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The Federal Trade Commission announced (May 28th) that it is further delaying enforcement of the “Red Flags” Rule through December 31, 2010.  Enforcement was to have begun June 1, 2010 (see related story below).  The delay comes at the request of Congress, which is currently considering legislation that would affect the scope of entities covered by the rule.

Today’s announcement and the release of an Enforcement Policy Statement do not affect other federal agencies’ enforcement of the original November 1, 2008 deadline for institutions subject to their oversight to be in compliance.  Access the FTC statement about the decision online.  (Source:  NTCA, 5/28/10)

The Federal Trade Commission, at the request of Congress, delayed until June 1 (changed to December 31...see related story above) enforcement of its Red Flag Rule to give creditors and financial institutions more time to review FTC guidance and develop and implement written Identity Theft Prevention Pro-grams. The June 1 deadline applies to entities under the jurisdiction of the FTC and does not affect the Address Discrepancy or Card Issuer Rules. Under the new rules, all businesses that maintain a creditor-debtor relationship with customers, including virtually all telecommunications carriers (but other companies as well), must adopt written procedures designed to detect the relevant warning signs of identity theft, and implement an appropriate response.

The Red Flag compliance program was in place as of Nov. 1, 2008. But the FTC will not enforce the rules until June 1, 2010, meaning only that a business will not be subject to enforcement action by the FTC if it delays implementing the pro-gram until June 1. The FTC announcement does not affect other federal agencies’ enforcement of the original Nov. 1, 2008, compliance deadline for institutions subject to their oversight. Other liabilities may be incurred if a violation occurs in the meantime. The requirements are not just binding on telcos and wireless carriers that are serving the public on a common carrier basis. They also apply to any "creditor" (which includes entities that defer payment for goods or services) that has "covered accounts" (accounts used mostly for personal, family or household purposes).

This also may affect private user clients, as well as many telecom carriers’ non-regulated affiliates and subsidiaries. BloostonLaw has prepared a Red Flag Compliance Manual to help your company achieve compliance with the Red Flag Rule. Please contact: Gerry Duffy (202-828-5528) or Mary Sisak (202-828-5554) with any questions or to request the manual. (Source:  BloostonLaw 5/26/10)

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Natl. Associations File Comments with FCC on Petition to Amend Retransmission Consent Rules

OPASTCO and allies NTCA, the Independent Telephone and Telecommunications Alliance (ITTA), WTA and the Rural Independent Competitive Alliance (RICA) filed comments with the FCC on May 18 in response to a petition requesting that the FCC consider amending and supplementing current retransmission consent rules.  The associations claimed that market-based reform of retransmission consent rules is necessary to enable small and mid-sized multichannel video programming distributors (MVPDs) to offer affordable rates and more choices to their video customers, as well as to increase broadband adoption.  The suggested actions include:

The Commission should implement new, market-based rules that allow MVPDs to (a) provide channels from outside their designated market area (DMA); (b) pool bargain; and (c) have access to "most favored nation status" pricing for programming;

The Commission should protect consumers by instituting a "standstill" provision that would ensure that customers experience no loss of broadcast signals while negotiations and/or dispute resolution proceedings are underway; and

The Commission should establish one or more dispute resolution mechanisms, as this would minimize a dispute's effect on consumers and increase the likelihood that mutually acceptable agreements would be reached. (Source:  OPASTCO 411, 5/20/10)

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Fellow Associations File Comments with FCC on E-Rate Program

OPASTCO and fellow associations the Cellular Telecommunications and Internet Association (CTIA), ITTA, NTCA, USTelecom and WTA, and telecommunications companies Consolidated Communications, FairPoint Communications, Frontier Communications, Hawaiian Telecom, Iowa Telecommunications Services, Sprint Nextel, Surewest Communications and Windstream Communications filed comments with the FCC on May 14 in response to a petition submitted to clarify the scope and meaning of the "lowest corresponding price" rule element of the USF Schools and Libraries (E-Rate) Program.  OPASTCO and its joint filers asserted that:

The lowest corresponding price obligation should only apply to competitive bids submitted by a provider in response to an FCC Form 470;

The lowest corresponding price obligation should not be a continuing obligation;

Service providers are not required to ensure continuing compliance with the lowest corresponding price obligation;

Compliance with the lowest corresponding price obligation does not require discrete elements in service bundles to be compared or priced individually;

The Commission should clarify its rules regarding challenges to lowest corresponding price obligations; and

If the Commission disagrees with the petitioners' requests for clarification, any contrary interpretations of the E-Rate rules must be prospective only.

(Source:  OPASTCO 411, 5/20/10)

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FCC News

FCC Adopts Pole Attachments Order, FNPRM

The FCC adopted on May 20 an Order and Further Notice of Proposed Rulemaking (FNPRM) regarding pole attachments.  The Order clarifies the statutory right of communications providers to use the same space- and cost-saving techniques as utility pole owners, such as placing attachments on both sides of a pole, and establishes timely access to poles.  The FNPRM seeks comment on a specific timeline to govern each step of the pole attachment process, and it proposes rules to speed resolution of disputes.  Both the Order and FNPRM incorporate recommendations made in the National Broadband Plan.
     Comments responding to the FNPRM will be due 30 days after publication in the Federal Register.  Reply comments will be due 60 days after publication. (Source:  OPASTCO 411, 5/25/10)

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The FCC has ex-tended the existing freeze of Part 36 category relation-ships and jurisdictional cost allocation factors until June 30, 2011. Jurisdictional separations is a system of rules for allocating common network costs into interstate and intrastate jurisdictions and this affects regulated inter-state and intrastate rates. The Commission froze as-pects of the jurisdictional separations rules in 2001 and has periodically extended the freeze since then. The FCC believes that extending the freeze will provide sta-bility for carriers that must comply with the Commission’s separations rules while issues related to interim and comprehensive reform are considered.

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Latest FCC Telephone Penetration Report Now Available

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Comments on NPRM on NBP Recommendations for USF Reform Due July 12

The FCC is now accepting comments on its Notice of Proposed Rulemaking (NPRM) regarding reform of the Universal Service Fund (USF) per recommendations made in the National Broadband Plan (NBP) (411, April 22).  Specifically, the NPRM seeks public comment on the following:

Proposals to cut certain legacy USF support in high-cost areas so as to shift support to broadband communications, including:

Capping the size of the USF High-Cost Program at 2010 levels;