
consideration of those authorizations that most likely raise national
security, law enforcement, foreign policy, and/or trade policy
concerns. The Commission currently prioritizes the processing of
renewal applications for broadcast station licenses and wireless
licenses to promote administrative efficiency. For broadcast renewal
applications, the filing dates and license expiration dates for radio
and television station licenses are based on geographical groupings of
states. In the context of wireless licensing, WCS licenses have
different license terms based on different spectrum bands, yet all
renewal applications must be filed no later than the expiration date of
the authorization and no sooner than 90 days prior to the expiration
date. Similarly, the Commission seeks to adopt a process in
consultation with the Executive Branch agencies, including the
Committee, to streamline and simplify the renewal filing procedures.
The Commission proposes to apply these same principles to the extent
the Commission adopts a periodic review process rather than a renewal
framework. The Commission seeks comment on the process described below
both as it may apply in a renewal context and in a periodic review
context.
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\14\ The Commission refers here, in Section IV.C.1., to
``reportable foreign ownership'' to signify the ownership interests
that an authorization holder or applicant is required to disclose as
part of an application or notification required by Sec. 63.18(h)
and/or Sec. 63.24 of the Commission's rules. See 47 CFR 63.18(h),
63.24.
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39. Other National Security, Law Enforcement, and Other Concerns.
As discussed further below, the Commission proposes to routinely refer
to the Executive Branch agencies, including the Committee, certain
renewal applications or, in the alternative, periodic review
submissions, where the authorization holder does not have reportable
foreign ownership but other issues associated with the filing may
separately raise national security, law enforcement, foreign policy,
and/or trade policy concerns that require input from the Executive
Branch agencies to assist the Commission's public interest review. This
would include, for example, international section 214 authorization
holders without reportable foreign ownership that certify that they use
or will use foreign-owned MNSPs and/or report cross border facilities
that may separately raise national security, law enforcement, foreign
policy, and/or trade policy concerns. The Commission seeks comment on
this proposal.
40. Priority Categories--Groups 1 to 5. Specifically, the
Commission proposes to prioritize the renewal applications or any
periodic review filings and deadlines based on: (1) reportable foreign
ownership, including any reportable foreign interest holder that is a
citizen of a foreign adversary country, (2) the year of the oldest to
most recent Commission action (i.e., initial grant, modification,
assignment, or transfer of control), divided in fixed intervals, and
(3) whether or not the authorizations are conditioned on a mitigation
agreement. The Commission also proposes to prioritize any filings that
raise other national security, law enforcement, or other concerns. The
Commission proposes as well to have authorization holders with separate
authorizations that fall into more than one group below to file for all
their authorizations, perhaps in a single filing, based on the deadline
for the highest priority group. The Commission proposes to delegate
authority to the Office of International Affairs to establish the
deadlines and make necessary modifications, if needed, and to consult
with the Executive Branch agencies concerning prioritizing the renewal
applications or any periodic review filings.
<bullet> Group 1: All Authorization Holders with Reportable Foreign
Ownership, Including Foreign Ownership from Foreign Adversary Country/
No Mitigation Agreement/Authorization Granted over 10 Years Ago/Or
Raises Other National Security, Law Enforcement, or Other Concerns. The
Commission proposes that the filing deadline for Group 1 will apply to
authorizations where the authorization holder: (1) has reportable
foreign interest holders, including those that are citizens or
government organizations of any foreign adversary country; (2) the
authorization is not conditioned on a mitigation agreement with the
Executive Branch agencies; and (3) the Commission's most recent review
of such authorization (i.e., initial grant, modification, assignment,
or transfer of control) occurred over 10 years ago; or (4) for any
other national security, law enforcement, or other concerns.
<bullet> Group 2: All Authorization Holders with Reportable Foreign
Ownership, Including Foreign Ownership from Foreign Adversary Country/
Mitigation Agreement/Authorization Granted over 10 Years Ago. The
Commission proposes that the filing deadline for Group 2 will apply to
authorizations where the authorization holder: (1) has reportable
foreign ownership; (2) the authorization is conditioned on a mitigation
agreement with the Executive Branch agencies; and (3) the Commission's
most recent review of such authorization (i.e., initial grant,
modification, assignment, or transfer of control) occurred over 10
years ago.
<bullet> Group 3: All Authorization Holders with Reportable Foreign
Ownership, Including Foreign Ownership from Foreign Adversary Country/
No Mitigation Agreement/Authorization Granted less than 10 Years Ago.
The Commission proposes that the filing deadline for Group 3 will apply
to authorizations where the authorization holder: (1) has reportable
foreign ownership; (2) the authorization is not conditioned on a
mitigation agreement with the Executive Branch agencies; and (3) the
Commission's most recent review of such authorization (i.e., initial
grant, modification, assignment, or transfer of control) occurred less
than 10 years ago.
<bullet> Group 4: All Authorization Holders with Reportable Foreign
Ownership, Including Foreign Ownership from Foreign Adversary Country/
Mitigation Agreement/Authorization Granted less than 10 Years Ago. The
Commission proposes that the filing deadline for Group 4 will apply to
authorizations where the authorization holder: (1) has reportable
foreign ownership; (2) the authorization is conditioned on a mitigation
agreement with the Executive Branch agencies; and (3) the Commission's
most recent review of such authorization (i.e., initial grant,
modification, assignment, or transfer of control) occurred less than 10
years ago.
<bullet> Group 5: No Reportable Foreign Ownership/No Other National
Security, Law Enforcement, or Other Concerns. The Commission proposes
that the filing

[[Page 50495]]

deadline for Group 5 will apply to all other authorizations where: (1)
the authorization holder does not currently have reportable foreign
ownership; and (2) the authorization does not raise other national
security, law enforcement, or other concerns.
41. FCC's Preliminary Review and Referral to the Executive Branch
Agencies of International Section 214 Authorizations. Based on the
Commission's records, the best estimate is that the number of active
international section 214 authorization holders is approximately 1,500.
The Commission notes that it is also seeking comment below on other new
rules, such as proposing to require authorization holders to have only
one authorization and seeking comment on decreasing the reportable
ownership threshold to 5% that, if adopted, likely would affect the
number of filings to be reviewed. The Commission estimates that
approximately 375 of the 1,500 authorization holders have reportable
foreign ownership.\15\ The Commission proposes to prioritize the
submission of filings with reportable ownership based on the
Commission's preliminary review and refer to the Executive Branch
agencies, including the Committee, the first four groupings (Group 1 to
Group 4) set out above. In addition, the Commission proposes to process
in Group 1 any filings where the authorization holder does not have
reportable foreign ownership but the application raises national
security, law enforcement, foreign policy, and/or trade policy
concerns, such as applications that certify that they use or will use
foreign-owned MNSPs and/or report cross border facilities. The filing
and review of submissions without reportable foreign ownership (Group
5) would occur after consideration of the priority submissions. The
Commission seeks comment on this approach.
---------------------------------------------------------------------------

\15\ This estimate is based on the percentage of applications
out of the total international section 214 applications (i.e.,
applications for international section 214 authority and
applications for modification and substantial assignment and
transfer of control of international section 214 authority) filed
with the Commission where an applicant has reportable foreign
ownership.
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42. Renewal Application or Periodic Review Submission Deadline. The
Commission proposes that, upon approval by the OMB of the information
collections under the new rules proposed herein, the Office of
International Affairs will establish filing deadlines for Groups 1 to 5
that require the first submissions of renewal applications by
authorization holders within six months of OMB approval. The Commission
proposes to apply these same principles to the extent the Commission
adopts a periodic review process rather than a renewal framework. The
Commission seeks comment generally from applicants and the Executive
Branch agencies on the proposed approach for structuring the renewal
process or, in the alternative, periodic review process and filing
deadlines. The Commission also seeks comment on what filing deadlines
would be feasible for applicants and the Executive Branch agencies,
including the Committee, in consideration of the recent timeframes and
rules adopted in the Executive Branch Process Reform Order. The
Commission seeks comment on these proposals and what potential burdens,
if any, would be imposed upon authorization holders under any of these
approaches.
43. The Commission seeks comment on how best to structure the
filing and review of renewal applications or, in the alternative,
periodic review submissions to prioritize those authorizations most
likely to raise current national security, law enforcement, foreign
policy, and/or trade policy issues. The Commission believes that
carriers' compliance with the one-time information collection required
in the Order will be crucial for the Commission's efficient
administration of a renewal process or, in the alternative, periodic
review process. Through the Commission's assessment of the one-time
information collection, the Commission proposes to delegate authority
to the Office of International Affairs to (1) identify which
authorization holders are existing and active and would undergo the
renewal or other periodic review process; (2) identify which
authorization holders fail to respond to the Order and thus
presumptively are no longer in operation, and cancel their
authorizations pursuant to the process proposed above; (3) identify,
among the respondents, which authorization holders currently have or do
not have reportable foreign ownership or other relevant indicia and
designate them accordingly in Groups 1 to 5; and (4) determine which
authorization holders in Groups 1 to 5 must file renewal applications
or, in the alternative, periodic review submissions by each respective
filing deadline based on a 10-year requirement. Therefore, the results
of the one-time information collection will inform the Commission's
determination of the best processing and timing approach for the
renewal process or, in the alternative, periodic review process. In
addition, the Office of International Affairs may release the results
of the one-time information collection to improve the comment record or
seek further comment based on the results of the one-time information
collection, as needed.
44. Periodic Review Alternative. The Commission proposes to apply
these same principles to the extent the Commission adopts a periodic
review process rather than a renewal framework. The Commission
proposes, for example, to prioritize the filing of the required
information submissions and the review of specific authorizations in
the same manner as proposed for a renewal framework. The Commission
seeks comment on these proposals and how best to minimize
administrative burdens and maximize the effectiveness of the
Commission's review. The Commission seeks other suggestions on how best
to prioritize and simplify the process. Should the Commission consider
other options?
2. Processing Procedures
45. Streamlined Renewal Processing Procedures. The Commission
proposes that it adopt streamlined processing for renewal applications
in Group 5 in certain situations. For instance, Sec. 63.12(a) of the
Commission's rules provides that, ``[e]xcept as provided by paragraph
(c) of this section, a complete application seeking authorization under
Sec. 63.18 of this part shall be granted by the Commission 14 days
after the date of public notice listing the application as accepted for
filing.'' In current practice, once filed, Commission staff review the
application for compliance with the Commission's rules and place the
application on an Accepted for Filing public notice at that point. The
Commission proposes to adopt similar streamlined processing procedures
for renewal applications that are in Group 5, where the authorization
holder does not currently have reportable foreign ownership and the
application does not raise other national security, law enforcement, or
other considerations. With regard to those authorization holders in
Group 5, the Commission would place the renewal application on
streamlined Accepted for Filing public notice and the application would
be granted by the Commission 14 days after the date of the public
notice if: (1) the Commission does not refer the application to the
Executive Branch agencies because the applicant does not have
reportable foreign ownership and the application does not raise other
national security, law enforcement, or other considerations; (2) the
application does not raise other public interest considerations,
including regulatory compliance; (3) the Executive Branch agencies do
not separately request

[[Page 50496]]

during the comment period that the Commission defer action and remove
the application from streamlined processing; and (4) no objections to
the application are timely raised by an opposing party. The Commission
seeks comment on this proposal. The Commission believes a streamlined
process for renewal applications in Group 5 would decrease the burdens
on applicants and ensure a faster review process.
46. Authorizations Pending Renewal. As with Title III licensees
pursuant to section 307(c) of the Act, and consistent with the
Administrative Procedure Act, the Commission proposes that an applicant
that has timely applied for renewal of its international section 214
authority may continue providing service(s) under its international
section 214 authority while its renewal application is pending review.
The Commission seeks comment on this proposal.
47. Referral of Applications with Reportable Foreign Ownership to
the Executive Branch Agencies, Including the Committee. Consistent with
the Commission's formal review process, the Commission proposes to
refer to the relevant Executive Branch agencies, including the
Committee agencies, those applications for renewal of international
section 214 authority where the applicant has reportable foreign
ownership. For these referrals, the Commission proposes to apply the
same time frames that were adopted in the Executive Branch Process
Reform Order, a 120-day initial review period followed by a
discretionary 90-day secondary assessment. The Commission anticipates
that a referral of a renewal application with reportable foreign
ownership may result in a mitigation agreement, or modification of an
existing mitigation agreement, or a recommendation by the Committee or
other relevant Executive Branch agencies to deny the application. The
Commission seeks comment on these proposals.
48. Referral of Certain Applications Without Reportable Foreign
Ownership to the Executive Branch Agencies, Including the Committee.
The Commission recognizes, in view of evolving and heightened threats
to U.S. telecommunications infrastructure, that national security, law
enforcement, foreign policy, and/or trade policy risks may also be
associated with an authorization holder irrespective of whether it has
foreign ownership. The Commission proposes in this document that all
applicants provide information concerning foreign-owned MNSPs. The
Commission proposes and seeks comment on rules that would require
applicants to provide information on the facilities they use and/or
will use to provide services between the United States and Canada and/
or Mexico (cross border), and also propose to require applicants to
disclose whether they use equipment or services identified on the
Commission's ``Covered List.'' If the Commission adopts such
requirements, the Commission would propose to routinely refer to the
Executive Branch agencies, including the Committee, to assist the
Commission's public interest determination, those applications where an
applicant discloses that it:
<bullet> uses and/or will use a foreign-owned MNSP;
<bullet> has cross border facilities; and/or
<bullet> uses equipment or services identified on the Commission's
``Covered List'' of equipment and services pursuant to the Secure and
Trusted Communications Networks Act.
For these referrals, the Commission proposes to apply the same time
frames that were adopted in the Executive Branch Process Reform Order,
a 120-day initial review period followed by a discretionary 90-day
secondary assessment. The Commission seeks comment on these proposals.
The Commission reaffirms, however, that it retains discretion to
determine which applications it will refer to the Executive Branch
agencies for review.
49. Non-Referral of Certain Applications. As noted above, the
Commission is applying the same rules for renewal applications as the
Commission has applied to initial applications for international
section 214 authority and applications to modify, assign, or transfer
control of international section 214 authority. As an example, the
Commission's current rules provide that it will generally exclude from
referral to the Executive Branch agencies, including the Committee,
certain categories of applications that present a low or minimal risk
to national security, law enforcement, foreign policy, or trade policy.
Here, the Commission similarly seeks comment on whether there are
categories of renewal applications where the Commission can leverage
prior national security determinations to minimize burdens on the
Executive Branch agencies, including the Committee, without sacrificing
the ability to conduct comprehensive review. Are there categories of
applications that the Commission should not refer to the Executive
Branch agencies, including applications concerning which the Commission
on its own motion could take action and institute appropriate
proceedings without referral? What prior national security
determinations may be relevant to this analysis? For example, can the
Commission leverage the list of foreign adversary countries as defined
in the Department of Commerce rule, 15 CFR 7.4, in determining which
applications to refer to the Executive Branch agencies and which
applications it could act on without referral? The Commission seeks
comment on these potential categories, the potential benefits and
drawbacks of such an approach, as well as the Commission's legal
authority to do so.
50. Failure to Timely File Renewal Applications. The Commission
proposes that if an authorization holder fails to timely file an
application for renewal of its international section 214 authority, the
Commission will deem the international section 214 authorization
expired and cancelled by operation of law. The Commission proposes to
delegate authority to the Office of International Affairs to provide
notice in advance of the renewal deadline. The Commission has similar
procedures where it automatically terminates an earth station license
upon the expiration of the license term if a renewal application was
not timely filed. In the case of a space station license, the license
is ``automatically terminated in whole or in part without further
notice to the licensee'' upon the expiration date unless an application
for extension of the license term has been filed with the Commission.
The Commission's rules allow the reinstatement of an earth station
license or a space station license or authorization that is
automatically terminated if the Commission determines that
reinstatement would best serve the public interest, convenience and
necessity, but a petition for reinstatement will only be considered if,
among other things, it explains the failure to file a timely
notification or renewal application. When a broadcast licensee fails to
file a timely renewal application, the authorization is cancelled
pursuant to a public notice issued by the Media Bureau shortly after
the expiration date of the license; a renewal application filed after
such public notice may be processed provided that the applicant
successfully petitions for reinstatement of license and the renewal
application is filed within 30 days of the cancellation public notice.
The Media Bureau may commence an enforcement action for untimely filing
and unauthorized operation. In the wireless radio services context, if
a renewal application is not filed in a timely manner, a licensee must
request a waiver of the filing deadline, pursuant to Sec. 1.925 of the

[[Page 50497]]

Commission's rules, along with its late-filed renewal application. The
Commission will grant the waiver and renewal application nunc pro tunc
if they are filed up to thirty days after the expiration date and if
the application is otherwise sufficient, but the licensee may be
subject to enforcement action for untimely filing and unauthorized
operation. The Commission will grant applications filed after this
period under certain circumstances.
51. The Commission seeks comment on this proposed approach. Would
this procedure be adequate as applied to international section 214
authorizations in effect as of the effective date of any new rules? The
Commission seeks comment on alternative approaches. Would any of the
procedures used in the other contexts, such as those discussed above,
be appropriate or desirable in the international section 214 context?
The Commission proposes that an authorization holder whose
authorization expires due to its failure to timely file a renewal
application may file an application for a new international section 214
authorization.
52. Periodic Review Alternative/Processing. The Commission
generally proposes to apply similar processing to the extent the
Commission adopts a periodic review process rather than a renewal
framework. For instance, the Commission proposes to prioritize review
of specific authorizations in the same manner as proposed under a
renewal framework. The Commission seeks comment on these proposals and
how best to minimize administrative burdens and maximize the
effectiveness of the Commission's review under this alternative. The
Commission seeks other suggestions on how best to prioritize and
simplify the periodic review process. Should the Commission consider
other options?
53. Periodic Review Alternative/Failure to Timely File Required
Information. The Commission proposes that the Office of International
Affairs initiate a revocation process against an authorization holder
that, absent good cause, fails to timely file periodic review
information with the Commission. The Commission seeks comment on this
proposed approach. What procedures would ensure that the authorization
holder has the opportunity to demonstrate good cause, and what factors
should the Commission consider in evaluating a good cause showing?
Should the Commission accept late filings instead of initiating
revocation proceedings? The Commission further seeks comment on whether
and under what circumstances an authorization holder whose
authorization is revoked for its failure to timely file periodic review
information be barred from applying for a new international section 214
authorization.
3. Due Process and Procedural Requirements
54. Due Process and Procedural Requirements. The Commission seeks
comment on the procedural measures necessary to ensure the development
of an adequate administrative record, including procedures for
participation by other interested parties, and on the appropriate
procedural safeguards to ensure due process with regard to the
Commission's proposed renewal or, in the alternative, a periodic review
process. To determine what process is due involves consideration of the
Mathews v. Eldridge three-part test: (1) ``the private interest that
will be affected by the official action;'' (2) ``the risk of an
erroneous deprivation of such interest through the procedures used, and
the probable value, if any, of additional or substitute procedural
safeguards;'' and (3) ``the Government's interest, including the
function involved and the fiscal and administrative burdens that the
additional or substitute procedural requirement would entail.'' The
Commission notes that neither the Act, the Commission's rules, nor the
Administrative Procedure Act requires trial-type hearing procedures.
Congress has granted the Commission broad authority to ``conduct its
proceedings in such manner as will best conduce to the proper dispatch
of business and to the ends of justice.'' The Commission has broad
discretion to craft its own rules ``of procedure and to pursue methods
of inquiry capable of permitting them to discharge their multitudinous
duties.'' Furthermore, the Act gives the Commission the power of ruling
on facts and policies in the first instance. In exercising that power,
the Commission may resolve disputes of fact in an informal hearing
proceeding on a written record. In particular, the Commission seeks
comment on the extent to which the Commission's proposed renewal or in
the alternative, a periodic review process should incorporate the
procedures the Commission recently utilized--and which the Court of
Appeals for the D.C. Circuit approved--in revoking, and in certain
cases terminating, four Chinese government-owned carriers' section 214
authority.
55. The Commission stated in those cases that the Act does not
specify any procedures for revoking a section 214 authorization. Nor
has the Commission promulgated any regulations setting forth any such
procedures. The Commission explained that although the Commission
adopted regulations prescribing certain procedures for the revocation
of station licenses and construction permits pursuant to Part 1,
Subpart B of its rules, those regulations do not apply to the
revocation of a section 214 authorization and that hearing rights for
common carriers under section 214 are limited.\16\ In the recent
revocation proceedings, the Commission exercised its discretion to
``resolve disputes of fact in an informal hearing proceeding on a
written record,'' and reasonably determined that the issues raised in
those cases could be properly resolved through the presentation and
exchange of full written submissions before the Commission itself. The
Commission determined, among other things, that the fiscal and
administrative burden on the government would be especially heavy in
those cases, as a trial before an administrative law judge could
require participation by officials from other agencies. More
importantly, given the national security issues at stake, any resulting
unwarranted delay could be harmful. Accordingly, to provide affected
carriers with due process, the Commission allowed them to submit
evidence and arguments in writing and determined the need for the
revocation and/or termination of 214 authorizations on the basis of a
written record. The court of appeals affirmed the Commission's use of
these procedures.
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\16\ The hearing requirements applicable to Title III
applications do not apply to section 214 applications. Procedural
Streamlining of Administrative Hearings, Notice of Proposed
Rulemaking, 34 FCC Rcd 8341, 8343, paragraph 4 & n.16 (2019);
Oklahoma W. Tel. Co. Order, 10 FCC Rcd at 2243 through 44, paragraph
6 (finding no substantial public interest questions existed to
justify hearing on section 214 application) (citing ITT World
Commc'ns v. FCC, 595 F.2d 897, 900 through 01 (2d Cir. 1979)).
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56. The Commission seeks comment on the procedures applicable to
international section 214 renewal applications and, in the alternative,
to the periodic review applications. To the extent the Commission
adopts a periodic review process framework under which an order
instituting revocation procedures might ensue, the Commission proposes
to implement the approach the Commission used in its most recent
section 214 revocation proceedings. The Commission has stated that if
it is considering revoking an authorization, it will ``provide the
authorization holder such notice and an opportunity to respond as is
required by due process and applicable law, and appropriate in light of
the facts and

[[Page 50498]]

circumstances.'' Is there any reason the Commission should not use the
same procedures if it adopts a renewal framework? The Commission notes
that the Commission's Part 1, Subpart B provides procedures for
hearings in appropriate circumstances. Those procedures do not
automatically apply to section 214 authorizations, but they provide a
possible model for incorporating such procedures should the Commission
determine they are appropriate in a specific case. Under what
circumstances, if any, should any such procedures be incorporated in a
renewal or periodic review hearing? If the Commission tentatively
determines that renewal might not be warranted, it will provide the
authorization holder such notice and an opportunity to respond as is
required by due process and applicable law, and appropriate in light of
the facts and circumstances. Should the procedures be different for
authorization holders whose international section 214 authority was or
is granted prior to the effective dates of the new rules, and if so, in
what way?
57. Burden of Proof/Renewal. The Commission proposes to assign the
burden of proof to the applicant seeking renewal of its international
section 214 authority. Should the Commission use the same approach
where a renewal applicant was or is granted international section 214
authority prior to the effective date of the new rules? Section 63.18
of the Commission's rules requires that an application for
international section 214 authority ``include information demonstrating
how the grant of the application will serve the public interest,
convenience, and necessity.'' The Commission has stated that the
applicant for an international section 214 authorization bears the
burden of demonstrating that grant of its application would serve the
public interest in accordance with Sec. 63.18 of the Commission's
rules. The Commission believes the same burden of proof is appropriate
with respect to applicants seeking renewal of international section 214
authority. If the Commission adopts a renewal requirement for existing
authorization holders that were or are granted international section
214 authority prior to the effective date of new rules, should the
applicant or the Commission bear the burden of proof in a proceeding to
deny renewal? \17\
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\17\ For example, in broadcast renewal proceedings, licensees
bear the burden of proof in demonstrating that renewal is in the
public interest, see, e.g., Entercom License, LLC, Hearing
Designation Order and Notice of Opportunity for Hearing, 31 FCC Rcd
12196, 12231, paragraph 92 (2016), subsequent hist. omitted, whereas
in a broadcast revocation proceeding, the Commission bears the
burden of proof, 47 U.S.C. 312(d); see, e.g., Acumen Communications,
Licensee of Various Authorizations in the Wireless Radio Services,
Applicant for Modification of Various Authorizations in the Wireless
Radio Services, Applicant for Renewal of Authorization in the
Wireless Radio Services, Order to Show Cause, Hearing Designation
Order and Notice of Opportunity for Hearing, WTB Docket No. 17-17,
32 FCC Rcd 243, 248 through 49, paragraphs 16, 21 (MD-WTB 2017)
(stating, among other things, that the burden of proceeding with the
introduction of evidence and the burden of proof with regard to
revocation of various Wireless Radio Service authorizations shall be
on the Commission's Enforcement Bureau and the burden of proceeding
with the introduction of evidence and the burden of proof with
regard to various applications, including an application for
renewal, shall be on the applicant).
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58. Periodic Review Alternative/Burden of Proof. If the Commission
adopts a periodic review process framework for both existing and new
authorization holders, how should the burden of proof be allocated?
Should the Commission determine the burden of proof on a case-by-case
basis at the time of review?

D. Renewal Application Requirements

59. Given the increasing concerns about ensuring the security and
integrity of U.S. telecommunications infrastructure, the Commission
proposes or seeks comment on new requirements that it anticipates will
help it acquire critical information from applicants including
additional certifications to create accountability for applicants and
to improve the reliability of the information that they provide. The
Commission tentatively concludes that the new requirements that the
Commission proposes or seeks comment on would improve the Commission's
assessment of evolving public interest risks. The Commission proposes
to apply the requirements applicable to initial applications for
international section 214 authority to the proposed rules for renewal
applications and thus harmonize the application requirements. The
Commission notes that, whereas a renewal framework would require the
filing of renewal applications, a periodic review process would require
the Commission to obtain relevant information in a different manner.
The Commission proposes that any periodic review process would require
authorization holders to submit the same information as that required
for a renewal application. Is there any reason the Commission would not
require authorization holders subject to periodic review to file the
same information required in a renewal application? The Commission
seeks comment on whether the two types of filings should be different
in any respect, and if so, what purpose such differences would serve.
60. The Commission proposes, as a baseline, to apply the
requirements applicable to initial applications for international
section 214 authority to the proposed rules for renewal applications.
Section 63.18 of the Commission's rules, which implements section 214
of the Act, requires that an application for international section 214
authority ``include information demonstrating how the grant of the
application will serve the public interest, convenience, and
necessity,'' and ``[s]uch demonstration shall consist of the following
information as applicable.'' Specifically, the current application
rules provide important information and attestations concerning an
applicant's contact information, the specific type of authority that
each applicant seeks, any foreign carrier affiliations, and any
competition issues, among other things. The Commission proposes to
apply these provisions of Sec. 63.18 to the application rules that the
Commission proposes for renewal applicants.\18\ The Commission believes
these information and certification requirements are necessary for the
Commission's public interest review of applications for renewal of
international section 214 authority. Furthermore, the Commission's
proposal would require renewal applicants to provide the same
information as applicants for international section 214 authority and
the Commission believe such harmonization would advance the public
interest. The Commission seeks comment on these proposals and the draft
rule provisions in Appendix A.
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\18\ Specifically, the Commission proposes to apply the
requirements of Sec. 63.18(a) through (k), (m) through (o), (q)
through (r) to the application rules that the Commission proposes
for renewal applicants. See 47 CFR 63.18(a) through (k), (m) through
(o), (q) through (r). As discussed further below, the Commission
proposes or seeks comment on amendments to the current requirements
in Sec. 63.18(h) and 63.18(o).
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61. Specifically, the Commission proposes to require renewal
applicants to submit the same application information and
certifications that are set out in Sec. 63.18,\19\ including:
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\19\ The Commission tentatively concludes that the Commission
will not add two provisions of Sec. 63.18 to the proposed rules for
renewal applications. The Commission will not add Sec. 63.18(l), as
it no longer contains a rule provision. In addition, the Commission
will not add Sec. 63.18(p), which requires, ``[i]f the applicant
desires streamlined processing pursuant to Sec. 63.12, a statement
of how the application qualifies for streamlined processing.'' 47
CFR 63.18(p) (emphasis added). As discussed in Section IV.C.2, the
Commission proposes to adopt streamlined processing procedures for
renewal applications in certain circumstances. The Commission
proposes to add a new rule specifically for renewal applications
that would address any streamlined processing procedures that the
Commission adopts for renewal applications.

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[[Page 50499]]

<bullet> Applicant Information. Section 63.18(a) through (c) of the
rules requires basic information about the applicant and contact
information.\20\
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\20\ Section 63.18(a) requires the ``name, address, and
telephone number of each applicant.'' 47 CFR 63.18(a). Section
63.18(b) requires identification of ``[t]he Government, State, or
Territory under the laws of which each corporate or partnership
applicant is organized.'' Id. 63.18(b). Section 63.18(c) requires
the ``name, title, post office address, and telephone number of the
officer and any other contact point, such as legal counsel, to whom
correspondence concerning the application is to be addressed.'' Id.
63.18(c). Collecting minimum contact information allows the
Commission to communicate with the applicant including to address
any questions or concerns that the Commission has.
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<bullet> Type of International Section 214 Authority. Section
63.18(d) through (f) of the rules requires information pertaining to an
applicant's previous receipt of international section 214 authority and
the specific authority, either facilities-based and/or resale-based
and/or other authorization, that it seeks in the application. An
applicant for global facilities-based authority must certify that it
will comply with the terms and conditions contained in Sec. Sec. 63.21
and 63.22. An applicant for global resale authority must certify that
it will comply with the terms and conditions contained in Sec. Sec.
63.21 and 63.23. An applicant for authority to acquire facilities or to
provide services not covered by Sec. 63.18(e)(1) and (e)(2) must
provide a description of the facilities and services for which it seeks
authorization and certify that it will comply with the terms and
conditions contained in Sec. Sec. 63.21 and 63.22 and/or 63.23, as
appropriate. An applicant may apply for any or all of the authority
provided for in Sec. 63.18(e) of the rules in the same
application.\21\
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\21\ 47 CFR 63.18(f). An applicant seeking facilities-based
authority under Sec. 63.18(e)(3) must provide a statement as to
whether an authorization of the facilities is categorically excluded
from environmental processing as defined by Sec. 1.1306 of the
rules. Id. 63.18(g). Section 63.18(g) provides that ``[i]f answered
affirmatively, an environmental assessment as described in Sec.
1.1311 of this chapter need not be filed with the application.'' Id.
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<bullet> Ownership and Interlocking Directorates. Section 63.18(h)
requires that applicants provide information about any person or entity
that directly or indirectly holds 10% or greater ownership interest in
the applicant and identify any interlocking directorates with a foreign
carrier.\22\ While the Commission seeks comment on modifying the
ownership disclosure requirements from 10% to 5%, as discussed below,
the Commission proposes to require renewal applicants to provide
ownership information consistent with Sec. 63.18(h) as well as
identification of any interlocking directorates with a foreign carrier.
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\22\ Id. 63.18(h). The Executive Branch Process Reform Order
amended Sec. 63.18(h), as discussed below, and redesignated these
requirements as Sec. 63.18(h)(1) through (3). See Executive Branch
Process Reform Order, 35 FCC Rcd at 10985 through 87, Appx. B; Order
Erratum, 35 FCC Rcd at 13173 through 74. As discussed below, the
Commission seeks comment on making changes to the ownership
reporting requirements.
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<bullet> Foreign Carrier Affiliation. Section 63.18(i) through (k)
and (m) of the rules requires applicants to provide information and
certifications relating to whether an applicant is, or is affiliated
with, a foreign carrier. Section 63.18(i) requires an applicant to
certify whether it is or is affiliated with a foreign carrier and
identify each foreign country in which the applicant is or is
affiliated with a foreign carrier. Section 63.18(j) requires an
applicant to certify whether it seeks to provide international
telecommunications services to any destination country where the
applicant is or controls a foreign carrier in that country; or any
entity that owns more than 25% of the applicant, or that controls the
applicant, controls a foreign carrier in that country; or two or more
foreign carriers (or parties that control foreign carriers) own, in the
aggregate, more than 25% of the applicant and are parties to, or the
beneficiaries of, a contractual relation affecting the provision or
marketing of international basic telecommunications services in the
United States. If any country identified by the applicant in the
certification under Sec. 63.18(j) is not a member of the World Trade
Organization (WTO), the applicant must demonstrate whether the foreign
carrier has market power or lacks market power. Any applicant that is
or is affiliated with a foreign carrier in a country identified in the
certification under Sec. 63.18(i), and which seeks to be regulated as
non-dominant for the provision of particular international
telecommunications services to such country, should demonstrate that it
qualifies for non-dominant classification.
<bullet> No Special Concessions. Section 63.18(n) of the rules
requires an applicant to certify that it has not agreed to accept
special concessions directly or indirectly from any foreign carrier
with respect to any U.S. international route where the foreign carrier
possesses market power on the foreign end of the route and will not
enter into such agreements in the future.
<bullet> Not Subject to Denial of Federal Benefits. Section
63.18(o) of the rules requires ``[a] certification pursuant to
Sec. Sec. 1.2001 through 1.2003 of this chapter that no party to the
application is subject to a denial of Federal benefits pursuant to
[s]ection 5301 of the Anti-Drug Abuse Act of 1988. See 21 U.S.C.
853a.'' The Commission proposes to require renewal applicants to
provide a certification that is consistent with the amendments the
Commission proposes for Sec. 63.18(o), as discussed in Section IV.F.
<bullet> Other Requirements. Section 63.18(q) of the current rules
requires that applicants provide ``[a]ny other information that may be
necessary to enable the Commission to act on the application.'' \23\
Section 63.18(r) of the current rules requires that applications must
be filed electronically through ICFS.\24\
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\23\ 47 CFR 63.18(q). In the Executive Branch Process Reform
Order, the Commission adopted a new Sec. 63.18(q) and redesignated
the current requirements of Sec. 63.18(q) as Sec. 63.18(s).
Executive Branch Process Reform Order, 35 FCC Rcd at 10985, Appx. B,
paragraph 11; Order Erratum, 35 FCC Rcd at 13173, paragraph 11. The
amended rule is not yet effective.
\24\ 47 CFR 63.18(r) (``Subject to the availability of
electronic forms, all applications described in this section must be
filed electronically through the International Communications Filing
System (ICFS). A list of forms that are available for electronic
filing can be found on the ICFS homepage. For information on
electronic filing requirements, see Sec. Sec. 1.1000 through
1.10018 of this chapter and the ICFS homepage at <a href="https://www.fcc.gov/icfs">https://www.fcc.gov/icfs</a>. See also Sec. Sec. 63.20 and 63.53.''). In the
Executive Branch Process Reform Order, the Commission redesignated
the current requirements of Sec. 63.18(r) as Sec. 63.18(t).
Executive Branch Process Reform Order, 35 FCC Rcd at 10985, Appx. B,
paragraph 11; Order Erratum, 35 FCC Rcd at 13173, paragraph 11. The
amended rule is not yet effective.
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62. The Commission also proposes to apply the application
requirements that were adopted in the Executive Branch Process Reform
Order, with regard to international section 214 authorizations, to
renewal applications. The Commission anticipates that these
requirements will improve the Commission's assessment of evolving
national security, law enforcement, foreign policy, and/or trade policy
risks associated with applications for renewal of international section
214 authority.
<bullet> Calculation of Equity Interests Held Indirectly in the
Carrier. The Executive Branch Process Reform Order adopted a new
subsection (1)(i) in Sec. 63.18(h), which directs that equity
interests that are held by an individual or entity indirectly through
one or more intervening entities shall be calculated by successive
multiplication of the equity percentages for each link in the vertical
ownership chain, regardless of whether any particular link in the chain
represents a controlling interest in the company positioned in the next
lower tier. The new Sec. 63.18(h)(1)(i) includes an example.

[[Page 50500]]

<bullet> Calculation of Voting Interests Held Indirectly in the
Carrier. The Executive Branch Process Reform Order adopted a new
subsection (1)(ii) in Sec. 63.18(h), which directs that voting
interests that are held through one or more intervening entities shall
be calculated by successive multiplication of the voting percentages
for each link in the vertical ownership chain, except that wherever the
voting interest for any link in the chain is equal to or exceeds 50% or
represents actual control, it shall be treated as if it were a 100%
interest.\25\ The new Sec. 63.18(h)(1)(ii) includes an example.
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\25\ See Order Erratum, 35 FCC Rcd at 13173 through 74,
paragraph 11; see also Executive Branch Process Reform Order, 35 FCC
Rcd at 10986, Appx. B, paragraph 11. A general partner shall be
deemed to hold the same voting interest as the partnership holds in
the company situated in the next lower tier of the vertical
ownership chain. Order Erratum, 35 FCC Rcd at 13173, paragraph 11;
see also Executive Branch Process Reform Order, 35 FCC Rcd at 10986,
Appx. B, paragraph 11. A partner of a limited partnership (other
than a general partner) shall be deemed to hold a voting interest in
the partnership that is equal to the partner's equity interest.
Order Erratum, 35 FCC Rcd at 13173, paragraph 11; see also Executive
Branch Process Reform Order, 35 FCC Rcd at 10986, Appx. B, paragraph
11.
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<bullet> Ownership Diagram. The Executive Branch Process Reform
Order adopted a new subsection (2) in Sec. 63.18(h), which requires
applicants to provide an ownership diagram that illustrates the
applicant's vertical ownership structure, including the direct and
indirect ownership (equity and voting) interests held by the
individuals and entities named in response to Sec. 63.18(h)(1).\26\
The ownership diagram shall include both the pre-transaction and post-
transaction ownership of the authorization holder.
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\26\ See Order Erratum, 35 FCC Rcd at 13174, paragraph 11; see
also Executive Branch Process Reform Order, 35 FCC Rcd at 10987,
Appx. B, paragraph 11. Every individual or entity with ownership
shall be depicted and all controlling interests must be identified.
Order Erratum, 35 FCC Rcd at 13174, paragraph 11; see also Executive
Branch Process Reform Order, 35 FCC Rcd at 10987, Appx. B, paragraph
11.
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<bullet> Responses to Standard Questions. The Executive Branch
Process Reform Order adopted a new Sec. 63.18(p), which requires that
each applicant for which an individual or entity that is not a U.S.
citizen holds a 10% or greater direct or indirect equity or voting
interest, or a controlling interest, in the applicant, must submit
responses to Standard Questions, prior to or at the same time the
applicant files its application with the Commission, directly to the
Committee. While the Commission seeks comment on modifying the
ownership disclosure requirements, as discussed below, the Commission
proposes to require renewal applicants to comply with the requirements
consistent with the new Sec. 63.18(p), including the amendments on
which the Commission seeks comment herein.
<bullet> Certifications. The Executive Branch Process Reform Order
adopted a new Sec. 63.18(q) that requires each applicant to make the
following certifications by which they agree:
[cir] (1) to comply with all applicable Communications Assistance
for Law Enforcement Act (CALEA) requirements and related rules and
regulations;
[cir] (2) to make communications to, from, or within the United
States, as well as records thereof, available in a form and location
that permits them to be subject to a valid and lawful request or legal
process in accordance with U.S. law;
[cir] (3) to designate a point of contact who is located in the
United States and is a U.S. citizen or lawful U.S. permanent resident,
for the execution of lawful requests and as an agent for legal service
of process;
[cir] (4)(A) that the applicant is responsible for the continuing
accuracy and completeness of all information submitted, whether at the
time of submission of the application or subsequently in response to
either the Commission or the Committee's request, as required in Sec.
1.65(a), and that the applicant agrees to inform the Commission and the
Committee of any substantial and significant changes while an
application is pending;
[cir] (4)(B) after the application is no longer pending for
purposes of Sec. 1.65 of the rules, the applicant must notify the
Commission and the Committee of any changes in the authorization holder
or licensee information and/or contact information promptly, and in any
event within thirty (30) days; and
[cir] (5) that the applicant understands that if the applicant or
authorization holder fails to fulfill any of the conditions and
obligations set forth in the certifications set out in Sec. 63.18(q)
or in the grant of an application or authorization and/or that if the
information provided to the U.S. government is materially false,
fictitious, or fraudulent, applicant and authorization holder may be
subject to all remedies available to the U.S. government, including but
not limited to revocation and/or termination of the Commission's
authorization or license, and criminal and civil penalties, including
penalties under 18 U.S.C. 1001.
63. Application Fees. The Commission proposes to adopt a fee for
renewal applications and, in the alternative, a fee for periodic review
submissions for international section 214 authority that is consistent
with the fee for applications for new international section 214
authorizations.\27\ The proposed fee is consistent with the established
fee category of ``International Service'' and will follow the fee
calculation methodology adopted by the Commission in the 2020
Application Fee Report and Order. Currently, the fee for an application
for a new international section 214 authorization is $875.\28\ Since
the Commission envisions the level of Commission resources required to
review a renewal application or periodic review submission will be
consistent with review of an application for new international 214
authority, the Commission proposes to adopt a fee of $875. The
Commission seeks comment on the Commission's proposed application fee
for a renewal application or periodic review submission.
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\27\ See 47 U.S.C. 158(a); 47 CFR 1.1101; 47 CFR 1.1107. Section
8(c) of the Act requires the Commission to, by rule, amend the
application fee schedule if the Commission determines that the
schedule requires amendment so that: (1) such fees reflect increases
or decreases in the costs of processing applications at the
Commission or (2) such schedule reflects the consolidation or
addition of new categories of applications. 47 U.S.C. 158(c).
Section 8(c) of the Act does not mandate a timeframe for making any
such amendments under section 8(c). If the Commission determines
that the application fee schedule may require an amendment pursuant
to section 8(c), the Commission will initiate a rulemaking to seek
comment on any proposed amendment(s) to the application fee
schedule. The Commission does so here. Amendment of the Schedule of
Application Fees Set Forth in Sections 1.1102 through 1.1109 of the
Commission's Rules, Order, FCC 22-94, 2022 WL 17886514, at n.2 (rel.
Dec. 16, 2022) (2022 Application Fee Order).
\28\ 2022 Application Fee Order at Appx.; 47 CFR 1.1107. This
fee rate became effective on March 2, 2023. See Federal
Communications Commission, Schedule of Application Fees, 88 FR 6169
(Jan. 31, 2023).
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64. The Commission seeks comment on these proposals and the draft
rule provisions in Appendix A. The Commission proposes to incorporate
almost all of the application requirements in Sec. 63.18 to the
proposed rules for renewal applications or, in the alternative,
periodic review submissions. Are there other related provisions of Part
63 that the Commission should require of authorization holders that
file a renewal application or periodic review submission? Are there any
reasons to modify certain information requirements in Part 63 as
applied to renewal applications or periodic review submissions?

[[Page 50501]]

E. New Application Requirements for All International Section 214
Applicants and Authorization Holders

65. The Commission proposes or seeks comment on adopting new
application requirements to improve the Commission's assessment of
evolving national security, law enforcement, foreign policy, and/or
trade policy risks following a grant of international section 214
authority. The Commission seeks comment on whether to adopt a new 5%
ownership reporting threshold for all initial applications for
international section 214 authority and applications for modification,
assignment, transfer of control, and renewal of international section
214 authority for certain cases.\29\ The Commission also proposes to
require each applicant to provide information about its services,
geographic markets, and facilities crossing the United States' borders
with Canada and Mexico (cross border facilities), and certify that
their facilities-based equipment meets certain requirements.\30\ Prior
to the current global international section 214 licensing scheme, the
Commission granted authorizations on a country-by-country basis and
collected facilities information.\31\ That was over 25 years ago. Since
that time, the Commission has not collected and does not have any
information on critical infrastructure that is used by international
section 214 authorization holders to provide services under their
international section 214 authority. Additionally, the Commission
proposes or seeks comment on requiring all authorization holders to
report their reportable ownership and other information on an ongoing
basis, starting every three years after grant of a renewal application.
The Commission tentatively concludes that these requirements that the
Commission proposes or seeks comment on are important and necessary for
informing the Commission's evaluation of an applicant's request for
international section 214 authority or the modification, assignment,
transfer of control, or renewal thereof and would serve the public
interest given evolving risks identified by the Commission and the
Executive Branch.
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\29\ The Commission notes that Sec. 63.04(b) of the
Commission's rules, pertaining to applications for transfer of
control of domestic section 214 authorizations, permits joint
international and domestic section 214 transfer of control filings
and requires applicants filing such joint applications to satisfy
the requirements in both Sec. Sec. 63.04 and 63.18 addressing
ownership. See 47 CFR 63.04(b), 63.18. This document does not
propose to modify Sec. 63.04(a)(4), which addresses ownership
information required to be disclosed for domestic-only section 214
transfer of control applications. If the Commission adopts a 5%
reporting requirement for international section 214 authorizations,
the Commission proposes to require that applicants filing a joint
international and domestic section 214 transfer of control
application must continue to submit information that satisfies the
requirements in both Sec. Sec. 63.04 and 63.18, including ownership
information that would be required by Sec. 63.18(h) under the
proposed 5% ownership reporting threshold.
\30\ Unless indicated otherwise, the Commission refers to
``applicant'' or ``applicants'' in this subsection, Section IV.E.,
to refer to (1) applicants that file an initial application for
international section 214 authority or an application for
modification, assignment, transfer of control, or renewal of
international section 214 authority, and (2) authorization holders
that file a notification of pro forma assignment or transfer of
control. See 47 CFR 63.18; id. 63.24(e) (``Applications for
substantial transactions''); id. 63.24(f) (``Notifications for non-
substantial or pro forma transactions''). Unless indicated
otherwise, the Commission refers to ``application'' or
``applications'' in this subsection, Section IV.E., to refer to
applications for international section 214 authority; applications
for modifications, assignments, transfers of control, and renewals
of international section 214 authority; and pro forma notifications
of assignments and transfers of control of international section 214
authority.
\31\ The Commission adopted global facilities-based
international section 214 authorizations in 1996. 1996 Streamlining
Order, 11 FCC Rcd at 12888 through 94, paragraphs 9-20. Prior to the
1996 Streamlining Order, the Commission's rules required that
applications for international section 214 authority specify the
geographic market (i.e., the country) to be served, the particular
services to be provided, and the facilities to be used. See 1995
Streamlining NPRM, 10 FCC Rcd at 13481, paragraph 8.
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1. Five (5) Percent Threshold for Reportable Interests
66. The Commission seeks comment on whether to adopt a new
ownership reporting threshold that would require disclosure of certain
5% or greater direct and indirect equity and/or voting interests with
respect to applications for international section 214 authority and
modification, assignment, transfer of control, and renewal of
international section 214 authority. Over twenty years ago, the
Commission found that a 10% reporting threshold would assist the
Commission in determining whether a particular international section
214 application raises issues of national security, foreign policy, or
law enforcement risks. The national security and law enforcement
environment, however, has changed dramatically during this timeframe.
The current 10% reporting threshold may not capture all foreign
interests that may present national security, law enforcement, foreign
policy, and/or trade policy concerns. In the 2021 Standard Questions
Order, the Commission noted, with respect to the Standard Questions,
the views of Committee staff that ``5% threshold is appropriate because
in some instances a less-than-ten percent foreign ownership interest--
or a collection of such interests--may pose a national security or law
enforcement risk.'' The Commission further noted, ``[t]he Committee
staff states that a group of foreign entities or persons, each owning
nine percent and working together, could easily reach a controlling
interest in a company without having to disclose any of their interests
to the Committee for certain FCC application types.''
67. In furtherance of the Commission's objective in this
proceeding, and as the Commission reviews the current rules and their
applicability to the proposed renewal or, in the alternative, periodic
review process, the Commission seeks comment on whether a 5% reporting
threshold would better capture foreign interests, including and
especially any such interests that are associated--either individually
or in the collective--with a foreign adversary country. The Commission
seeks comment whether the 5% reporting threshold as described would
improve the Commission's assessment of evolving public interest risks.
In the alternative, the Commission seeks comment whether the Commission
should only require disclosure of foreign ownership at the 5% level by
citizens, entities, and government organizations from foreign adversary
countries, as defined in the Department of Commerce's rule, 15 CFR 7.4.
68. The Commission seeks comment on whether to apply the 5%
reporting threshold to encompass all equity and voting interests,
regardless whether the interest holder is a domestic or foreign
individual or entity. The Commission notes that in the context of
foreign ownership rulings under section 310(b) of the Act, the
Commission does not require the identification of certain foreign
investors if their investment meets insulation criteria set out in the
Commission's rules.\32\ The Commission seeks comment on whether the
Commission should adopt such an approach for identifying ownership in
international section 214 authorizations. In other words, should the
Commission require reporting only where the 5% or greater ownership
interest is not passive or otherwise insulated? The Commission notes
the potential for

[[Page 50502]]

certain ownership of U.S. entities by foreign adversaries may pose
unique national security and/or law enforcement risks. In light of
these concerns, the Commission seeks comment on whether applicants that
include ownership of 5% or greater by an entity or citizen of a foreign
adversary country should be required to disclose those holdings
regardless of whether they are passive or insulated or not. In the
Executive Branch Process Reform Order, the Commission rejected
arguments to seek, for purposes of the Standard Questions, only
information regarding foreign investors with 5% or greater interests,
noting, ``the Executive Agencies' review extends beyond just foreign
policy considerations; the review process also involves national
security and law enforcement issues as well, which could be implicated
regardless of whether the equity interest holder is a domestic or
foreign entity.''
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\32\ See 47 CFR 1.5001. The insulation criteria are set out in
47 CFR 1.5003. See Letter from Andrew D. Lipman, Ulises Pin, and
Patricia Cave, Counsel to DigitalBridge Group, Inc., Morgan, Lewis &
Bockius LLP, and Matthew Brill and Elizabeth Park, Counsel to
Searchlight Capital Partners, Latham & Watkins LLP, to Marlene H.
Dortch, Secretary, FCC, IB Docket No. 23-119 and MD Docket No. 20-
270, at 3 (filed Apr. 12, 2023) (DigitalBridge and Searchlight Apr.
12, 2013 Ex Parte Letter).
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69. Currently, the ownership reporting threshold in Sec. 63.18(h)
of the Commission's rules requires applicants for international section
214 authority to disclose the name, address, citizenship, and principal
businesses of any person or entity that directly or indirectly owns at
least 10% of the equity of the applicant, and the percentage of equity
owned by each of those entities (to the nearest 1%).\33\ Applicants
seeking an assignment or transfer of control of an international
section 214 authorization are also subject to the ownership disclosure
requirement in Sec. 63.18(h) pursuant to Sec. 63.24 of the
Commission's rules. If the Commission adopts a 5% threshold, the
Commission proposes to amend the ownership disclosure requirement in
Sec. 63.18(h) of the rules to require that all applicants that file an
application or notification required by Sec. 63.18 and/or Sec. 63.24
of the Commission's rules must disclose all individuals and entities
with 5% or greater direct and/or indirect equity and/or voting interest
in the applicant, as specified in each rule. Where no individual or
entity directly or indirectly owns 5% or more of the equity interests
and/or voting interests, or a controlling interest, of the applicant,
the Commission proposes that the application must include a statement
to that effect.
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\33\ 47 CFR 63.18(h). In the 2020 Executive Branch Process
Reform Order, the Commission amended its rules to require that
applicants for domestic section 214 transactions, international
section 214 authorizations, and submarine cable licenses must
identify the voting interests, in addition to the equity interests,
of individuals or entities with 10% or greater direct or indirect
ownership in the applicant. 2020 Executive Branch Process Reform
Order, 35 FCC Rcd at 10963 through 64, paragraph 95; Order Erratum,
35 FCC Rcd at 13173, paragraph 11. The amended rule is not yet
effective.
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70. The Commission seeks comment on the burdens that would be
placed on applicants to report direct and indirect equity and/or voting
ownership at a 5% threshold. A reporting threshold of 5% would be
consistent with other similar relevant federal reporting requirements.
A reporting threshold of 5% would be consistent with the ownership
threshold used by the Committee in its review of applications that are
referred by the Commission, to obtain information from applicants
concerning their 5% or greater owners. Are there relevant differences
between the FCC's section 214 review process and the Committee's
processes that the Commission should take into account? In the
Executive Branch Process Reform Order, the Commission declined to add
to its application forms additional questions regarding an applicant's
investors with 5% or more equity that were suggested by NTIA, given
``they are inconsistent with the Commission's ownership disclosure
requirements'' for applications concerning international section 214
authorizations, among other applications.\34\ In light of the
Commission's goal in this proceeding to establish a formalized and
systemized process by which the Commission can reassess and continually
account for evolving public interest risks, the Commission takes this
opportunity to review the current ownership disclosure requirement for
such applications and tentatively find that an ownership reporting
threshold of 5% is consistent with the views previously expressed by
the Committee and would better inform the Commission's foreign
ownership analysis.
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\34\ Executive Branch Process Reform Order, 35 FCC Rcd at 10945,
paragraph 47 (noting, however, that they are part of the sample
triage questions that the Commission will use as a basis for the
Standard Questions); see, e.g., 2021 Standard Questions Order, 36
FCC Rcd at 14855 through 57, 14833 through 96, 14897 through 911,
paragraphs 14, 16 through 17, Attach. A (Standard Questions for an
International Section 214 Authorization Application), Attach. B
(Standard Questions for an Application for Assignment or Transfer of
Control of an International Section 214 Authorization).
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71. A reporting threshold of 5% is also consistent with information
that U.S. public companies and their shareholders provide to the SEC.
The Exchange Act Rule 13d-1 requires a person or ``group'' that
becomes, directly or indirectly, the ``beneficial owner'' of more than
5% of a class of equity securities registered under Section 12 of the
Exchange Act to report the acquisition to the SEC.\35\ The Commission
further notes that various SEC forms filed by issuers, including their
annual reports (or proxy statements) and quarterly reports, require the
issuer to include a beneficial ownership table that contains, inter
alia, the name and address of any individual or entity, or ``group,''
who is known to the issuer to be the beneficial owner of more than 5%
of any class of the issuer's voting securities.
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\35\ 2016 Foreign Ownership Report and Order, 31 FCC Rcd at
11293, paragraph 45. For purposes of Exchange Act Rule 13d-1,
Exchange Act Rule 13d-3(a) defines a beneficial owner of a security
to include any person who, directly or indirectly, through any
contract, arrangement, understanding, relationship, or otherwise has
or shares voting power, which includes the power to vote, or to
direct the voting of, such security; and/or investment power, which
includes the power to dispose, or to direct the disposition of, such
security. Id. at n.128; 17 CFR 240.13d-3(a). Exchange Act Rule 13d-
1(i) defines the term ``equity security'' as any equity security of
a class which is registered pursuant to section 12 of that Act as
well as certain equity securities of insurance companies and equity
securities issued by closed-end investment companies registered
under the Investment Company Act of 1940. 2016 Foreign Ownership
Report and Order, 31 FCC Rcd at 11293, n.128; 17 CFR 240.13d-1(i).
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72. In addition, a reporting threshold of 5% is consistent with
information that the Committee on Foreign Investment in the United
States (CFIUS) \36\ requires of parties to a voluntary notice filed
with CFIUS. Specifically, CFIUS regulations require that if an ultimate
parent of a foreign person that is a party to the transaction is a
public company, the parties to the transaction must provide in the
voluntary notice, the name, address, and nationality (for individuals)
or place of incorporation or other legal organization (for entities) of
``any shareholder with an interest of greater than five percent in such
parent.'' \37\ Thus, the

[[Page 50503]]

Commission tentatively concludes that the Commission's proposal to
adopt a reporting threshold of 5% would be consistent with other
federal agencies and impose minimal burdens on applicants. The
Commission seeks comment on what, if any, potential burdens would be
imposed on applicants under the 5% equity and/or voting interest
reporting threshold that the Commission seeks comment on here.
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\36\ CFIUS is ``an interagency committee authorized to review
certain transactions involving foreign investment in the United
States and certain real estate transactions by foreign persons, in
order to determine the effect of such transactions on the national
security of the United States.'' U.S. Department of Treasury, The
Committee on Foreign Investment in the United States (CFIUS),
<a href="https://home.treasury.gov/policy-issues/international/the-committee-on-foreign-investment-in-the-united-states-cfius">https://home.treasury.gov/policy-issues/international/the-committee-on-foreign-investment-in-the-united-states-cfius</a> (last visited Apr.
12, 2023); see U.S. Department of Treasury, CFIUS Overview, <a href="https://home.treasury.gov/policy-issues/international/the-committee-on-foreign-investment-in-the-united-states-cfius/cfius-overview">https://home.treasury.gov/policy-issues/international/the-committee-on-foreign-investment-in-the-united-states-cfius/cfius-overview</a> (last
visited Apr. 12, 2023).
\37\ 31 CFR 800.502(c)(1)(v)(C), 802.502(b)(1)(vi)(C).
Additionally, CFIUS regulations require that a voluntary notice
filed under 31 CFR 800.501 must provide, with respect to the foreign
person engaged in the transaction and its parents, the following
information for any individual that has ``an ownership interest of
five percent or more in the acquiring foreign person engaged in the
transaction and in the foreign person's ultimate parent'': (1) a
``curriculum vitae or similar professional synopsis,'' and (2)
``personal identifier information,'' including full name, date of
birth, and place of birth, among other thing. Id. 800.502(c)(5)(vi);
see also id. 802.502(b)(3)(vi).
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73. The Commission seeks comment on whether a reporting threshold
of 5% equity and/or voting interest as described here adequately
captures the relationship, association, and/or extent of influence that
a foreign investor, including foreign governments, may have with
respect to an applicant and/or other individuals or entities in the
applicant's chain of ownership. For instance, would a reporting
threshold of 5% equity and/or voting interest sufficiently account for
circumstances where a foreign government interest holder with
comparatively smaller ownership interests may have a disproportionately
significant influence on the applicant and its operations, such as
through ``golden shares''? Should the Commission require additional
information about an applicant's reportable interest holders? For
example, should the Commission require applicants to identify other
types of interests or interest holders in addition to equity interests
and voting interests, such as management agreements? Is there any other
information the Commission could require to fully capture interest
holders that are either foreign governments or foreign state-owned
entities? What additional ownership information would fully inform and
assist the Commission's assessment of national security, law
enforcement, foreign policy, and trade policy risks raised by such
interest holders?
74. The Commission seeks comment on minimizing burdens on all
applicants generally, including small entities, if the Commission
adopts a 5% ownership reporting threshold. For instance, if the
Commission adopts a 5% reporting threshold, the Commission seeks
comment on whether the Commission should treat the disclosure of
certain ownership interests of 5% and up to less than 10% as
presumptively confidential,\38\ without requiring the authorization
holder to file a request for confidentiality. The Commission notes that
the information must be not publicly available elsewhere either in this
country or another in order for us to make it confidential.
Alternatively, should the Commission limit the public disclosure of
ownership interests of 5% and up to less than 10% to only those
interest holders that are citizens, entities, or government
organizations of foreign adversary countries, as defined in the
Department of Commerce's rule, 15 CFR 7.4? Since the Commission's
ability to guarantee confidentiality may also be limited by other legal
requirements, should the Commission allow relevant information about
the identities of 5-10% foreign interests to be omitted from filings
with the Commission and instead filed directly with the Committee?
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\38\ Other Commission requirements, such as supply chain annual
reporting, provide for a checkbox certification and the submission
of information that is presumptively confidential. 2020 Protecting
Against National Security Threats Order, 35 FCC Rcd at 14369 through
70, paragraph 214 (``We believe that the public interest in knowing
whether providers have covered equipment and services in their
networks outweighs any interest the carrier may have in keeping such
information confidential . . . . Other information, such as location
of the equipment and services; removal or replacement plans that
include sensitive information; the specific type of equipment or
service; and any other provider specific information will be
presumptively confidential.'').
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2. Services and Geographic Markets
75. The Commission proposes to adopt rules requiring applicants to
include in all initial applications for international section 214
authority and applications for modification, assignment, transfer of
control, and renewal of international section 214 authority,
information about their current and/or expected future services and the
geographic markets where the authorization holder offers service in the
United States under its international section 214 authority. The
Commission's rules currently only require an applicant for
international section 214 authority to indicate whether it seeks
facilities-based authority, resale authority, and/or authority to
acquire facilities or to provide services not covered by Sec.
63.18(e)(1) or (e)(2) of the rules. The Commission's rules for
modifications, assignments, and transfers of control of international
section 214 authority only require that the applicant state ``whether
the applicant previously received authority under Section 214 of the
Act and, if so, a general description of the categories of facilities
and services authorized.'' The current rules do not require applicants
to provide the Commission with specific information about the services
they provide and/or will provide under the international section 214
authority, the facilities they use and/or will use, or other
information related to their operations in the United States and
abroad.
76. This information will further help the Commission to properly
assess evolving national security, law enforcement, foreign policy,
and/or trade policy risks associated with an applicant. In recent
revocation actions, the Commission specifically assessed the risks
associated with the particular services offered pursuant to
international section 214 authority. In addition, the Commission notes
that the Executive Branch agencies seek ``detailed and comprehensive
information'' from applicants with reportable foreign ownership,
including services to be provided.\39\ The Commission believes
information about an applicant's current and/or planned future services
would be important for the Commission's review of applicants to
meaningfully assess national security, law enforcement, and other
considerations.
---------------------------------------------------------------------------

\39\ See e.g., Executive Branch Process Reform Order, 35 FCC Rcd
at 10943, paragraph 42; id. at 10981, Appx. C, paragraph 7; Order
Erratum, 35 FCC Rcd at 13170, paragraph 7; 2021 Standard Questions
Order, 36 FCC Rcd at 14883 through 96, 14897 through 911, Attach. A
(Standard Questions for an International Section 214 Authorization
Application), Attach. B (Standard Questions for an Application for
Assignment or Transfer of Control of an International Section 214
Authorization). The Standard Questions are not yet effective.
---------------------------------------------------------------------------

77. Specifically, the Commission proposes to require applicants to
provide the following information with respect to services they provide
and/or expect to provide using the international section 214 authority:
(1) identification and description of the specific services they
provide and/or will provide using the international section 214
authority; (2) types of customers that are and/or will be served; (3)
whether the services will be provided through the facilities for which
the applicant has an ownership, indefeasible-right-of use or leasehold
interest or through the resale of other companies' services; and (4)
identification of where they currently and/or in the future expect to
market, offer, and/or provide services using the particular
international section 214 authority, such as a U.S. state or territory
and/or U.S.-international route or globally. The Commission notes that
the Office of International Affairs retains the authority to request
additional information during the course of its review and, as
discussed above, the Commission proposes to adopt a similar rule for
the Commission's review of renewal applications. The Commission seeks
comment on these proposals and the potential burdens on applicants. The
Commission seeks comment on whether

[[Page 50504]]

the Commission should instead require authorization holders to provide
this information on an as-needed basis.
3. Foreign-Owned Managed Network Service Providers
78. In this proceeding, the Commission considers managed network
service providers (MNSPs) to be third parties with access to
telecommunications network, systems, or records to provide Managed
Services that support core domestic and international
telecommunications services, functions, or operations. The Commission
relies on international section 214 authorization holders to protect
U.S. records, such as customer proprietary network information (CPNI),
and ensure the security and reliability of U.S. telecommunications
networks. In October 2021, the Commission adopted an Order that will
require certain applicants and petitioners with reportable foreign
ownership--including applicants seeking international section 214
authority or modification, assignment, or transfer of control of
international section 214 authority--to provide answers to a set of
standardized national security and law enforcement questions (Standard
Questions). The Standard Questions will require an applicant, prior to
or at the same time the applicant files its application with the
Commission, to submit answers to those Questions directly to the
Committee, including whether ``any third-party Individual or Entity
[has] Remote Access to the Applicant's network, systems, or records to
provide Managed Services.'' Those applicants without reportable foreign
ownership are not routinely referred to the Committee or to other
relevant Executive Branch agencies. Such applicants, however, also may
reach contractual agreements or have other arrangements with foreign-
owned MNSPs, thereby granting such foreign-owned MNSPs access to U.S.
networks and potentially allowing them to take actions in ways that are
contrary to U.S. interests, without the Committee ever being informed.
79. Given the potential vulnerabilities raised by a foreign-owned
entity's access to critical telecommunications infrastructure in the
United States, the Commission proposes to require all applicants,
including those without reportable foreign ownership, to identify in
their application whether or not they use and/or will use foreign-owned
MNSPs. The Commission also proposes to adopt this requirement for
applicants seeking international section 214 authority and
modification, assignment, transfer of control, and renewal of
international section 214 authority.
80. The Commission proposes that any applicant with or without
foreign ownership that indicates it uses and/or will use foreign-owned
MNSPs will need to answer Standard Questions and those applications
would be routinely referred to the Executive Branch agencies, including
the Committee. Should the Commission ask additional questions, such as
requiring applicants to provide ownership information with respect to
each foreign-owned MNSP that they use and/or will use? Should the
Commission require applicants to identify all entities and/or
individuals that hold 5% or greater direct or indirect equity and/or
voting interests in the foreign-owned MNSP? Should an MNSP be
considered ``foreign-owned'' only if it is majority-owned and/or
controlled by one or more non-U.S. individual(s) or entity(ies)? Should
the Commission require applicants to explain in detail the foreign
individuals' or entities' involvement and management roles in the
foreign-owned MNSP? How best can the Commission obtain additional
information with regard to these arrangements for purposes of this
proceeding? For instance, should the Commission conduct a one-time
collection targeted to the use of foreign-owned MNSPs?
81. The Commission seeks comment on whether the Commission should
evaluate the character qualifications of foreign-owned MNSPs using the
same standards that the Commission proposes herein to rely on for the
Commission's assessment of applicants seeking international section 214
authority or modification, assignment, transfer of control, or renewal
of international section 214 authority. Because MNSPs are not seeking
Commission authorizations, and the Commission's character policy is
meant to ensure that the Commission can rely on regulated entities to
deal truthfully with the Commission and comply with the Act and the
Commission's rules, should the Commission be concerned about different
types of past misconduct when the Commission assesses an authorization
holder's relationship with a foreign-owned MNSP? \40\ Should the
Commission require applicants, similar to the questions set out in the
Standard Questions as applied to applicants, to identify whether or not
the foreign-owned MNSP or any entity and/or individual with any
ownership or controlling interest in such MNSP has ``been investigated,
arraigned, arrested, indicted, or convicted'' of criminal violations
that are indicative of a propensity to engage in behavior that may
jeopardize the security and reliability of U.S. telecommunications
networks? \41\ Should the Commission limit any information requirement
regarding MNSPs to a specific prior period of time?
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\40\ Examples of past misconduct by an MNSP the Commission might
consider relevant to the Commission's assessment include deceptive
sales practices, violations of consumer protection statutes and any
regulations, and/or other fraud or abuse practices in violation of
federal, state, and/or local law; and violations of federal, state,
or local law in connection with the provision of telecommunications
services, equipment, and/or products, and/or any other practices
regulated by the Telecommunications Act of 1996 and/or by public
utility commissions in the United States. See 2021 Standard
Questions Order, 36 FCC Rcd at 14883 through 96, Attach. A (Standard
Questions for an International Section 214 Authorization
Application).
\41\ Such criminal violations of U.S. law would include
violations of the Espionage Act (18 U.S.C. 792 et seq.), the
International Traffic in Arms Regulations (22 CFR parts 120 through
130), and/or the Export Administration Regulations (15 CFR part 730
et seq.). See 2021 Standard Questions Order, 36 FCC Rcd at 14889,
Attach. A, Standard Questions for an International Section 214
Authorization Application (``Has the Applicant or any Individual or
Entity with an Ownership Interest in the Applicant, or any of their
Corporate Officers, Senior Officers, Directors ever been
investigated, arraigned, arrested, indicted, or convicted of any of
the following: (a) Criminal violations of U.S. law, including
espionage-related acts or criminal violations of the International
Trade in Arms Regulations (ITAR) or the Export Administration
Regulations (EAR) . . . .'').
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82. Are there other considerations regarding MNSPs that should
factor into the Commission's analysis? For example, to what extent do
applicants, both facilities-based and resale-based authorization
holders, contract with foreign-owned MNSPs? Should the Commission
collect information on authorization holders' use of MNSPs in any other
context? Should applicants identify in their application whether they
use and/or will use a non-foreign-owned MNSP(s), or an MNSP with
foreign ownership that is less than a reportable threshold, if that
MNSP routes or manages traffic using facilities outside of the United
States? Wireless carriers with international section 214 authorizations
may provide international services to their customers. Are there any
special concerns raised by use of foreign-owned MNSPs by wireless
carriers, including by CMRS providers?
83. If the Commission adopts such requirements, the Commission
would propose to routinely refer to the Executive Branch agencies,
including the Committee agencies, to assist the Commission's public
interest determination, an application for a new international section
214 authorization as well as an application to modify,

[[Page 50505]]

assign, transfer control of, or renew the international section 214
authority where an applicant discloses that it uses and/or will use a
foreign-owned MNSP. Similar to the Commission's current practice, the
Commission proposes to delegate to the Office of International Affairs
the authority to develop Standard Questions, to modify and harmonize
existing questions on MNSPs and other matters, and to require
applicants to submit answers to the Standard Questions, including
personally identifiable information (PII), directly to the Committee
prior to or at the same time the applicant files its application with
the Commission. The Commission seeks comment on these proposals.
4. Cross Border Facilities Information
84. The Commission proposes to collect from current international
section 214 authorization holders information on critical
infrastructure that is used by authorization holders to provide service
crossing the U.S.-Mexico and U.S.-Canada borders, including the
location, ownership, and type of facilities, and to require
authorization holders to continue to update this information as part of
the ongoing three-year reporting requirement proposed below. The
Commission also proposes to share this information with relevant
Executive Branch agencies, including the Committee agencies. The
Commission currently receives this information for submarine cables
that land in the United States pursuant to its rules. With this
proposed new information collection, the Commission would then have an
understanding of not only submarine fiber cable connections to U.S.
facilities, but also facilities information for terrestrial fiber
cables that cross the U.S.-Mexico and U.S.-Canada borders. Below, the
Commission also proposes to conduct a one-time information collection
concerning cross border facilities and proposes to require updates in
the ongoing reports as well as sharing this information with the
Commission's federal partners. The proposed rules would ensure that the
Commission has knowledge of the critical infrastructure at the nation's
borders. The Commission seeks comment on this proposal.
85. Congress created the Commission, among other reasons, ``for the
purpose of the national defense [and] for the purpose of promoting
safety of life and property through the use of wire and radio
communications . . . .'' Throughout the past decade, Congress and the
Executive Branch have repeatedly stressed the importance of identifying
and eliminating potential security vulnerabilities in U.S.
communications networks and supply chains. Recently, the Commission has
taken a number of targeted steps as part of its ongoing efforts to
protect the security of the networks that provide telecommunications
services. The Commission has taken significant steps by blocking access
to U.S. communications networks, pursuant to its authority under
section 214 of the Act, to providers posing a substantial and serious
security threat to U.S. communications networks, and continues its
efforts to identify and eliminate potential security vulnerabilities in
U.S. telecommunications networks and supply chains.
86. The security of physical telecommunications facilities is
essential to maintaining resilient infrastructure, not only for its
role in ensuring that people can communicate but also because it
enables all other critical infrastructure sectors, especially the
energy, information technology, financial services, emergency services,
and transportation systems sectors. The Presidential Policy Directive
on Critical Infrastructure Security and Resilience (Directive),
released in 2013, called for the federal government to strengthen the
security and resilience of critical infrastructure in an ``integrated,
holistic manner to reflect this infrastructure's interconnectedness and
interdependency.'' The Directive also highlighted the federal
government's plan to engage with international partners to protect U.S.
critical infrastructure. Recent guidance by the DHS Cybersecurity &
Infrastructure Security Agency (CISA) on the convergence between
cybersecurity and physical security warns against siloing information/
cybersecurity and physical security, instead recommending integrated
threat management. In addition, with respect to applicants with
reportable foreign ownership, the Standard Questions adopted in the
2021 Standard Questions Order include questions about the ``present and
anticipated physical locations'' concerning applicants' network
equipment, data centers, and infrastructure, whether applicants'
network equipment, data centers, and infrastructure is owned or leased;
descriptions of equipment used; network architecture diagrams, if the
applicant will be operating any physical and/or virtual
telecommunications switching platforms; and whether any entities,
including foreign-based entities, will be able to control the
infrastructure.
87. The Commission has emphasized the importance of security and
sensitivity of physical infrastructure relating to carriers' provision
of telecommunications service in view of significant national security
and law enforcement risks. For example, in the China Unicom Americas
Order on Revocation, the Commission stated that China Unicom (Americas)
Operations Limited's physical Points of Presence (PoPs) in the United
States ``are highly relevant to its ability to access, monitor, store,
disrupt, and/or misroute communications to the detriment of U.S.
national security and law enforcement.'' In the China Telecom Americas
Order on Revocation and Termination, the Commission addressed concerns,
among other things, that China Telecom (Americas) Corporation's (CTA)
PoPs in the United States ``are highly relevant to the national
security and law enforcement risks associated with CTA'' and that
``CTA, like any similarly situated provider, can have both physical and
remote access to its customers' equipment.'' In the Pacific Networks
and ComNet Order on Revocation and Termination, the Commission stated
that the physical location of Pacific Networks Corp.'s and ComNet (USA)
LLC's operations with respect to their points of presence in the United
States ``is relevant to identified national security and law
enforcement risks.'' Given the potential vulnerabilities associated
with carriers' physical presence and proximity to U.S. communications
networks, the Commission seeks to collect information and better
understand cross border facilities, bringing it in line with
information that the Commission already collects in the context of
submarine cable landing licenses.
88. Additionally, collecting more information on cross border
facilities would assist the Commission and its partners in the federal
government in understanding potential vulnerabilities in U.S.
telecommunications networks involving traffic rerouting. The Commission
is especially concerned about the ability of service providers to move
traffic outside of the United States when normal internet Protocol (IP)
routing protocols would not normally take such traffic outside of the
United States (for example, when the origination and destination points
are both located within the country). The Commission notes that
misrouting of traffic outside of the United States can be done without
the authorization and knowledge of the customer, and may

[[Page 50506]]

result in traffic that is sent to locations that are not under U.S.
legal protection. Cross border facilities are particularly significant
because of potential threats raised by U.S.-inbound traffic, such as
possible disruption to U.S. telecommunications service through bad
actors inserting malware into U.S. networks or inbound denial of
service attacks. Improved awareness of these facilities would provide
needed insight into the international upstream networks sending traffic
into the United States.
89. Based on the Commission's concerns above, the Commission
proposes to require all applicants for facilities-based international
section 214 authority to identify in their initial application for
international section 214 authority and the application for renewal of
their international section 214 authority, the facilities, services,
and other information concerning the facilities that they use and/or
will use to provide services under their international section 214
authority from the United States into Canada and/or Mexico. The
Commission proposes to require the same information in applications for
modifications, assignments, or transfers of control of facilities-based
international section 214 authorizations. Similarly, the Commission
proposes to require all applicants for resale-based international
section 214 authority to identify in their initial application for
international section 214 authority and the renewal application, the
facilities they lease and/or will lease to provide services under their
international section 214 authority from the United States into Canada
and/or Mexico. The Commission proposes to require the same information
in applications for modifications, assignments, or transfers of control
of resale-based international section 214 authorizations.
90. Specifically, the Commission proposes requiring the collection
of the following information from applicants for international section
214 authority, regardless of whether they seek facilities-based or
resale-based authorizations, and applicants for modification,
assignment, transfer of control, and renewal of international section
214 authority:
<bullet> Location of each cross border facility (street address and
coordinates);
<bullet> Name, street address, email address, and telephone number
of the owner(s) of each cross border facility, including the
Government, State, or Territory under the laws of which the facility
owner is organized;
<bullet> Identification of the equipment to be used in the cross
border facilities, including equipment used for transmission, as well
as servers and other equipment used for storage of information and
signaling in support of telecommunications;
<bullet> Identification of all IP prefixes and autonomous system
domain numbers used by the facilities that have been acquired from the
American Registry for Internet Numbers (ARIN); and
<bullet> Identification of any services that are and/or will be
provided by an applicant through these facilities pursuant to
international section 214 authority.
91. Would the public interest be served by requiring less or more
specific information? The Commission encourages parties to address
whether this information would enhance the Commission's ability to
protect U.S. telecommunications infrastructure. Should the Commission
share this information with, for example, state and local governments?
Are there other sources of information for infrastructure at the U.S.-
Canada and U.S.-Mexico borders? What other ways can the Commission
ensure that it has information about all critical infrastructure
facilities that are used by international section 214 authorization
holders to provide services, under their international section 214
authority, crossing the U.S.-Canada and U.S.-Mexico borders?
92. The Commission recognizes that non-common carrier facilities
located across the U.S.-Canada and U.S.-Mexico borders are an important
component of cross border infrastructure security. The Commission
proposes to require applicants to also provide the information set out
above about their non-common carrier facilities offered across the
U.S.-Canada and U.S.-Mexico borders. The security and safety of
telecommunications network is critical and if the Commission grants an
international section 214 authorization, it is essential for the
Commission and its federal partners to also receive non-common carrier
information to assist in the goals of this proceeding. The Commission
currently assesses fees on international non-common carrier circuits.
The Commission seeks comment generally on this proposal, including the
nature and extent of any burdens on applicants and authorization
holders. The Commission asks commenters to address whether this would
ensure the collection of almost all facilities at the borders. Are
there less burdensome alternatives that would achieve the Commission's
national security objectives?
93. Finally, if the Commission adopts such requirements, it would
propose to routinely refer to the Executive Branch agencies, including
the Committee, an application for a new international section 214
authorization as well as an application to modify, assign, transfer
control of, or renew those authorizations where an applicant reports
cross border facilities. These applications may separately raise
national security, law enforcement, and other concerns that require
input from the Executive Branch agencies to assist the Commission's
public interest review. The Commission seeks comment on this proposal.
94. Cross Border Facilities--Initial Information Collection and
Updates in the Ongoing Reports. The Commission proposes requiring all
current international section 214 authorization holders to report the
information specified above sixty (60) days after the effective date of
the rule, following OMB approval. The Commission further proposes to
require all current and future international section 214 authorization
holders to report this information to the Commission as part of the
ongoing reporting process discussed further below.
95. Sharing with Federal Agencies. The Commission anticipates
sharing the information gathered on cross border facilities with the
Executive Branch agencies and other federal agencies to improve the
Commission's understanding of the information and to augment the
Executive Branch's understanding of cross border telecommunications
security issues. To the extent that any of the information is
confidential, the Commission notes that its existing rules already
provide for the sharing of business confidential information with
Executive Branch agencies, including the Committee, in the context of
reviews within the scope of the Executive order. The rules also provide
for sharing of confidential information with other federal agencies
upon notice to the party seeking confidential treatment of the
information. The Commission seeks comment on whether sharing of the
confidential information with other federal agencies should be subject
to the same provisions regarding sharing confidential information with
the Committee.\42\ Disclosure of this information to other federal
agencies, if adopted, may require modifications to

[[Page 50507]]

the applicable System of Record Notice's routine uses.
---------------------------------------------------------------------------

\42\ The Commission will, to the extent required, modify the
applicable System of Records Notice under the Privacy Act to account
for, among other things, the collection of new information types
(e.g., information regarding cross border facilities) or new
disclosures (e.g., to new federal partners) as discussed throughout
this Notice. See Federal Communications Commission, Privacy Act of
1974; System of Records, IB-1, International Bureau Filing System,
86 FR 43237 (Aug. 6, 2021).
---------------------------------------------------------------------------

96. Updated Facilities Information. The Commission seeks comment on
requiring all authorization holders to notify the Commission within
thirty (30) days after commencing service in the new facility or
commencing service with an underlying facilities provider. The
Commission also seeks comment on whether it should require applicants
for initial international section 214 authority and modification,
assignment, transfer of control, and renewal of international section
214 authority to report, within thirty (30) days, pursuant Sec.
1.65(a), any changes that occur during the pendency of an application
relating to the cross border information that was provided in the
application with respect to existing facilities, as specified above,
and/or new facilities they are using or will use to provide services,
under their international section 214 authority, crossing the U.S.-
Canada and U.S.-Mexico borders.\43\
---------------------------------------------------------------------------

\43\ Any change to an applicant's cross border facilities
information as discussed herein would be deemed substantial and
significant, including deactivation of facilities.
---------------------------------------------------------------------------

97. The Commission believes collecting updated timely information
would promote equitable compliance for all entities subject to this
requirement. In light of evolving national security, law enforcement,
foreign policy, and trade policy threats, it is important for the
Commission to collect this information as soon as practicable to ensure
that the Commission and its federal partners have the most up-to-date
information for their continued efforts to protect this nation's
telecommunications infrastructure.
98. The Commission seeks comment on this information collection
generally. For example, the Commission seeks comment as to whether
other information should be submitted. The Commission seeks comment on
whether subsequent updates by carriers concerning facilities equipment
should be limited to identifying changes in or new additions to the
types of equipment (e.g., next generation firewalls) and manufacturers,
instead of a detailed list of equipment. Given the broad scope of the
Commission's proposed approach, should the Commission instead narrow
the information collection and how? As discussed below, should the
Commission require authorization holders to report updated information
in ongoing reports required every three years instead of requiring it
within 30 days after commencing service in the new facility or
commencing service with an underlying facilities provider? The
Commission seeks comment on whether it should reserve the right to
request detailed lists of equipment at the time of the Commission's
choosing.
5. Facilities-Based Equipment, Resellers, and Service Certification
99. Facilities Cybersecurity Certification. The Commission proposes
to require applicants for international section 214 authority and
modification, assignment, transfer of control, and renewal of
international section 214 authority to certify in the application that
they will undertake to implement and adhere to baseline cybersecurity
standards based on universally recognized standards such as those
provided by CISA or the Department of Commerce's National Institute of
Standards and Technology (NIST). The Commission tentatively concludes
that baseline security requirements would help mitigate national
security and law enforcement concerns associated with threats to the
security of U.S. communications infrastructure. The Commission seeks
comment on this proposal.
100. Other federal government agencies, namely CISA and NIST, have
put forward cross-sector security standards. The Commission seeks
comment on whether there are other universally recognized baseline
cybersecurity standards comparable to the security standards provided
by CISA and NIST, and whether applicants should be allowed to certify
instead that they will adopt those alternative cybersecurity standards.
The Commission seeks comment on whether the proposed certification
requirement should take into account the size of the applicant and its
operations. For example, should the Commission allow large facilities-
based providers and small resellers to certify adherence to different
baseline security standards? The Commission seeks comment on these
proposals and the potential burdens, if any, that would be imposed upon
applicants.
101. Facilities ``Covered List'' Certification. The Commission
proposes to require applicants for international section 214 authority
and modification, assignment, transfer of control, and renewal of
international section 214 authority to certify in the application as to
whether or not they use equipment or services identified on the
Commission's ``Covered List'' of equipment and services deemed pursuant
to the Secure and Trusted Communications Networks Act to pose an
unacceptable risk to the national security of the United States or the
security and safety of United States persons. The Commission proposes
that this certification would apply to covered equipment or services
purchased, rented, leased, or otherwise obtained on or after August 14,
2018 (in the case of Huawei, ZTE, Hikvision, Dahua, and Hytera), or on
or after 60 days after the date that any equipment or service is placed
on the Covered List. The Commission seeks comment on whether applicants
must provide notification to the Commission within 30 days prior to
implementing any plan to add new vendors to provide equipment or
services that are on the Covered List or plan to add/remove such
services for existing or new customers. The Commission also seeks
comment on whether applicants must provide notification to the
Commission within 30 days after they add new vendors to provide
equipment or services that are on the Covered List or add/remove such
services for existing or new customers.
102. The Commission proposes to require applicants for
international section 214 authority and modification, assignment,
transfer of control, and renewal of international section 214 authority
to certify that they will not purchase and/or use equipment made by
entities (and their subsidiaries and affiliates) on the ``Covered
List'' as a condition of the potential grant of the application. The
Commission seeks comment on these proposals and generally on what other
certifications the Commission should adopt concerning the ``Covered
List.''
103. Finally, if the Commission adopts such requirements, the
Commission would propose to routinely refer to the Executive Branch
agencies, including the Committee agencies, applications for new
international section 214 authorizations as well as applications to
modify, assign, transfer control of, or renew those authorizations
where an applicant certifies that it uses equipment or services
identified on the Commission's ``Covered List'' of equipment and
services pursuant to the Secure and Trusted Communications Networks
Act. These applications may separately raise national security, law
enforcement, foreign policy, and trade policy concerns that require
input from the Executive Branch agencies to assist the Commission's
public interest review. The Commission seeks comment on this proposal.
6. Regulatory Compliance Certification
104. The Commission proposes that all applicants seeking
international section 214 authority or modification, assignment,
transfer of control, or renewal of international section 214

[[Page 50508]]

authority must certify in the applications whether or not they are in
compliance with the Commission's rules and regulations, the Act, and
other laws. The Commission proposes to consider whether an applicant
that files any application involving international section 214
authority has the requisite character qualifications. Specifically, the
Commission proposes to require each applicant to certify in its
application whether or not the applicant has violated the Act,
Commission rules, or U.S. antitrust or other competition laws, has
engaged in fraudulent conduct before another government agency, has
been convicted of a felony, or has engaged in other non-FCC misconduct
the Commission has found to be relevant in assessing the character
qualifications of a licensee or authorization holder. The Commission
seeks comment on these proposals. The Commission also seeks comment on
whether it should require applicants to disclose any pending FCC
investigations, including any pending Notice of Apparent Liability, and
any adjudicated findings of non-FCC misconduct.

F. Other Changes to Part 63 Rules

105. The Commission proposes additional changes to its rules
concerning international section 214 authorizations to ensure that the
Commission has current and accurate information about which
authorization holders are providing service under their international
section 214 authority. As discussed above, although the Commission's
records indicate there are approximately 7,000 international 214
authorization holders, the Commission estimates the more accurate
number is closer to approximately 1,500 active authorization holders.
The Commission tentatively concludes that a substantial majority of
international section 214 authorizations are in disuse, including those
that may have never commenced use. Without accurate information about
who is providing U.S.-international service and how that service is
being provided, it is difficult for the Commission to ensure that such
service does not raise national security, law enforcement, foreign
policy, and/or trade policy concerns. The Commission seeks comment on a
number of proposals to improve the information that the Commission has
about authorization holders that provide service under their
international section 214 authority and the service that they are
providing. The Commission also seeks comment on whether there are
specific rules in Part 63 where the benefits do not outweigh the
burdens and whether the Commission should eliminate or modify such
rules.
1. Permissible Number of Authorizations
106. The Commission proposes to adopt a rule that would allow an
authorization holder to hold only one international section 214
authorization except in certain limited circumstances. The Commission
proposes that, if an authorization holder currently has more than one
international section 214 authorization, that carrier must surrender
the excess authorization(s). As explained below, an authorization
holder may have acquired different types of authorizations and under
different circumstances. The Commission's records indicate that
approximately 3% of authorization holders hold more than one
authorization. Under the Commission's current rules, there may be
various circumstances through which an authorization holder acquired
more than one authorization. An authorization holder may have acquired
multiple authorizations as a result of an assignment or transfer of
control. Or, an authorization holder may have obtained different types
of authorizations, such as global facilities-based authority, global
resale authority, and/or other authorization pursuant to Sec.
63.18(e)(1)-(3) of the Commission's rules. The Commission's concern is
that carriers may have duplicative authorizations that are not required
for them to provide U.S.-international service. The Commission
recognizes that in certain limited circumstances, a carrier may need
more than one authorization, such as authority for overseas cable
construction for a common carrier submarine cable or if the carrier is
affiliated with a foreign carrier with market power on a U.S.-
international route. However, the Commission tentatively finds that in
most circumstances, a carrier only requires one international section
214 authorization to provide service(s) under that authority.
107. The Commission seeks comment on this proposal. How should the
Commission consider for these purposes multiple authorizations held by
commonly controlled entities? Should carriers be allowed to hold more
than one authorization in certain circumstances? If so, commenters
should explain in detail why carriers should hold more than one
authorization. Would a carrier need a different authorization for each
type of authority enumerated in Sec. 63.18(e)(1)-(3)? The Commission
seeks comment on any additional exceptions that it should consider.
Should the Commission replace multiple authorizations held by a carrier
with a single, consolidated authorization that includes all of the
authority and conditions enumerated in each of the multiple
authorizations? The Commission seeks comment on whether such a proposed
measure is feasible under the Commission's current rules, and the
reasons therefor.
2. Commence Service Within One Year
108. Currently an entity can obtain an international section 214
authorization and never provide U.S.-international service pursuant to
the authorization. This may occur because business plans change or the
entity goes out of business, and this has led to a large number of
authorizations in the Commission's records where the authorization is
not being used to provide service. The Commission notes that it has
requirements for other licensees of regulated services where the
licensee must begin providing service within a set period of time or
its license is cancelled. The Commission proposes to adopt similar
requirements for international section 214 authorization holders. This
proposed requirement would also provide the Commission with more
accurate information as to who is actually providing U.S.-international
service and improve the administration of the Commission's rules.\44\
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\44\ See also 1996 Streamlining Order, 11 FCC Rcd at 12894,
paragraph 20. In the 1996 Streamlining Order, the Commission amended
Sec. 63.05 of the rules ``so that international common carriers
need not commence providing service within a specified time after
the Section 214 authorization date.'' Id. The Commission stated that
``[i]nternational carriers need to obtain operating agreements from
foreign carriers'' and ``[o]btaining such agreements may be delayed
by events outside U.S. carriers' control,'' adding that,
``[c]arriers' traffic reports will advise the Commission of the year
that carriers actually initiate service to individual countries.''
Id.
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109. The Commission tentatively concludes that authorization
holders should retain their authorization only if service is being
provided to the public under that authorization. Consequently, the
Commission proposes to adopt a rule requiring an international section
214 authorization holder to commence service under its international
section 214 authority within one year following the grant. Under this
proposal, an authorization holder will be required to file a
notification with the Commission through ICFS within 30 days of the
date when it begins to offer service but in no case later than one year
following the grant of international section 214 authority. The
Commission proposes that the commencement of service notification must
include: (1) a

[[Page 50509]]

certification by an officer or other authorized representative of the
authorization holder that the authorization holder has met the
commencement of service requirement; (2) the date that the
authorization holder commenced service; (3) a certification that the
information is true and accurate upon penalty of perjury; and (4) the
name, title, address, telephone number, and association with the
authorization holder of the officer or other authorized representative
who executed the certifications. The Commission proposes that an
authorization holder may obtain a waiver of the one-year time period if
it can show good cause why it is unable to commence service within one
year following the grant of its authorization and identify an
alternative reasonable timeframe when it can commence service. If an
authorization holder does not notify the Commission of the commencement
of service or file a request for a waiver within one year following the
grant of international section 214 authority, the Commission proposes
to cancel the authorization.
110. The Commission seeks comment on these proposals, including
whether one year is sufficient time to initiate U.S.-international
service or if another time period is appropriate in certain situations,
such as where an international section 214 authorization is acquired in
association with a common carrier submarine cable. The Commission seeks
comment on the Commission's proposal that authorization holders may
seek a waiver of the one-year requirement. The Commission's rules
provide in other contexts that licensees may seek a waiver of certain
rules. If an authorization holder seeks a waiver of the one-year time
period, what facts would establish good cause to extend the time period
for commencing U.S.-international service pursuant to its international
section 214 authority? The Commission also seeks comment on whether the
Commission should require authorization holders with authorizations
that were or are granted prior to the effective date of the new rules
to file with the Commission a commencement of service notification
within one year of the effective date of the rules.
3. Changes to the Discontinuance Rule
111. The Commission proposes to amend Sec. 63.19 of the
Commission's rules to require that all authorization holders that
permanently discontinue service under their international section 214
authority must file with the Commission a notification of the
discontinuance and surrender the authorization.\45\ Currently, the
discontinuance procedures set out in Sec. 63.19 only apply when an
authorization holder discontinues the service for which it has
customers. Section 63.19 requires that the carrier notify affected
customers of the planned discontinuance, reduction, or impairment of
service at least 30 days prior to its planned action.\46\ When the
Commission last revised the discontinuance rules in 2007, the
Commission did not address the particular situation where an
international section 214 authorization holder does not have customers.
As a result, an authorization holder may retain indefinitely an
authorization that has never been used or is no longer being used. An
authorization holder that ceases to provide international service or
goes out of business altogether is not currently required to notify the
Commission and surrender the authorization. This makes it difficult to
effectively administer international section 214 authorizations given
that the Commission's records indicate that many of the authorizations
are no longer being used to provide U.S.-international service.
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\45\ In 2007, the Commission amended its rules ``to reduce the
notification period for a non-dominant carrier's discontinuance of
international service from 60 days to 30 days, to be more consistent
with the minimum period generally allowed before a non-dominant
carrier can receive authority to discontinue domestic service.''
2007 Amendment of Parts 1 & 63 Order, 22 FCC Rcd at 11402, paragraph
10. The Commission found that ``the further increase in the number
of carriers and competition in the U.S. international
telecommunications marketplace since 1996 justifies a further
reduction in our discontinuance notice period for international
services.'' Id. at paragraph 12. The Commission also modified its
rules to require international carriers to file a copy of the
discontinuance notification with the Commission at the same time
they provide notification to their affected customers. Id. at 11402,
11403, paragraphs 10, 13. The Order did not address a situation
where discontinuance of international service occurred where an
authorized carrier had no customers.
\46\ 47 CFR. 63.19(a). Section 63.19(a) requires that ``any
international carrier that seeks to discontinue, reduce, or impair
service, including the retiring of international facilities,
dismantling or removing of international trunk lines,'' must: (1)
``notify all affected customers of the planned discontinuance,
reduction, or impairment at least 30 days prior to its planned
action,'' and (2) file with the Commission ``a copy of the
notification on the date on which notice has been given to all
affected customers.'' Id. 63.19(a)(1)-(2). The notification must
``be in writing to each affected customer unless the Commission
authorizes in advance, for good cause shown, another form of
notice.'' Id. 63.19(a)(1). Section 63.19(b) contains procedural
requirements for any international carrier that the Commission has
classified as dominant in the provision of a particular
international service because the carrier possesses market power in
the provision of that service on the U.S. end of the route. Id.
63.19(b). Any such carrier that seeks to retire international
facilities, dismantle, or remove international trunk lines, but does
not discontinue, reduce, or impair the dominant services being
provided through these facilities, shall only be subject to the
notification requirements of section 63.19(a). Id. If such carrier
discontinues, reduces, or impairs the dominant service, or retires
facilities that impair or reduce the service, the carrier shall file
an application pursuant to Sec. Sec. 63.62 and 63.500. Id.
Commercial Mobile Radio Service (CMRS) carriers, ``as defined in
section 20.9 of the Commission's rules, are not subject to the
provisions of'' Sec. 63.19. Id. 63.19(c).
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112. Permanent Discontinuance of Service. The Commission proposes
to modify Sec. 63.19 by adding a requirement that an authorization
holder that permanently discontinues service under its international
section 214 authority must surrender the authorization. The Commission
proposes to define permanent discontinuance of service as a period of
three consecutive months during which an authorization holder does not
provide any service under its international section 214 authority. The
Commission will continue to require that an authorization holder with
existing customers must comply with the requirements of Sec. 63.19(a)
to notify all affected customers prior to discontinuance. If a carrier
will discontinue part but not all of its U.S.-international services--
for example, by discontinuing service only on a particular U.S.-
international route--and will continue to provide other U.S.-
international service(s) under its international section 214 authority,
it must comply with the requirements of Sec. 63.19(a) to notify
affected customers prior to discontinuance of those services.
113. The Commission proposes that, if an authorization holder has
permanently discontinued service provided pursuant to its international
section 214 authority, it must surrender its authorization and file
with the Commission a notification that con

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