The FCC’s Wireline Competition Bureau Clarifies Billing for VoIP-PSTN Traffic
Kelley Drye Client Advisory
March 6, 2012

On February 27, 2012, in the third decision issued in the past two months to clarify and/or correct aspects of the Connect America Fund ("CAF") Order, the Wireline Competition Bureau ("WCB") addressed when a CLEC is entitled to assess and collect the full ILEC access benchmark rate when billing for VoIP-PSTN traffic.  The WCB order may limit CLEC access charges for VoIP-PSTN traffic depending on the arrangements, and raises new questions regarding non-VoIP access traffic.  Providers should review the decision carefully to ensure that access billing is in compliance with Section 61.26(f) as interpreted by the Bureau.

Issue Raised

The Bureau entertained a question concerning the scope of the so-called "VoIP symmetry" rule implemented through Section 61.26(f) of the Rules, which was modified in the CAF Order.  Section 61.26(f) states that a "CLEC may assess a rate equal to the rate that would be charged by the competing ILEC for all exchange access services required to deliver interstate traffic to the called number" where it "provides some portion of the switched exchange access services used to send traffic to or from an end user not served by that CLEC" and "the CLEC is listed in the database of the Number Portability Administration Center [NPAC] as providing the calling party or dialed number."  The Bureau was asked whether a LEC is entitled to charge the full 'benchmark' rate level "whenever it is providing telephone numbers and some portion of the interconnection with the PSTN, and regardless of how or by whom the last-mile transmission is provided."  Under this hypothetical, it is possible that neither the CLEC nor its VoIP retail partner would be providing all the functions that make up the ILEC's full benchmark rate.  Stated differently, the Bureau provided guidance on what is or are the baseline access function or functions that a CLEC must perform in order to charge full ILEC switched access rates.

Ruling

The WCB concluded that, despite section 61.26(f)'s language, the fact that a CLEC may be providing "some portion" of the interconnection required to complete VoIP-PSTN calls and may be listed in the NPAC database as providing the associated telephone numbers, does not mean, in itself, that the CLEC may charge the full benchmark rate.  Rather, the Bureau explained that its rules -- in particular Section 51.913(b) -- provide that a CLEC and its retail VoIP provider partner may only bill for the functions that they actually perform, regardless of the apparently expansive language of Section 61.26(f).  To remove any ambiguity about the breadth of Section 61.26(f) and the ability of a CLEC to charge the full benchmark rate when providing access for VoIP-PSTN traffic, the WCB amended Section 61.26(f) to add the qualification "to the extent permitted by § 51.913(b)."

While the Bureau may have cleared up one question, its order potentially raises another.  Section 61.26(f) is not limited to CLEC access service provided in originating or terminating VoIP-PSTN Traffic, but on its face applies to all access traffic.  If the rule section does not allow the CLEC to assess the full benchmark rate for VoIP-PSTN traffic unless it (or its retail VoIP provider partner) perform all the access functions (or their equivalent) reflected in the full benchmark rate, the rule as amended now suggests that in certain other scenarios not involving VoIP-PSTN traffic, the CLEC may not be able to charge the full benchmark rate even if the CLEC meets the criteria in Section 61.26(f), namely where it "provides some portion of the switched exchange access services used to send traffic to or from an end user not served by that CLEC" and "the CLEC is listed in the database of the Number Portability Administration Center [NPAC] as providing the calling party or dialed number."  The Bureau's February 27 Order does not provide further guidance as to the circumstances when a CLEC may charge a full benchmark rate, so this is unlikely to be the last word on Section 61.26(f).

Please be advised that attorneys in Kelley Drye & Warren's Communications practice group are experienced in addressing issues related to the hearing aid compatibility handset reports. For more information regarding this client advisory, please contact your usual Kelley Drye attorney or any member of the Communications practice group.