[Federal Register Volume 85, Number 120 (Monday, June 22, 2020)]
[Rules and Regulations]
[Pages 37364-37376]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2020-11348]
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FEDERAL COMMUNICATIONS COMMISSION
47 CFR Part 1
[MD Docket No. 19-105; MD Docket No. 20-105; FCC 20-64; FRS 16782]
Assessment and Collection of Regulatory Fees for Fiscal Year 2020
AGENCY: Federal Communications Commission.
ACTION: Final actions.
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SUMMARY: In this document, the Federal Communications Commission
(Commission) acts on several proposals that will impact FY 2020
regulatory fees.
DATES: These final actions are effective July 22, 2020.
FOR FURTHER INFORMATION CONTACT: Roland Helvajian, Office of Managing
Director at (202) 418-0444.
SUPPLEMENTARY INFORMATION: This is a summary of the Commission's Report
and Order, FCC 20-64, MD Docket No. 19-105, and MD Docket No. 20-105,
adopted on May 12, 2019 and released on May 13, 2020. The full text of
this document is available for public inspection and copying during
normal business hours in the FCC Reference Center (Room CY-A257), 445
12th Street SW, Washington, DC 20554, or by downloading the text from
the Commission's website at http://transition.fcc.gov/Daily_Releases/Daily_Business/2017/db0906/FCC-17-111A1.pdf.
I. Administrative Matters
A. Final Regulatory Flexibility Analysis
1. As required by the Regulatory Flexibility Act of 1980 (RFA),\1\
the Commission has prepared a Final Regulatory Flexibility Analysis
(FRFA) relating to this Report and Order. The FRFA is located towards
the end of this document.
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\1\ See 5 U.S.C. 603. The RFA, see 5 U.S.C. 601-612, has been
amended by the Small Business Regulatory Enforcement Fairness Act of
1996 (SBREFA), Public Law 104-121, Title II, 110 Stat. 847 (1996).
The SBREFA was enacted as Title II of the Contract with America
Advancement Act of 1996 (CWAAA).
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B. Final Paperwork Reduction Act of 1995 Analysis
2. This document does not contain new or modified information
collection requirements subject to the Paperwork Reduction Act of 1995
(PRA), Public Law 104-13. In addition, therefore, it does not contain
any new or modified information collection burden for small business
concerns with fewer than 25 employees, pursuant to the Small Business
Paperwork Relief Act of 2002, Public Law 107-198, see 44 U.S.C.
3506(c)(4).
C. Congressional Review Act
3. The Commission has determined, and the Administrator of the
Office of Information and Regulatory Affairs, Office of Management and
Budget, concurs that these rules are non-major under the Congressional
Review Act, 5 U.S.C. 804(2). The Commission will send a copy of this
Report & Order to Congress and the Government Accountability Office
pursuant to 5 U.S.C. 801(a)(1)(A).
II. Introduction
4. In this Report and Order, we follow through on our proposal in
the FY 2019 Report and Order and Further Notice of Proposed Rulemaking
(FNPRM) \2\ to level the playing field between domestic and foreign
licensed space stations by assessing a regulatory fee on commercial
space stations licensed by other administrations (non-U.S. licensed
space stations) with United States market access, among other things.
We also adjust the FTE allocation for the international bearer circuit
(IBC) category, and we decline to grant a categorically lower
regulatory fee for VHF stations to account for signal limitations.
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\2\ Assessment and Collection of Regulatory Fees for Fiscal Year
2019, Report and Order and Further Notice of Proposed Rulemaking, 34
FCC Rcd 8199 (2019) (FY 2019 Report and Order (84 FR 50890
(September 26, 2019) and FY 2019 FNPRM (84 FR 56734 (October 23,
2019))).
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III. Report and Order
1. In this Report and Order, we level the playing field among space
stations by assessing a regulatory fee on non-U.S. licensed space
stations with United States market access and including those non-U.S.
licensed space stations in the current regulatory fee categories for
geostationary (GSO) and non-geostationary (NGSO) space stations. We
impose this fee regardless of whether the non-U.S. licensed space
station operator obtains the market access through a declaratory ruling
or through an earth station applicant as a point of communication. We
also take the related action of adding four FTEs into the satellite
regulatory fee category to account for the work that benefits these new
fee payors. We further adjust the FTE allocation for the international
bearer circuit (IBC) category from 6.9 FTEs to eight FTEs to reflect
direct FTE work in the International Bureau that benefits the fee
payors in the IBC regulatory fee category. Finally, we decline to
categorically lower regulatory fees for VHF stations to account for
signal limitations.
[[Page 37365]]
A. Assessing Regulatory Fees on Non-U.S. Licensed Space Stations With
U.S. Market Access
2. The Commission currently assesses regulatory fees on GSO and
NGSO space stations licensed by the Commission but does not assess
regulatory fees on non-U.S. licensed space stations that have been
granted market access to the United States.\3\ The issue of assessing
regulatory fees on non-U.S. licensed space stations with U.S. market
access has been raised several times previously. In the FY 1999 Report
and Order, the Commission declined to adopt such a fee.\4\ In 2013 and
again in 2014, the Commission sought comment on assessing regulatory
fees on non-U.S. licensed space stations with U.S. market access,\5\
but the Commission declined to adopt such a fee at the time because it
might ``raise[ ] significant issues regarding our authority to assess
such a fee as well as the policy implications if other countries
decided to follow our example.'' \6\ The following year, the Commission
observed that excluding non-U.S. licensed satellite operators from fees
amounted to a subsidy of such operators by U.S. licensed satellite
operators.\7\ The Commission thus concluded that the four FTEs working
on market access petitions or other matters involving non-U.S. licensed
space stations should be removed from the regulatory fee assessments
for U.S. licensed space stations and considered indirect for regulatory
fee purposes.\8\
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\3\ Under the Commission's rules, a satellite licensed by an
administration other than the United States may seek to communicate
with satellite earth stations in the United States through a process
called market access. 47 CFR 25.137. Market access is either
requested by the space station operator through a petition for
declaratory ruling from the Commission that market access by the
non-U.S. licensed space station is in the public interest, or
through an application by a U.S. licensed earth station to
communicate with the non-U.S. licensed space station. 47 CFR
25.137(a). In either case, the Commission does not license the space
station, but the request for U.S. market access requires the
submission and review of the same legal and technical information
for the non-U.S. licensed space station as would be required in a
license application for that space station. 47 CFR 25.137(b).
\4\ Assessment and Collection of Regulatory Fees for Fiscal Year
1999, Report and Order, 14 FCC Rcd 9868, 9883, paragraph 39 (1999)
(79 FR 37982, paragraphs 53-56 (July 3, 2014) (FY 1999 Report and
Order).
\5\ Assessment and Collection of Regulatory Fees for Fiscal Year
2014, Notice of Proposed Rulemaking, Second Further Notice of
Proposed Rulemaking, and Order, 29 FCC Rcd 6417, 6433-34, paragraphs
47-50 (2014) (79 FR 37982, paragraphs 53-56 (July 3, 2014)) (FY 2014
NPRM); Assessment and Collection of Regulatory Fees for Fiscal Year
2013, Notice of Proposed Rulemaking and Further Notice of Proposed
Rulemaking, 28 FCC Rcd 7790, 7809-810, paragraphs 47-49 (2013) (78
FR 34612, paragraphs 53-55 (June 10, 2013)) (FY 2013 NPRM).
\6\ Assessment and Collection for Regulatory Fees for Fiscal
Year 2014, Report and Order and Further Notice of Proposed
Rulemaking, 29 FCC Rcd at 10781, paragraph 34 (79 FR 54190
(September 11, 2014)) (FY 2014 Report and Order).
\7\ Assessment and Collection of Regulatory Fees for Fiscal Year
2015, Report and Order and Further Notice of Proposed Rulemaking, 30
FCC Rcd at 10278, paragraph 24 (2015) (80 FR 55775, paragraphs 24-26
(September 17, 2015)) (FY 2015 Report and Order).
\8\ FY 2015 Report and Order, 30 FCC Rcd at 10278, paragraph 24.
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3. The issue of assessing regulatory fees on non-U.S. licensed
space stations with U.S. market access has been raised several times
since Congress originally adopted the statutory schedule of regulatory
fees originally in 1993.\9\ In exercising our Congressional mandate to
collect regulatory fees each fiscal year, we proceed with careful
consideration and make changes in our process only after fully
developing the record. This may mean, as it did here, that the
Commission considers the adoption of a new fee category or a change in
categories multiple times and only proceeds with making a change when
it develops sufficient basis for making the change. This meticulous
approach to making changes moreover serves the goal of ensuring that
our actions in assessing regulatory fees are fair, administrable, and
sustainable.\10\
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\9\ Section 6002(a) of the Omnibus Budget Reconciliation Act of
1993 (hereinafter, ``1993 Budget Act''). See Public Law 103-66,
Title VI, 6002(a), 107 Stat. 397 (approved August 10, 1993).
Congress made subsequent minor amendments to the schedule.
\10\ See FY 2012 NPRM at 8464-65, paragraphs 14-16 (77 FR 29275
(May 17, 2012)). The concept of administrability includes the
difficulty in collecting regulatory fees under a system that could
have unpredictable dramatic shifts in assessed fees in certain
categories from year to year.
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4. In the FY 2019 FNPRM, the Commission again sought comment on
assessing regulatory fees on non-U.S. licensed space stations with U.S.
market access, noting that the International Bureau's policy,
regulatory, international, user information, and enforcement activities
all benefit non-U.S. licensed space stations that access the U.S.
market.\11\ Non-U.S. licensed space stations are monitored to ensure
that their operators satisfy all conditions placed on their grant of
U.S. market access, including space station implementation milestones
and operational requirements, and are subject to enforcement action if
the conditions are not met.\12\ The Commission specifically sought
comment on whether ``we should or must assess regulatory fees on non-
U.S. licensed space stations serving the United States under section 9,
given that non-U.S. licensed space stations appear to benefit from the
Commission's regulatory activities in much the same manner as U.S.
licensed space stations.'' \13\ The Commission noted that its initial
decision in 1999 was premised on the Commission's understanding at the
time that its authority reached only space station ``licensees,'' i.e.,
those licensed under Title III. We observed that section 9 of
Communications Act, as amended by the RAY BAUM'S Act, does not mention
``licensees'' but only the ``number of units'' in each payor category--
and that the ``unit'' used for assessing satellite space station
regulatory fees is ``per operational station in geostationary orbit''
or ``per operational system in non-geostationary orbit,'' units that do
not distinguish between the government issuing the license.\14\ The
Commission also sought comment on reallocating four International
Bureau indirect FTEs as direct, if regulatory fees are adopted for non-
U.S. licensed space stations.\15\
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\11\ FY 2019 Report and Order, 34 FCC Rcd at 8212, paragraph 63.
\12\ Id.
\13\ Id. at 8213, paragraph 64.
\14\ Id.
\15\ Id. at 8214, paragraph 66.
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5. We conclude that we can and should adopt regulatory fees for
non-U.S. licensed space stations with U.S. market access. On the
question of whether we may assess regulatory fees on non-U.S. licensed
space stations with U.S. market access, we start with the statutory
text. The Act contemplates that we impose fees on regulatees that
reflect the ``benefits provided to the payor of the fee by the
Commission's activities.'' \16\ The Act specifically contemplates the
subset of regulatees that must be exempted from regulatory fees in a
section entitled ``Parties to which fees are not applicable.'' \17\
[[Page 37366]]
Notably, Congress did not include operators of non-U.S. licensed space
stations with U.S. market access in that list, and thus did not require
the Commission to exempt them from an assessment of regulatory fees.
Moreover, the Commission's authority to waive regulatory fees is
limited to specific instances and the Commission has consistently
rejected consideration of waiving the regulatory fee for classes of
regulatees.\18\ Given the framework where the Commission has a mandate
to collect fees from its regulatees, coupled with a limited list of
exempt entities and narrow waiver authority, nothing in the text of the
statute supports maintaining a blanket exception from regulatory fees
for non-U.S. licensed space stations granted market access.
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\16\ 47 U.S.C. 159(d).
\17\ The statute exempts governmental and nonprofit entities,
amateur radio operators, and noncommercial radio and television
stations are exempt from regulatory fees under section 9(e)(1). 47
U.S.C. 159(e)(1); 47 CFR 1.1162. Moreover, we note that the
exemption for noncommercial radio ad television stations, which
Congress added to the statute in the RAY BAUM's Act, was a
codification of an exemption that the Commission had previously
established in its rules. See 47 CFR 1.1162(e) (1994); also compare
current section 9(e) with the now-deleted section 9(h). The
Commission adopted the exemption based on its interpretation of the
legislative history and Congressional direction. See Implementation
of Section 9 of the Communications Act, Notice of Proposed
Rulemaking, 9 FCC Rcd 6957 at paragraphs 18 through 22 (59 FR 12570
(March 17, 1994)) (explaining noncommercial broadcast exemption
based on legislative history and wording of the statute) (1994);
Implementation of Section 9 of the Communications Act, Report and
Order, 9 FCC Rcd. 533 at paragraphs 13, 20-21 (59 FR 30984 (June 16,
1994)) (1994). In addition, Congress also codified in the RAY BAUM's
Act the Commission's de minimis rule through the adoption of new
section 9(e)(2). See FY 2019 Report and Order, 34 FCC Rcd at 8206-
07, paragraphs 46 through 47.
\18\ 47 CFR 1.1166.
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6. U.S. licensed operators agree, arguing that we have the
authority to impose regulatory fees on non-U.S. licensed space station
operators with market access because section 9 provides that the
purpose of regulatory fees is to recover the costs of the Commission's
activities taking ``into account factors that are reasonably related to
the benefits provided to the payor of the fee by the Commission's
activities.'' \19\ Commenters contend that the use of the term ``number
of units'' in the amended section 9(c)(1)(A), instead of ``licensee,''
broadens the language of the statute so that it appears to be
applicable to both U.S. licensed and non-U.S. licensed space
stations.\20\ SpaceX contends that the Commission ``must consider
increases and decreases only in the `number of units' of operational
GSO satellites and NGSO systems regardless of licensing
administration.'' \21\ Based on the plain language of statute--and the
absence of any express limitation that we impose regulatory fees only
on ``licensees'' or that we exempt non-U.S. licensed space stations
with U.S. market access, we conclude that there is no statutory bar to
adopting a new regulatory fee for non-U.S. licensed space stations with
U.S. market access.
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\19\ U.S. Satellite Licensees Comments at 8 (quoting 47 U.S.C.
159(d)). These joint commenters are EchoStar Satellite Services, LLC
(EchoStar), Hughes Network Systems, LLC (Hughes), Intelsat License
LLC (Intelsat), and Space Exploration Technologies Corp. (SpaceX).
\20\ U.S. Satellite Licensees Comments at 8-9; SpaceX Comments
at 4-7; SpaceX Reply Comments at 6.
\21\ SpaceX Comments at 5.
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7. We dismiss the arguments of some commenters that focus on
whether Congress intended to expand our authority by removing the word
``licensees'' in the amended section 9.\22\ Telesat argues that ``[t]he
number of `units' says nothing about which entities are subject to the
Commission's regulatory fee authority in the first instance.'' \23\
Inmarsat contends that ``the plain language of RAY BAUM'S Act is not
directed to the entities from which the Commission may collect fees,
but the manner in which the Commission may adjust fees.'' \24\ Such
arguments, however, are a double-edged sword because the word
``licensees'' in that sentence was the only textual hook (under prior
law) that such advocates had for arguing that the Commission's
authority was limited to assessing fees on licensees. And so, although
we tend to agree that this change does not imply a change in who could
be assessed, we also find that the use of the word ``licensee'' did not
imply that only licensees could be assessed. In other words, whether
Congress intended to expand the reach of regulatory fees with this
language is irrelevant. The question instead remains whether Congress
precluded us from imposing regulatory fees on non-U.S. licensed space
stations that clearly benefit from market access to the United States
and the activities of the Commission--and nothing in the language of
the Act suggests Congress intended to preclude such regulatees from the
ambit of regulatory fees.
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\22\ OneWeb Comments at 4-7; Telesat Canada (Telesat) Comments
at 3-4 & Reply Comments at 9-10; Myriota Comments at 5-6; Eutelsat
Comments at 5; Kepler Communications (Kepler) Reply Comments at 2-3;
Inmarsat Reply Comments at 2-3.
\23\ Telesat Comments at 10.
\24\ Inmarsat Reply Comments at 3.
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8. Absent any textual hook, commenters turn to the legislative
history of section 9 \25\ and argue that the Commission has taken this
position previously.\26\ Indeed, in the FY 1999 Report and Order, the
Commission based its conclusion on legislative history from 1991.\27\
We find that it is appropriate to re-evaluate this conclusion at this
time.
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\25\ Telesat Comments at 2; Eutelsat Comments at 4-5; Inmarsat
Reply Comments at 2-3.
\26\ FY 1999 Report and Order, 14 FCC Rcd at 9883, paragraph 39;
Assessment and Collection of Regulatory Fees for Fiscal Year 1995,
Report and Order, 10 FCC Rcd 13512, 13550, paragraph 110 (1995) (60
FR 34004, paragraphs 16-18 (June 29, 1995)) (FY 1995 Report and
Order).
\27\ FY 1999 Report and Order, 14 FCC Rcd at 9883, paragraph 39;
FY 1995 Report and Order, 10 FCC Rcd at 13550, paragraph 110.
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9. The legislative history referred to in the FY 1999 Report and
Order and the FY 1995 Report and Order is found in the House and Senate
Reports, Committee on Energy and Commerce, 102 H. Rpt. 207, September
17, 1991, in which the Committee stated: ``The Committee intends that
fees in this category be assessed on operators of U.S. facilities,
consistent with FCC jurisdiction. Therefore, these fees will apply only
to space stations directly licensed by the Commission under Title III
of the Communications Act. Fees will not be applied to space stations
operated by international organizations subject to the International
Organizations Immunities Act, 22 U.S.C. Section 288 et seq.'' \28\
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\28\ House and Senate Reports, Committee on Energy and Commerce,
102 H. Rpt. 207, at 33 (Sept. 17, 1991). The language of the 1991
House and Senate Report was incorporated by reference in the
Conference Report accompanying the 1993 Budget Reconciliation Act,
which included the regulatory fee program. See Conference Report H.
Rept. No. 213, 103d Cong., 1st Sess. 499 (1993); see also FY 1995
Report and Order at 13550. The 1991 language related to a comparable
bill that passed the House in 1991 but was not passed into law. See
PanAmSat Corp. v. FCC, 198 F.3d 890, 895 (D.C. Cir. 1999). The
Conference Report accompanying the 1993 Budget Reconciliation Act
did not provide any statement on space station regulatory fees
beyond incorporating by reference the language from 1991.
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10. To understand these committee reports, it is helpful to
recognize that in 1991 there was a very different marketplace and
regulatory environment than now exists in 2020. In 1991, U.S. licensed
space stations operated as either domestic satellites (domsats) \29\ or
international systems (separate satellite systems).\30\ Satellite
services in the United States, however, were mainly provided by
INTELSAT and INMARSAT, which were treaty-based international
governmental organizations. Both were the product of a unique set of
initiatives undertaken by the United States and other countries to
develop the global communications satellite systems. As a result, they
both benefited from a framework of protections based in statute,\31\
treaty,
[[Page 37367]]
and Commission policy that protected and preserved the status of each
international governmental organization.
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\29\ Domestic Communications Satellite Facilities, 22 FCC 2d 86
(1970). The Commission's Transborder Policy did permit the use of
domsats for certain international services based on criteria set
forth in a letter dated July 23, 1981 from then Under Secretary of
State James L. Buckley to then FCC Chairman Mark Fowler (Buckley
Letter). The Buckley Letter stated that domsats could be used for
public international telecommunications with nearby countries where:
(1) INTELSAT could not provide the service; or (2) it would be
clearly uneconomical or impractical to provide the planned service
over the INTELSAT system. See Transborder Satellite Video Services,
88 FCC2d 258 (1981); Satellite Business Systems, 88 FCC2d 195
(1981).
\30\ Establishment of Satellite Systems Providing International
Communications, 101 FCC2d 1046 (1985), recon. grtd, 61 R.R. 2d 649
(1986), further recon. grtd 1 FCC Rcd 439 (1986). The term
``separate satellite system'' refers to U.S. licensed international
systems that are owned and operated separately from the INTELSAT
global satellite system.
\31\ The Communications Satellite Act of 1962 declared it U.S.
policy to join with other countries to create a commercial, global
communications satellite system. Public Law 87-624, 87th Cong., 2d
Sess. (Aug. 31, 1962), 76 Stat. 419. Similarly, the International
Maritime Satellite Telecommunications Act of 1978 declared it U.S.
policy to provide for U.S. participation in INMARSAT in order to
develop a global maritime satellite system that will meet the
maritime commercial and safety needs of the United States and
foreign countries. Public Law 95-564, 92 Stat. 2392 (1978). The
statutes provided that COMSAT would be the U.S. signatory to both
INTELSAT and INMARSAT. COMSAT, itself, had its own unique status
under treaties. All three entities were privatized by 2000/2001 in
accordance with the requirements of the ORBIT Act. For a review of
the privatization process for these entities, refer to the FCC's
multiple ORBIT Act reports. See, e.g., FCC Report to Congress as
Required by the ORBIT Act, 15 FCC Rcd 11288 (2000); FCC Report to
Congress as Required by the ORBIT Act, 16 FCC Rcd 12810 (2001).
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11. In this context, the phrase ``space stations operated by
international organizations subject to the International Organizations
Immunities Act, 22 U.S.C. Section 288 et seq.'' used in the 1991
legislative history referred to INTELSAT and INMARSAT, which at that
time were international governmental organizations formed as a result
of international treaties and with explicit support by the United
States through statutory and regulatory mechanisms.\32\ This conclusion
is borne out by the focus in the same legislative history on licenses
issued directly by the FCC (as opposed to indirect regulation of
provision of INTELSAT and INMARSAT services through licenses issued to
COMSAT) and on the International Organization Immunities Act, which
provides certain exemptions, immunities, and privileges to
international organizations and their employees, such as exemption from
custom duties and internal-revenue taxes,\33\ and which applied to both
INTELSAT and INMARSAT as international governmental organizations.
Further, it was not until 1997 that the Commission adopted a formal
process for granting market access to non-U.S. licensed space
stations.\34\
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\32\ Communications Satellite Corp. v. FCC, 836 F.2d 623 (1988)
(providing a helpful description of the statutory and treaty-based
genesis of INTELSAT, and the complicated regulatory framework
whereby it provided international services to the U.S. domestic
market); Satellites that Form a Global Communications System in
Geostationary Orbit, Memorandum Opinion, Order and Authorization, 15
FCC Rcd 15460, recon. denied, 15 FCC Rcd 25234 (2000), further
proceedings, 16 FCC Rcd 12280 (2001). As such, they had the unique
circumstance that their global satellite systems were not licensed
by any national licensing authority.
\33\ 22 U.S.C. 288a (Privileges, exemptions, and immunities of
international organizations).
\34\ The adoption by the United States in 1997 of the WTO
Agreement on Basic Telecommunications Services obligated the United
States to open its satellite markets to foreign systems licensed by
other WTO member countries. Fourth Protocol to the General Agreement
on Trade in Services (GATS) (April 30, 1996), 36 I.L.M. 336 (1997)
(entered into force Jan. 1, 1998). The Commission therefore adopted
procedures to give satellite systems licensed by other countries
access to the U.S. market. Amendment of the Commission's Regulatory
Policies to Allow Non-U.S. Licensed Space Stations to Provide
Domestic and International Satellite Service in the United States,
Report and Order, 12 FCC Rcd 24094 (1997) (62 FR 64167 (December 4,
1997)) (DISCO II). Prior to the adoption of DISCO II, the Commission
allowed very limited provision of service in the U.S. through non-
U.S. licensed space stations only upon a showing that existing U.S.
domestic satellite capacity was inadequate to satisfy specific
service requirements. Letter from Bertram Rein, Deputy Assistant
Secretary of Bureau of Economic and Business Affairs, U.S.
Department of State, to Kenneth Williamson, Minister of Embassy of
Canada (Nov. 7, 1972). See also Letter from Thomas Tycz, Chief,
Satellite and Radiocommunication Division, F.C.C. International
Bureau, to Teresa Baer, Attorney, Latham & Watkins (Feb. 13, 1996)
(confirming verbal grant of special temporary authority for Hughes
Communications Galaxy, Inc. to lease capacity from a Brazilian
satellite to provide domestic U.S. service).
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12. Today, there are many commercial non-U.S. licensed satellite
companies offering service in the United States. The two International
Government Organizations operating satellites at that time--INTELSAT
and INMARSAT--are no longer International Governmental Organizations
but instead are commercial enterprises. INTELSAT became a private
company in 2001, Intelsat, Ltd., after 37 years as an International
Governmental Organization.\35\ Intelsat's corporate headquarters are in
Luxembourg and the United States, and it currently has a fleet of more
than 50 satellites.\36\ INMARSAT, now Inmarsat, Inc., is headquartered
in London, England, has offices in over 40 countries, and owns and
operates 13 satellites.\37\ Other commercial non-U.S. licensed
satellite companies include Eutelsat Communications SA, a public
corporation, which has 38 satellites, is headquartered in France,\38\
and has satellites licensed by France and other countries, including
the United States; \39\ and Telesat, a private Canadian satellite
company, with 16 satellites.\40\ These companies, and others, have U.S.
market access and compete with the U.S. licensed satellite companies
such as commenters EchoStar Satellite Services (EchoStar) and Space
Exploration Technologies (SpaceX). We find that the 1991 legislative
history \41\ purportedly limiting regulatory fees to U.S. licensed
satellites is no longer relevant because in stating that ``[f]ees will
not be applied to space stations operated by international
organizations'' it was not exempting from regulatory fees commercial
non-U.S. licensed satellites with general U.S. market access, which did
not exist at that time, but two International Governmental
Organizations that no longer exist. In other words, we find that the
legislative history of the Act poses no bar to assessing regulatory
fees on non-U.S. licensed space stations with U.S. market access.
Operators of non-U.S. licensed space stations contend that Congress did
in fact contemplate certain circumstances in which non-US licensed
space stations could be used to provide service in the United
States.\42\ But at that time, Congress could not have been
contemplating non-U.S. licensed space stations that provide commercial
service in the United States on an ongoing, unrestricted basis under
the same regulatory framework as their U.S. licensed counterparts.\43\
The circumstances that the operators cite consisted of very limited
provision of service in the U.S. through non-U.S. licensed space
stations upon a showing that existing U.S. domestic satellite capacity
was inadequate to satisfy specific service requirements.\44\ Such case-
by-case approval of use of a non-U.S. licensed satellite on a
bilateral, government-to-government basis to provide limited services
was much more rare, and of a very different nature, than the
regulations that the Commission adopted years later to permit U.S.
market access by non-U.S. licensed space stations.\45\
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\35\ See http://www.intelsat.com/about-us/history/.
\36\ See http://www.intelsat.com/global-network/satellites/overview/.
\37\ See https://www.inmarsat.com/about-us/our-technology/our-satellites/.
\38\ See https://www.eutelsat.com/en/group/our-history.html.
\39\ Eutelsat Comments at 1.
\40\ See https://www.telesat.com/services.
\41\ SpaceX observes that this legislative history is nearly 30
years old and ``extremely dated.'' SpaceX Reply Comments at 6-7.
\42\ Letter from Joseph A. Godles, Attorney for Telesat Canada,
et al., to Marlene H. Dortch, Secretary, FCC (filed April 22, 2020)
(Godles April 22 Ex Parte).
\43\ See DISCO II, 12 FCC Rcd at 24098, paragraph 7 (stating
that ``[a]s required by Title III of the Communications Act of 1934,
as amended (Communications Act), we will examine all requests to
determine whether grant of authority is consistent with the public
interest, convenience and necessity.'' See also DISCO II, 12 FCC Rcd
at 24098, paragraph 7, n.7 (citing 47 U.S.C. 301, et seq.).
\44\ See footnote [49], supra.
\45\ In 1993, the Commission considered and rejected the
adoption of the type of market access provisions that the Commission
would adopt several years later. Amendment of the Commission's Rules
to Establish Rules & Policies Pertaining to A Non-Voice, Non-
Geostationary Mobile-Satellite Serv., Report and Order, 8 FCC Rcd.
8450, 8454 paragraph 13 (1993) (58 FR 68053 (December 23, 1993))
(adopting rules clarifying ``the basic tenets that [non-voice, non-
geostationary orbit satellite service] transceivers operating in the
United States must communicate with or through U.S. authorized space
stations only, and that such communications must be authorized as
well by the space station licensee or an authorized vendor'' and
explicitly rejecting a proposal that the FCC ``devise a rule that
will allow domestically authorized user transceivers to access
foreign-licensed [non-voice, non-geostationary orbit satellite
service] space station systems'' stating that ``[w]e do not believe
that this type of arrangement should be dealt with by regulation.'')
(emphasis added).
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[[Page 37368]]
13. Non-U.S. licensed space station operators contend that
Congressional silence subsequent to the Commission's statements
regarding the legislative history of section 9 presumes Congress's
approval of the Commission's prior interpretation and argue that the
``acquiescence doctrine'' supports their position.\46\ While this
doctrine recognizes that Congressional silence may have some bearing on
the interpretation of a statute, it neither requires that an agency's
interpretation be cemented in stone if not overtaken by subsequent
legislative action, nor forecloses an agency from changing its
interpretation of a statute and how the legislative history should
inform such interpretation,\47\ no matter how longstanding,
particularly when the prior interpretation is based on error.\48\ Here
we acknowledge a change in our interpretation of the legislative
history underlying section 9 based on a fuller and more accurate
analysis of the context of the legislative history at the time it was
adopted.\49\
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\46\ See Godles April. 22 Ex Parte at 3.
\47\ Courts do not uniformly embrace the proposition that
Congressional silence denotes acquiescence. See Chisholm v. FCC, 538
F.2d 349, 361 (D.C. Cir. 1976) (``We begin by noting that
attributing legal significance to Congressional inaction is a
dangerous business''), citing Power Reactor Development Co. v.
International Union of Electrical, Radio and Machine Workers, AFL-
CIO, 367 U.S. 396, 408-10 (1961). The Supreme Court has said that
Congressional failure to repudiate particular decisions ``frequently
betokens unawareness, preoccupation, or paralysis'' rather than
conscious choice, Zuber v. Allen, 396 U.S. 168, 185-86 n.21 (1969)
and ``affords the most dubious foundation for drawing positive
inferences,'' United States v. Price, 361 U.S. 304, 310-11 (1960)
(Harlan, J.). See also Jones v. Liberty Glass Co., 332 U.S. 524, 533
(1947) (``The doctrine of legislative acquiescence is at best only
an auxiliary tool for use in interpreting ambiguous statutory
provisions'').
\48\ Chisholm v. FCC, 538 F.2d 349, 364 (D.C. Cir. 1976) (``We
note initially that an administrative agency is permitted to change
its interpretation of a statute, especially where the prior
interpretation is based on error, no matter how longstanding.'')
(internal citations omitted). Similarly, an agency may change its
policies and standards, so long as it provides a reasoned
explanation for change. See, e.g., FCC vs. Fox Television Stations,
Inc., 556 U.S. 502, 514-15 (2009); National Labor Relations Board v.
CNN America, Inc., 865 F.3d 740, 751 (D.C. Cir. 2017).
\49\ We also note that when Congress recently re-visited section
9 as part of the RAY BAUM'S Act, it did not elect to amend the list
of entities exempted from assessment of regulatory fees to include
non-U.S. licensed space stations. Although non-U.S. licensed space
station operators state that ``[n]othing in Ray Baum's Act, or in
the associated legislative history, evidences any intent to alter
the FCC's understanding that its authority to impose regulatory fees
on space stations is limited to those licensed pursuant to Title
III,'' Godles April 22 Ex Parte at 4, it could equally be said that
Congress demonstrated no intent to endorse our prior interpretation
or reiterate some intent to exempt non-U.S. licensed space stations
in the legislative history of the RAY BAUM'S Act.
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14. On the policy question of whether we should assess regulatory
fees on non-U.S. licensed space stations with U.S. market access, we
start with the fact that these non-U.S. licensed space stations benefit
from the Commission's regulatory activities in much the same manner as
U.S. licensees.\50\ Operators of U.S. licensed space stations argue
that non-U.S. licensed operators consume, and benefit from, Commission
resources just as do U.S. licensees.\51\ They estimate that nearly half
of all satellite space station authorizations granted between 2014 and
2018 (30 of 62) were filed by non-U.S. operators \52\ and that non-U.S.
operators participate actively in Commission rulemaking proceedings and
benefit from Commission monitoring and enforcement activities.\53\
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\50\ FY 2019 Report and Order, 34 FCC Rcd at 8213, paragraph 64.
\51\ See, e.g., U.S. Satellite Licensees Comments at 1-2.
\52\ In addition, they note that there are more market access
requests than new satellite applications; in 2019 there were nine
new market access requests, but only six new U.S. satellite license
applications. U.S. Satellite Licensees Reply Comments at 2-3.
\53\ U.S. Satellite Licensees Reply Comments at 2. Furthermore,
SpaceX highlights that Eutelsat and Telesat are also involved in a
proceeding to repurpose C-band satellite spectrum in which these
non-U.S. operators and others have argued that they may not be
denied access to portions of the 3700-4200 GHz band in the United
States without significant compensation. SpaceX Reply Comments at 2-
3.
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15. Certain non-U.S. licensed space stations argue that they should
not contribute regulatory fees because the Commission incurs no costs
regulating them and that non-U.S. licensed space stations do not
benefit from the FCC's regulatory activities, including international
coordination and enforcement activities.\54\ Inmarsat contends that
non-U.S. licensed satellites do not benefit from FCC regulatory
activities because oversight of their operations is accomplished by the
country that licenses the satellite, not by the FCC.\55\
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\54\ Eutelsat Comments at 2-3 (``Foreign-licensed satellite
operators do not receive a Commission license or the benefits that
come with it.''); Myriota Comments at 3 (``Foreign-licensed
satellite system operators do not receive an FCC space station
license or the significant benefits associated with it. . . .'');
Eutelsat Comments at 3 (``While [compliance] oversight is ongoing,
the administrative burden is both minimal and conducted for the
benefit of United States space and earth station licensees.'');
Myriota Comments at 3 (``Although [compliance] oversight is ongoing,
however, the actual administrative cost of such monitoring is
minimal and imposing a recurring regulatory fee to recover these de
minimis costs would not be appropriate.''); Inmarsat Reply Comments
at 4 (``[Non-U.S. licensed space stations] do not receive the
benefit of United States-led coordination negotiations, relying
instead on the country of licensure.'').
\55\ Inmarsat Reply Comments at 4 (``Spacecraft maintenance,
end-of-life, and orbital debris mitigation are supervised not by the
United States, but by the administration issuing the license.'')
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16. We find that the Commission devotes significant resources to
processing the growing number of market access petitions of non-U.S.
licensed satellites and that they benefit from much of the same
oversight and regulation by the Commission as the U.S. licensed
satellites. For example, processing a petition for market access
requires evaluation of the same legal and technical information as
required of U.S. licensed applicants. The operators of non-U.S.
licensed space stations also benefit from the Commission's oversight
efforts regarding all space and earth station operations in the U.S.
market, since enforcement of Commission rules and policies in
connection with all operators--whether licensed by the United States or
otherwise--provides a fair and safe environment for all participants in
the U.S. marketplace. Likewise, the Commission's adjudication,
rulemaking, and international coordination efforts benefit all U.S.
marketplace participants by evaluating and minimizing the risks of
radiofrequency interference, increasing the number of participants in
the U.S. satellite market, opening up additional frequency bands for
use by satellite services, providing a level and uniform regime for
mitigating the danger of orbital debris, and streamlining Commission
rules that apply to all providers of satellite services in the United
States, whether through U.S. licensed or non-U.S. licensed space
stations.\56\ The active
[[Page 37369]]
participation of operators of non-U.S. licensed space stations in these
adjudications and rulemakings--either individually or through
involvement in industry trade organizations--demonstrates that they
recognize benefits from Commission action to their operations within
the U.S. market, since they would not participate in such proceedings
if they held no possibility of benefit to them.\57\ Thus, the
significant benefits to non-U.S. licensed satellites with market access
support including them in regulatory fees.
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\56\ FY 2019 Report and Order, 34 FCC Rcd at 8212-13, paragraph
63 (citing Mitigation of Orbital Debris in the New Space Age, IB
Docket No. 18-313, Notice of Proposed Rulemaking and Order on
Reconsideration, 33 FCC Rcd 11352 (2018) (84 FR 4742 (February 19,
2019)) (Orbital Debris NPRM); Amendment of Parts 2 and 25 of the
Commission's Rules to Facilitate the Use of Earth Stations in Motion
Communicating with Non-Geostationary Orbit Space Stations in
Frequency Bands Allocated to the Fixed-Satellite Service, IB Docket
No. 18-315, Notice of Proposed Rulemaking, 33 FCC Rcd 11416 (2018)
(83 FR 67180 (December 28, 2018)) (ESIM NPRM); Amendment of the
Commission's Policies and Rules for Processing Applications in the
Direct Broadcast Satellite Service, IB Docket No. 06-160, Second
Notice of Proposed Rulemaking, 33 FCC Rcd 11303 (2018) 84 FR 2126
(February 6, 2019); Amendment of Parts 2 and 25 of the Commission's
Rules to Facilitate the Use of Earth Stations in Motion
Communicating with Geostationary Orbit Space Stations in Frequency
Bands Allocated to the Fixed Satellite Service, IB Docket No 17-95,
Report and Order and Further Notice of Proposed Rulemaking, 32 FCC
Rcd 9327 (2018) (84 FR 53630 (October 8, 2019) and 84 FR 5654
(February 22, 2019)); Further Streamlining Part 25 Rules Governing
Satellite Services, IB Docket No. 18-314, Notice of Proposed
Rulemaking, 33 FCC Rcd 11502 (2018) (84 FR 638 (January 31, 2019))
(Part 25 Further Streamlining NPRM); Streamlining Licensing
Procedures for Small Satellites, IB Docket No. 18-86, Notice of
Proposed Rulemaking 33 FCC Rcd 4152 (2018) (83 FR 24064 (May 24,
2018)); Update to Parts 2 and 25 Concerning Non-Geostationary,
Fixed-Satellite Service Systems and Related Matters, IB Docket No.
16-408, Report and Order and Further Notice of Proposed Rulemaking,
32 FCC Rcd 7809 (2017) (82 FR 59972 (December 18, 2017) and 82 FR
52869 (November 15, 2017)); Amendment of Parts 2 and 25 of the
Commission's Rules to Facilitate the Use of Earth Stations in Motion
Communicating with Geostationary Orbit Space Stations in Frequency
Bands Allocated to the Fixed-Satellite Service, IB Docket No. 17-95,
Notice of Proposed Rulemaking, 32 FCC Rcd 4239 (2017) (82 FR 27652
(June 16, 2017)).
\57\ Market access recipients filed comments in nearly all of
the Commission's recent satellite rulemaking proceedings. See, e.g.,
Comments of WorldVu Satellites Limited d/b/a OneWeb, SES Americom
and Eutelsat in Orbital Debris NPRM, (filings made Apr. 5, 2019);
ESIM NPRM (filings made Feb. 11, 2019) and Part 25 Further
Streamlining NPRM (filings made Mar. 18, 2019).
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17. In the FY 2019 FNPRM, we also sought comment on whether
assessing non-U.S. licensed space stations would promote regulatory
parity among space station operators.\58\ U.S. licensees argue that the
current fee system is inequitable and encourages companies to simply
move overseas to evade fees and oversight.\59\ Non-U.S. licensed
satellite operators respond by contending that imposing regulatory fees
on non-U.S. licensed satellites would place those entities at a
competitive disadvantage.\60\ Non-U.S. licensed satellite operators are
already paying regulatory fees in their own jurisdictions and, they
assert, our regulatory fees would be a duplicative fee.\61\ Operators
of non-U.S. licensed space stations also contend that imposing
regulatory fees will negatively impact U.S. consumers because smaller
foreign operators will bypass the U.S. market and the increased costs
will be passed on to U.S. consumers.\62\ Imposing such a fee, they
argue, would jeopardize the United States' position in the global
satellite market and other jurisdictions could also now impose similar
charges on U.S. licensed satellites.\63\
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\58\ FY 2019 Report and Order, 34 FCC Rcd at 8212-13, paragraph
63.
\59\ U.S. Satellite Licensees Comments at 2.
\60\ WorldVu Satellites Limited d/b/a OneWeb (OneWeb) Comments
at 1-4; Kepler Reply Comments at 4.
\61\ Eutelsat Comments at 2, 7; Telesat Reply Comments at 3-4.
\62\ OneWeb Comments at 7-8 & Reply Comments at 6; Myriota
Comments at 3-4; Kepler Reply Comments at 4-5; Telesat Reply
Comments at 4.
\63\ OneWeb Comments at 7-8 & Reply Comments at 4-5; Myriota
Comments at 3-4; Eutelsat Comments at 6-8; Telesat Reply Comments at
5; Inmarsat Reply Comments at 4; Kepler Reply Comments at 4.
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18. We agree with the comments of U.S. licensed space station
operators--who express more concern about fee inequity in the United
States than the prospect of new or increased fees in other markets--
that entities receiving U.S. market access, through either a space
station or earth station authorization, should be subject to the same
satellite regulatory fees as those assessed on U.S. licensed space
station systems.\64\ Indeed, we are not convinced by the parade of
horribles cited by non-U.S. licensed satellite operators as they offer
insufficient evidence to support their claims.
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\64\ U.S. Satellite Licensees Comments at 6-7. SpaceX proposes
that earth station operators that received U.S. market access prior
to August 27, 2019, the release date of the FY 2019 Report and
Order, would be exempt from such regulatory fees under this
proposal. SpaceX Comments at 2-3.
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19. Non-U.S. licensed satellite operators also argue that an
assessment of fees conflicts with international trade agreements under
the WTO Agreement on Basic Telecommunications Services.\65\ Eutelsat
and Telesat contend that under the Commission's DISCO II decision, the
Commission rejected the idea of issuing a separate license for non-U.S.
licensed space stations.\66\ In response, SpaceX asserts that spreading
the regulatory costs evenly across U.S. and non-U.S. licensed space
station operators instead of imposing the entire cost on U.S. space
station licensees is fully consistent with the DISCO II decision.\67\
We find that our actions are consistent with the DISCO II decision
because we are treating non-U.S. licensed space station operators the
same as U.S. licensed space station operators in assessing regulatory
fees.
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\65\ Telesat Comments at 12 & Reply Comments at 5; Kepler Reply
Comments at 3; Inmarsat Reply Comments at 4-5. AT&T disagrees that
this assessment of fees would be precluded by international
agreements. AT&T Reply Comments at 5-6; OneWeb Reply Comments at 7-
8.
\66\ Eutelsat Comments at 2, 7, citing DISCO II at 24174,
paragraph 188; Telesat Reply Comments at 6. OneWeb also argues that
our proposal would violate DISCO II because it would put non-U.S.
licensed satellite operators at a disadvantage. OneWeb Comments at
2. We disagree, as discussed above, because the U.S. licensed
satellite operators competing against non-U.S. licensed operators,
are disadvantaged due to the imposition of regulatory fees on the
U.S. licensed operators.
\67\ SpaceX Reply Comments at 8-9.
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20. Non-U.S. licensed space station operators argue that it would
be unfair now to assess regulatory fees on non-U.S. licensed space
stations accessing the U.S. market because they have relied on a prior
finding that regulatory fees for space stations were to be assessed on
only those stations licensed by the United States and that they have
made business plans based on this long-standing prior finding.\68\
Licensees have no vested right to an unchanged regulatory
framework.\69\ This is as true for market access grantees as it is for
licensees, since both are subject to the Commission's regulatory
framework while providing service in the United States. Moreover, each
year the Commission engages in a proceeding seeking comment on its
proposed fees for the year and frequently makes adjustments to the
regulatory scheme to reflect changes in fact and law. For the reasons
stated herein, we have concluded that non-U.S. licensed space stations
accessing the U.S. market should be subject to assessment of regulatory
fees under section 9.\70\
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\68\ Godles April 22 Ex Parte at 3.
\69\ Improving Public Safety Communications in the 800 Mhz Band,
21 FCC Rcd 678, 682 (2006); Motient Communications Inc., 19 FCC Rcd
13086, 13093 (2004), citing Amendment of Part 1 of Commission's
Rules--Competitive Bidding Procedures, Order on Reconsideration of
the Third Report and Order, Fifth Report and Order, and Fourth
Further Notice of Proposed Rule Making, 15 FCC Rcd 15293, 15306
paragraph 22 (2000) (65 FR 52323 (August 29, 2000) and 65 FR 52401
(August 29, 2000)).
\70\ Congress mandates that the Commission recover as an
offsetting collection its fiscal year appropriation and prescribes
the mechanism to do so. Congress has prescribed that regulatees bear
the FTE burden associated with the Commission's work in respect to a
given set of regulatees.
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21. Including non-U.S. licensed space stations in the Commission's
assessment of regulatory fees is important to fulfilling Congress's
mandate that the Commission recover the costs associated with its
activities, since market access by non-U.S. licensed space stations has
become a significant portion of the satellite services regulated by the
Commission and exemption of non-U.S. licensed space stations places the
burden of regulatory fees--which are designed to defray the costs of
Commission regulatory activities (which we undertake to serve the
overall interests of the public, including all parties engaged in the
communications marketplace)--solely on the shoulders
[[Page 37370]]
of U.S. licensees, either directly or indirectly.\71\ We find that this
is not sustainable, since the ability to gain the same benefits of
Commission activities without being assessed regulatory fees presents
an incentive for space station operators, even U.S.-based companies, to
elect to be licensed by a foreign administration in order to still have
access to the U.S. market, but without being assessed regulatory fees.
In summary, we conclude that assessing the same regulatory fees on non-
U.S. licensed space stations with market access as we assess on U.S.
licensed space stations will better reflect the benefits received by
these operators through the Commission's adjudicatory, enforcement,
regulatory, and international coordination activities. Moreover, it
will promote regulatory parity and fairness among space station
operators by evenly distributing the regulatory cost recovery.
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\71\ The Commission's prior solution in 2015 of recategorizing
four International Bureau FTEs as indirect to avoid assessing U.S.
licensed space stations for work that directly benefited non-U.S.
licensed space stations that did not pay regulatory fees still
required U.S. licensees to bear the costs of the non-U.S. licensed
space station operators participation in the regulatory environment;
it simply broadened the base of U.S. licensees bearing those costs,
since the costs were labeled as indirect, and therefore borne by all
FCC entities that were assessed regulatory fees. See FY 2015 Report
and Order, 30 FCC Rcd at 10278, paragraph 24.
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22. In the interest of equity and to eliminate regulatory
arbitrage, we further conclude that regulatory fees for non-U.S.
licensed space stations should be contributed regardless of the method
by which the space station obtains U.S. market access. In addition to
receiving U.S. market access directly through a petition for
declaratory ruling, a non-U.S. licensed space station operator may also
receive market access by being added as a point of communication in an
earth station license application. In either case, the Commission's
review of the space station market access request is the same. The
earth station application may be filed by the non-U.S. licensed
operator, one of its subsidiaries, or an independent third party.
Currently, neither the earth station licensee nor the non-U.S.
satellite operator with market access through that earth station pays a
regulatory fee despite the benefits it receives and the additional
Commission resources consumed by such market access. We find that it
serves the public interest to assess regulatory fees in the same manner
against all non-U.S. licensed satellite operators with U.S. market
access, regardless of how that access is obtained.
23. We next address the mechanisms of assessment when non-U.S.
satellite operators gain market access through earth stations. As of
October 1, 2019, there are approximately 25 non-U.S. licensed space
stations serving the U.S. market through earth station licensees.
SpaceX proposes creating a new regulatory fee category for earth
station authorizations that include a first-time market access grant
for a satellite system to ``apply the same regulatory fee applicable to
non-U.S. licensed systems granted market access at the space station
level.'' \72\ SpaceX asserts that doing so ``would eliminate an
opportunity for regulatory arbitrage while ensuring that the
Commission's regulatory fee structure equitably covers satellite
systems granted access to the U.S. market regardless of the mechanism
used to achieve that end.'' \73\ We agree with SpaceX that assessing a
regulatory fee to cover non-U.S. licensed space stations that gain
market access through an earth station serves the public interest,
although we assess the space station benefiting from the market access
rather than the earth station operator(s). Doing so will place the
responsibility with the space station operator directly benefiting from
market access rather than one or multiple earth stations that may be
communicating with many other satellites as well.
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\72\ SpaceX Comments at 8. Kepler argues that it would be
inequitable to assess the same regulatory fee on a foreign satellite
operator with a single earth station. Kepler Reply Comments at 5. We
note the same argument can be made regardless of whether the foreign
operator communicating with only one earth station does so through a
petition for declaratory ruling and an earth station license or
solely through an earth station license.
\73\ SpaceX Comments at 8.
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24. We will therefore require non-U.S. licensed space stations that
enter into the U.S. market through earth station authorizations to be
subject to regulatory fees similar to those space stations receiving
U.S. market access directly through a petition for declaratory
ruling.\74\ Failure to pay a regulatory fee will subject the operator
of the non-U.S. licensed space station to statutory penalties and the
Commission's rules governing nonpayment.\75\ In addition to other
penalties, non-payment may result in removal of the delinquent non-U.S.
space station as a point of communication for any associated earth
station authorizations. Non-payment may also prevent such space station
to obtain future U.S. market access or other regulatory benefits until
such matters are resolved.\76\ This action eliminates any regulatory
arbitrage or gaming opportunity by eliminating any regulatory fee
differences between receiving U.S. market access directly through a
petition for declaratory ruling or indirectly, through an earth station
license application.
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\74\ As a general matter, a single NGSO constellation that
includes both U.S. and foreign-licensed satellites will be treated
the same as any wholly U.S. or foreign-licensed constellation for
regulatory fee purposes.
\75\ Under sections 9A(c)(1) & (2) of the Act, the Commission is
required to impose a late payment penalty of 25 percent of the
unpaid regulatory fee debt and to assess interest on the unpaid
regulatory fee (including the 25 percent penalty) until the debt is
paid in full. The Commission is also required to pursue collection
of all past due regulatory fees (including penalty and interest)
using all collection remedies available to it under the Debt
Collection Improvement Act of 1996. These remedies include
offsetting regulatory fee debt against monies owed to the debtor by
the Commission, and referral of the debt to the United States
Treasury for further collection efforts, including centralized
offset against monies other Federal agencies may owe the debtor. 31
U.S.C. 3701 et seq.; 31 CFR part 901; 47 CFR 1.1901. The failure to
timely pay regulatory fees also subjects regulatees to the
Commission's ``red light'' rule and revocation of authorizations. 47
CFR 1.1910 and 1.1164(f).
\76\ See 47 U.S.C. 159A(c)(3) (dismissal of applications or
filings); id. at 159A(c)(4) (revocations); 47 CFR 1.1164(f) (same).
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25. In some cases, non-U.S. licensed space stations that do not
access earth stations aboard aircraft (ESAA) terminals in the United
States or its territorial waters have been identified as a point of
communication for U.S. licensed ESAA terminals.\77\ To the extent such
license clearly limits U.S. licensed ESAA terminals' access to these
non-U.S. licensed space stations to situations in which these terminals
are in foreign territories and/or over international waters and the
license does not otherwise allow the non-U.S. licensed space station
access to the U.S. market, the non-U.S. licensed space station does not
fall within the category of a non-U.S. licensed space station with
access to the U.S. market for regulatory fee purposes. In addition, a
non-U.S. licensed space station that communicates with a U.S. licensed
earth station solely for tracking, telemetry and command (TT&C)
purposes will not fall within the category of a non-U.S. licensed space
station with access to the U.S. market for regulatory fee purposes.\78\
The relevant earth station license, however, must clearly limit the
non-U.S. licensed space station's access to TT&C communications only.
If it does not include such a limitation, the relevant non-U.S.
licensed space station will be
[[Page 37371]]
subject to regulatory fees. Accordingly, non-U.S. licensed space
station operators may notify the Commission by July 15, 2020, as
discussed below, to certify that their access is solely for TT&C and
identify the relevant earth station licenses for any needed express
condition that the relevant non-U.S. licensed space station is
identified a point of communication for TT&C purposes only.\79\
Otherwise, they will be assessed regulatory fees.
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\77\ See Letter from Karis Hastings, Counsel to SES, to Marlene
H. Dortch, Secretary, Federal Communications Commission, at 2 (May
5, 2020).
\78\ See Letter from Pamela L. Meredith, Counsel to Kongsberg
Satellite Services AS, to Marlene H. Dortch, Secretary, Federal
Communications Commission, at 1-2 (May 5, 2020).
\79\ We note that an earth station authorization allowing any
other kind of data acquisition by a non-U.S. licensed space station
will be considered to have access to the U.S. market and will be
subject to the regulatory fees.
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26. We understand that non-U.S. licensed satellite operators have
not always been conscientious in the past about advising the Commission
when they have ceased to provide service to the U.S. from a particular
satellite. To provide a clear deadline for operators to correct the
record and afford the International Bureau and the Office of Managing
Director an opportunity to create a definitive list of market access
grants from which to develop the final fee amounts, non-U.S. licensed
space station operators with U.S. market access may notify the
Commission by July 15, 2020 whether they want to relinquish that market
access.\80\ Operators that relinquish their U.S. market access will not
be assessed regulatory fees this year. Accordingly, for FY 2020 we will
require regulatory fees to be paid by those non-U.S. licensed space
stations that have U.S. market access after July 15, 2020.\81\ We
instruct the International Bureau, when it receives a notice of
surrender of market access by the operator of a non-U.S. licensed space
station, to remove the space station as a point of communication in all
earth station licenses, regardless of whether the earth station
licensee itself requests removal of the non-U.S. licensed space station
as a point of communication.\82\ We do this so that a non-U.S. licensed
space station operator would not be prejudiced by non-action of a
third-party earth station licensee.
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\80\ Such a voluntary surrender of market access can be made
through existing procedures for surrender of grants of market access
or removal of a non-U.S. licensed space station as a point of
communications in an earth station license.
\81\ We note that after FY 2020 it is the responsibility of a
non-U.S. licensed space station with U.S. market access to inform
the Commission (International Bureau) by September 30th before the
new fiscal year begins that it is relinquishing its U.S. market
access; failing timely notification, the non-U.S. licensed station
will be assessed regulatory fees for the ensuing fiscal year. For
example, in FY 2021, a non-U.S. licensed space station with U.S.
market access must inform the Commission (International Bureau) by
September 30, 2020 that it wishes to relinquish its market access or
it will be charged the FY 2021 regulatory fee in September 2021.
\82\ The International Bureau will include notice of such
surrenders in its routine weekly Public Notices of Actions Taken for
satellite space and earth stations.
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27. Accordingly, we will issue an invoice for the annual space
station regulatory fee to the non-U.S. licensed space station operator
of record listed on the Schedule S filed in connection with a grant of
a petition for declaratory ruling to access the U.S. market, or with an
earth station application to add the non-U.S. licensed space station as
a point of communication, as of July 16, 2020.\83\ To facilitate
administration of regulatory fees, we require that all non-U.S.
licensed space station operators with such market access to obtain an
FCC Registration Number by August 1, 2020.\84\ Further, we remind non-
U.S. licensed space station operators who do not pay the regulatory
fees in a timely fashion that they will be in violation of our
regulatory fee rules and, while being subject to other regulatory fee
enforcement consequences, may be unable to obtain future U.S. market
access until such matters are resolved.\85\ To reiterate, this fee will
be assessed on any non-U.S. licensed space station that has been
granted market access through existing earth stations licensees as of
July 16, 2020.\86\
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\83\ In some cases, a single GSO satellite with access to the
U.S. market may be operated by more than one entity, as reflected in
the terms of the license or market access grant. In such cases, the
satellite operators should notify OMD which operator/FRN is the
contact for the space station regulatory fee purposes and that
operator/FRN will be billed. If no notification is received, OMD
will assign one party as the FRN contact for billing purposes.
\84\ https://apps.fcc.gov/coresWeb/publicHome.do.
\85\ See 47 U.S.C. 159(a).
\86\ For FY 2021 and subsequent years, the date of assessment
will be October 1, which is the standard date of assessment for
space and earth stations.
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28. We also conclude that we should reallocate four International
Bureau indirect FTEs as direct to account for our decision to assess
regulatory fees on non-U.S. licensed space stations. The Commission
previously recategorized four International Bureau FTEs as indirect to
avoid assessing U.S. licensed space stations for work that directly
involved non-U.S. licensed space stations that did not pay regulatory
fees.\87\ We find that it is appropriate to make this adjustment to
account for our decision to assess regulatory fees on non-U.S. licensed
space stations and the section 9 requirement that the Commission set
regulatory fees to ``reflect the full-time equivalent number of
employees within the bureaus and offices of the Commission adjusted to
take into account factors that are reasonably related to the benefits
provided to the payor of the fee by the Commission's activities.'' \88\
We accordingly add four FTEs to the satellite regulatory fee category
as direct FTEs to account for the work that was allocated as indirect
previously. We note, however, that we add back these four FTEs only to
correct the total number of direct FTEs in the International Bureau for
regulatory fee purposes. The apportionment of fees among International
Bureau regulatees is calculated based on the factors reasonably related
to the benefits provided to the payors of the fee, as discussed below.
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\87\ FY 2015 Report and Order, 30 FCC Rcd at 10278, paragraph
24. At the time, the Commission stated that the number of market
access requests by these entities can vary; however, four FTEs was
appropriate to be reallocated as indirect in calculating benefit to
International Bureau fee payors at the time. See id. paragraph 24,
and n. 94.
\88\ 47 U.S.C. 159(d).
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29. Finally, we find that subjecting non-U.S. licensed space
stations with U.S. market access to the space station regulatory fees
is an amendment as defined in section 9(d) of the Act.\89\ Such an
amendment must be submitted to Congress at least 90 days before it
becomes effective pursuant to section 9A(b)(2).\90\
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\89\ Id.
\90\ 47 U.S.C. 159A(b)(2).
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B. Apportionment of Fees Among International Bureau Regulatees
30. The Commission has previously determined over the course of
several orders that a significant number of FTEs in the International
Bureau do work that should be considered indirect for regulatory fee
purposes and set the number of direct FTEs at 24.\91\ The
[[Page 37372]]
International Bureau fees are divided into a satellite category (with
subcategories of GSO space stations, NGSO space stations, and earth
stations) and an international bearer circuits category (consisting of
submarine cable systems in one subcategory and terrestrial and
satellite international facilities in another). In the FY 2019 Report
and Order, the Commission explained that we currently allocate 17.1 of
the 24 International Bureau FTEs to the satellite category and 6.9 to
the international bearer circuits category.\92\ Including the 4 FTEs
that were previously considered indirect because of their work with
non-U.S. licensed space stations as discussed above brings those totals
to 21.1 FTEs assigned to the satellite category and 6.9 to the
international bearer circuit category.
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\91\ In FY 2013, the Commission proposed that all Satellite
Division FTEs working on issues involving regulatees, 25 FTEs, be
considered direct FTEs for determining the regulatory fees for space
stations and earth stations. FY 2013 NPRM, 28 FCC Rcd at 7800,
paragraphs 22-23. The Commission further proposed that two FTEs from
the Telecommunications and Analysis Division be allocated as direct
FTEs for regulatory fee purposes. Id. at 7802, paragraph 27. The
Commission also proposed that the Global Strategy and Negotiation
Division would be considered indirect because their activities
benefit the Commission as a whole and are not specifically focused
on International Bureau regulatees. Id. at 7802-803, paragraph 28.
The Commission adopted the proposal, but revised the number of
direct International Bureau FTEs to 28. Assessment and Collection of
FY 2013 Regulatory Fees, Report and Order, 28 FCC Rcd 12351, 12355-
56, paragraph 14 (78 FR 52433 (August 23, 2013)) (FY 2013 Report and
Order). Then, in 2015, the Commission further reduced the number of
direct FTEs in the International Bureau to 24 due to the number of
International Bureau FTEs in the Satellite Division working on non-
U.S. licensed space station market access requests. FY 2015 Report
and Order, 30 FCC Rcd at 10278, paragraph 24.
\92\ FY 2019 Report and Order, 34 FCC Rcd at 8197, paragraph 20.
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31. In the FY 2019 FNPRM, we sought comment on whether we should
adjust the apportionment among fee categories within the International
Bureau.\93\ In response, the International Bureau undertook a review of
its work, staffing, and distribution of responsibilities benefiting its
fee payers, division by division and between the Telecommunications and
Analysis Division and the Satellite Division. Based on this review, we
find that adjusting the FTE allocation for the international bearer
circuit category to 8 FTEs rather than 6.9 FTEs would better reflect
the direct FTE work in the International Bureau that benefits the fee
payors in the international bearer circuit category. This action brings
the FTEs for the satellite category to 20 and the total number of
direct FTEs for the International Bureau to 28.
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\93\ Id. at 8214, paragraph 67.
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32. We are not persuaded by the Submarine Cable Coalition's
assertion that two FTEs from the Telecommunications and Analysis
Division are sufficient for international bearer circuit
regulation.\94\ As we explained in the FY 2015 Report and Order, two
FTEs do not take into account all the work provided for this industry
by the International Bureau.\95\ Currently, almost all of the work of
the Telecommunications and Analysis Division, as well as some of the
work by the Office of the Bureau Chief, benefits international
telecommunications service providers including submarine cable
operators.\96\
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\94\ Submarine Cable Coalition Comments at 3-4. The Commission
initially indicated the number of FTEs was two in 2013. FY 2013
NPRM, 28 FCC Rcd at 7802, paragraph 27.
\95\ FY 2015 Report and Order, 30 FCC Rcd 10273, paragraph 12.
\96\ One exception is the work in the Telecommunications and
Analysis Division on foreign ownership issues under section 310 of
the Communications Act, 47 U.S.C. 310, which benefits domestic
common carrier wireless providers by facilitating foreign investment
in wireless carriers.
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33. The Submarine Cable Coalition also argues that the number of
FTEs in the International Bureau was not appropriately reduced when the
Office of Economics and Analytics was created and the reassignment of
staff led to decreases in the direct FTEs in the Media, Wireline
Competition, and Wireless Telecommunication Bureaus.\97\ None of the 24
FTEs from the International Bureau identified as direct for regulatory
fee purposes, however, were moved to the Office of Economics and
Analytics. Therefore, the number of direct FTEs in the International
Bureau was not reduced due to the creation of the Office of Economics
and Analytics. Accordingly, we reject these arguments. In the FY 2019
Report and Order we recognized that the increase to fees for
International Bureau regulatees was not trivial when we rejected
similar arguments and explained that such an increase was consistent
with previous FTE shifts we have made as well as the statute.\98\
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\97\ Submarine Cable Coalition Comments at 4-5.
\98\ FY 2019 Report and Order, 34 FCC Rcd at 8195, paragraphs
15-18.
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34. GSO and NGSO Space Stations Apportionment. In the FY 2019
FNPRM, we sought comment on adjustments to the allocation of FTEs among
GSO and NGSO space and earth station operators.\99\ The FY 2019 annual
regulatory fee per unit for Space Stations (Geostationary Orbit) is
$159,625, and the comparable fee per unit for Space Stations (Non-
Geostationary Orbit) is $154,875.\100\
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\99\ Id. at 8214, paragraph 67 (citing Letter from Jennifer A.
Manner, Senior Vice President, EchoStar Satellite Operating
Corporation and Hughes Network Systems, LLC, to Marlene H. Dortch,
Secretary, FCC, MD Docket No. 19-105, Attachment at 1 (filed Aug. 8,
2019) (EchoStar August 8 Ex Parte Letter)).
\100\ 47 CFR 1.1156(a).
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35. In response, SES Americom, Intelsat, EchoStar, and Hughes
(collectively, the GSO Satellite Operators), request that the
Commission rebalance the cost allocations between GSO and NGSO space
stations to address perceived unfairness in the current balance and
because the current balance purportedly does not align with underlying
costs.\101\ The GSO Satellite Operators observe that, for FY 2019, the
expected regulatory fee revenue from GSO satellite operators was
$15,643,250, which is more than 14 times the expected $1,084,125
regulatory fee revenue for NGSO satellite operators.\102\ This
imbalance in regulatory fee revenue results from the large disparity in
number of units between GSO space stations (98) and NGSO space stations
(7),\103\ even though under a single NGSO license hundreds, or
thousands, of satellites can be operated while counting as a single
unit for regulatory fee purposes, whereas only one satellite can be
operated per GSO space station regulatory fee unit.\104\
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\101\ GSO Satellite Operators Comments at 1-2.
\102\ Id. at 2 (citing FY 2019 Report and Order, 34 FCC Rcd at
8223-24, Appendix B).
\103\ It may also arise from the fact that the Commission does
not assess regulatory fees on licenses that do not have operational
satellites associated with them. Thus, even though there may be an
increase in NGSO licensing in recent years, there would not be an
increase in regulatory fees if those licensed systems had not yet
launched and operated satellites.
\104\ See, e.g., Space Exploration Holdings, LLC, Application
for Approval for Orbital Deployment and Operating Authority for the
SpaceX NGSO Satellite System, IBFS File Nos. SAT-LOA-20161115-00118,
SAT-LOA-20170726-00110, 33 FCC Rcd 3391 (2018).
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36. We agree with the GSO Satellite Operators that the
significantly larger amount of regulatory fee payments by GSO operators
cannot be attributed to them benefiting more from the Commission's
regulatory activities. We instead allocate 80% of space station fees to
Space Stations (Geostationary Orbit) and 20% to Space Stations (Non-
Geostationary Orbit). We consider three factors that reflect the
benefits of Commission oversight to GSO and NGSO operators: The number
of applications processed (that is, the benefits of adjudication), the
number of changes made to the Commission's rules (that is, the benefit
of rulemaking), and the number of FTEs working on oversight for each
category of operators.
37. First, using the data compiled from the International Bureau
Filing System, we looked at the applications received and processed by
the International Bureau for each of the most recent three years (that
is, 2017-2019).\105\ The breakdown shows that GSO applications
accounted for 79% (108/136) of applications disposed in 2019 and 79%
(124/157) of applications received in 2019. For 2018, the GSO share is
75% (88/117) disposed and 84% (77/92) received. For 2017, the GSO share
is 84% (122/146) disposed and 77% (128/167) received. Thus, the
[[Page 37373]]
total number of applications received and disposed of in this three-
year period continues to support a significantly greater allocation of
adjudication benefits to GSO than NGSO systems in the range of 75% to
84%.
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\105\ The application counts include applications from U.S. and
non-U.S. space station operators for new systems, requests for
modification or amendment, and requests for special temporary
authority. By reporting the data as part of this proceeding, we
address the request of the Satellite Industry Association to provide
additional factual detail on fee decisions. Satellite Industry
Association Comments at 17.
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38. Second, using compiled data for the last three years on the
number of Commission-level items originating from the Satellite
Division of the International Bureau, we considered each items'
relative precedential value to GSO and NGSO operators.\106\ The list
consists of 6 items during 2017-2019,\107\ of which 3 held more benefit
for GSOs and 3 held more benefit for NGSOs.\108\ Accordingly, the data
presented suggests that there was approximately the same rulemaking
benefit to GSO operators as to NGSO operators. We note, however, that,
quantifying only the most recent rulemaking activities does not take
into account any continued benefits derived from older rulemakings.
Some of those continued benefits are received through the efforts of
adjudication and administration of the rules adopted in those
rulemakings. Accordingly, we find that attributing a value to
rulemaking activities directly is a somewhat subjective exercise and
lacks precision.
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\106\ We limited our review to Commission-level items because of
their greater precedential value and because they include rulemaking
proceedings that affect the industry as a whole, rather than a
particular entity.
\107\ Notices of Proposed Rulemakings that resulted in the
adoption of an Order within the same three-year period were not
included since inclusion could result in double-counting of an
eventual benefit.
\108\ The following proceedings primarily benefit GSO systems:
(1) Amendment of the Commission's Policies and Rules for Processing
Applications in the Direct Broadcast Satellite Service, Second
Report & Order, IB Docket No. 06-160 (rel. Sep. 27, 2019); (2)
Further Streamlining Part 25 Rules Governing Satellite Services,
Notice of Proposed Rulemaking, 33 FCC Rcd 11502 (2018); and (3)
Facilitating the Communications of Earth Stations in Motion with
Non-Geostationary Orbit Space Stations, Report and Order and Further
Notice of Proposed Rulemaking, 33 FCC Rcd 9327 (84 FR 53630 (October
8, 2019) and 84 FR 5654 (February 22, 2019)) (2018). The following
rulemaking proceedings primarily benefit NGSO systems: (1)
Mitigation of Orbital Debris in the New Space Age, Notice of
Proposed Rulemaking, 33 FCC Rcd 11352 (2019); (2) Streamlining
Licensing Procedures for Small Satellites, Report and Order, 34 FCC
Rcd 13077 (2019); (3) Facilitating the Communications of Earth
Stations in Motion with Non-Geostationary Orbit Space Stations,
Notice of Proposed Rulemaking, 33 FCC Rcd 11416 (83 FR 67180
(December 28, 2018)) (2018). One of the six items, Mitigation of
Orbital Debris in the New Space Age, could be seen as benefitting
both GSOs and NGSOs, but since the item largely addresses mitigation
of debris resulting from new space operations in NGSOs, it was
counted as benefitting NGSO more.
---------------------------------------------------------------------------
39. Third, we considered whether we could examine FTE activities
directly, but there has been no change in the number of FTEs
attributable to satellite regulatory activities in the International
Bureau from previous years and the International Bureau does not
separate FTEs by work done on GSO versus NGSO matters.\109\ Indeed, a
single FTE may work on authorizations and rulemakings that benefit both
categories of satellite operations. Because we are unable to assess
benefits based on a clearly identifiable division of work by assigned
FTEs, we must estimate the relative percentage of FTEs that are
attributable to benefitting either GSO or NGSO systems based on the
factors above.
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\109\ Similarly, the International Bureau also does not separate
FTEs by work done on U.S. licensed versus non-U.S. licensed space
stations. Most regulatory activities benefit all space stations,
whether U.S. licensed or not.
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40. We recognize the considerable challenge of assigning a precise
number to the apportionment of regulatory fees between GSO and NGSO
space stations. Taking all of the foregoing factors and data into
consideration we conclude, however, that the GSO/NGSO ratio should be
adjusted to reflect that GSO space stations derived roughly 75-84% of
the benefit from the Commission's adjudicatory efforts. Given that our
consideration of FTE activities did not yield a clearly identifiable
division between GSO and NGSO, and because it is difficult to be
precise in quantifying benefits of rulemaking activities, we believe a
number in the middle of the 75-84% range is appropriate. We are also
mindful that the number of NGSO units for which regulatory fees are
assessed is small, so selection of a number at the bottom end of the
75-84% range would result in a much greater change in the regulatory
fee assessed. We find that selecting a number in the middle of the 75-
84% range best reflects the other factors considered in our re-
balancing and imposes a balanced burden in that range on all space
station operators, including the smaller number of NGSO system
operators. Accordingly, for FY 2020, GSO and NGSO space stations will
be allocated 80% and 20% of the space station fees, respectively.
41. Earth Station and Space Station Apportionment. Although the FY
2019 FNPRM did not propose adjusting the allocation within the
satellite category for earth station regulatory fees, certain satellite
operators asked that we review such apportionment \110\ and suggested
that we implement different earth station subcategories for regulatory
fee purposes.\111\
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\110\ GSO Satellite Operators Comments, at 4; SIA Comments at 9.
\111\ GSO Satellite Operators Comments at 4.
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42. We decline to adopt any changes at this time. We find that
there is insufficient evidence in the record to increase the
apportionment of fees paid by earth station licensees. GSO Satellite
Operators state that earth station licensees collectively are
responsible for $1,402,500 in total regulatory fees, which is less than
one-eleventh of the regulatory fees paid by GSO space station
licensees.\112\ Although the GSO Satellite Operators claim that this
proportion is out of synch with actual relative costs,\113\ they do not
provide any data to support this claim, or propose an appropriate
apportionment of fees between earth and space stations. In support of
their claim, GSO Satellite Operators point solely to a pair of
proceedings focused on Earth Stations in Motion (ESIMs).\114\ Although
earth station licensees do benefit from these proceedings, we also find
that the proceedings are of equal, if not more, benefit to space
station licensees, which would gain access to additional frequency
bands in which to sell transponder capacity for mobility services and
increased streamlining of their regulatory environment. Accordingly,
the record does not support an increase of the apportionment of fees
paid by earth station licensees at this time.
---------------------------------------------------------------------------
\112\ Id.
\113\ Id.
\114\ Id. (citing Amendment of Parts 2 and 25 of the
Commission's Rules to Facilitate the Use of Earth Stations in Motion
Communicating with Geostationary Orbit Space Stations in Frequency
Bands Allocated to the Fixed-Satellite Service, Notice of Proposed
Rulemaking, 32 FCC Rcd 4239 (2017); Facilitating the Communications
of Earth Stations in Motion with Non-Geostationary Orbit Space
Stations, Notice of Proposed Rulemaking, 33 FCC Rcd 11416 (2018).
---------------------------------------------------------------------------
43. We also find that the record does not support implementing
different classes of earth stations for regulatory fee purposes or
increasing earth station regulatory fees. GSO Satellite Operators
suggest that blanket-licensed earth station licensees involving
multiple antennas under a single authorization should pay higher fees
than other earth station licensees because blanket-licensed earth
station licensees require more regulatory oversight.\115\ The GSO
Satellite Operators, however, provide no factual support for the
proposition other than a conclusory statement. GSO Satellite Operators
instead observe that the fee schedule originally adopted by Congress
differentiated between blanket-licensed earth stations and stand-alone
antennas.\116\ But the prior statutory differentiation pertained to
application fees, not regulatory fees--
[[Page 37374]]
i.e., it was not tied to the statutory factors that bind us in setting
regulatory fees.\117\ Accordingly, we find no basis in the record to
support an increase in regulatory fees for earth station licenses or to
support the creation of a separate, higher regulatory fee for blanket-
licensed earth stations.
---------------------------------------------------------------------------
\115\ GSO Satellite Operators Comments at 4.
\116\ Id. at 4-5.
\117\ The GSO Satellite Operators cite section 159(g) of Title
47 of the United States Code in support, which was repealed in 2018.
GSO Satellite Operators Comments at 5 n.12. Section 159(g) was
entitled ``Application of Application Fees'' and addressed the
separate issue of FCC filing fees, not regulatory fees.
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C. Regulatory Fees Paid by VHF Broadcasters
44. In the FY 2018 Report and Order, we adopted a new methodology
for assessment of broadcast television regulatory fees, finding that
the service contour-based population method more accurately reflects
the actual market served by full-power television stations for purposes
of assessing regulatory fees than the DMA-based methodology we
previously employed.\118\ We also said that we would phase in
implementation of the new methodology in two years, using a
transitional fee structure for FY 2019 fees and the new methodology for
assessment of FY 2020 fees.\119\
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\118\ Assessment and Collection of Regulatory Fees for Fiscal
Year 2018, Report and Order and Order, 33 FCC Rcd 8497, 8501-8502,
paragraphs 13-15 (2018) (83 FR 47079, paragraphs 13-15 (September
18, 2018)) (FY 2018 Report and Order).
\119\ Id.
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45. In the FY 2019 FNPRM, we sought comment on whether we should
adjust population counts for the new methodology to address a signal
limitation issue raised by commenters to the FY 2019 NPRM.\120\
Specifically, those commenters argued that VHF channels should have
lower regulatory fees because the predicted contour distance does not
adequately account for all of the possible effects on the VHF station
signal, such as environmental noise issues, the result of which may
limit the signal and the population reached. Thus, they argued, the
population count is overstated for VHF stations and should be adjusted
downward accordingly.\121\
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\120\ FY 2019 Report and Order, 34 FCC Rcd at 8214-15, paragraph
68 and FY 2019 NPRM (84 FR 26234 (June 5, 2019)).
\121\ Id.
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46. Commenters reiterate and amplify the signal limitation concern.
NAB explains that following the digital transition, some VHF channels
encountered environmental noise that affected the reliability of those
broadcasters' signals.\122\ As a compensatory measure, some VHF
stations have increased their power levels, resulting in an increase in
the theoretical, but not the actual, population served and higher
regulatory fees under the new methodology.\123\ PMCM TV argues that we
should assess VHF stations, and especially low band VHF stations, a
significantly lower regulatory fee.\124\ Maranatha Broadcasting
proposes that we average the fee amounts assessed to the commercial
full power UHF stations in a given market and apply the average UHF fee
as the fee to be assessed VHF stations in the same market.\125\
Maranatha Broadcasting argues that the population methodology does not
properly account for ``the inherent technical inferiority of the VHF
signal in the digital broadcast world,'' and that VHF stations should
not be charged more than UHF stations in the same market.\126\
---------------------------------------------------------------------------
\122\ NAB Comments at 2.
\123\ NAB Comments at 3-4; NAB suggests a station's original DTV
contour is a more accurate reflection of a VHF station's actual
coverage and population reach. See also Maranatha Broadcasting
Comments at 1-4.
\124\ PMCM Comments at 4. PMCM TV and Maranatha Broadcasting
observe that the advertising revenues for TV are based on the DMA
where the station is located, because that is where most of the
audience is, and not on the population outside the DMA that may also
be able to reach the station. PMCM TV Comments at 4; Maranatha
Broadcasting Comments at 5.
\125\ Maranatha Broadcasting Comments at 6-7. See also Letter
from Barry Fisher, President, Maranatha Broadcasting Company, Inc.,
to Marlene H. Dortch, Secretary, FCC, MD Docket No. 19-105, (filed
May 1, 2020).
\126\ Maranatha Broadcasting Comments at 7.
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47. We decline to categorically lower regulatory fees for VHF
stations to account for signal limitations. Inconsistencies in the
reports of low-VHF reception issues have led the Media Bureau to
conclude that there is nothing inherent in VHF transmission that
creates signal deficiencies but that environmental noise issues can
affect reception in certain areas and situations. And although we agree
that environmental noise blockages affecting signal strength and
reception exist, they do not exist across the board. The impact of
signal disruptions, to the extent they exist, varies widely from
service area to service area and does not lend itself to an across-the-
board rule. However, we do agree with NAB and propose to take into
account the licensed power increases that go beyond the maximum allowed
for VHF stations. Therefore, we will assess the fees for those VHF
stations that are licensed with a power level that exceeds the maximum
based on the maximum power level specified for channels 2-6 in Sec.
73.622(f)(6) and for channels 7-13 in Sec. 73.622(f)(7).
IV. Final Regulatory Flexibility Analysis
1. As required by the Regulatory Flexibility Act of 1980, as
amended (RFA),\127\ an Initial Regulatory Flexibility Analysis (IRFA)
was included in the FY 2019 Further Notice of Proposed Rulemaking.\128\
The Commission sought written public comment on these proposals
including comment on the IRFA. This Final Regulatory Flexibility
Analysis (FRFA) conforms to the IRFA.\129\
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\127\ 5 U.S.C. 603. The RFA, 5 U.S.C. 601-612 has been amended
by the Small Business Regulatory Enforcement Fairness Act of 1996
(SBREFA), Public Law 104-121, Title II, 110 Stat. 847 (1996).
\128\ Assessment and Collection of Regulatory Fees for Fiscal
Year 2019, Report and Order and Further Notice of Proposed
Rulemaking, 34 FCC Rcd 8189 (2019) (FY 2019 FNPRM).
\129\ 5 U.S.C. 604.
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A. Need for, and Objectives of, the Report and Order
2. In this Report and Order, the Commission assesses for the first
time a regulatory fee on non-U.S. licensed space stations with United
States market access, by including those non-U.S. licensed space
stations in the current regulatory fee categories for GSO and NGSO
space stations. This fee is assessed regardless of whether the foreign
satellite operator obtains the market access through a declaratory
ruling or through an earth station applicant as a point of
communication. In either case, the Commission's review of the space
station market access request is the same. The earth station
application may be filed by the foreign operator, one of its
subsidiaries, or an independent third party. Currently, the regulatory
fee paid by an earth station licensee that has secured market access
for a foreign satellite operator is the same as the fee paid by any
other earth station licensee in its class, despite the additional
Commission resources consumed by such market access requests. For these
reasons, and because it is inequitable and anticompetitive for U.S.
licensed space stations to pay regulatory fees while non-U.S. licensed
space stations with U.S. market access do not, the Commission assesses
its existing GSO and NGSO regulatory fee categories on non-U.S.
licensed space stations that have access to the United States market,
either through a petition for market access or through an earth
station.
B. Summary of the Significant Issues Raised by the Public Comments in
Response to the IRFA
3. None.
[[Page 37375]]
C. Response to Comments by the Chief Counsel for Advocacy of the Small
Business Administration
4. Pursuant to the Small Business Jobs Act of 2010, which amended
the RFA, the Commission is required to respond to any comments filed by
the Chief Counsel for Advocacy of the Small Business Administration
(SBA), and to provide a detailed statement of any change made to the
proposed rules as a result of those comments. In this section respond
specifically to any comment filed by Chief Counsel of SBA. The Chief
Counsel did not file any comments in response to the proposed rules in
the Further Notice of Proposed Rulemaking in this proceeding
D. Description and Estimate of the Number of Small Entities To Which
the Rules Will Apply
5. The RFA directs agencies to provide a description of, and where
feasible, an estimate of the number of small entities that may be
affected by the proposed rules and policies, if adopted.\130\ The RFA
generally defines the term ``small entity'' as having the same meaning
as the terms ``small business,'' ``small organization,'' and ``small
governmental jurisdiction.'' \131\ In addition, the term ``small
business'' has the same meaning as the term ``small business concern''
under the Small Business Act.\132\ A ``small business concern'' is one
which: (1) Is independently owned and operated; (2) is not dominant in
its field of operation; and (3) satisfies any additional criteria
established by the SBA.\133\ Nationwide, there are a total of
approximately 27.9 million small businesses, according to the SBA.\134\
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\130\ 5 U.S.C. 603(b)(3).
\131\ 5 U.S.C. 601(6).
\132\ 5 U.S.C. 601(3) (incorporating by reference the definition
of ``small-business concern'' in the Small Business Act, 15 U.S.C.
632). Pursuant to 5 U.S.C. 601(3), the statutory definition of a
small business applies ``unless an agency, after consultation with
the Office of Advocacy of the Small Business Administration and
after opportunity for public comment, establishes one or more
definitions of such term which are appropriate to the activities of
the agency and publishes such definition(s) in the Federal
Register.''
\133\ 15 U.S.C. 632.
\134\ See SBA, Office of Advocacy, ``Frequently Asked
Questions,'' https://www.sba.gov/sites/default/files/advocacy/SB-FAQ-2016_WEB.pdf.
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6. Small Businesses, Small Organizations, Small Governmental
Jurisdictions. Our actions, over time, may affect small entities that
are not easily categorized at present. We therefore describe here, at
the outset, three broad groups of small entities that could be directly
affected herein.\135\ First, while there are industry specific size
standards for small businesses that are used in the regulatory
flexibility analysis, according to data from the SBA's Office of
Advocacy, in general a small business is an independent business having
fewer than 500 employees.\136\ These types of small businesses
represent 99.9% of all businesses in the United States which translates
to 28.8 million businesses.\137\
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\135\ See 5 U.S.C. 601(3)-(6).
\136\ See SBA, Office of Advocacy, ``Frequently Asked Questions,
Question 1--What is a small business?'' https://www.sba.gov/sites/default/files/advocacy/SB-FAQ-2016_WEB.pdf (June 2016).
\137\ See SBA, Office of Advocacy, ``Frequently Asked Questions,
Question 2--How many small businesses are there in the U.S.?''
https://www.sba.gov/sites/default/files/advocacy/SB-FAQ-2016_WEB.pdf
(June 2016).
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7. Next, the type of small entity described as a ``small
organization'' is generally ``any not-for-profit enterprise which is
independently owned and operated and is not dominant in its field.''
\138\ Nationwide, as of August 2016, there were approximately 356,494
small organizations based on registration and tax data filed by
nonprofits with the Internal Revenue Service (IRS).\139\
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\138\ 5 U.S.C. 601(4).
\139\ Data from the Urban Institute, National Center for
Charitable Statistics (NCCS) reporting on nonprofit organizations
registered with the IRS was used to estimate the number of small
organizations. Reports generated using the NCCS online database
indicated that as of August 2016 there were 356,494 registered
nonprofits with total revenues of less than $100,000. Of this
number, 326,897 entities filed tax returns with 65,113 registered
nonprofits reporting total revenues of $50,000 or less on the IRS
Form 990-N for Small Exempt Organizations and 261,784 nonprofits
reporting total revenues of $100,000 or less on some other version
of the IRS Form 990 within 24 months of the August 2016 data release
date. See http://nccs.urban.org/sites/all/nccs-archive/html//tablewiz/tw.php where the report showing this data can be generated
by selecting the following data fields: Report: ``The Number and
Finances of All Registered 501(c) Nonprofits''; Show: ``Registered
Nonprofits''; By: ``Total Revenue Level (years 1995, Aug to 2016,
Aug)''; and For: ``2016, Aug'' then selecting ``Show Results.''
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8. Finally, the small entity described as a ``small governmental
jurisdiction'' is defined generally as ``governments of cities,
counties, towns, townships, villages, school districts, or special
districts, with a population of less than fifty thousand.'' \140\ U.S.
Census Bureau data from the 2012 Census of Governments \141\ indicate
that there were 90,056 local governmental jurisdictions consisting of
general purpose governments and special purpose governments in the
United States.\142\ Of this number there were 37, 132 General purpose
governments (county,\143\ municipal and town or township \144\) with
populations of less than 50,000 and 12,184 Special purpose governments
(independent school districts \145\ and special districts \146\) with
populations of less than 50,000. The 2012 U.S. Census Bureau data for
most types of governments in the local government category show that
the majority of these governments have populations of less than
50,000.\147\ Based on this data we estimate that at least 49,316 local
government jurisdictions fall in the category of ``small governmental
jurisdictions.'' \148\
[[Page 37376]]
Governmental entities are, however, exempt from application fees.\149\
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\140\ 5 U.S.C. 601(5).
\141\ See 13 U.S.C. 161. The Census of Government is conducted
every five (5) years compiling data for years ending with ``2'' and
``7''. See also Program Description Census of Government https://factfinder.census.gov/faces/affhelp/jsf/pages/metadata.xhtml?lang=en&type=program&id=program.en.COG#.
\142\ See U.S. Census Bureau, 2012 Census of Governments, Local
Governments by Type and State: 2012--United States--States, https://factfinder.census.gov/bkmk/table/1.0/en/COG/2012/ORG02.US01. Local
governmental jurisdictions are classified in two categories--General
purpose governments (county, municipal and town or township) and
Special purpose governments (special districts and independent
school districts).
\143\ See U.S. Census Bureau, 2012 Census of Governments, County
Governments by Population-Size Group and State: 2012--United
States--States. https://factfinder.census.gov/bkmk/table/1.0/en/COG/2012/ORG06.US01. There were 2,114 county governments with
populations less than 50,000.
\144\ See U.S. Census Bureau, 2012 Census of Governments,
Subcounty General-Purpose Governments by Population-Size Group and
State: 2012--United States--States. https://factfinder.census.gov/bkmk/table/1.0/en/COG/2012/ORG07.US01. There were 18,811 municipal
and 16,207 town and township governments with populations less than
50,000.
\145\ See U.S. Census Bureau, 2012 Census of Governments,
Elementary and Secondary School Systems by Enrollment-Size Group and
State: 2012--United States--States. https://factfinder.census.gov/bkmk/table/1.0/en/COG/2012/ORG11.US01. There were 12,184 independent
school districts with enrollment populations less than 50,000.
\146\ See U.S. Census Bureau, 2012 Census of Governments,
Special District Governments by Function and State: 2012--United
States--States. https://factfinder.census.gov/bkmk/table/1.0/en/COG/2012/ORG09.US01. The U.S. Census Bureau data did not provide a
population breakout for special district governments.
\147\ See U.S. Census Bureau, 2012 Census of Governments, County
Governments by Population-Size Group and State: 2012--United
States--States. https://factfinder.census.gov/bkmk/table/1.0/en/COG/2012/ORG06.US01; Subcounty General-Purpose Governments by
Population-Size Group and State: 2012--United States--States--
https://factfinder.census.gov/bkmk/table/1.0/en/COG/2012/ORG07.US01;
and Elementary and Secondary School Systems by Enrollment-Size Group
and State: 2012--United States--States. https://factfinder.census.gov/bkmk/table/1.0/en/COG/2012/ORG11.US01. While
U.S. Census Bureau data did not provide a population breakout for
special district governments, if the population of less than 50,000
for this category of local government is consistent with the other
types of local governments the majority of the 38, 266 special
district governments have populations of less than 50,000.
\148\ Id.
\149\ 47 U.S.C. 158(d)(1)(A).
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9. All Other Telecommunications. The ``All Other
Telecommunications'' category is comprised of establishments primarily
engaged in providing specialized telecommunications services, such as
satellite tracking, communications telemetry, and radar station
operation.\150\ This industry also includes establishments primarily
engaged in providing satellite terminal stations and associated
facilities connected with one or more terrestrial systems and capable
of transmitting telecommunications to, and receiving telecommunications
from, satellite systems.\151\ Establishments providing internet
services or voice over internet protocol (VoIP) services via client-
supplied telecommunications connections are also included in this
industry.\152\ The SBA has developed a small business size standard for
All Other Telecommunications, which consists of all such firms with
annual receipts of $35 million or less.\153\ For this category, U.S.
Census Bureau data for 2012 shows that there were 1,442 firms that
operated for the entire year.\154\ Of those firms, a total of 1,400 had
annual receipts less than $25 million and 15 firms had annual receipts
of $25 million to $49, 999,999.\155\ Thus, the Commission estimates
that the majority of ``All Other Telecommunications'' firms potentially
affected by our action can be considered small.
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\150\ See U.S. Census Bureau, 2017 NAICS Definitions, NAICS Code
``517919 All Other Telecommunications'', https://www.census.gov/cgi-bin/sssd/naics/naicsrch?input=517919&search=2017+NAICS+Search&search=2017.
\151\ Id.
\152\ Id.
\153\ See 13 CFR 121.201, NAICS code 517919.
\154\ U.S. Census Bureau, 2012 Economic Census of the United
States, Table EC1251SSSZ4, Information: Subject Series--Estab and
Firm Size: Receipts Size of Firms for the United States: 2012, NAICS
code 517919, https://factfinder.census.gov/bkmk/table/1.0/en/ECN/
2012_US/51SSSZ4//naics~517919.
\155\ Id.
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E. Description of Projected Reporting, Recordkeeping and Other
Compliance Requirements
10. This Report and Order does not adopt any new reporting,
recordkeeping, or other compliance requirements.
F. Steps Taken To Minimize Significant Economic Impact on Small
Entities, and Significant Alternatives Considered
11. The RFA requires an agency to describe any significant
alternatives that it has considered in reaching its approach, which may
include the following four alternatives, among others: (1) The
establishment of differing compliance or reporting requirements or
timetables that take into account the resources available to small
entities; (2) the clarification, consolidation, or simplification of
compliance or reporting requirements under the rule for small entities;
(3) the use of performance, rather than design, standards; and (4) an
exemption from coverage of the rule, or any part thereof, for small
entities.\156\
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\156\ 5 U.S.C. 603(c)(1)-(c)(4).
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12. This Report and Order does not adopt any new reporting
requirements. Therefore, no adverse economic impact on small entities
will be sustained based on reporting requirements. In keeping with the
requirements of the Regulatory Flexibility Act, we have considered
certain alternative means of mitigating the effects of fee increases to
a particular industry segment. For example, The Commission's annual de
minimis threshold of $1,000, replaced last year with a new section
9(e)(2) annual regulatory fee exemption of $1,000, will reduce burdens
on small entities with annual regulatory fees that total $1,000 or
less. Also, regulatees may also seek waivers or other relief on the
basis of financial hardship. See 47 CFR 1.1166.
G. Federal Rules That May Duplicate, Overlap, or Conflict
13. None.
V. Ordering Clauses
14. Accordingly, it is ordered that, pursuant to the authority
found in sections 4(i) and (j), 9, 9A, and 303(r) of the Communications
Act of 1934, as amended, 47 U.S.C. 154(i), 154(j), 159, 159A, and
303(r), this Report and Order is hereby adopted.
15. It is further ordered that the Report and Order shall be
effective 30 days after publication in the Federal Register.
16. It is further ordered that the amendment adopted in section III
A shall be effective 90 days after notice to Congress, pursuant to
section 159A(b) of the Communications Act of 1934, as amended, 47
U.S.C. 159A(b),
17. It is further ordered that the Commission's Consumer and
Governmental Affairs Bureau, Reference Information Center, shall send a
copy of this Report and Order, including the Final Regulatory
Flexibility Analysis in this document, to Congress and the Government
Accountability Office pursuant to 5 U.S.C. 801(a)(1)(A).
Federal Communications Commission.
Cecilia Sigmund,
Federal Register Liaison Officer.
[FR Doc. 2020-11348 Filed 6-19-20; 8:45 am]
BILLING CODE 6712-01-P