FCC Releases FNPRM on Updating ICC Regime to Eliminate Access Arbitrage

On July 15, 2022, the FCC released the Future Notice of Proposed Rulemaking (“FNPRM”) seeking comment on updating the intercarrier compensation (“ICC”) regime to eliminate access arbitrage, which was adopted at the July 14th Open Meeting.  In the FNPRM, the FCC seeks comment on several proposals to prevent companies from executing new business strategies to engage in access stimulation by evading the Commission’s existing Access Stimulation Rules, thereby harming consumers and imposing unwarranted costs on America’s telecommunications networks.  The FNPRM clarifies that the term “IXC,” as used throughout the item, encompasses wireless carriers to the extent they are payers of switched access charges.

The FNPRM proposes (i) ways to clarify perceived ambiguities in the Commission’s rules that some providers are exploiting to force IXCs and their end-user customers to continue to bear the costs of high-volume calling services by incorporating IP enabled service (“IPES”) Providers into the call path; (ii) that when traffic is delivered to an IPES Provider by a LEC or an Intermediate Access Provider, and the terminating-to-originating traffic ratios of the IPES Provider exceed certain triggers established in the existing Access Stimulation Rules, the IPES Provider will be deemed to be engaged in Access Stimulation; and (iii) that Intermediate Access Providers be prohibited from imposing tariffed terminating tandem switching and transport access charges on IXCs sending traffic to access-stimulating IPES Providers or to such providers’ end-user customers.  The FNPRM also generally seeks comment on the Commission’s legal authority to act, costs and benefits of the proposals and efforts to promote digital equity and inclusion.

Comments are due 30 days after the date of publication in the Federal Register.

Reply Comments are due 60 days after date of publication in the Federal Register.

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