Court Upholds FCC Decision Not to Forbear From Part 32

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The U.S. Court of Appeals for the District of Columbia Circuit has upheld a 2013 FCC decision to deny a request that the FCC forbear from applying the requirement that incumbent price cap carriers maintain a Uniform System of Accounts pursuant to Part 32 of the FCC’s rules.  In February 2012, the United States Telecom Association (USTelecom) filed a petition seeking forbearance from a myriad of “legacy telecommunications regulations” that it describes as unnecessary and outdated.  The FCC granted partial, conditional, or complete forbearance from 126 of the approximately 141 rules and requirements covered in the petition, but found that USTelecom had not demonstrated that forbearance from the Part 32 Uniform System of Accounts was warranted.  Verizon and AT&T challenged this decision in court, arguing that price cap regulation has rendered Part 32 of the FCC’s rules “useless,” and the Communications Act therefore requires the FCC to forebear from applying it.  The D.C. Circuit disagreed.  In denying Verizon and AT&T’s petition for review, the court concluded that the FCC’s interpretation and application of its forbearance authority was permissible.

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