*Pages 1--6 from Microsoft Word - 5504.doc* Federal Communications Commission FCC 00- 392 1 Before the Federal Communications Commission Washington, D. C. 20554 In the Matter of Amendment of Section 1.1204 of the Commission’s Ex Parte Rules ) ) ) ) ) ) ) ) ) GC Docket No. 00- 219 NOTICE OF PROPOSED RULE MAKING Adopted: October 30, 2000 Released: December 15, 2000 Comment Date: [30 days after Federal Register publication] Reply Date: [45 days after Federal Register publication] By the Commission: 1. By this notice of proposed rulemaking, we propose to modify 47 C. F. R. § 1.1204( a)( 6), one of the rules governing the permissibility of ex parte presentations in Commission proceedings. The rule in question defines one of several “exempt ex parte presentations,” that is, presentations that may be made on an ex parte basis 1 regardless of the type of proceeding involved. 2 The current rule provides that the following type of presentation is exempt: 1 A presentation is a communication directed to the merits or outcome of a proceeding. 47 C. F. R. § 1. 1202( a). An ex parte presentation is a presentation, which if written, is not served on the parties of the proceeding, and, if oral, is made without advance notice to the parties and without opportunity for them to be present. 47 C. F. R. § 1.1202( b). 2 In general, the nature of the proceeding determines the permissibility of ex parte presentations. In exempt proceedings, ex parte presentations are generally permitted, in permit- but- disclose proceedings, ex parte presentations to decisions- makers are permitted but must be disclosed, and in restricted proceedings, ex parte presentations both to and by decision- makers are prohibited. 47 C. F. R. §§ 1.1200, 1.1204, 1.1206, 1.1208. 1 Federal Communications Commission FCC 00- 392 2 (6) The presentation is to or from the United States Department of Justice or Federal Trade Commission and involves a telecommunications competition matter in a proceeding which has not been designated for hearing and in which the relevant agency is not a party or commenter (in an informal rulemaking or Joint board proceeding) provided that, any new factual information obtained through such a presentation that is relied on by the Commission in its decision- making process will be disclosed by the Commission no later than at the time of the release of the Commission's decision; We propose to broaden the scope of this exemption to include international and foreign governmental bodies that exercise similar jurisdiction over relevant matters. 2. The rule was intended to “promote the public interest through the exchange of information between the Commission and the other principal agencies responsible for promoting or ensuring competition in the telecommunications industry.” Amendment of the Commission’s Ex Parte Rules, 9 FCC Rcd 6108 ¶ 2 (1994). The Commission stated that the rule: . . . should lead to more effective enforcement and protection of the public interest, development and application of more consistent analytical methodologies, an improved, expedited license transfer process, and the possible avoidance of unnecessarily duplicative efforts. At the same time, the requirement for disclosure of any factual information relied on by the Commission will protect the rights of the parties. Id. at ¶ 2. The Commission reaffirmed this rationale in its comprehensive revision of the ex parte rules in 1997 following notice and comment. Amendment of 47 C. F. R. § 1.1200 et seq., 12 FCC Rcd 7348, 7368 ¶ 61 (1997), recon. denied, 14 FCC Rcd 18831 (1999), modified, DA 99- 2788 (Dec. 17, 1999). 3. We continue to believe that the public interest will be served by permitting free consultation between the agencies with principal jurisdiction over telecommunications competition matters. Indeed, the need for effective, expedited, and consistent governmental response to issues of competition is especially acute in the present environment of major structural reorganizations within the telecommunications industry, accelerated technological change, and increased globalization. The current section 1.1204( a)( 6), however, fails to take into account an important dimension in the oversight of telecommunications competition, namely the increased globalization of telecommunications competition issues. The entities and services involved in, for example, mergers may well be international, rather than national in character, and the oversight of such cases potentially involves not only the Commission, the DOJ, and the FTC, but also their foreign and international counterparts. 4. This situation has prompted antitrust and competition policy officials of the United States to develop close relationships with their foreign and international counterparts with respect to notifications, consultations, and coordination. In this regard, formal bilateral agreements have been reached between the United States and Australia, Brazil, Canada, Germany, the European 2 Federal Communications Commission FCC 00- 392 3 Communities, Israel, Japan, and Mexico. 3 Additionally, informal relationships exist with other countries. See UNITED STATES DEPARTMENT OF JUSTICE AND FEDERAL TRADE COMMISSION, ANTITRUST ENFORCEMENT GUIDELINES FOR INTERNATIONAL OPERATIONS, available at . Because the public interest requires the effective, expedited, and consistent exercise of authority on the international as well as national scale, presentations by the appropriate foreign and international agencies should also be exempt under the Commission’s ex parte rules. 5. We therefore propose to modify section 1.1204( a)( 6) as set forth in the attached appendix. 6. As an additional matter, we take this opportunity to clarify that the term “telecommunications competition matter” in the current rule was intended to be broadly construed to include the full extent of the respective agencies’ jurisdiction over communications competition matters. It was not intended to be limited to specific types of competition matters involving “telecommunications” as that term may be technically defined by the Act. For example, we have not in the past limited our application of the rule to matters involving carriers, and the rules’ coverage extends to the full range of competition issues arising before the Commission. A. Ex Parte Rules -- Permit- but Disclose Proceeding 7. This is a permit- but- disclose notice- and- comment rulemaking proceeding. Ex parte 3 See Agreement Between the Government of the United States of America and the Government of Australia on Mutual Antitrust Enforcement Assistance, April 27, 1999, U. S. – Australia, T. I. A. S. No. ____; Agreement Between the Government of the United States of America and the Government of the Federative Republic of Brazil Regarding Cooperation Between Their Competition Authorities in the Enforcement of Their Competition Laws, October 26, 1999, U. S. – Brazil, T. I. A. S. No. _____; Agreement Between the Government of the United States of America and the Government of Canada Regarding the Application of Their Competition and Deceptive Marketing Practices Laws, August __, 1995, U. S. – Canada, T. I. A. S. No. _______; Agreement Between the Government of the United States of America and the Government of the Federal Republic of Germany Relating to Mutual Cooperation Regarding Restrictive Business Practices, June 23, 1976, U. S. – Germany, T. I. A. S. No. 8291; Agreement Between the Government of the United States of America and the European Communities on the Application of Positive Comity Principles in the Enforcement of Their Competition Laws, June 4, 1998, U. S. – European Communities, T. I. A. S. No. ______; Agreement Regarding the Application of Their Competition Laws, March 15, 1999, U. S. – Israel, T. I. A. S. No. ______; Agreement between the Government of the United States of America and the Government of Japan Concerning Cooperation on Anticompetitive Activities, October 7, 1999, U. S. – Japan, T. I. A. S. No. ___; Agreement Between the Government of the United States of America and the Government of the United Mexican States Regarding the Application of their Competition Laws, July 11, 2000, U. S. – Mexico, T. I. A. S. No. ______. . 3 Federal Communications Commission FCC 00- 392 4 presentations are permitted, except during the Sunshine Agenda Period, provided they are disclosed as set forth in 47 C. F. R. § 1.1206( b). B. Regulatory Flexibility Certification 8. Section 603 of the Regulatory Flexibility Act, as amended, requires a preliminary regulatory flexibility analysis in a notice and comment rulemaking proceeding unless we certify that "the rule will not, if promulgated, have a significant economic impact on a substantial number of small entities." 5 U. S. C. § 605( b). We believe that the rule we propose today will not have a significant economic impact on a substantial number of small entities. 9. As noted above, in proposing to revise the ex parte rules we are expanding the scope of presentations treated as exempt. The proposed rule does not impose any additional compliance burden on persons dealing with the Commission, including small entities. The new rule would not significantly affect the rights of persons participating in Commission proceedings. There is no reason to believe that operation of the new rule would impose significant costs on parties to Commission proceedings. 10. Accordingly, we certify, pursuant to Section 605( b) of the Regulatory Flexibility Act, as amended by the Contract with America Advancement Act of 1996 (CWAAA), Pub. L. No. 104- 121, 110 Stat. 847 (1996), that the rules will not have a significant economic impact on a substantial number of small entities. 5 U. S. C. § 605( b). The Commission shall send a copy of this Notice of Proposed rulemaking, including this certification, to the Chief Counsel for Advocacy of the SBA. 5 U. S. C. § 605( b). A copy of this certification will also be published in the Federal Register. Id. C. Authority 11. Authority for this rulemaking is contained in 47 U. S. C. §§ 154( i), 154( j), 303( r), and 403. 12. ACCORDINGLY, IT IS ORDERED, That NOTICE IS HEREBY GIVEN of the proposed regulatory changes described above, and that COMMENT IS SOUGHT on these proposals. 13. IT IS FURTHER ORDERED, That pursuant to applicable procedures set forth in 47 C. F. R. §§ 1.415 and 1.419, comments SHALL BE FILED on or before [30 days after Federal Register publication] and reply comments SHALL BE FILED on or before [45 days after Federal Register publication]. To file formally in this proceeding, commenters must file an original and four copies of all comments, reply comments, and supporting comments. If commenters want each Commissioner to receive a personal copy of their comments, they must file an original plus nine copies. Comments and reply comments should be sent to Office of the Secretary, Federal Communications Commission, Washington, D. C. 20554. In addition, commenters should file a copy of any such pleadings with the Office of General Counsel, Portals II, 445 12 th Street, SW, Room 8- C723, Washington, D. C. 20554. Comments and reply comments will be available for public inspection during regular business hours in the FCC Reference 4 Federal Communications Commission FCC 00- 392 5 Information Center, Portals II, 445 12 th Street, SW, Room CY- A257, Washington, D. C. 20554. Copies of filings may be purchased from the Commission's copy contractor, International Transcription Service (ITS), 1231 20 th Street, NW, Washington, D. C. 20036, telephone (202) 857- 3800, facsimile (202) 857- 3805. Filings may also be viewed on the Commission’s Internet web site using the Electronic Document Filing System (ECFS) at . 14. For further information, contact David S. Senzel, (202) 418- 1720, Office of General Counsel. FEDERAL COMMUNICATIONS COMMISSION Magalie Roman Salas Secretary 5 Federal Communications Commission FCC 00- 392 6 APPENDIX § 1.1204 Exempt ex parte presentations and proceedings (a)**** (6) The presentation is to or from: (i) the United States Department of Justice; (ii) the United States Federal Trade Commission; or (iii) a foreign or international agency, including but not limited to the Competition Directorate of the European Commission, with responsibility for the oversight of competition matters similar to the foregoing United States agencies; and the presentation involves a telecommunications competition matter. This exemption applies to proceedings which have not been designated for hearing and in which the relevant agency is not a party or commenter (in an informal rulemaking or Joint board proceeding). Any new factual information obtained through such a presentation that is relied on by the Commission in its decision- making process shall be disclosed by the Commission no later than at the time of the release of the Commission's decision; 6