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"X s {O- xԍ Id. Bellcore administers NPA codes, N11 codes for national use, CICs, 500NXX codes, 900NXX codes,  xh456NXX codes, 800NXX codes (Caribbean only), Service Access Codes (N00), 809NXX codes, 555 line numbers,  xiVertical Service Codes, SS7 network codes (under contract with Committee T1), MBG identifiers (under contract  yOK-with Committee T1) and ANI II digits.  Additionally, within the United  xKStates, eleven regional CO code administrators handle CO code assignments. The dominant local  X- xexchange carrier (LEC) in a particular region serves as the CO code administrator.` \Bs {O- xԍ Id. The CO code administrators within the United States are: Alascom; Ameritech; Bell Atlantic; BellSouth;  xxCincinnati Bell; GTE (for 813 area code); GTE (for 808 area code); NYNEX; Southern New England Telephone;  {O'-SBC; and U S WEST. Id. at n.20.` Currently,  X -Bellcore Client Companiesh  fs yO-ԍ Ameritech; Bell Atlantic; BellSouth; NYNEX; SBC; and U S WEST. h fund the operation of Bellcore as the NANPA.B  s {O&!-ԍ NANP Order at 2594.B  X9 - ` x4.` ` As more new entrants entered the telecommunications market, particularly wireless  xentrants in direct competition with the wireline industry, the wireline industry's continued  X - xadministration of the NANP became unacceptable.; s {O,&-ԍ Id. at 2595.; In 1994 we issued a Notice of Proposed  X - xRulemaking examining what entities might perform the policymaking, dispute resolution and" ,K(K(<<"  X- xZapplications processing functions associated with NANP administration.s {Oy- xԍ Administration of the North American Numbering Plan, Notice of Proposed Rulemaking, CC Docket No. 92 {OC-237, 9 FCC Rcd 2068 (1994) (NANP NPRM). In the resulting NANP  X- xOrder, we stated that adequate numbering resources are essential to provide consumers efficient  x>access to new telecommunications services and technologies, and to support growth of an  X-economy dependent upon those services and technologies.^$s {Op-ԍ NANP Order at 2591, citing the NANP NPRM.^ We stated:  XX(PXxThe NANP erects a framework for assigning the telephone numbers upon which  those services depend and for permitting international calls between the member  ncountries to be completed without the need to dial international access codes and  international country codes. The advantages of widespread access to such a  _seamless network are considerable. These numbers are a public resource, and are  not the property of the carriers. [Footnote omitted]. Access to numbering  resources is critical to entities desiring to participate in the telecommunications  industry. Numbers are the means by which businesses and consumers gain access  to, and reap the benefits of, the public switched telephone network. These benefits  cannot be fully realized, however, unless numbering resources of the NANP are  administered in a fair and efficient manner that makes them available to all parties  desiring to provide telecommunications services. To maximize these benefits  orequired continued international coordination of number administration among  X-member countries of the NANP.8s {O-ԍ Id.8   XH- ` x5.` ` The NANP Order resolved several issues related to the future administration of the  xyNANP. In it, we stated the broad policy objectives that should and could be achieved through judicious administration of the NANP. They are as follows:  X-  xAdministration of the plan must seek to facilitate entry into the communications  x@marketplace by making numbering resources available on an efficient, timely basis to communications services providers.  X2-  ^xAdministration of the NANP should not unduly favor or disadvantage any particular industry segment or group of consumers.  X-  xAdministration of the NANP should not unduly favor one technology over another. The NANP should be largely technology neutral.  X`-  lxAdministration of the NANP and the dialing plan should give consumers easy access to the public switched telephone network. "H,K(K(<<"Ԍ X-  }xAdministration of the NANP should ensure that the interests of all NANP member  xcountries are addressed fairly and efficiently, and foster continued integration of the NANP across NANP member countries.  Xt-  /xUnited States numbering policy should be developed in a manner that fosters international  XQ-numbering consistency and interoperability.EQs {O-ԍ NANP Order at 259596.E  X - ` 2x6.` ` We concluded that an effective structure for number administration in the United  xStates would be one in which an industry policy board or oversight committee would develop  xpolicy and, at least initially, would resolve disputes. The NANPA would maintain administrative  xnumber databases and process applications for numbers, while reporting to the oversight  X - x0committee instead of directly to regulatory bodies.; Zs {O -ԍ Id. at 2601.; The committee would report to the  xCommission and other NANP member country regulatory bodies, which would resolve disputes  X9 - xjthe board could not and set broad numbering objectives and policy.39 s {O-ԍ Id. 3 We concluded that this  xmodel would serve the public interest by permitting fair and efficient administration of  xnumbering resources, fostering an integrated approach to numbering administration across NANP  xZmember countries, and enabling the Commission and regulatory bodies of other nations to ensure  xithat domestic numbering administration is effective, while leveraging the expertise and innovation  X- xof the industry.3~s {O-ԍ Id. 3 In the NANP Order, we committed to creating the North American Numbering  x]Council (NANC) as the oversight committee. One of the tasks we directed the NANC to  xundertake was to recommend to the Commission an independent, nongovernment entity that is not closely associated with any particular industry segment to serve as the new NANPA.  X- ` Qx7.` ` In February 1996, Congress passed the Telecommunications Act of 1996 (1996  X- xAct) amending the Communications Act of 1934 (the Act).xs yO{-ԍ Telecommunications Act of 1996, Pub. L. No 104104, 110 Stat. 56 (1996). x Section 251(e)(1) of the Act  xrequires the Commission to create or designate one or more impartial entities to administer  Xt- xtelecommunications numbering and to make such numbers available on an equitable basis.Bts yO -ԍ 47 U.S.C.  251(e)(1).B  xSection 251(e)(1) further states that the Commission shall have exclusive jurisdiction over those  xportions of the North American Numbering Plan that pertain to the United States, but that nothing  xin section 251(e)(1) shall preclude the Commission from delegating to State commissions or other  X-entities all or any portion of such jurisdiction.20 s {O%-ԍ Id.2 " ,K(K(<<"Ԍ X- ` Ax8.` ` In implementing the 1996 Act, we released the Local Competition Second Report  X- xand Order on August 8, 1996.<(s {OX- xԍ Implementation of the Local Competition Provisions of the Telecommunications Act of 1996, Second Report  {O"- xLand Order and Memorandum Opinion and Order, CC Docket No. 9698, 11 FCC Rcd 19392 (1996) (Local  {O- xYCompetition Second Report and Order). Rev'd in part People of the State of California v. Federal Communications  {O-Commission, No. 963519 and consolidated cases, 1997 WL 476529  (8th Cir. Aug. 22, 1997). < In that order, we concluded that the actions taken in the NANP  X- x]Order satisfied the section 251(e)(1) requirement that we create or designate an impartial  X- xnumbering administrator.hs {O -ԍ Local Competition Second Report and Order at 19510.h We noted that we had required that there be a new, impartial number  Xz- xadministrator and established the model for how that administrator would be chosen.2zJs {Ou -ԍ Id.2 We had  xthus taken "action necessary to establish regulations" leading to the designation of an impartial  X4-number administrator as required by section 251(e)(1).24s {O-ԍ Id.2 x  X-xB.` ` The North American Numbering Council  X- ` Cx9.` ` In the NANP Order, we agreed that this Commission must actively oversee  xkadministration of limited numbering resources, and agreed with parties expressing concerns  xMregarding the industry's ability to administer number resources fairly and in a competitively  XA - xneutral manner.BA n s {O`-ԍ NANP Order at 2602.B We concluded that we can monitor the administrator through participation in  X - xand direction of an advisory board (i.e. the NANC).2 s {O-ԍ Id.2 We stated that we believed that the  x-NANPA could function most effectively by reporting to a single entity with broad representation  X -from industry, consumers, state regulators and other NANP member countries.2 s {O-ԍ Id.2  X- ` x 10.` ` Noting that the United States is not the only country relying upon the NANP for  x[its numbering needs or having policy concerns affecting the NANP's future administration, we  xencouraged other member countries to support the model for numbering administration that we  X)- x[adopted.3 )$s {O!-ԍ Id. 3 We recognized that each NANP member is a sovereign country with responsibility  xfor ensuring the efficient development of its telephone network, and observed that commenters  X- xfrom those countries had indicated support for an industryled NANP administration.3!s {OJ%-ԍ Id. 3 We stated  X- xLour belief that the approach we adopted in the NANP Order would benefit not only the United  xStates but all NANP members, because the NANC would provide a forum in which"H!,K(K(<<"  xztelecommunications service providers from all NANP countries can raise concerns affecting  X-common numbering resources.2"s {OV-ԍ Id.2  X- ` x 11.` ` In the NANP Order, we concluded that the numbering administration model we  xhad adopted called for the creation of the NANC, which would provide recommendations to the  xCommission on numbering issues and be the initial site for resolution of disputes relating to  xadministration of the NANP. We stated that, although industry fora had achieved success in  x=resolving numbering issues, industry mechanisms for resolving issues may not always lead to  x|timely resolution or may not afford all parties reasonable access to dispute resolution  X- xmechanisms.2#Z {O -ԍ Id.2 We noted that the strength of industry fora to resolve issues is the wealth of  xtechnical and operational expertise they bring to bear on complex numbering issues. We stated,  xhowever, that as competition in telecommunications grows and new competitors join incumbents  xKin industry fora, it would become more difficult for those fora, operating by consensus, to resolve  X; - xnumbering issues.>$;  {O-ԍ Id. at 260809.> Further, we concluded that the Commission needs consensus advice from  x\industry on numbering issues to enable it to make timely, informed decisions on numbering  X -policy issues.;% ~ {O$-ԍ Id. at 2609.;  X- ` x 12.` ` We concluded that the NANC would be subject to the Federal Advisory Committee  xyAct because it is an advisory committee established to obtain advice or recommendations for a  Xi- x<federal agency.G&Zi {O*- xxԍ Id., citing FACA, 5 U.S.C., App.  4(a) and 3 (2)(C). The NANC charter states that NANC would exist as  x,a federal advisory committee for a two year period, prior to the close of which the Commission could seek renewal of the charter. G Creation of the NANC was determined to be essential and in the public interest  x<because of the importance of numbers to providers of telecommunications services, and the need  X#- xfor neutral administration of numbers to ensure their availability.;'#2  {O-ԍ Id. at 2610.; We stated that NANC  xmeetings would be open to the public, that detailed meeting minutes would be prepared, and that  X- xa designated federal official would be present at all meetings.Q(  {OR!-ԍ Id., citing FACA at  10.Q We further noted that an advisory  xcommittee established under FACA must have a balanced membership in terms of the points of  X- xview represented.^)V  {O$-ԍ Id. at 2609, citing FACA at 2 (b)(2).^ Thus, we stated that council membership would be drawn from all segments  xof the industry, including local exchange carriers (LECs), interexchange carriers (IXCs), wireless  xproviders, and competitive access providers. The membership also would include other interested  xparties from the United States and other NANP member countries, including the National".),>(>(II"  xAssociation of Regulatory Utility Commissions (NARUC), telecommunications users, and other  X-consumer groups.h* {OV-ԍ Id. See Appendix B for a list of all NANC members.h  X- ` ox 13.` ` The NANC had its first meeting on October 1, 1996 and continues to meet on a  xjregular basis. The NANC established several working groups, including: (1) a steering group;  xO(2) a NANPA group; and (3) a local number portability administration (LNPA) group.  xLParticipation in the working groups is open to all interested parties. All working groups report  xdirectly to the NANC. The NANPA working group has task forces to address issues pertaining  x<to cost recovery for NANPA, NANPA transition planning, and CO code administration transition  xLplanning. The LNPA group has task forces to address issues pertaining to LNPA architecture planning and LNPA technical and operational requirements.  X\ -xC.` ` Summary of Tasks Given to the NANC  X - ` x 14.` ` In the NANP Order, we outlined several specific tasks for the NANC, whose  xmission, as a federal advisory body, is to provide the Commission with advice and  xrecommendations reached through consensus to foster efficient and impartial number  X- xadministration as telecommunications competition emerges.+Z {O- xԍ NANP Order at 2609. The NANC also provides recommendations to the telecommunications regulatory authorities of other NANP member countries. One of its first tasks was to  xkrecommend to the Commission an independent, nongovernmental entity that is not closely  Xi- xassociated with any particular industry segment to serve as the new NANPA.2,i {O-ԍ Id.2 We also asked  xthe NANC to provide recommendations on: (1) the transition plan for CO code administration  xto be transferred from the LECs to the new NANPA; (2) the measures that should be taken to  xconserve numbering resources; (3) the number resources, beyond those currently administered by  xthe NANPA, that the new NANPA should administer; and (4) whether the NANC should  X- xcontinue as a federal advisory committee after 2 years.2-F {O-ԍ Id.2 We also directed the NANC to perform  X-a host of tasks to implement local number portability.R. {O - xԍ Telephone Number Portability, First Report and Order and Further Notice of Proposed Rulemaking, CC  xDocket No. 95116, 11 FCC Rcd 8352 (1996). We directed the NANC to recommend to the Commission no later  xhthan May 1, 1997 one or more entities to serve as local number portability administrators (LNPAs). Further, it was  xto recommend to the Commission technical and operational requirements developed through coordination with the  xindustry to govern the national number portability database system. On May 1, 1997, the NANC issued  xrecommendations regarding the implementation of local number portability. The Common Carrier Bureau sought  {O#- xcomment on those recommendations on May 2, 1997. Telephone Number Portability, Public Notice, CC Docket No.  x95116, DA97916 (May 2, 1996). Comments were received on June 2, 1997, and reply comments were received  xon June 17, 1997. On August 18, 1997 we released an order adopting the NANC's recommendations with some  {O,&- xmodifications. Telephone Number Portability, Second Report and Order, CC Docket No. 95116, FCC 97289 (rel. Aug. 18, 1997). R" >.,>(>(IIq"Ԍ X- ` ԙx15.` ` We stated that the NANC should also serve as a forum for initial dispute  X- xresolution.;/ {OV-ԍ Id. at 2604.; We asked the NANC to develop recommendations defining how NANPA costs  xishould be recovered, including the specific mechanisms for collecting these funds and disbursing  X- xthem to the administrator.;0Z {O-ԍ Id. at 2628.; Regarding the issue of number conservation, we requested NANC  Xt- xto investigate ways to ensure efficient number use.21t {O -ԍ Id.2 We also sought the NANC's  xrecommendation on additional numbering resources for which the NANPA should be  X.-responsible.;2.~ {O] -ԍ Id. at 2615.;  X- III.xNANP Administrator  X-xA.` ` Background  X\ - ` x16.` ` On May 15, 1997, the Commission received the NANC's recommendation related  X9 - xto the selection of the NANPA and the B&C Agent.39  yO- xJԍ Recommendation of the North American Numbering Council, North American Numbering Plan Administrator and Billing and Collection Agent (May 15, 1997) (NANC Recommendation). To complete the tasks the Commission  xhad set for it pertaining to the selection of the NANPA, NANC formed the NANPA Working  xKGroup (Working Group), and in its recommendation describes the process by which this Working  xGroup developed a Requirements Document and an evaluation process to assess candidates for  X- xthe new NANPA and the B&C Agent.4"h  yO- xkԍ NANC Recommendation at 4. To facilitate public accessibility to the Requirements Document, the  {O- xCommission released the Requirements Document on February 20, 1997. See NEWSReport No. CC 978, NANC  x<Seeks Proposals from Entities Interested in Serving as North American Numbering Plan Administrator (Feb. 20, 1997). Responses to the Requirements Document were due on April 3, 1997.  The Working Group reported directly to the NANC, and its membership was open to all interested parties.  XD-xB.` ` NANC Recommendations for NANPA and Billing and Collection Agent  X- p4x` ` 1. Process Followed by NANC in Selecting and Recommending new NANPA and Billing and Collection Agent  X-x` ` a.The Requirements Document  XO- ` 2x17.` ` In its recommendation, NANC explained that it received proposals in response to  xa "Requirements Document" that set forth the qualities and attributes of the NANPA and the", R 4,>(>(IIP"  X- xB&C Agent and the functions that each would be expected to perform.5  yOy- xԍ Requirements Document at 12. In preparing the Requirements Document, the NANC and the NANPA  xWorking Group developed the possibility of a B&C Agent that would be separate from the NANPA. They did not  xdetermine that such an arrangement was essential, however, and they structured the Requirements Document to allow interested parties to submit proposals to be the NANPA, the B&C Agent, or both.  As set out in section  x1.9.2 of the Requirements Document, the criteria for evaluating the proposals were: (1)  xcompliance with the Requirements Document; (2) experience; (3) completeness of the proposal;  x(4) communications effectiveness; and (5) innovation. The Requirements Document provided that  Xt- xythe new NANPA would serve for an initial period of five years.H6t yO -ԍ Requirements Document, 1.3.H The Requirements Document  xyspecifically stated that respondents should quote a firm, fixed price for performing the NANPA  X.-and B&C functions.G7.@ yO -ԍ Requirements Document, 10.G  X-x` `  b.Description of Evaluation Process.  X- ` Cx18.` ` In its recommendation, NANC included information describing the process  xkfollowed by the NANPA Working Group and its Evaluation Team in preparing the Working  xGroup's report for the NANC. Potential respondents to the Requirements Document were  xiallowed to submit written questions to clarify their understanding of the Requirements Document,  xand received written responses to their questions from the NANPA Working Group. On March  x26, 1997, the NANPA Working Group met with the potential respondents to review any  xxadditional questions. Participants included Bellcore, the Center for Communications Management  xlInformation (CCMI), Lockheed, Mitretek Systems (Mitretek) and NECA. Proposals were  x/submitted by those entities on April 3, 1997. The NANC Working Group Evaluation Team,  xwhich had been approved by the NANC, held a meeting April 711, 1997. Each team member  x/reviewed each of the proposals to determine if the proposal complied with the schedule for  x.assuming NANPA responsibilities ordered by the Commission. No proposals were eliminated  xxfor noncompliance. The team members then assessed the proposals, using a "compliance matrix"  xLto determine whether the respondents met the criteria outlined in the Requirements Document.  xyWhen compliance was confirmed, the team members evaluated the detailed information of each  xproposal. For each response evaluated, team members completed an evaluation table, and  xjassigned a numerical score for each evaluation criteria. A candidate's total score was obtained  x{by multiplying the evaluation grade by the respective weighting factor for that particular  xrequirement. The Evaluation Team noted that the quantitative analysis was intended to aid the  xevaluation process but was not the only assessment tool used. Pricing information was taken into  xNaccount, and was given a weighting of 50 percent, while all other evaluation information  xcombined also had a weighting of 50 percent. Finally, the Evaluation Team compiled a list of questions for respondents that had not been eliminated.  XZ- ` Cx19.` ` The Evaluation Team distributed specific questions seeking clarification or  xadditional information on functional and pricing issues pertaining to the individual proposals  xyto respondents on April 17, 1997. Respondents submitted their answers to those questions on" 7,>(>(II"  xApril 24, 1997. The Evaluation Team held another meeting on April 30May 1, 1997, in which  xxit developed additional questions for each of the respondents in preparation for meetings with the  xrespondents individually on May 2, 1997. On May 2, respondents gave presentations to the  xEvaluation Team and had the opportunity to answer the questions developed by the Evaluation  xTeam. The Evaluation Team held a final fourday meeting from May 5 to May 8, 1997.  xMembers reevaluated the respondents based on the presentations and on the written answers to  xthe Evaluation Team's questions. The Evaluation Team broke into subgroups and listed the  xKstrengths and weaknesses of the candidates for the new NANPA, identifying the major attributes  xof each candidate. First, second, and third choices for the new NANPA were identified, and a  xfinal evaluation was conducted to identify the top two choices. A similar process was followed  xLto identify the top candidates for the B&C Agent. The Evaluation Team developed a report to  x<the NANC that presented the Team's recommendations for the new NANPA and the B&C Agent.  xIn its report, the Evaluation Team identified two respondents, Mitretek and Lockheed, as the  xzpreferred choices for the new NANPA and NECA as the primary choice for the B&C Agent.  x>Although the team could not achieve consensus on a single respondent for the NANPA, a  X -majority preferred Mitretek.8  {Ol- x,ԍ See NANPA Working Group Evaluation Team Report to the North American Numbering Council on a North American Numbering Plan Administrator and Billing and Collection Agent (Evaluation Team Report) at 2023.  X- ` x20.` ` On May 14, 1997, the full NANC held a closed meeting to review the Evaluation  xlTeam's report and to determine the NANC's recommendations to the Commission for the  Xg- xNANPA and the B&C Agent.9g" {O:- xԍ Administration of the North American Numbering Plan, Public Notice, CC Docket No. 92237 (April 28, 1997). On May 15, 1997, the NANC recommended Lockheed as the  XD- xpreferred choice to serve as the new NANPA and Mitretek as the alternate.B:D| yOq-ԍ NANC Recommendation at 3.B Although NANC  xdid not reach consensus on a preferred respondent for the new NANPA, a majority (13 members)  X- xvoted for Lockheed while 11 members voted for Mitretek.2;  {O-ԍ Id.2 The NANC also recommended that  xthe new NANPA comply with specific requirements concerning pricing and intellectual property  xrights, which were included in the proposed rules that NANC also recommended to the  X-Commission.2< {O-ԍ Id.2 Those requirements are as follows:  aXx(1) The new NANPA shall perform the numbering administration functions  4currently performed by Bellcore, and the CO code administration functions  currently performed by the eleven CO code administrators, at the price agreed to  at the time of its selection. The new NANPA may request from NANC, with  #approval by the FCC, an adjustment in this price if the actual number of CO Code  assignments made per year, the number of NPAs requiring relief per year or the" 0 <,>(>(II"  Qnumber of NPA relief meetings per NPA exceeds 120% of the NANPA's stated assumptions for the above tasks at the time of its selection.    X` hp x (#%'0*,.8135@8: -ԍ Id. at 17.:   X - x21. Subject to the condition that the Commission order NECA to create an  xindependent board of directors exclusively for the B&C Agent, the NANC recommended that  X9 -NECA be the B&C Agent.8>9 Z_ {OD-ԍ Id. at 4.8  X -x44 (1) NANPA  X- ~x22. The NANC determined that the proposals of both Lockheed and Mitretek were  X- x\fully compliant with the NANC Requirements Document.8?_ {O'-ԍ Id. at 5.8 Specifically, both organizations  xdemonstrated compliance with the neutrality criteria set forth in section 1.2 of the Requirements  XD- xDocument.2@D~_ {Os-ԍ Id.2 According to the NANC, both candidates displayed understanding and appreciation  X!- x[of the numerous complexities associated with administering the NANP.2A!_ {O-ԍ Id.2 In the NANC's view,  xKboth also differentiated themselves from the other respondents by offering "innovative ideas and  xforwardlooking stateoftheart administration systems and tools that the NANC considered  X-essential for effective administration in accordance with the Requirements Document."2B_ {O -ԍ Id.2  Xr- x23. NANC stated that the advantages of the Lockheed proposal are: (1) its cost,  xwhich is half of that of the Mitretek proposal; (2) its reflection of Lockheeds experience with  X,- xnumbering issues relative to local number portability and the 800/888 Help Desk;CX,4 _ yO$- xԍ On May 1, 1997, the NANC recommended that Lockheed be selected as the administrator for local number  {O$- x,portability in four of seven regions nationwide. Telephone Number Portability, Public Notice, DA 97916 (May 2,  x;1997). On August 18, 1997, we released an order adopting the NANC's recommendations with some modifications.  {Ok&- xTelephone Number Portability, Second Report and Order, FCC 97289 (rel. Aug. 18, 1997). Lockheed also in the  xJpast has contracted with Database Services Management, Inc., the administrator of the toll free number database, to"5'B,>(>(h'"  xprovide user support for the SMS/800 Help Desk. The SMS/800 Management Team, however, has notified  xResponsible Organizations that it has chosen a new provider, Sykes Enterprises, Inc., to operate the SMS/800 Help Desk. and (3) its", C,>(>(IIP"  xpotential to achieve synergy from the future consolidation of numbering administration systems  X- xand processes (e.g., number pooling).D _ yOv- xԍ NANC Recommendation at 5. Number pooling is being examined by industry groups, at the NANC's  xdirection, as a tool for slowing depletion of CO codes and of using numbers more efficiently. Number pooling has been described by the industry as follows:  AXxPooling of numbers in a local number portability environment is a number administration and  nassignment process which allocates numbering resources to a shared reservoir associated with a  "designated geographic area. Initially, the designated geographic area is limited to an existing rate  center within a geographic NPA. The numbering resources in the shared reservoir would be  ^available, potentially, in blocks of numbers or on an individual basis, for assignment to competing  @service providers participating in local number portability for the purpose of providing service to customers in that area.   xIndustry Numbering Committee, Status Report on Issue 105, Number Pooling, to the North American Numbering Council (June 10, 1997). Some NANC members expressed concerns, however,  xregarding Lockheed's ability to perform the NPA relief and CO code administration functions  X- xeffectively because of its proposed staff size.BE_ yO-ԍ NANC Recommendation at 5.B Because Lockheed at the time of its response to  xthe NANC performed 800/888 Help Desk functions, and performs local number portability  xadministration center (LNP NPAC) functions for the industry, the NANC also expressed concern  X.-regarding a lack of vendor diversity in numbering administration generally.2F.0_ {O-ԍ Id.2  X- x24. Lockheed's original proposal stated that, as the NANPA, it would centralize  X- x\all national number relief and administration tasks at a single office on the east coast.G_ {O8- xԍ See CaPUC comments at 4. See also Letter from Jeffrey Ganek, Lockheed Martin IMS, to William F. Caton dated August 14, 1997 (Lockheed August 14 ex parte) at 2. The  xNANC noted that Lockheed has labor and capital resources to manage fluctuations in workload  xor funding. Regarding the organizational structure, the NANC stated that Lockheed's centralized  xNPA relief planning and CO code administration could simplify new entrant and national carrier  X9 - xaccess to the NANPA and lead to consistency in assignment procedures.HH9 _ yO"-ԍ NANC Recommendation at 6.H The NANC was  xconcerned, however, that Lockheeds centralization in Tarrytown, NY could hamper Lockheed's" H,>(>(II "  X- x.ability to obtain personnel to perform NPA relief and CO code functions,8I_ {Oy-ԍ Id. at 5.8 and could lead to a  X-lack of local expertise in specific geographic regions.8JZ_ {O-ԍ Id. at 6.8  X- x25. In NANC's view, Lockheed demonstrated an understanding of the workload  xNof NANPA, had experience in operating the 800/888 Help Desk, and had experience with  XQ- xkcontentious industry LNP meetings.3KQ_ {O -ԍ Id. 3 The NANC also favored Lockheed's proposed use of  xlautomated online access systems for entry, validation, tracking, and management for all  xapplication processing and Lockheed's proposed forecasting model to assist the industry in  X- xCentral Office Code Utilization Surveys (COCUS) and NPA relief timing.8L~_ {O-ԍ Id. at 7.8 The NANC noted  x-that the Lockheed proposal contained a stateoftheart computer system with advanced security  x.and disaster recovery to assure reliability in its database management. Further, NANC stated  xxthat Lockheed displayed database management experience and expressed a willingness to identify  X\ -to the NANC any abuses in assignment processes.2M\ _ {O-ԍ Id.2  X - x26. Regarding price, NANC noted that Lockheeds overall proposed price for the  X - x=fiveyear term as NANPA was half of Mitreteks.@N _ {OF-ԍ Id. at 8. @ NANC stated that Lockheed had indicated  x[its willingness to consider distributing personnel performing NPA relief planning and CO code  x[administration across three existing Lockheed locations (East coast, West coast and Midwest  X- xlocations) without any increase to its price.2O4 _ {Oo-ԍ Id.2 On the transfer of intellectual property, the NANC  xreported that, at the May 14, 1997 NANC meeting, Lockheed committed to providing intellectual  xproperty rights for certain systems, software, and support documentation specifically developed  X!-to support NANPA functions.2P! _ {O-ԍ Id.2  X- Rx27. The NANC found the strengths of Mitretek's proposal to be: (1) Mitretek's  x?detailed analysis and understanding of the requirements the NANPA must meet; (2) the  xnumbering expertise of the staff recently acquired by Mitretek; (3) Mitretek's willingness to make  xiavailable all intellectual property rights to any successor; and (4) Mitretek's participation in recent  XO- xyINC and NANPA Working Group activities.8QOX _ {OX&-ԍ Id. at 9.8 The NANC raised concerns regarding Mitretek's"OQ,>(>(II"  xxhigher price, which reflected Mitretek's larger staff in comparison to other respondents' proposals,  X-and about Mitretek's lack of corporate experience related to number administration.2R_ {OV-ԍ Id.2!!D  X- x28. Mitretek proposed to distribute its CO code administration and NPA relief  x.planning staff in five locations across the country, with at least one NANPA presence in each  XQ- xtime zone.KSQZ_ yO\-ԍ Mitretek comments at Attachment B.K NANC noted that Mitretek would be performing only NANP administration and no  xxother numbering administration, so Mitretek's selection as NANPA would assure another supplier  xyof numbering administration services, enhancing vendor diversity and a competitive market for  X- xsuch services in the future.BT_ yO -ԍ NANC Recommendation at 9.B In reviewing Mitretek's proposed organizational structure, NANC  xZstated that Mitretek's proposed decentralized structure for CO code administration and NPA relief  xplanning would enhance Mitreteks ability to attract experienced personnel and to acquire  X - xlunderstanding of local numbering needs and issues.3U z_ {O-ԍ Id. 3 The NANC stated, however, that  xdecentralization could undermine consistency in applying industry numbering guidelines among  X9 - xthe different central office code administration centers.2V9 _ {O-ԍ Id.2 The NANC reported that it did not  xreach consensus that a decentralized organizational structure is necessary to perform NPA relief  X -planning and CO code administration functions.3W _ {OB-ԍ Id. 3  X- ~x29. In the NANC's view, Mitreteks proposed staffing would assure meeting of the  X- xZindustry's demands for CO code administration and NPA relief planning.3X0 _ {Ok-ԍ Id. 3 The NANC noted that  Xg- xyMitretek had already hired industry numbering experts to help prepare the Mitretek proposal.2Yg _ {O-ԍ Id.2  xThe NANC stated, however, that Mitretek's staffing could be excessive, and thus could impose  X!- xunnecessary costs on the industry.2Z!T _ {O&!-ԍ Id.2 The NANC expressed concern that the total cost of the  X- x=Mitretek proposal is $22.5 million higher than Lockheed's over the fiveyear term as NANPA.[_ {O#-ԍ Id. at 11. The price associated with the Mitretek proposal was the NANC's primary concern. Id. at 12.  xKThe NANC also stated that Mitretek's proposal may have been influenced by industry experience  x]in California and that that experience may have led Mitretek to overestimate the required"x[,>(>(IID"  X- xresources.\"_ {Oy- xԍ Id. at 11. In Mitretek's comments, it noted that the consensus position of industry and state government  xgroups commenting before the California Public Utilities Commission estimated that nine staff were required to  xperform the NPA relief planning and Central Office Code Utilization Survey (COCUS) analysis function in California alone. Mitretek comments at 17. The NANC further noted that Mitretek proposed a mechanized CO code  xadministration tool, a forwardlooking forecasting tool, a future online access capability for CO  xycode application and a proposed procedure for resolving code conflict problems. Mitretek had  xalso proposed the use of stateoftheart computer and communications systems and software, and  Xt- xkhad established a Mitretek NANPA internet site.J]t_ yO -ԍ NANC Recommendation at 10. J Finally, NANC observed that Mitretek's  xattendance at recent INC meetings had given it awareness of current numbering issues, and had  xMdemonstrated a willingness to work with the industry and make changes based on industry  X -preferences and concerns.2^ B_ {O -ԍ Id.2  X- x30. Regarding intellectual property rights, the NANC stated that Mitretek would  xmake available to the NANC all systems and software upon the former's termination as  X - x[NANPA.9_ _ {O-ԍ Id. at 11.9 Mitretek enumerated two ways it could allow this transfer, at Mitretek's option: (1)  x/by transferring all systems, software, documents and data to the NANC or another NANC xMdesignated organization; or (2) by issuing a nocost, nonexclusive license for the systems,  xsoftware, documents and data. Mitretek stated that the transfer would involve no cost to the  X -NANC, or to any other designated organization that might serve as the future NANPA.2` f _ {O -ԍ Id.2  X- x31. NANC eliminated Bellcore and CCMI from consideration for the NANPA.  xNANC considered Bellcores description of systems, models, and options that might be applicable  Xg- xto current and future needs less innovative than those presented in other proposals.2ag _ {O-ԍ Id.2 In addition,  xthe NANC expressed concern that Bellcore's proposal for NANPA, Inc. to use personnel from  xBellcores Numbering Strategies Organization for consulting and technical support would create  X- xxpotential for undue influence by one particular industry segment.b _ {O9!- xԍ Id. Bellcores proposed compliance with the neutrality requirements is based on its sale to SAIC and the establishment of a separate subsidiary, NANPA, Inc., to oversee NANPA operations. Finally, the NANC stated that  xKBellcores proposal to centralize CO code administration but distribute NPA relief planning would"b,>(>(II "  X- xminimize synergies that might otherwise be obtained.9c_ {Oy-ԍ Id. at 16.9 There was general agreement among  X-NANC members that the CCMI proposal was not as strong as other proposals.dZ_ {O-ԍ Id. The NANC stated that CCMI lacked expertise on complex numbering administration activities.  X-x44 (2) Billing and Collection Agent  XQ- Qx32. The B&C Agent's primary function will be to calculate, assess, bill, and collect  xpayments for numbering administration functions and distribute funds to NANPA on a monthly  X - xbasis.ez _ yO - xԍ The B&C Agent shall also: (1) design a standard Reporting Worksheet to collect information for assessment  xcalculations from carriers and distribute it to carriers and other NANP nations; (2) keep confidential all data obtained  xhfrom carriers and not disclose such data in companyspecific form unless authorized by the Commission; (3) develop  xprocedures to monitor industry compliance with reporting requirements and propose specific procedures to address  xreporting failures and late payments; (4) file annual reports with the appropriate regulatory authorities of the NANP  xmember countries as requested; and (5) obtain an annual audit from an independent auditor and submit the audit  {OX-report to the Commission for appropriate review and action. See 47 C.F.R.  52.16. In its recommendation, the NANC stated that, subject to a specific condition designed  xto assure neutrality, it recommends that NECA be the B&C Agent for three major reasons. First,  xythe NANC stated, NECA has cost recovery expertise. NECA is the current administrator of the  x|Telecommunications Relay Services (TRS) fund, and the recommended cost recovery  X - xmechanismfX . _ yO^- xԍ 47 C.F.R.  52.17 provides that all telecommunications carriers in the United States shall contribute on a  xcompetitively neutral basis to meet the costs of establishing numbering administration. For each telecommunications carrier, such contributions shall be based on the gross revenues from the provision of its telecommunications services. mirrors the TRS model, which requires that every carrier providing interstate  xtelecommunications services shall contribute to the TRS fund on the basis of its relative share of  x[gross interstate revenues. NANC concluded this experience makes NECA qualified to manage  X - xiNANPA cost recovery.Ig N _ yO-ԍ NANC Recommendation at 12.I Second, NECA has experience in telephone industry billing and a long  xrelationship with U.S. telecommunications carriers, again gained through its experience with the  X - xTRS fund.2h _ {O_-ԍ Id.2 Third, NECA's proposed price was onethird less than that of another finalist with  X-equal staffing levels.3ip_ {O -ԍ Id. 3  Xg- x 33. NANC's recommended cure to assure the B&C Agent's neutrality is that the  xCommission order NECA to create an independent board of directors exclusively for the B&C  X!- xAgent.9j!_ {O%-ԍ Id. at 13.9 The NANC recommends that the B&C Agent Board have broadbased representation  xfrom telecommunications service providers that use the NANP, and that the Board have at least"j,>(>(IIF"  X- xone nonUnited States representative.2k_ {Oy-ԍ Id.2 The NANC found NECA's proposal to place the  x/NANPA B&C Agent responsibilities under the Universal Service Administrative Company  X- x-(USAC)GlZ_ yO- xYԍ NECA Proposal at 9. The USAC will administer the universal service support mechanisms for high cost areas  xand lowincome consumers, as well as perform billing and collection functions associated with the universal support  xmechanisms for schools and libraries and rural health care providers. Board on Universal Service, CC Docket Nos.  {O- x9721 and 9645, Report and Order and Second Order on Reconsideration, FCC 97253 (rel. July 18, 1997) at para. 5. G to be insufficient to address parties' concerns about NECA's neutrality.Cm _ yOw -ԍ NANC Recommendation at 13.C The NANC  xnotes that, in its May 2, 1997 presentation, NECA stated that it would be responsive to a specific  xrequest by the Commission for a separate B&C Agent Board. Consistent with CC Docket No.  XQ- x9645 and CC Docket No. 9721,n"Q_ {O- xԍ Federal-State Joint Board on Universal Service, First Report and Order, CC Docket No. 96-45, FCC 97-157  x(rel. May 8, 1996); Changes to the Board of Directors of the National Exchange Carriers Association, Inc. and  xYFederalState Joint Board on Universal Service, Report and Order and Second Order on Reconsideration, CC Docket No. 9721 and CC Docket No. 9645, FCC 97253 (rel. July 18, 1997). the NANC recommends that the B&C Agent Board: (1) be  xMneutral and impartial; (2) not advocate specific positions to the Commission in proceedings  xunrelated to numbering administration; (3) not be aligned with a particular industry segment; and  X-(4) not have a direct financial interest in support mechanisms established by the Commission.Co _ yO-ԍ NANC Recommendation at 13.C  X- Cx!34. In spite of its support of NECA, the NANC had several concerns related to  xNNECA's selection. Those concerns were: (1) NECA's lack of international experience; (2)  xNECA's unwillingness to handle shortfalls in collections; (3) a lack of diversity resulting from  x=one organization collecting funds for various purposes, including Universal Service, TRS, and  xNANPA; and (4) NECA's failure to include nonroutine reports, testimony and litigation in its  X -firm price quote.<p _ {O-ԍ Id. at 1314.<  X- qx"35. NANC recommended Lockheed as the alternate B&C Agent, noting that  xLockheed did not bid to perform B&C functions as a separate function, but instead made its  Xg- xperformance of those functions dependent upon its selection as the NANPA.9qg_ {O!-ԍ Id. at 14.9 The NANC  xrecommended Lockheed as the alternate because Lockheed: (1) has the resources to handle  x!shortfalls in collections; (2) has expertise in billing and collections; (3) has international  X- xkexperience and experience handling foreign currencies; and (4) is completely neutral.2r:_ {O%-ԍ Id.2 The  x>NANC stated that Lockheed was not the first choice for the NANPA B&C Agent primarily"r,>(>(II "  X- xbecause of its higher cost to perform the B&C functions with equivalent staffing.9s_ {Oy-ԍ Id. at 15.9 Also, NANC  xnoted that Lockheed's experience in billing and collection services is not specific to the  x telecommunications industry, and that Lockheed, unlike NECA, does not have established  X-relationships with U.S. telecommunications carriers.3tZ_ {O-ԍ Id. 3  XQ-x44 c. Positions of the Parties x44  (1) Comments on NANPA  X-  x#36. To commenters that support Lockheed, Lockheed's chief advantages over  xMitretek are as follows: (1) Lockheed's price was half as much as Mitretek's; (2) Lockheed  xpossesses numbering experience associated with local number portability and administration of  xthe SMS/800 Help Desk; (3) Lockheed has the potential to achieve synergy from future  xconsolidation of numbering administration systems associated with Lockheed's number portability  xinvolvement; and (4) Lockheed's centralized approach to CO code administration could achieve  X - xcost savings and overhead efficiencies.mu _ {O- x,ԍ#X\  P6G;ɒP# MCI comments at 910. See also NEXTLINK reply comments at 12; GTE reply comments at 3; Lockheed  xreply comments at 11; WinStar reply comments at 4. NEXTLINK asserts that, by serving as both the NANPA and  xthe NPAC, Lockheed will be able to develop new approaches and technologies using number portability to improve  xnumber conservation and limit attempts by incumbent carriers to use numbering problems for competitive advantage. NEXTLINK reply comments at 2. m MCI opposes paying more for NANPA than is  xnecessary, and notes that it alone would pay approximately $1.5 million more if Mitretek were  X-selected.xv_ yO-ԍ#X\  P6G;ɒP# MCI comments at 11, reply comments at 7.x  Xg- x$37. For those that prefer Mitretek, Lockheed's chief disadvantages are: (1) its  xproposed staffing levels; (2) its centralization; (3) its initial unwillingness to transfer intellectual  xLproperty upon termination of its tenure as NANPA; (4) the lack of vendor diversity; and (5) its  xestimation of costs. These commenters include: AirTouch; the California Public Utilities  X- xCommission (CaPUC); CTIA; PCIA; and SBC.w. _ yO- x-ԍ#X\  P6G;ɒP# PCIA, however, after filing its comments and reply comments in this proceeding, amended its position to  {O - xsupport the NANC recommendation of Lockheed as the new NANPA. See Letter from Mark J. Golden, PCIA, to  xChairman Reed Hundt dated August 18, 1997 (PCIA August 18 ex parte). Both AT&T and WorldCom state that  xwthey would prefer Mitretek to be the NANP administrator, but that they do not object to the selection of Lockheed. AT&T comments at 2; WorldCom comments at 2; AT&T reply comments at 2; WorldCom reply comments at 1.  The NANC's lack of consensus on a"w,>(>(II"  xrecommendation for NANPA concerns some commenters, who argue that the Commission is not  X-bound by the recommendation and must make an independent decision.]x~_ {OV- xԍ AirTouch comments at 35. See also CVS comments at 1 (because of the lack of consensus on the NANC,  {O - xthe Commission must now review NANPA submissions de novo and select an administrator in a public manner or  xproceeding); Mitretek comments at 3; SBC comments at 5; WorldCom comments at 23; PCIA reply comments at  xZ2. While there is no legal definition of consensus, other industry fora consider consensus to be established when  x"substantial agreement" has been reached among interest groups participating. Substantial agreement means more  {OB- x[than a majority, but not necessarily unanimity. See  6.7.7, Principles and Procedures of the Carrier Liaison Committee.]  X- ~x%38. Staffing Levels. Some commenters assert that Lockheed's proposal is deficient  xand will result in unacceptable delays in completion of code assignments, NPA relief, and other  XQ- xnumbering administration tasks.y\Q_ {O - xԍ#X\  P6G;ɒP# AirTouch comments at 7; CTIA comments at 2; PCIA comments at 34; SBC comments at 69; WorldCom  {O - xwcomments at 34; AT&T reply comments at 3; CaPUC reply comments at 2; SBC reply comments at 23. See also Mitretek comments at 1718; reply comments at 23. AirTouch states that Lockheed assumes an average of 10,000  xcentral office code opening requests per year, between 3040 NPAs requiring relief, and an  X - x average of 12 meetings per NPA relief, yet only proposes a staff of eleven persons.gz 2 _ yO-ԍ#X\  P6G;ɒP# AirTouch comments at 7.g The  xzCaPUC notes that the Evaluation Team stated that Lockheed's proposal appeared to rely on  xjmechanized systems and processes instead of personnel, and that Lockheed may lack the staff  X- xnecessary to address numbering issues requiring human intervention and judgment.#{ _ {O- xԍ#X\  P6G;ɒP# CaPUC comments at 2.  See also Omnipoint comments at 3; SBC comments at 7; CaPUC reply comments  xat 2. The CaPUC is also concerned that the NANC did not properly consider the NPA/NXX exhaust situation in  xCalifornia, which depletes NPAs and NXXs faster than any other jurisdiction participating in the NANP, and thus  yOo- xviews an adequate NANPA staff as crucial. CaPUC Comments at 34. The CaPUC argues that, at a minimum,  x=Lockheed must justify how its proposed staffing level could accommodate the growth in numbering and code  {O-administration activities. CaPUC reply comments at 3.  # CTIA notes  xthat the NANPA will implement "jeopardy" and conservation procedures for NPAs that need  xrelief, will handle area code relief that is already underway, and will process a growing number  X9 - xof CO code applications.e|9 >_ yO(-ԍ#X\  P6G;ɒP# CTIA comments at 34.e CTIA argues that Mitretek's proposal will assure that the industry's  X - xnumbering administration demands will be met.~}Z _ {O - xԍ#X\  P6G;ɒP# Id. at 2. See also PCIA comments at 45 (suggesting that the Commission could state that, if Mitretek's  xproposed level of staffing is not required after a certain time period, the staff will be reduced and the savings returned in the form of reduced costs).~ Similarly, Omnipoint notes that the NANPA's  xrole is likely to grow more challenging as the problems of number exhaust increase and more  xnew entrants come into the market, and expresses concern that Lockheed's proposed staff is" },>(>(II"  X- xZinadequate to respond effectively to the workload.h~_ yOy-ԍ#X\  P6G;ɒP# Omnipoint comments at 3.h SBC asserts that Lockheed has not secured  X-an experienced industry team to perform complex NANPA functions.bX_ yO-ԍ#X\  P6G;ɒP# SBC comments at 7.b  X- 2x&39. Mitretek states that the differences in the proposed staff levels between Mitretek  xand Lockheed result from significant differences in the assumed number of NPAs requiring relief  x^and the assumed workload associated with critical functions required of the CO code  X.- xadministrator.|._ {O - xԍ#X\  P6G;ɒP# Mitretek comments at 5. See also PCIA reply comments at 3. Mitretek assumed that there would be 3,265  xiCO code requests in Year 1, 8,799 CO code requests in Year 2, and 9,336 in Years 3, 4, and 5. Mitretek assumed  xthat there would be 71 NPA relief activities underway per year. Regarding relief planning meetings, it assumed that  xthere would be 51 in Year 1, 43 in Year 2, 33 in Year 3, 46 in Year 4, and 22 in Year 5. In contrast, Lockheed  xassumed that there would be an average of 10,000 CO code requests per year, that 3040 NPAs would require relief  xin each year over the fiveyear period, and that each NPA relief activity would require an average of 12 meetings.  {Oy-See NANC Recommendation, Attachment 4. According to Mitretek, the differences in the number of NPA relief activities  xassumed by the respondents are evidence of the potential ambiguity in and misunderstanding of  X- x0the stated requirements.g, _ yO-ԍ#X\  P6G;ɒP# Mitretek comments at 5.g In Mitretek's view, the Central Office Code Utilization Study  xM(COCUS) forecast and history are better indicators of future activity than the Requirements  xDocument, and the recent COCUS forecasts and history indicate an unexpected level of NPA  X - xrelief planning activity greater than that indicated in the Requirements Document.a _ {O-ԍ#X\  P6G;ɒP# Id. at 67.a Mitretek  x[adds that technology and market factors will continue to increase the number of NPAs in relief  X9 -planning and a decrease during the five year NANPA term is unlikely._9 N _ {O8-ԍ#X\  P6G;ɒP# Id. at 9._  X - $x'40. Mitretek also alleges that the differences in the proposed staff levels between  xyMitretek and Lockheed result from significant differences in the staff time each assumed would  xbe required to perform key CO code administration and NPA relief planning functions. Mitretek  x!projected that two hours of staff time would be required per CO code assignment, while  Xg- xLockheed projected that one hour of staff time would be sufficient.`g_ {O -ԍ#X\  P6G;ɒP# Id. at 15.` Mitretek projected that  xapproximately four staff per NPA in relief planning per year would be needed, while Lockheed  X!-assumed that one staff member could handle seven NPAs in relief planning per year.`!r_ {OD$-ԍ#X\  P6G;ɒP# Id. at 16.` ",>(>(IIF"Ԍ X- Cx(41. Neutrality. On September 4, 1997, Mitretek filed an ex parte letter regarding  X- xLockheed's compliance with the neutrality requirements for the NANPA._ yOV- xԍ Letter from Dr. H. Gilbert Miller, Mitretek, to William F. Caton dated September 4, 1997 (Mitretek September 4 ex parte). Mitretek states that  xzLockheed Martin IMS is a whollyowned subsidiary, and hence an affiliate as defined in the  x>Communications Act, of the Lockheed Martin Corporation. Mitretek further states that the  x\Lockheed Martin Corporation and its affiliates currently offer and have received licenses to  xprovide telecommunications services. Specifically, Mitretek alleges that the relationships between  xthe Lockheed Martin Corporation, Lockheed Martin IMS, and the affiliates known as Lockheed  X - x-Martin Telecommunications, Lockheed Martin Intersputnik,&  _ yO - x=ԍ WorldCom also states that Lockheed's recent venture into telecommunications service provision with  xIntersputnik should be examined, and that the Commission should make clear that if the joint venture in the future  xKchooses to serve North America for any type of data, telecommunications or cable television service, Lockheed  ximmediately would lose its competitively neutral status and its position as NANPA. WorldCom reply comments at 5.& Loral Space and Communications,  X- xand Globalstar violate, or in the future could violate, the neutrality requirements.L_ yOi-ԍ Mitretek September 4 ex parte at 1.L Mitretek  xstates that, given the importance of the neutrality of the NANPA, it is appropriate for the  x>Commission to determine whether or not Lockheed Martin Corporation and its affiliates are  X -telecommunications services providers.xZ ` _ {O- xԍ Id. at 2. The Act defines telecommunications services as "the offering of telecommunications for a fee  x-directly to the public, or to such classes of users as to be effectively available directly to the public, regardless of  yO"-the facilities used." 47 U.S.C.  153(46).x  X9 - x)42. Lockheed responded to the Mitretek ex parte letter on September 11, 1997.9 _ yOl- xKԍ Letter from Cheryl A. Tritt, Counsel for Lockheed Martin IMS, to William F. Caton dated September 11, 1997 (Lockheed September 11 ex parte).  xyLockheed states that it is in compliance with the NANC's neutrality criteria and will continue to  X - xcomply with those requirements during its term as the NANPA.M _ yO~-ԍ Lockheed September 11 ex parte at 1.M Lockheed asserts that the  xjNANC's neutrality criteria confirm the Commission's view that the NANPA must not represent,  x?or be unduly influenced by, any segment of the industry that will use NANP numbering  xresources. Lockheed notes that the NANC neutrality criteria provide that the NANPA may not  xbe an affiliate of any telecommunications service provider as defined in the Communications Act  xof 1934, as amended by the Telecommunications Act of 1996. In other words, the NANPA may  xlnot be an affiliate of an entity that provides telecommunications "for a fee directly to the  X- xpublic,"@j_ yO%-ԍ 47 U.S.C.  153(46).@ and therefore requires allocations of NANPAdistributed numbering resources.M_ yO&-ԍ Lockheed September 11 ex parte at 2.M ",>(>(II "  xiLockheed states that the business relationships described in Mitretek's letter are with entities that  xxwill not use numbering resources and are not classifiable as telecommunications service providers  X- xunder the Act.M_ yO3-ԍ Lockheed September 11 ex parte at 3.M Lockheed specifically states that Globalstar, Astrolink, and Loral SKYNET  X-meet the requirements of competitive neutrality.8X_ {O-ԍ Id. at 3.8  XQ- Rx*43. According to Lockheed, Loral SKYNETCzQ_ yO - xMԍ According to Lockheed, Loral SKYNET is an indirect, whollyowned subsidiary of Loral Space and  xCommunications Ltd. (Loral Space) through three intervening subsidiaries. The Lockheed Martin Corporation  xreceived a preferred stock position as a result of the January 1996 acquisition of Loral's defense electronics  xxoperations. Lockheed states that when the Lockheed Martin Corporation acquired an interest in Loral Space, its  xiinterest represented 20% of Loral Space's shares on a fully diluted basis. As of September 1, 1997, the Lockheed  {O - xZMartin Corporation's interest represents approximately 16% of Loral Spaces's shares on a fully diluted basis. Id. at n.11. C does not and will not use NANP  X.- xresources and does not provide "telecommunications services" as defined in the Act.2., _ {O -ԍ Id.2 Lockheed  xargues that, therefore, Loral SKYNET cannot be classified as a "telecommunications service  X- xxprovider" under the Act or the neutrality criteria.8 _ {OW-ԍ Id. at 4.8 In order to be so classified, Lockheed asserts,  xLoral SKYNET must: (1) provide services to the public, or to such classes of users as may be  xequivalent to public availability; and (2) provide its services to the public directly, rather than  X - xthrough intermediate customers.3 P _ {O-ԍ Id. 3 Lockheed states that the first requirement is not met where,  xas in the case of Loral SKYNET, a provider offers service only to a restricted class of nonend  X9 - xuser customers.pz9 _ {O- x<ԍ Id. Lockheed states that the bulk of Loral SKYNET space segment is leased for video distribution service  xZto a small group of broadcasters, cable operators, and other video providers. Loral SKYNET also provides space  xjsegment to AT&T and GCI who use it for system redundancy and to fulfill certain government contracts. In  xaddition, Lockheed states, Loral SKYNET leases space segment to GE Tridom, which, in turn, provides VSAT  xservices to corporate customers. Lockheed states that Loral SKYNET has no ground facilities or switches through  xwhich it can connect with the public switched telephone network and offer service directly to the public. Further, Loral SKYNET customers also must provide their own equipment. p In Lockheed's view, Loral SKYNET'S highly restricted scope of service is  X - x0subject to the analysis applied in the 1996 cable landing licensing decision in the AT&T  X - xSubmarine Systems, Inc. Applications Proceeding.d\ $_ yO#- x-ԍ AT&T Submarine Systems, Inc. Application for a License to Land and Operate a Digital Submarine Cable  {O$- xKSystem Between St. Thomas and St. Croix in the U.S. Virgin Islands, Cable Landing License, 11 FCC Rcd 14884  {O\%-(Int'l. Bur. 1996) (AT&TSSI).d Lockheed states that, in that proceeding, the  xCommission's International Bureau reasoned that, in deciding whether a service is effectively  xavailable directly to the public, and therefore is a telecommunications service under the Act, "the"H,>(>(II"  xjtype, nature, and scope of users for whom the service is intended and whether it is available to  X- xa significant restricted class of users" must be determined.O_ yOV-ԍ Lockheed September 11 ex parte at 45.O Lockheed contends that the  xInternational Bureau determined that AT&TSSI's service would not be effectively available  x<directly to the public because AT&TSSI proposed to make available "bulk capacity in its system  xto a significantly restricted class of users, including common carrier cable consortia, common  XQ-carriers, and large businesses."8QX_ {OZ-ԍ Id. at 5.8  X - ox+44. Lockheed further claims that services that are offered to a broad base of public  xxend users, such as dialtone and long distance services, are easily distinguished from services that  xiare offered only to carriers and other intermediaries that stand between the provider of the service  X- xand the ultimate user.2_ {O=-ԍ Id.2 In order to offer a telecommunications service under the Act, an entity  x=must itself offer service to the public, Lockheed argues, and Loral SKYNET does not offer any  X\ -service of this kind.8\ |_ {O-ԍ Id. at 6.8  X -  x,45. Regarding Globalstar, _ yO- xԍ The Lockheed Martin Corporation has a 16 percent interest in Loral Space, which has a 38 percent interest  {O-in Globalstar. Id. at n.21. Lockheed asserts that Globalstar will provide mobile  xservice, data, facsimile, position location and other mobile satellite services through distributors  X - xfor both domestic and international subscribers.M h _ yO-ԍ Lockheed September 11 ex parte at 6.M Lockheed states that the Commission has  xspecifically found that Globalstar will not provide telecommunications services and thus will not  X- x[be classified as a telecommunications carrier.\ _ {O3- xԍ Id., citing Application of Loral/Qualcomm Partnership, L.P. For Authority to Construct, Launch, and Operate  xGlobalstar, a Low Earth Orbit Satellite System to Provide Mobile Satellite Services in the 16101626.5 MHz/2483.5 {O-2500 MHz Bands, 10 FCC Rcd 2333, 2336 (Int'l. Bur. 1995) aff'd, 11 FCC Rcd 18502 (1996). Therefore, Globalstar's services do not qualify  xas telecommunications services under the Act and Globalstar should not be deemed a  XD- xtelecommunications service provider for purposes of the neutrality requirements.2D_ {O!-ԍ Id.2 Similarly,  X!- xLockheed states that Astrolink!_ yO#- xԍ Astrolink is part of Lockheed Martin Telecommunications, which is a subsidiary of the Lockheed Martin Corporation. intends to provide advanced broadband communications  X- xservices to businesses and consumers on a worldwide basis.S_ yO&-ԍ Lockheed September 11 ex parte at 7.S In authorizing the construction,",>(>(IId"  xlaunch, and operation of Astrolink's nine GCO FixedSatellite Service (FSS) satellites, Lockheed  xstates, the Commission concluded that Astrolink may operate on a noncommon carrier basis as  X- x.well.w^_ {O3- x,ԍ Id., citing Lockheed Martin Corporation Application for Authority to Construct, Launch, and Operate a Ka {O- xBand Satellite System in the FixedSatellite Service, File Nos. 182 Through 186SATP/LA95, Order and  {O-Authorization, DA No. 97973 (May 9, 1997). w Therefore, Lockheed argues, Astrolink does not provide telecommunications services  xwithin the meaning of the Act and should not be considered a telecommunications service  Xt-provider for purposes of the neutrality requirements.t_ {O - xiԍ Id. See also Letter from Cheryl A. Tritt, Counsel for Lockheed, to William F. Caton dated September 19, 1997 (Lockheed September 19 ex parte).  X.- x-46. Lockheed contends that Lockheed Martin Intersputnik (LMI), a joint venture  xMbetween the Lockheed Martin Corporation and Intersputnik, plans to develop a commercial  xZsatellite services business using resources contributed by both the Lockheed Martin Corporation  X- x.and Intersputnik.3H_ {O-ԍ Id. 3 The initial business effort of the joint venture may involve the use of one  xLockheed Martin Corporation satellite to be launched in late 1998 using a Belarusfiled orbital  X - xslot at 75E. The orbital slot does not provide coverage of the United States.2 _ {O -ԍ Id.2 According to  xZLockheed, the proposed services to be provided include broadcast, fixed telecommunications and  x=VSAT services to customers in Eastern Europe, South Asia, Africa, and the Commonwealth of  xIndependent States. LMI's proposed service offering does not implicate the competitive harms  x[the neutrality criteria are to guard against, Lockheed argues. Any potential service of LMI will  xnot be provided directly to end users, will not use NANP resources and can in no way affect  X-Lockheed's neutrality.3l _ {O-ԍ Id. 3  Xg- x.47. On September 24, 1997, the NANC Chairman, by letter to the Acting Chief  xyof the Common Carrier Bureau, stated that it is the opinion of all NANC members present at the  xNANC's September 23, 1997 meeting that neither Lockheed Martin nor any of its affiliates is a  xtelecommunications service provider as defined in the Communications Act of 1934, as amended  x>by the Telecommunications Act of 1996. The NANC members participating in that meeting  xunanimously concluded that Lockheed Martin fulfills the neutrality requirements to serve as the  X-NANPA.} _ yOD"-ԍ Letter from Alan C. Hasselwander, NANC, to Richard Metzger dated September 24, 1997.}  XO- x/48. Centralization of NANPA Functions. The CaPUC argues that Lockheed's  x.centralization in an east coast office could result in poor service to jurisdictions that are not in  xthe Eastern standard time zone. Further, commenters assert that Lockheed may not be able to  xhire a sufficient number of personnel in the centralized location to perform NPA relief and CO" ,>(>(II"  X- x=code functions._ {Oy-ԍ#X\  P6G;ɒP# CaPUC comments at 3. See also SBC comments at 8; PCIA reply comments at 4. California, it says, needs regional expertise because of the high demand for  xinumbering resources, and an "outfit" on the other side of the country cannot properly respond to  X- xthis demand and properly coordinate with the CaPUC.Z_ {O-ԍ#X\  P6G;ɒP# CaPUC comments at 5. See also SBC comments at 8. Also, the CaPUC contends that  xcentralization could impair the ability of CaPUC staff and other western state commissions to  x=participate in relief planning activities if they are held in New York, and could impair the ability  XQ-of NANPA staff to attend relief meetings in exhausting NPAs around the country.aQ_ {O -ԍ#X\  P6G;ɒP# Id. at 56.a  X - x049. Transfer of Intellectual Property. Commenters express concern that Lockheed's  xunwillingness to surrender all intellectual property and resources developed for NANPA activities  xwithout charge could impede the transfer of numbering administration activities to a new  X- xyNANPA.~_ yO- xxԍ#X\  P6G;ɒP# CaPUC comments at 7; PCIA comments at 56; WorldCom comments at 4; CaPUC reply comments at 5; WorldCom reply comments at 3. PCIA asserts that Lockheed's proposal to allow a new NANPA to use only certain  X - xKsoftware and systems could force the Commission to continue using Lockheed as the NANPA.c _ yO-ԍ#X\  P6G;ɒP# PCIA comments at 5.c  xyPCIA also notes that, if a new NANPA were selected after five years, the industry would either  xhave to pay additional costs to obtain all of Lockheed's systems or pay the new NANPA to redo  xLwork Lockheed had already completed. PCIA states that accounting for these costs raises the  X -price of Lockheed's services., f _ {O - xԍ#X\  P6G;ɒP# PCIA reply comments at 6. See also, however, the PCIA August 18 ex parte, stating that PCIA's concerns have been addressed and that it will support the NANC recommendation of Lockheed as the new NANPA.,  X- x150. Vendor Diversity. Some commenters argue that diversity of suppliers will  X- x.promote a competitive market for number administration services. _ yO-ԍ#X\  P6G;ɒP#AirTouch comments at 8; CTIA comments at 5; CaPUC reply comments at 4. They note that Lockheed  xis presently responsible for local number portability (LNP) administration and operates the  XD- xSMS/800 Help Desk.XDP _ yOE - xԍ#X\  P6G;ɒP# AirTouch comments at 8; CTIA comments at 5. SBC notes that any potential synergies that could result from  xLockheed's operation of the SMS/800 Help Desk will not happen because the SMS/800 Management Team has transferred SMS/800 Help Desk functions to Sykes Enterprises, Inc. SBC comments at 910.  CTIA asserts that, because Lockheed already performs other numbering  xadministration functions, it may be able to recreate a monopoly position over administration  X- x[functions, a risk that is decreased with Mitretek.p_ {O%-ԍ#X\  P6G;ɒP# CTIA comments at 56.  See also PCIA comments at 56; AT&T reply comments at 45. PCIA notes that one of the requirements in  xchoosing LNP administrators was that they not have a direct material financial interest in the  x/United States portion of the NANP, and number assignments pursuant to the plan. As the",>(>(II&"  xyNANPA, PCIA states, Lockheed would have a strong and direct financial interest in the NANP  X-and number assignments, which could prevent it from serving as a neutral LNP administrator.c_ yOV-ԍ#X\  P6G;ɒP# PCIA comments at 8.c  X- Ex251. Estimation of Costs/Pricing Issues. PCIA asserts that Lockheed has  xunderestimated the costs involved in NANP administration, and that Lockheed may be expecting  xadditional compensation for certain services, such as services provided during the transition to  xthe new NANPA and the provision of information on how to obtain documents related to CO  X - x-code administration. X_ {O -ԍ#X\  P6G;ɒP# PCIA comments at 67. See also CaPUC reply comments at 3. Some commenters assert that Lockheed's lower price was the only reason  xthe NANC did not recommend Mitretek, and argue that a lower price is not a reason to select an  X- xinferior number administrator._ yO` -ԍ#X\  P6G;ɒP# AirTouch comments at 8; CaPUC reply comments at 3. AirTouch states that Lockheed's proposal in fact incorporated  xthe highest cost per person, while Mitretek's cost per person was comparable to other  X - xrespondents. z_ {O- xԍ#X\  P6G;ɒP# AirTouch comments at 8. See also CaPUC comments at 8; Omnipoint comments at 3; SBC comments at 7; Mitretek comments at 5; CaPUC reply comments at 3; Mitretek reply comments at 4.  The CaPUC notes that Lockheed's proposal did not include travelrelated  xexpenses, the costs Lockheed would expect for transferring some intellectual property rights, or  X9 - xadditional costs for staffing that may be necessary.9 _ {O-ԍ#X\  P6G;ɒP# CaPUC comments at 7.  See also Omnipoint comments at 34. The CaPUC states that it is likely that the  xNANPA workload will increase by more than 120 percent, and that the total cost of the Lockheed  X - xiproposal will increase.E f _ {O - xhԍ#X\  P6G;ɒP# CaPUC comments at 8. See also Omnipoint comments at 3 (because Lockheed proposed the highest cost per person, increases in its staffing, which are likely, will have a disproportionately high impact on its cost as NANPA).E AirTouch contends that, because the cost recovery mechanism spreads  xjthe cost differential across the industry over five years, the cost differential will have a minimal  X- ximpact on any given carrier.  _ yO- xԍ#X\  P6G;ɒP# AirTouch comments at 9. AirTouch states that the annual difference between Mitretek's and Lockheed's  xxproposed price constitutes an "immaterial" percentage of total industry annual revenues, and that, for the largest  xincumbent LEC, the difference is approximately 0.002% of its operating revenues. For smaller carriers, AirTouch contends, the difference will probably be in the hundreds of dollars. Omnipoint notes that the Evaluation Team stated that Lockheed  xperceived that it may further negotiate regarding pricing issues. In Omnipoint's view, the  xCommission should not rely on a NANPA that cannot provide firm cost figures upon which the  XD-industry can depend.D_ {O"-ԍ#X\  P6G;ɒP# Omnipoint comments at 4. See also PCIA reply comments at 23, 5.  X- ox352. Mitretek contends that, in developing the Requirements Document, the NANC  X- xdid not elect any pricing scheme other than firm, fixed pricing.k:_ yO&-ԍ#X\  P6G;ɒP# Mitretek comments at 1819.k Mitretek states that on two",>(>(II'"  xoccasions it formally suggested that, if the NANC was interested in a lower price, it could  xconsider a pricing basis other than a firm, fixed price. Mitretek stated its willingness to adjust  xthe price, not only if it had underestimated the staff required, but also if it has overestimated the  X- xstaff required.`_ {O-ԍ#X\  P6G;ɒP# Id. at 19.` Mitretek alleges that the NANC departed from a firm, fixed pricing requirement  xjand incorporated a price adjustment mechanism in response to the difference in proposed staff  XQ- xlevels and perceived future need for additional staff.ZQZ_ {O\-ԍ#X\  P6G;ɒP# Id. Z This changed the price and risk strategy  xconsidered and proposed by Mitretek. Also, Mitretek argues that, because the trigger for the  xkprice adjustment is the stated assumptions of the respondent, rather than the NANCstated  X-requirements, the change encourages and rewards understatement of the required staff and cost.`_ {O -ԍ#X\  P6G;ɒP# Id. at 20.`  X- x453. Other Concerns. WorldCom states that Lockheed must abide by safeguards to  xiensure that there is a smooth transition to, and effective management of, the new NANPA. These  xsafeguards should include direction to Lockheed to provide documentation of all transactions and  X9 - xMprocedures, and to document practices as they are developed to resolve issues.m9 ~_ yOh-ԍ#X\  P6G;ɒP# WorldCom reply comments at 3.m Further,  xWorldCom asserts that any entity selected as NANPA must assent to investigation by a successor  xof all files regarding any facet of the business, and to craft a transition plan subject to NANC  X - xapproval.Y _ {O-ԍ#X\  P6G;ɒP# Id.Y WinStar, while supporting Lockheed, urges the Commission to build an appropriate  x"firewall" between Lockheed's dual functions as NPAC vendor and as NANPA. Without proper  xydistance, WinStar argues, information gleaned from LNP applications could be used unfairly to  xjkeep a carrier with substantial porting activity from obtaining new NXX resources essential for  XD- xzgrowth.lD_ yO-ԍ#X\  P6G;ɒP# WinStar reply comments at 5.l MCI and WinStar both agree that the Commission should implement Lockheed's  xselection as quickly as possible, because it is essential to the future of numbering administration  X-and to the future of local telephone competition.0 _ {O-ԍ#X\  P6G;ɒP# MCI comments at 89. See also NEXTLINK reply comments at 3; GTE reply comments at 1.  X- x554. In reply comments, Lockheed responds to various concerns raised by  xjcommenters. It states that it fully commits to the NANC conditions regarding price adjustment  Xr- xand the transfer of intellectual property upon termination of its services as NANPA.mr _ yO#-ԍ#X\  P6G;ɒP# Lockheed reply comments at 4.m Lockheed  x-states that it will deliver high quality number administration services, including sufficient staffing  xand expertise, systems, and travel, at the quoted price. Thus, Lockheed asserts, even if it  x-underestimated the costs of NANP administration, any adjustments will not affect the prices paid" R ,>(>(IIm"  X- xby the industry.__ {Oy-ԍ#X\  P6G;ɒP# Id. at 5._ Lockheed states that its work load and volume assumptions are firmly  X- xMgrounded in the Requirements Document and industry figures.<Z_ {O-ԍ Id. at 7. < Lockheed states that the  xNANC's proposed rule regarding transfer of intellectual property will eliminate unforeseen added  xcosts, such as licenses and transfer costs, and will ensure that the incumbent NANPA enjoys no  xunfair advantage in future selection processes because of the costs faced by other bidders in  XQ-developing new systems._Q_ {O -ԍ#X\  P6G;ɒP# Id. at 6._  X - x655. Lockheed asserts that its approach to numbering administration partly depends  xlon streamlining the administration process through use of advanced technologies. This  xystreamlining would increase staff productivity, which decreases the number of staff required to  X- xperform the functions._~_ {O-ԍ#X\  P6G;ɒP# Id. at 7._ Lockheed adds that cost and technology economies will be realized  X - xthrough leveraging an existing Lockheed Communications Industry Services infrastructure._ _ {O@-ԍ#X\  P6G;ɒP# Id. at 8._  xyFurther, Lockheed states that it will be able to attract qualified and experienced staff, and notes  xthat, in developing the NPAC SMS system for local number portability, it has attracted the best  X - xsubject matter experts in their fields._ _ {Oi-ԍ#X\  P6G;ɒP# Id. at 9._ Lockheed states that for NANPA, it is hiring number  xadministration experts from all segments of the industry, and is recruiting experts in CO code  xadministration, NPA relief planning, and carrier identification code administration. It notes that,  xto facilitate the hiring of quality staff, it will assign its NANPA personnel to three existing  X-Lockheed offices across the nation.Y4 _ {Oo-ԍ#X\  P6G;ɒP# Id.Y  Xg- x x44  (2) Comments on NANPA Billing and Collection Agent.  X- x756. Several commenters agree that NECA should be selected as the B&C agent,  X- xprovided that NECA creates an independent board as described in the recommendation. _ yOR!-ԍ#X\  P6G;ɒP#AirTouch comments at 1; MCI comments at 1921; GTE reply comments at 4. MCI  xnotes that NECA has expertise in cost recovery and experience in telephone industry billing, and  xthat NECA's price, which assumes the same staffing levels, is still lower than those of the other  Xr- xrespondents.rV _ {Oy%-ԍ#X\  P6G;ɒP# MCI comments at 19. See also NTCA comments at 2. MCI states that the Commission should state that if NECA does not administer"r,>(>(II"  xlB&C activities impartially, aggrieved carriers may seek Commission redress, and that the  X-Commission will act quickly by enforcing the rules recommended by NANC.Z_ {OV-ԍ#X\  P6G;ɒP# Id. Z  X- $x857. NTCA asserts that the proposed neutrality cure for NECA is unnecessary. In  x-NTCA's view, NECA should have the discretion to create an advisory board or oversight council  xKinstead of a separate subsidiary. Creation of a separate board to oversee only the B&C functions  x[will be costly and inefficient, and will not yield public benefits. NTCA argues that an advisory  X - x/council such as the USAC can as easily cure neutrality concerns.c Z_ yO -ԍ#X\  P6G;ɒP# NTCA comments at 2.c Similarly, NECA itself  xsuggests that it form a B&C oversight council to provide independent oversight exclusively for  xthe NANPA B&C functions. The council would oversee NECA's operation, via its USAC  xsubsidiary, of the NANPA B&C functions. NECA states that the council could consist of the  xUSAC Board and others in the NANP community, and one or more international  X\ - xrepresentatives.e\ _ yO-ԍ#X\  P6G;ɒP# NECA comments at 23.e The NANPA B&C functions and financial management would be conducted  xkseparately and independently from NECA's or USAC's other administrative responsibilities.  xCreation of the council, instead of a separate corporate entity, would lower administrative costs  X - xwhile preserving neutrality.} z_ {O-ԍ#X\  P6G;ɒP# Id. See also NECA reply comments at 2.} In response to WorldCom's arguments that NECA cannot be  X - xneutral because of its ties to the incumbent LECs,p _ {O-ԍ#X\  P6G;ɒP# See para. 58, infra.p NECA states that its proposal assures neutral  xadministration of the billing and collection functions. Further, NECA alleges that WorldCom  xfails to recognize NECA's successful administration of the Commission's interstate TRS fund and  Xg-its recent selection as interim administrator of the Commission's new universal service funds.ig_ yO-ԍ#X\  P6G;ɒP# NECA reply comments at 4.i  X!- x958. WorldCom opposes the selection of NECA as the B&C agent, alleging that,  xieven with the "cosmetic" modifications NECA proposes, NECA cannot operate in a competitively  X- xineutral fashion.~. _ yO-ԍ#X\  P6G;ɒP# WorldCom comments at 67, reply comments at 3.~ The creation of an independent board will not change the historical incumbent  X- xLEC leanings of NECA, WorldCom argues. _ {O'"-ԍ#X\  P6G;ɒP# Id. at 7. See also WorldCom reply comments at 4. WorldCom states that NECA does have some  xexperience in B&C activities in the NANP environment, but that it nullifies its eligibility by  xrefusing to accommodate shortfalls in collections, a stated requirement for the B&C agent.  XO- xZFurther, NECA does not have billing experience in a competitive and contentious environment.YOP _ {OP&-ԍ#X\  P6G;ɒP# Id.Y "O,>(>(II"  xWorldCom urges the Commission to select Lockheed or another neutral entity as the B&C  X- xagent.Y_ {Oy-ԍ#X\  P6G;ɒP# Id.Y WorldCom argues that an advisory board or oversight council, as suggested by some  xcommenters, lacks the authority of an independent board of directors and would be unable to  X- xsupervise NECA to guard against anticompetitive actions.m}_ yO-ԍ#X\  P6G;ɒP# WorldCom reply comments at 4.m WorldCom states that an  x<independent board would have bias problems, but that an oversight council would be completely  XQ- x=ineffective in keeping check on NECA's partiality.YQ _ {O -ԍ#X\  P6G;ɒP# Id.Y WorldCom contends that, if NECA is the  x|B&C agent, at a minimum its activities must be supervised by a specific branch of the  X - xCommission.Z _ {O[ -ԍ#X\  P6G;ɒP# Id. Z WorldCom asserts that rules should be codified to ensure that: (1) NECA is  xrequired to balance its board of directors completely with nonILEC interests; (2) membership  xin NECA is open to all interested parties, including IXCs and CLECs; (3) the board has authority  xover the hiring of professional staff and other personnel; and (4) NECA is required to comply  X - xfully with the neutrality principles articulated by the NANC.a 1_ {Oa-ԍ#X\  P6G;ɒP# Id. at 67.a Other parties, in their reply  xcomments, also disagree with comments that an advisory board or oversight council is  X9 - x/sufficient.9 _ yO-ԍ#X\  P6G;ɒP# WorldCom reply comments at 4; AT&T reply comments at 56. AT&T argues that any cost savings NECA would realize by overseeing B&C  X -functions through USAC, rather than through a separate B&C board, would be trivial.i S _ yO-ԍ#X\  P6G;ɒP# AT&T reply comments at 5.i x44  X -x44 d. Discussion x44  (1) NANPA  XD- %x:59. We accept NANC's recommendation of Lockheed as the new NANPA and  x codify NANC's proposed conditions regarding transfer of intellectual property and pricing  X- xjadjustment.O _ {O-ԍ See para. 20, supra.O The record demonstrates that Lockheed offers substantial savings compared to  xMitretek, and can bring efficiency and synergy advantages to number administration activities.  xWe note that the record demonstrates that Lockheed has worked to address the concerns of parties  X- xopposing its selection as the NANPA.u _ {O#- xԍ See PCIA August 18 ex parte (After numerous discussions with Lockheed, PCIA feels its concerns have been addressed and will support the NANC recommendation of Lockheed as the new NANPA). The conditions the NANC recommends, which we are  xzimposing on Lockheed and all future NANPAs, persuasively address the concerns of those  xparties opposing Lockheed because of its proposed estimation of costs and it initial unwillingness"O ,>(>(II"  xto transfer intellectual property rights. Concerns regarding Lockheed's projected staffing levels are addressed by the record, as discussed below.  X- Bx;60. We are not persuaded that Lockheed, as compared to Mitretek, is "so wholly"  Xt- xunderstaffed as to be unable to discharge its NANPA functions.Mt_ {O-ԍ See, e.g., SBC comments at 7.M Such a conclusion would be  xkinconsistent with the finding of the NANPA Evaluation Team, which reached consensus to  X.- x<recommend both Lockheed and Mitretek as "preferred choices for the new administrator."9.Z_ yO9 -ԍ MCI reply at 3.9 We  x/agree with MCI that it is inconceivable that the Evaluation Team, characterized by the very  xparties opposing Lockheed on this point to be the "most informed and knowledgeable body" in  xthe evaluation process, would have made such a recommendation if Lockheed were unable to fulfill its duties as NANPA because of inadequate staffing.  X^ - $x<61. As MCI has noted in the record in this proceeding, personnel levels alone are  X; - xnot dispositive of service quality.; _ yO-ԍ Letter from Mary Brown, MCI, to Marian Gordon dated July 28, 1997 (MCI July 28 ex parte) at 2. Lockheed's commitment is not limited to providing a  xparticular number of employees to perform specific NANPA functions, such as NPA relief  xplanning, but rather to performing the specific service of NANP administration and to assign  X - xhowever many employees are needed to fulfill that commitment.\ z_ {O-ԍ Id. See also AT&T reply comments at 3.\ To the extent that staffing  xconcerns are actually concerns relating to Lockheed's ability to perform its NANPA functions in  xa timely, efficient manner we note that Lockheed's performance will be closely monitored by the  xNANC and the Commission. If Lockheed fails to fulfill its responsibilities, this will become  xquickly evident and be swiftly remedied. Under the NANC's proposed rule, which we are  xlcodifying as Section 52.12(d) of our rules, the NANC will monitor the performance of the  xNANPA and, at the direction of the Commission, implement any remedial action necessary to  xcorrect identified problems. As we have stated many times, numbers are the means by which  xbusinesses and consumers gain access to, and reap the benefits of, the public switched network.  xSections 251(e) and 251(b) of the Telecommunications Act of 1996 are no less clear as to the  xLimportance of fair and efficient numbering administration, and require Commission diligence to  xLensure that numbers are made available on a nondiscriminatory basis. NANC itself, we further  xnote, has put any future NANPA on notice that failure to meet its responsibilities in this area will  xmean removal; we conclude that Lockheed would be unwilling to risk losing commercially  X-valuable opportunities through poor performance in this very critical and public arena.Vz _ {O"-ԍ See NANC's Proposed Rule 52.12(e).  XxTermination. "If the Commission determines at any time that the NANPA . . . substantially or  materially defaults in the performance of its obligations, the Commission shall advise immediately  Pthe NANPA . . . of said failure or default, request immediate corrective action, and permit the  PNANPA . . . reasonable time to correct such failure or default. If the NANPA . . . is unwilling  `or unable to take corrective action, the Commission may, in a manner consistent with the"W',>(>('"  Prequirements of the Administrative Procedure Act, take any action that it deems appropriate, including termination." V"! ,>(>(II"Ԍ X- ԙx=62. We further note that Lockheed, in response to concerns that its proposed  xcentralization of NANPA functions might hinder its ability to hire qualified staff, has already  xreplied that it will assign its NANPA personnel to three existing Lockheed offices, located on the  X- xKEast Coast, West Coast, and in the MidWest, to facilitate the hiring of the best staff available.K _ yOh-ԍ Lockheed reply comments at 9 n.21.K  xIn addition, Lockheed has affirmatively stated that it will anticipate and adjust proactively its  XQ- xstaffing needs to provide the necessary service levels.GQ_ yO -ԍ Lockheed comments at 9. G We note that the new NANPA will  xLassume its responsibilities gradually, which will provide Lockheed sufficient time to obtain the  X - xNnecessary staff to carry out its new functions. @_ yO - xxԍ The transition schedule calls for the current NANPA's functions to be transferred to the new NANPA no  x,later than 90 days after selection of the new NANPA. The CO code assignment functions will be transferred to the  xnew NANPA no more than 18 months after the new NANPA has assumed all of the current NANPA functions. The  xJorder in which the current CO code administrators will transfer their responsibilities to the new NANPA has not yet  xbeen determined. We emphasize that the current CO code administrators shall continue to be responsible for their current functions for up to 18 months after the new NANPA assumes Bellcore's current functions.  Finally, while many NANPA functions  xundoubtedly require human judgment, Lockheed's innovative approach to numbering  x=administration relying in part on the effective use of advanced technologies should streamline  X- xsome administration processes and reduce staffing needs in general.Q _ {O -ԍ  See Lockheed reply comments at 7.Q Current industry efforts,  xencouraged by the Commission and state public utility commissions to reduce the rate of  X\ - x\depletion of number resources, may reduce work demands on NANPA as well. Also, in the  X9 - xLocal Competition Second Report and Order, we stated that states may assume responsibility for  X - x initiating NPA relief planning.Z| J _ {O- xԍ Local Competition Second Report and Order at 19532. We stated that those states wishing to perform  xfunctions relating to initiation and development of area code relief plans must notify the new NANPA within 120  xdays of the selection of the new NANPA. Area code relief initiation and development functions will be transferred  {Om- xhto and performed by the new NANPA for those states that do not seek to perform such functions. Id. at 1953233.  xBy letter dated June 4, 1997, the Indiana Utility Regulatory Commission (IURC) informed Ameritech Indiana, the  xKCommission's Common Carrier Bureau, and the NANC that the IURC wishes to assume the role of initiating and planning NPA relief. Z While we do not know at this point how many states will actually take on that function, those that do will reduce the workload of the NANPA.  X- x>63. Regarding the transfer of intellectual property, we are not persuaded that  xkNANC's recommendation should be rejected because Lockheed is unwilling to surrender all  x{intellectual property and resources developed for NANPA activities. Responding to the  xEvaluation Team's concern that Lockheed had not committed to freely transfer intellectual  x-property it developed in its role as NANPA should another NANPA be selected, NANC imposed  xthe condition that any NANPA must freely transfer intellectual property to the NANC or a"",>(>(II"  X- xsuccessor NANPA selectee._ {Oy- xԍ See Proposed Rule 52.13(f) The proposed condition pertaining to transfer of intellectual property states that  x.the NANPA must make available any and all intellectual property and associated hardware resulting from its  xJactivities. This property shall include systems and the data contained therein, software, interface specifications and  xsupporting documentation. The NANPA shall make such property available, free of charge, to whomever the NANC  xdirects. Further, Lockheed must specify any intellectual property it proposes to exclude from the condition based  yOc-on the property's existence before Lockheed's selection as NANPA.  Lockheed has clarified on the record that, while it considers its  xKexisting "telecommunications infrastructure," which is based on "offtheshelf" technology, to be  xits own, it considers the "NANPA system," Lockheed's application for numbering administration  xthat makes use of its "telecommunications infrastructure," to be proprietary to the NANPA and  Xt- xwill transfer it to a new NANPA free of charge.HtB_ yOg -ԍ Lockheed reply comments at 56.H We conclude, therefore, that Lockheed has addressed all concerns regarding the transfer of its intellectual property.  X - Rx?64. Responding to Mitretek's argument that NANC departed from its firm, fixed  xMprice requirement by crafting a condition regarding price adjustment, we find no procedural  xirregularity. NANC was free to develop its own evaluation procedures and to attach conditions  xto its recommendation so long as they applied to all respondents. The record demonstrates that  xLockheed and Mitretek were treated equally in terms of their communications with NANC, the  xNANPA Working Group, and the Evaluation Team. Both had equal opportunities to make  xpresentations to the NANC and to justify the contents of their respective proposals and forecasts.  xjWe agree with Mitretek that the NANC incorporated a price adjustment mechanism because of  xithe difference in proposed staff levels and perceived future need for additional staff. Reasonably,  xin attempting to balance its concerns regarding Lockheed's minimal staff against its concerns  x/regarding Mitretek's significantly higher price, NANC determined that the price adjustment  x\condition was necessary. Mitretek is mistaken, however, in its assertion that NANC's price  xiadjustment condition "changed the price and risk strategy considered and proposed by Mitretek"  XD- xand "encourages and rewards understatement of the required staff and cost."DD_ yO-ԍ Mitretek comments at 1920.D In preparing its  x=proposal, Lockheed had no more notice than Mitretek that the NANC would develop the price  xadjustment condition and thus had no incentive to underestimate its staff and cost projections.  x-Further, the price adjustment condition applies to both the Lockheed and the Mitretek proposals,  xand does not unfairly benefit one respondent over another. Because the price adjustment  xcondition will be codified in our rules, future applicants for the role of NANPA could have  xincentive to underestimate staff and cost projections in proposals. Again, however, the price  xadjustment rule, and any advantages resulting from that rule, would apply to all applicants equally, and all applicants would be on an "equal footing" when preparing proposals.  X- Qx@65. We also disagree with arguments that the NANC gave too much weight to the  xmonetary difference between the Lockheed and Mitretek proposals. Costs are important,  xparticularly to the carriers that will bear larger shares of the costs for numbering administration.  xUnquestionably the price difference between the two proposals is substantial. Although some  xMcommenters note that the unit price per staff member was fairly consistent between the two"Z#b ,>(>(II<"  xproposals, the fact remains that Mitretek's proposal would cost the industry over $22 million  xmore than Lockheed's would, an obviously important factor to a majority of the NANC members.  xThe NANC's consideration of the prices of the two proposals was reasonable, and we do not  xZdisturb its overall recommendation on the basis that it gave too much weight to the issue of price.  XQ- CxA66. We recognize that vendor diversity for number administration services has  xzadvantages for the industry because it prevents the industry from being captive to a single,  xmonopolistic provider for these services. We conclude, however, that there will continue to be  x=adequate vendor diversity if Lockheed is the new NANPA as well as an administrator for local  xnumber portability (LNPA). The NANC recommended that Lockheed be the LNPA in only four  xout of seven regions. Therefore, even though Lockheed has been selected as a LNPA, there will  X - xbe another provider of LNPA services." _ yO - xԍ On May 1, 1997, the NANC recommended that Lockheed be the LNPA for four regions and that Perot  xySystems, Inc. be the LNPA for three regions. On August 18, 1997 we released an order adopting the NANC's  {O - xrecommendations with some modifications. Telephone Number Portability, Second Report and Order, CC Docket No. 95116, FCC 97289 (rel. Aug. 18, 1997).  Further, Lockheed will no longer be the administrator  X\ - xfor the SMS/800 Help Desk.EX\ _ yO- xhԍ On June 2, 1997, the SMS/800 Management Team (SMT) announced that Sykes Enterprises, Inc. (Sykes) had  xLbeen selected to provide services for the SMS/800 Help Desk. The SMT has transferred SMS/800 Help Desk functions from Lockheed to Sykes. E On this basis, we conclude that there will be adequate vendor  xjdiversity for number administration services. PCIA also argues that, if Lockheed is selected as  xZthe NANPA, it would have a financial interest in the NANP and number assignments which could  x=prevent it from serving as a neutral LNP administrator. We conclude that the financial interest  x"Lockheed would have in the NANP by virtue of its role as NANPA is not of the sort contemplated by the NANC when it solicited proposals for the LNP administrator.  Xg- xB67. We find that the NANC process for selection of the new NANPA was open  xand fair, and included the opportunity for participation from all segments of the  xtelecommunications industry. We will not reject the NANC's recommendation because of its  xfailure to reach consensus on that recommendation for the new NANPA. Unlike most  xtelecommunications fora and standards bodies, the federal advisory committee process does not  xirequire consensus. We note that the NANC recommended Mitretek as the alternate NANPA, and  xwe accept this recommendation formally. If Lockheed defaults on its obligations as NANPA, or  xif the NANC determines that Lockheed does not perform those functions in a satisfactory fashion,  x.Mitretek will have the opportunity to assume NANPA responsibilities for the remainder of the fiveyear term, if it still wishes to do so, without its undergoing another evaluation process. x44  (2) Billing and Collection Agent  X- xC68. We also accept the NANC recommendation and select NECA as the NANPA  X}- xiB&C Agent, subject to the neutrality conditions outlined below.G}_ {O&-ԍ See paras. 8291, infra.G The record demonstrates that  xNECA has relevant experience in cost recovery and billing and collection in the"Z$d ,>(>(II<"  xxtelecommunications industry, and has offered to perform the services at a significantly lower price  xthan Lockheed. Although it did express some reservations about NECA's selection, particularly  xbecause of NECA's willingness to handle shortfalls in collections, the NANC determined on  xbalance that NECA's experience with cost recovery and its lower price made NECA the better  Xt- xcandidate for the B&C Agent. We will not disturb that judgment. We will, however, formally  xname Lockheed as the alternate B&C agent. If NECA defaults on its obligations as the NANPA  xB&C Agent, is unable or unwilling to comply with the neutrality cure we impose below, or does  x=not perform the NANP B&C Agent functions in a satisfactory fashion, Lockheed will have the  xopportunity to assume NANPA B&C responsibilities, if it still wishes to do so, without its undergoing another evaluation process.  X -x442. Neutrality  X9 -x44 a. Description of Neutrality Definition  X -xD69. The Requirements Document defined "neutrality" as follows:  X- 4Xx1)44a respondent may not be an affiliate of any telecommunications service  $provider(s) as defined in the Telecommunications Act of 1996. "Affiliate" is a  person who controls, is controlled by, or is under the direct or indirect common  _control with another person. A person shall be deemed to control another if such  person possesses, directly or indirectly, (i) an equity interest by stock, partnership  (general or limited) interest, joint venture participation, or member interest in the  other person ten (10%) percent or more of the total outstanding equity interests in  the other person, or (ii) the power to vote ten (10%) percent or more of the  securities (by stock, partnership (general or limited) interest, joint venture  participation, or member interest) having ordinary voting power for the election  of directors, general partner, or management of such other person; or (iii) the  $power to direct or cause the direction of the management and policies of such  other person, whether through the ownership of or right to vote voting rights  3attributable to the stock, partnership (general or limited) interest, joint venture  2participation, or member interest of such other person, by contract (including but  not limited to stockholder agreement partnership (general or limited) agreement, joint venture agreement, or operating agreement), or otherwise;   X7- 4Xx2)44a respondent and any affiliate thereof may not issue a majority of its debt to,  nor it may derive a majority of its revenues from any telecommunications service  provider. "Majority" shall mean greater than 50 percent, and "debt" shall mean stocks, bonds, securities, notes, loans, or any other instrument of indebtedness; and   X"- 4EXx3)44notwithstanding the Neutrality Criteria set forth in 1) and 2) above, a  respondent may be determined to be or not to be subject to undue influence by  parties with a vested interest in the outcome of numbering administration  activities. NANC may conduct an evaluation to determine whether a respondent meets the undue influence criterion.  "&%,>(>(II'"Ԍ X-x44 b. Discussion x44  (1) NANP Administrator  Xt- xE70. Mitretek's September 4, 1997 letter raises questions concerning whether any  xaffiliates of Lockheed Martin IMS are telecommunications service providers. The Act defines "telecommunications" and "telecommunications service" as follows:  XxThe term "telecommunications" means the transmission, between or among points  }specified by the user, of information of the user's choosing, without change in the  X-form or content of the information as sent and received.@_ yO -ԍ 47 U.S.C.  153(43).@   nXxThe term "telecommunications service" means the offering of telecommunications  for a fee directly to the public, or to such classes of users as to be effectively  X -available directly to the public, regardless of the facilities used.@ X_ yO-ԍ 47 U.S.C.  153(46).@   X - $xF71. We previously concluded that inclusion of the phrase "directly to the public"  xin the definition of telecommunications service limits the reach of that term to  X- xxtelecommunications services provided on a common carrier basis._ {O#- xԍ Universal Service Order FederalState Joint Board on Universal Service, Report and Order, CC Docket No. 9645, FCC 97157 (rel. May 8, 1997), at para. 785. Federal precedent holds that  xa carrier may be a common carrier if it holds itself out "to service indifferently all potential  XD- xusers."0(DB_ {O7- xjԍ National Association of Regulatory Utility Commissioners v. FCC, 553 F.2d 601, 608 (D.C. Cir. 1976)  {O- x(NARUC II). See also CABLE & WIRELESS, PLC, Application for a License to Land and Operate in the United  {O- xStates a Private Submarine Fiber Optic Cable Extending Between the United States and the United Kingdom, Cable  {O-Landing License, File No. SCL96005, FCC 97204 (rel. June 20, 1997), at para. 12.0 We have found, however, that such users are not limited to end users. Common carrier  xservices include services offered to other carriers, such as exchange access service, which is  X- xoffered on a common carrier basis and provided primarily to other carriers.JZ2 _ {O- xiԍ See 47 C.F.R.  69; see generally MTS and WATS Market Structure, Phase I, Third Report and Order, CC  x,Docket No. 7872, 93 FCC 2d 241, paras. 13, 23 (1982) (access charges are regulated services and include "carrier's carrier" services).J Therefore, whether  xany affiliate of Lockheed Martin IMS is a telecommunications service provider does not depend  x\on whether those affiliates provide services directly to end users. The question is, instead,  x/whether they have been authorized to offer services indiscriminately to the public, and are, therefore, providing services on a common carrier basis.  X,- BxG72. Astrolink. It is clear that the Lockheed Martin Corporation's Astrolink system  xwill be operating on a noncommon carrier basis and will not provide telecommunications  xservices within the meaning of the Act. In its application, the Lockheed Martin Corporation"&T ,>(>(II"  X- xstated that it proposed to offer services on a noncommon carrier basis.d\_ {Oy- xԍ See Lockheed Martin Corporation Application for Authority to Construct, Launch, and Operate a KaBand  {OC- xSatellite System in the FixedSatellite Service, File Nos. 182 through 186SATP/LA95, Order and Authorization, DA No. 97973, 1997 WL 232167 (May 9, 1997).d In granting its  xapplication, we authorized the Lockheed Martin Corporation to operate on a noncommon carrier  X-basis.2_ {OW-ԍ Id.2  Xt- xH73. Globalstar. It also is clear that Globalstar will be operating on a noncommon  xcarrier basis and will not provide telecommunications services within the meaning of the Act.  xIn its application, the Loral/Qualcomm Partnership (LQP) stated that it did not intend to hold  X - xLitself out to provide mobile satellite services indifferently to the public.\ ~_ {O: - xԍ See Application of Loral/QualComm Partnership, L.P. For Authority to Construct, Launch, and Operate  xGlobalstar, a Low Earth Orbit Satellite System to Provide Mobile Satellite Services in the 16101626.5 MHz/2483.5 {O-2500 MHz Bands, Order and Authorization, 10 FCC Rcd 2333, 2336 (1995) aff'd, 11 FCC Rcd 18502 (1996). We authorized LQP  X-to operate on a noncommon carrier basis.2_ {O;-ԍ Id.2  X- xI74. Loral SKYNET. Loral SKYNET offers at least some of its services on a  xcommon carrier basis. In October 1996, AT&T Corporation (AT&T) and Loral SpaceCom  xCorporation (Loral) filed an application for authority to assign AT&T's licenses for Telstars 302,  xz303, 401, 402R, 5, and 6, and associated earth stations and common carrier authorizations, to  X - x.Loral.^ 4 _ {O- xiԍ See AT&T Corp. and Loral SpaceCom Corporation, Application for Authority to Assign the Licenses for  {O- xTelstars 302, 303, 401, 402R, 5, and 6, and Associated Earth Stations and Common Carrier Authorizations, Order  {O-and Authorization, DA 97125, 1997 WL 20687 (Jan. 17, 1997).  As discussed below, three of these are now operational. Loral proposed to maintain  x-continuity in SKYNET's service offerings, which include satellite services provided on a common  X - xcarrier basis.$ Z _ {O- xԍ Id.  We note that we have adopted a policy permitting satellite operators in the FixedSatellite Service to elect  x,to operate on a common carrier basis or a noncommon carrier basis. Amendment to the Commission's Regulatory  {Om- x<Policies Governing Domestic Fixed Satellites and Separate International Satellite Systems, Report and Order, IB Docket No. 9541, 11 FCC Rcd 2429, 2436 (1996). The International Bureau, acting on delegated authority, granted the assignment  X-application.^F_ {O!- xiԍ See AT&T Corp. and Loral SpaceCom Corporation, Application for Authority to Assign the Licenses for  {On"- xTelstars 302, 303, 401, 402R, 5, and 6, and Associated Earth Stations and Common Carrier Authorizations, Order  {O8#-and Authorization, DA 97125, 1997 WL 20687 (Jan. 17, 1997).  "'l,>(>(II"Ԍ X- xJ75. Telstar 302 is no longer in operation._ yOy-ԍ Letter from George F. Wazeter, Loral SpaceCom Corp., to William F. Caton dated September 11, 1997. Telstar 303 was launched and began  X- xLservice under common carrier regulation in August 1985.8ZX_ yO- xԍ AT&T Corp. Application for Modification of the TELSTAR 303 Domestic FixedSatellite, File No. 54SAT {O- x;ML95, 80SATML96, 81SATSTA96, 142SATSTA96, Order and Authorization, DA 961499, 11 FCC Rcd 10570, 10571 (1996).8 Its tenyear license term expired on  X- xAugust 7, 1995, and since that time, it has been operating under special temporary authority.3z_ {O-ԍ Id. 3  x-In September 1996, the International Bureau, acting on delegated authority, permitted the satellite  xzto operate until December 31, 1997, or until the date of the transfer of traffic from Telstar 303  XQ- xyto its replacement satellite, whichever occurred sooner.<Q _ {O -ԍ Id. at 10573.< Loral recently filed an application to  xmodify the license for the Telstar 303 satellite to extend the license term until December 31,  x1998, or, alternatively, for special temporary authority to continue to operate Telstar 303 from  X- xDecember 31, 1997 until a license modification is granted.$_ {O7- xԍ See Application to Modify the License for the Telstar 303 Satellite to Extend the License Term, filed Sept.  x;19, 1997. Loral notes in that application that on April 11, 1997, it filed an application to extend the construction  xand operation dates for the satellite (now called Telstar 6) that will replace Telstar 303 as a result of the catastrophic  {O-failure of Telstar 401. Id. at 3 n.7.  Telstar 303 is nearing the end of  X-its projected operational life. _ yO- x,ԍ Projections for the operational lives of satellites vary between ten and fifteen years, depending on the design of the satellites and how much fuel they have left at a given time.  X - `xK76. Telstar 401, which may have offered some services on a common carrier basis,  X\ - xis no longer in operation, having experienced a catastrophic failure in early 1997.K\ _ yO- x,ԍ Loral SpaceCom Corp. Application for Special Temporary Authority to Launch Telstar 5, File No. 58SAT {O- xLA97, Order, File No. 58SATLA97, DA 971099, 12 FCC Rcd 6743 (1997). In 1990, AT&T was granted  x;authority to sell a portion of the Cband transponders and a portion of the Kuband transponders on its Telstar 401  xand 402 satellites on a noncommon carrier basis, and to operate the remainder of the satellites' capacity on a common carrier basis. K On May 23,  x1997, the International Bureau, acting on delegated authority, authorized Loral to launch and  X - xoperate Telstar 5 on a noncommon carrier basis as an emergency replacement for Telstar 401. _ {O[!- xwԍ Id. The International Bureau, acting on delegated authority in 1996, previously had granted AT&T authority  xto launch and operate Telstar 5 and 6 satellites on a noncommon carrier basis. Assignment of Orbital Locations  xto Space Stations in the Domestic FixedSatellite Service, Application of American Telephone and Telegraph  {O#- xCompany, File No. 62SATAMEND95, 63SATP/LA95, 64SATP/LA95, 65SATP/LA95, Order and  {O$- xAuthorizations, DA 96713, 11 FCC Rcd 13788, 13789 (1996). See also Application of AT&T Corp. for Authority  {OI%- xto Construct, Launch, and Operate Space Stations in the Domestic FixedSatellite Service, Memorandum Opinion  {O&-and Order, DA 961942, 1996 WL 671150 (rel. Nov. 21, 1996). Telstar 5 is in operation on a noncommon carrier basis. " (,>(>(II"Ԍ X- ԙxL77. The third operational SKYNET service satellite is Telstar 402R and a portion  x>of its services appear to be offered on a common carrier basis. In 1990, AT&T was granted  x!authority to sell up to 12 of the 48 Cband transponders and up to 12 of the 48 Kuband  X- xtransponders on its Telstar 401 and 402 satellites on a noncommon carrier basis._ yO- xԍ Letter from Richard M. Firestone, Chief, Common Carrier Bureau, to Leonard J. Monize dated February 8, 1990 (Firestone letter) at 2. AT&T also  xwas granted authority to operate the remainder of the Telstar 402R capacity on a common carrier  XQ- x[basis.3Q _ {O" -ԍ Id. 3 AT&T was required to continue to adhere to all applicable Commission requirements  X.- xwith respect to its common carrier operations.2._ {O -ԍ Id.2 When AT&T and Loral applied for consent for  xyassignment of AT&T's licenses, Loral proposed to honor all of AT&T's existing contracts and  xother obligations with respect to its licensed facilities. The parties structured the acquisition to  xenable Loral to maintain uninterrupted service to AT&T's customers and to avoid disruption,  X-inconvenience, and confusion to the AT&T customers.FXD_ yO- xԍ AT&T Corp. and Loral SpaceCom Corporation, Application for Consent to Assignment of Licenses and  x[Section 214 Authorizations and for Any Necessary Approvals Pursuant to Section 310(b)(4) and Request for Expedited Treatment, filed October 9, 1996, at 78.F  X\ -  xM78. We conclude that Lockheed Martin IMS is an affiliate of a  x"telecommunications service provider," and is in technical violation of a portion of the NANC's  X - xproposed neutrality criteria. Section 52.12 (a)(1)E d _ yO+-ԍ 47 C.F.R.  52.12 (a)(1).E provides in part that the NANPA shall not  x-be an affiliate of any telecommunications service provider as defined in the Communications Act,  x/as amended. Lockheed, through its 16 percent ownership of Loral Space, is an affiliate of a  xtelecommunications service provider, Loral SKYNET, which currently provides certain services on a common carrier basis through its operation of Telstar 303 and Telstar 402R.  XD- xN79. We also find, however, that the violation of section 52.12(a)(1) is de minimis.  xThe customers of these SKYNET services constitute a discrete, specific group of former AT&T  xxcustomers. Moreover, it appears that, because the Telstar satellites are used, among other things,  xto provide video teleconferencing and broadcast video distribution, many customers of the Telstar  x/303 and Telstar 402R common carrier offerings do not use North American Numbering Plan  xresources and, therefore, the service offerings do not jeopardize the neutrality of Lockheed Martin  Xt-IMS as the NANPA.]t _ yO#- xhԍ See, e.g. American Telephone and Telegraph Company, Supplemental Information In Support of Application  xhfor Authorization to Construct, Launch, and Operate Replacement Satellites to be Used as Part of the AT&T/GSAT  xDomestic Satellite System, filed May 16, 1980, at A41, indicating that both video and audio services would be  {Oq%- xprovided with these satellites. See also American Telephone and Telegraph Company, Application for Authority to  xJConstruct, Launch and Operate a Domestic FixedSatellite Service System, filed September 15, 1987, at 21. AT&T  xYstates in that Application: "The TELSTAR satellites to be replaced are projected to operate at or near capacity for"',>(>(B'"  xJthe remainder of their useful lives. They are used to provide offshore MTS and WATS services; digital private line services; switched digital services; video teleconferencing; and broadcast video distribution."] "t) ,>(>(IIp"Ԍ X- ԙxO80. Further, section 52.12(a)(2)E _ yO-ԍ 47 C.F.R.  52.12 (a)(2).E provides that neither the NANPA nor any of its  xaffiliates may issue a majority (i.e. more than 50 percent) of its debt to, or derive a majority of  xZits revenues from, any telecommunications service provider. Nothing in this record suggests that  xLoral Space owns more than 50 percent of the debt instruments issued by the Lockheed Martin  xiCorporation. Further, it appears that the revenues that the Lockheed Martin Corporation received  xas a result of its affiliation with Loral Space represent only a small portion of the revenues of the  xLockheed Martin Corporation. According to the Form 10K that was filed with the Securities  x[and Exchange Commission for the period from April 1 through December 31, 1996, Loral Space  xzand Communications Ltd. acquired Skynet Satellite Services on March 14, 1997, at a price of  X- xj$478 million.;X_ yO&- xԍ Form 10K, Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 for  xthe Transition Period from April 1, 1996 to December 31, 1996, Loral Space and Communications Ltd., Commission file number 114180, at 27.; Lockheed Martin's equity interest in Loral is 16 percent, or approximately $76.5  X- xmillion of Loral's investment.R_ yO#-ԍ Lockheed September 11 ex parte at 3 n.11.R In 1996, Lockheed Martin reported total assets of $29.257  X - x=billion in its consolidated Balance Sheet.R ` _ yO-ԍ Lockheed Martin 1996 Annual Report at 1. R Therefore, its equity interest in Skynet represents approximately 0.26 percent (0.0026) of its total assets.  X - SxP81. In addition, section 52.12 (a)(3) of our rules,E  _ yO-ԍ 47 C.F.R.  52.12 (a)(3).E provides that, even if the  xlNANPA does not satisfy the neutrality criteria stated in sections 52.12 (a)(1) and (2), the  x-Commission nonetheless may find that the NANPA is neutral and not subject to undue influence  xby parties with a vested interest in the outcome of numbering administration and activities. Our  xrule further provides for the NANC in the first instance to evaluate such cases and to submit its  x-recommendation to the Commission. In the instant case, the NANC, whose membership includes  xya diverse group of industry experts, reviewed the ex parte filings of Mitretek and Lockheed and  xZrecommended that we find that Lockheed is neutral for purposes of assuming the functions of the  x/NANPA. We agree that Lockheed will not be subject to undue influence by parties with a  xzvested interest in the outcome of numbering administration, as a consequence of its current  X- xinterest in Loral SKYNET. In sum, in view of the de minimis nature of the common carrier  xservices currently offered by Loral SKYNET, the extremely small financial stake of the Lockheed  x/Martin Corporation in Loral SKYNET relative to the Lockheed Martin Corporation's overall  xassets, and the conclusion of the NANC that Lockheed is neutral, we conclude that Lockheed may  xserve as the NANPA without compromising the purposes of the statute and the resulting  xneutrality criteria. To any extent that the Lockheed Martin Corporation or its affiliates in the  X- xfuture offer common carrier services that are more than de minimis in nature, we would"* ,>(>(II"  xreconsider the issue of Lockheed's neutrality under section 52.12 and consider taking action  X-disqualifying Lockheed as the NANPA. _ yOV- xԍ We note that, on October 7, 1997, Loral announced that it has entered into a definitive agreement to acquire  {O- xZ100% of Orion Network Systems Inc. for Loral common stock.  See Loral Space & Communications Ltd., News  xRelease, Loral to Acquire Orion Network Systems in Exchange of Stock, Oct. 7, 1997. Orion is currently authorized  xto offer its services on a noncommon carrier basis. Establishment of Satellite Systems Providing International  {Ox-Communications, Report and Order, CC Docket No. 841299, 101 FCC 2d 1046, 1050 (1985). x44  <<(2) Billing and Collection Agent  XQ- xQ82. We agree with NANC's conclusion that NECA, as currently structured, is not  xneutral. We further find merit in NANC's proposed cure that NECA create an independent board  xexclusively for the B&C Agent and that such board: (i) be neutral and impartial; (ii) not advocate  xMspecific positions to the Commission in nonadministrationrelated proceedings; (iii) not be  xjaligned or associated with any particular industry segment; and, (iv) not have a direct financial  X- x<interest in the support mechanisms established by the Commission.D |_ yO-ԍ NANC Recommendation at 13.D NANC correctly observes  xythat these criteria are consistent with those recommended by the Universal Service Joint Board  xto assure the neutrality of a permanent administrator of the new universal service support  X9 -mechanisms. 9 _ {O- xxԍ Changes to the Board of Directors of the National Exchange Carrier Association, Inc., Notice of Proposed  {O-Rulemaking and Notice of Inquiry, CC Docket No. 9721, 12 FCC Rcd 72 (1997).   X - 'xR83. We find NECA's proposal to create a NANPA Billing and Collection  xx"Oversight Council" inadequate to address NANC's neutrality concerns. While NECA states that  x[its Oversight Council would operate separately and independently from NECA or its proposed  xwhollyowned subsidiary, the USAC, NANC was clear in its directive that the B&C Agent for  Xg- x0NANPA was to have its own independent board. gh _ yO- xZԍ NANC states: "The recommended neutrality cure is for the FCC to order NECA to create an independent board exclusively for the Billing and Collection Agent." NANC Recommendation at 13. NANC's statement that "[NECA's]  x>suggestion of the USAC Board . . . as a cure for its neutrality is considered insufficient and  X!- xinadequate for the concerns of all parties" underscores this point.3! _ {O-ԍ Id.3 The NANC obviously had  xserious reservations about whether USAC, created for purposes other than numbering  xkadministration, could adequately substitute for a board dedicated exclusively to overseeing  xNANPA billing and collection efforts. The record provides no basis upon which to reject the  x NANC's judgment. AT&T, for example, states in its reply comments that any cost savings realized by not requiring NECA to create a separate B&C board would be "trivial."  X,- xS84. Accordingly, we direct that, as soon as possible, NECA create an independent,  xnotforprofit subsidiary corporation, similar to the USAC model, under the laws of Delaware to  x[be designated the NANPA B&C Agent. We further direct NECA to submit to the Commission"+R ,>(>(II"  xfor approval proposed articles of incorporation, bylaws, and any documents necessary to  xincorporate the B&C Agent, by December 12, 1997, in order to ensure that prior to incorporation  xof the B&C Agent all requirements of this Order have been satisfied. The Commission will  xyapprove or modify the proposed documents through a Public Notice. Consistent with NANC's  xyrecommendation, we direct NECA to create the separate subsidiary corporation with a board of  xdirectors reflecting "broad based representation from the NANP community with at least one  X.- xiinternational representative."2._ {O-ԍ Id.2 The board of directors and the NECA board of directors shall not  xjhave common members. Specifically, mirroring the representational composition of NANC, the  x[board shall be composed of fourteen members: two representatives of domestic interexchange  xcarriers; two representatives of domestic incumbent local exchange carriers; two representatives  x of the competitive local exchange carriers; two representatives of the wireless carriers; two  xzrepresentatives of nondomestic carriers; two representatives of consumer groups; and two  X\ - xyrepresentatives from state and international regulatory bodies.\ Z_ yOg- xԍ We note that the presence of international representatives on the board should address NANC's concern regarding NECA's lack of international experience. The board shall meet at least  xquarterly, and more frequently if the board members deem necessary. As discussed below, it  xshall have an audit of the subsidiary's activities as B&C Agent for the NANPA conducted  xannually, and shall provide the audit report to the NANC. The board shall also report to the NANC on its activities on at least an annual basis.  X- AxT85. The establishment of this subsidiary corporation with its own independent board  xof directors will bring to numbering administration the expertise needed to ensure that billing and  xcollection functions related to numbering resources are administered efficiently. This subsidiary  xicorporation, through its parent company, NECA, will have access to the experience and resources  xnecessary to implement support mechanisms quickly. We expect that this general expertise will  x=enable the NANPA B&C Agent to assume its full responsibilities quickly. This in turn should  xassure that NANPA will begin to operate on schedule, despite the short implementation periods  X- xspecified in the NANP Order.C_ {O-ԍ NANP Order at 2632.C As stated above, if NECA should be unwilling or unable to  xperform as directed Lockheed should become the B&C Agent for NANPA. While it projected  xLhigher costs for the billing and collection function than NECA did, and does not have NECA's  xlongstanding relationships with telecommunications carriers, Lockheed is considered neutral for purposes of assuming the duties of the B&C Agent.  X- xU86. We direct NECA to establish the B&C Agent as a separate subsidiary. This  xseparate subsidiary will have separate directors, pursuant to the requirements set forth above, and  X- xwill maintain separate books of account from those of NECA's other operations. We direct that  xMthe appointment of NECA as the B&C Agent will become effective coincident with NECA's  xxincorporation of the B&C Agent subsidiary. We direct the B&C Agent subsidiary to develop any  xnecessary database systems, to hire and train personnel, and to discuss with contributors the  xassessment of NANPA cost recovery requirements. In its role as the B&C Agent, this NECA  xsubsidiary may engage only in activities directly related to billing and collection to recover costs  x[for NANP administration. Meetings of the B&C Agent subsidiary's board of directors shall be" ,D,>(>(II!"  xjopen to the public and shall be held in Washington, D.C., because this city is easily accessible  xand may be particularly convenient for the parties that have offices or representatives in the  xWashington, D.C. area. We conclude that board members shall be entitled to reimbursement for expenses directly incurred as a result of their participation on the B&C Agent subsidiary board.  XQ- xV87. Intercorporate Transactions. We anticipate that the B&C Agent subsidiary may  x=engage in transactions with NECA. We expect that NECA and the B&C Agent subsidiary will  xengage in such transactions whenever doing so would minimize the latter's expenses. We direct  xNECA to provide such services, including lending startup funds, upon the request of the B&C  x[Agent subsidiary, on reasonable terms. Startup funds for the B&C Agent subsidiary may not  X- xcome from the TRS fund or from TRS administrative expense accounts._ {O -#X\  P6G;ɒP#э#X\  P6G;ɒP# See 47 C.F.R.  64.604(c)(4)(iii)(H). All transactions that  xoccur between NECA and the B&C Agent subsidiary must be conducted on an arm's length  X\ - xbasis. For transactions between NECA and the B&C Agent subsidiary, NECA must comply with  X9 - xthe Commission's affiliate transaction rules.`^9 Z_ {OD- x#X\  P6G;ɒP##X\  P6G;ɒP#э#X\  P6G;ɒP#  See 47 C.F.R.  32.27. See also Joint Cost Order, Separation of Costs of Regulated Telephone Service from  {O- xCosts of Nonregulated Activities, Report and Order, 2 FCC Rcd 1298 (1987), modified on recon. 2 FCC Rcd 6283  {O-(1987); #X\  P6G;ɒP#Implementation of the Telecommunications Act of 1996; 1996 Safeguards Order. ` We also direct NECA to revise its cost allocation  X -manual (CAM) to reflect the formation of the B&C Agent subsidiary.q _ {OG-#X\  P6G;ɒP#э  See 47 C.F.R.  64.903.q  X - xW88. Accounting and Auditing Requirements. The B&C Agent subsidiary will  xmaintain books of account in accordance with generally accepted accounting principles (GAAP)  xthat are separate from NECA's books of account. We direct that an audit be performed of the  xB&C Agent subsidiary's books on an annual basis by an independent auditor. The audit period  xKshould conform to the time period on which the subsidiary keeps its books. We direct the NANC  xto make a recommendation to the Commission regarding the nature and scope of such an audit,  X- xand request that the NANC make a recommendation consistent with our Accounting Safeguards  X- xOrder, where we established specific audit procedures applicable to separate subsidiaries of the  X- xBOCs under section 272(d) of the Act.l_ {O- x#X\  P6G;ɒP#э See #X\  P6G;ɒP#Implementation of the Telecommunications Act of 1996; Accounting Safeguards under the  {OI-Telecommunications Act of 1996, Report and Order, 11 FCC Rcd 17539 (1996) (1996 Safeguards Order). l Because we conclude that oversight of the billing and  xcollection functions is necessary to ensure the integrity of those functions, we apply to the B&C  Xv- x.Agent subsidiary audit requirements similar to those contained in section 53.209 et seq. of our  XU- x-rules.~Un _ {Ot"-#X\  P6G;ɒP#э See 47 C.F.R.  53.209 et seq.~ Before selecting the independent auditor, the B&C Agent subsidiary shall submit to the  x.NANC the former's proposed preliminary audit requirements, including the proposed scope of  xthe audit and the extent of the compliance and substantive testing. The NANC shall review the  xNpreliminary audit requirements to determine whether they are adequate to meet the audit  xobjectives. We direct the NANC to submit the preliminary audit requirements to the Bureau,  xZalong with any recommended modifications that it deems necessary. After the audit requirements"- ,>(>(II"  xhave been approved by the Bureau, the B&C Agent subsidiary shall engage an independent  xauditor to conduct an agreedupon procedures audit following the procedures approved by the  xBureau. In making its selection, the B&C Agent subsidiary shall not engage an independent  xauditor that has been involved in designing the accounting or reporting systems under review in  xthe audit. In addition, the B&C Agent subsidiary shall require the independent auditor selected  xyto develop a proposed audit program based on the final audit requirements as approved by the  xBureau, and to submit such audit program to the Bureau staff, which will determine whether any  xmodifications are necessary to conform the proposed audit program to the final audit program approved by the Bureau. This procedure must occur every year.  X- %xX89. Because the audit program is an agreedupon procedures audit that will be  xconducted to assure that the B&C Agent serves the public interest, the B&C Agent subsidiary  xmust require the independent auditor it selects to inform the Bureau, during the course of that  xaudit, of any revisions the auditor makes to the final audit program or scope of the audit. The  xB&C Agent subsidiary must also require the independent auditor to notify the Bureau of any  x<meetings with the B&C Agent or NECA in which audit findings are discussed, so that the Bureau  xcan ensure that the audit program is conducted in accordance with Commission rules. In  xaddition, the B&C Agent subsidiary must require the independent auditor selected to submit to  xthe Bureau any accounting or rule interpretations that the B&C Agent subsidiary or the auditor  xmakes to complete the audit. By receiving the above information, the Bureau can ensure that the  x-auditor examines areas the Bureau has determined require review and that the Commission's rules are being followed.  X- 4xY90. The B&C Agent subsidiary must require the independent auditor selected,  x.within 60 days after the end of the audit period, but prior to discussing the audit findings with  xthe B&C Agent or with NECA, to submit a draft of the audit report to the Bureau. We conclude  xthat early submission of the audit report to the Bureau allow the Bureau to assess the validity of  xthe report's findings and the adequacy of the work product. If the Bureau staff, upon reviewing  x<the draft audit report, determines that additional audit work is necessary, the independent auditor  x[may request additional time to perform that work. The B&C Agent subsidiary must require the  xindependent auditor selected to submit the final audit to the B&C Agent subsidiary for its  xyresponse to the audit findings. Within 30 days after receiving the audit report, the B&C Agent  xxsubsidiary shall respond to the audit findings and send a copy of its response to the Bureau. The  x.B&C Agent subsidiary also must submit to the Bureau any reply that the independent auditor makes to the B&C Agent subsidiary's response.  X- xZ91. Nondisclosure of Information. The Commission will have full access to all  xdata received by the B&C Agent subsidiary. Requests for protection from Commission disclosure  xLcan be made under section 0.459 of the Commission's rules at the time that the subject data are  X!- xsubmitted to the B&C Agent.f!_ yO$$-#X\  P6G;ɒP#э 47 C.F.R.  0.459.f As required by our rules, such requests for nondisclosure must  X"- xstate reasons for withholding the materials from disclosure (e.g., competitive harm) and the facts  xsupporting that statement. We will require the B&C Agent to keep confidential all data obtained  xtelecommunications service providers, not to use such data except for purposes of billing and"D$.X,>(>(II%"  xcollection to recover costs for NANP administration, and not to disclose such data in companyspecific form unless directed to do so by the Commission.  X- xC.44Process for Governance of NANPA and the B&C Agent x  XQ-x441. Description of Recommended Rules  X - Rx[92. The NANC also has recommended our adoption of rules, developed by the  xNANPA Working Group, to govern how the new NANPA and the B&C Agent conduct their  X- xrespective operations.K_ yO> -ԍ NANC Recommendation, Attachment 2.K The NANC's proposed rules would require the NANPA and the B&C  xAgent to conduct their operations subject to oversight from the Commission, with  X - xrecommendations from the NANC.8 X_ {O -ԍ Id. at 2.8 Generally, the rules prescribe: (1) neutrality standards  X\ - xZgoverning both the NANPA and the B&C Agent;3\ _ {O-ԍ Id. 3 (2) the lengths of the terms of administration  X9 - xof both the NANPA and the B&C Agent;89 |_ {Of-ԍ Id. at 3.8 (3) how the NANPA and the B&C Agent are to  X - xrespond to changes to industry regulations, Commission rules, or other guidelines or directives;2 _ {O-ԍ Id.2  X - x=(4) the performance review process for the NANPA and the B&C Agent;2 _ {OD-ԍ Id.2 (5) the termination  xMof the tenure of the NANPA and the B&C Agent if either fails to comply with the neutrality  X- xrequirements or materially defaults in the performance of its obligations;:2 _ {O-ԍ Id. at 34.: (6) dispute resolution  X- xprocesses;8 _ {O-ԍ Id. at 4.8 (7) enterprise services that the NANPA may offer; ZV _ {O- xԍ Id. The Requirements Document states that enterprise services are "services not described elsewhere in this  xRequirements Document that may be provided by the new NANPA for a specific fee. Enterprise services and their associated fees are subject to prior approval by NANC. Requirements Document at para. 7.0. (8) duties of the NANPA;:!x_ {O!-ԍ Id. at 45.:  Xg- xxand (9) duties of the B&C Agent.:"g _ {O"$-ԍ Id. at 67.: The NANC's proposed rules defined conditions under which  xthe NANPA may seek an adjustment to its price schedule and the scope of the NANPA's"D/",>(>(II"  xobligation to transfer intellectual property rights to a successor NANPA that we have already  X-discussed.;#_ {OV-ԍ Id. at 56. ;  X- x\93. The NANC recommends that NANPA attempt to resolve disputes relating to  xMnumber administration using a binder of decisional principles, which the NANC refers to as  XQ- x"NANC guidelines."K$QZ_ yO\-ԍ NANC Recommendation, Attachment 3.K Initially, it says, the binder will contain: (1) regulatory guidance and  xorders specifically relating to numbering (e.g., orders and directives of the FCC, state regulators  xyand nonUnited States governmental bodies); and (2) numberingrelated guidelines and related  x[explanatory material that have been formally adopted by standards bodies (e.g., Committee T1,  xTIA committees) or the equivalent of such bodies (international organizations such as the ITU,  xInmarsat or Intelsat), or that reflect the consensus of numberingrelated forums and industry  x[committees (e.g., Network Interconnection and Interoperability Forum which formerly included the ICCF, Industry Numbering Committee, Canadian Numbering Committee, etc.).  X - x]94. NANC further recommends that the FCC establish processes under which a  xNANC recommendation will have the authority of an FCC decision, if the Commission does not  xyaffirmatively suspend, modify or reject the recommendation within a fixed time period following the release of a public notice announcing that NANC recommendation.  Xg-x44 2. Discussion  X!- x^95. There was very little comment on the NANC's proposed rules. We adopt the  xrules as proposed by the NANC, with some modifications. The rules set broad guidelines within  xLwhich the NANPA and the B&C agent must operate to meet the objectives of fair and efficient  xMnumbering administration. Because they constitute a minimal set of requirements, the rules  xshould give the industry flexibility to perform number administration so that the industry's needs  xfor numbering resources are met. The NANPA and, to the extent applicable, the B&C Agent,  xishall follow Commission rules and regulations and the guidelines developed by the INC and other  X,- xindustry groups pertaining to administration and assignment of numbering resources.>%,_ yO- xЍ These guidelines include, but are not limited to: (1) Central Office Code (NXX) Assignment Guidelines (INC  x95-0407-008) (dated April 1997); (2) NPA Code Relief Planning and Notification Guidelines (INC 97-0404-016)  x(dated April 1997); (3) Recommended Notification Procedures to Industry for Changes in Access Network  xkArchitectures ICCF 92-0726-004, Revision 2.; (4) NPA Allocation Plan and Assignment Guidelines (INC 96-0308-011) (dated April 1996). > If there  xis a dispute regarding the application of a particular guideline, or if the industry groups  xLdeveloping the guidelines cannot reach consensus regarding what guidelines apply in a given  xcontext, the Commission will address the dispute, either initially or after receiving a  xrecommendation from the NANC, and will if necessary codify formal regulations. Parties with  xZdisputes or questions regarding industry guidelines, or proposed changes to industry guidelines,  xare encouraged to seek assistance from the NANC first. We reject arguments that NANC "adds  x[an additional layer to decisionmaking on numbering issues" and therefore should be removed"70%,>(>(II"  X- xxfrom the arena of resolving numbering disputes.&_ {Oy-ԍ See Statement of US West Regarding Continuation of the NANC, to the NANC dated August 14, 1997. As amply demonstrated by its record thus far,  xthe NANC, proceeding at a rapid pace to resolve technically complex issues that affect the  xmcompetitiveness of the entire telecommunications industry, has greatly facilitated the  x>Commission's work in numbering. As we have stated many times before, we have carefully  x/balanced the membership of NANC so that it represents the numbering interests of service  xproviders, users, and regulators throughout the countries served by the NANP. The NANC  xmembership, working together to achieve consensus on issues for which time is of the essence,  xyhas expedited what would otherwise likely be a much longer process if the Commission were to  xrely on traditional rulemaking exclusively. For these reasons, we find that NANC operates in the public interest and should continue in operation.  X - x_96. We agree with the NANC's recommendation that the NANPA attempt to  xresolve disputes using the binder of decisional principles. We also agree that the administrator  xjshould apply its expertise to interpreting and applying existing decisional principles, but that it  xZshould not make policy or create the equivalent of new guidelines, and should not exceed a three xmonth time period for completing resolution of disputes before it. If the NANPA requires  xadditional time for resolution, it should inform the NANC how much additional time it requires  xand the reasons why three months is not sufficient. NANC concludes, and we concur, that most  xdisputes will arise because a party disagrees with an administrator's decision, action, or nonaction and it will ask the administrator to review the decision.  X!- x`97. We further agree with the NANC's recommendation that we codify an  xyinstruction to the NANC to adopt and use dispute resolution procedures that, for each dispute  xbefore the NANC, provide all interested parties: (1) notice of the matters at issue; (2) a  xreasonable opportunity to make oral and written presentations; (3) a reasoned recommended  xxresolution; and (4) a written report summarizing the recommendations and the underlying reasons.  xTo provide solutions to numbering disputes when time is critical, we further agree to streamline  xour administrative processes of review and accordingly order that, under authority delegated by  x[the Commission to address number administration, the Common Carrier Bureau, using NANC's  xinitial report, written submissions made to the NANC, and the NANC's final recommendation  xas a written record, review any NANC recommendation. In addition, we order that, if NANC's  x.recommendation is uncontested by the disputants, it will be deemed affirmed 14 days after the  x/Common Carrier Bureau releases a public notice announcing the NANC's recommendation,  xAunless the Common Carrier Bureau affirmatively suspends, modifies or rejects the  xrecommendation during that time period. The NANC is directed to provide notice of its decision  xwithin five days of issuance by filing its recommendation with the Common Carrier Bureau. The  x=NANC should include, at a minimum, the full text of its recommendation, including its decision  xand opinion. We further order that the NANPA shall not implement a NANC dispute resolution  xrecommendation until passage of the 14day time period, unless the Common Carrier Bureau  x<affirmatively directs otherwise. Should a disputant wish to contest the NANC's recommendation,  xit may do so by filing a petition with the Common Carrier Bureau within 14 days after NANC's  xsubmission of its recommendation to the Common Carrier Bureau. Filing of such petition will automatically suspend the 14day regulatory review time period discussed above. "B$1Z&,>(>(II%"Ԍ X- ԙxa98. MCI noted that the Commission's public notice seeking comment on the NANC  xxrecommendations, in its description of the NANC condition regarding price adjustment, contained  X- xslightly different language than did NANC's proposed rule.'_ yO3- xԍ MCI comments at 17. MCI notes that the public notice states that "the entity selected as the NANPA must  {O- xperform the NANPA functions at the price the entity submitted in its proposal to the NANC that formed the basis  xJfor the entity's selection by the NANC." The public notice also indicates that the "NANC may grant an adjustment  {O- xin price" if the tasks "exceed 120 percent of NANPA's assumption for the above tasks made in the proposal to the  xJNANC that formed the basis for the entity's selection by the NANC." (Emphasis supplied). MCI states that phrases  x"submitted in its proposal" and "in the proposal" are troublesome because some respondents' proposals did not  x;include numerical assumptions regarding the specific tasks listed in the proposed rule. It was only after the NANPA  xZWorking Group requested each respondent's workload assumptions regarding specific tasks that vendors provided  xthis information. Thus, the initial proposals themselves do not include any assumptions regarding the task workloads.  xConversely, the NANC's proposed rule's language of "at the time of selection" would include the assumptions that were provided to the NANPA Working Group.  MCI states that the textual  X- xdifference may raise confusion and undermine the effectiveness of the fixed price guarantee.3(, _ {Ot-ԍ Id. 3  Xt-We are, however, adopting the proposed rule as submitted in the NANC Recommendation.c)t _ yO-ԍ NANC Recommendation, Attachment 2, proposed rule 52.15(d).c  X.-IV.xTOLL FREE NUMBER ADMINISTRATION xA. Background  X- $xb99. The group within Bellcore that administers the NANP does not administer the  x1toll free number database. The latter is administered separately by Database Service  x\Management, Inc., (DSMI) under the Service Management System (SMS) Tariff. DSMI is a  X9 - xsubsidiary of Bellcore, which is currently owned by the RBOCs. In 1995, in the Toll Free  X - xNPRM,* N _ {O- xwԍ Toll Free Service Access Codes, CC Docket No. 95155, Notice of Proposed Rulemaking, 10 FCC Rcd 13692  {O-(1995) (Toll Free NPRM). we sought comment on whether DSMI should continue to administer the toll free  xjdatabases or whether another entity, such as the NANP administrator or another neutral party,  X - xMshould administer the toll free databases.H+ _ {O/-ԍ Toll Free NPRM at 13705.H The Commission asked parties to comment on  xjwhether independent third parties not affiliated with Bellcore or the RBOCs should perform the  xadministrative database functions instead of DSMI and Lockheed, who currently perform those  Xk-functions.,"k<_ {OX#- xԍ Id. The Commission noted that DSMI is currently the primary administrator of the toll free database. In  xZresponse to industry concerns, Bellcore established DSMI for the purpose of administering the SMS/800 database  xand subcontracted functions requiring access to proprietary customer information to a neutral third party, which at one time was Lockheed IMS. "H2&,,>(>(IIH"Ԍ X- xc100. Passage of the Telecommunications Act of 1996, and its specific mandate of  xZequitable numbering administration, required the Commission to solicit further comment to ensure  xthat it had a complete record on the issue of what entity should administer the toll free database.  X- xWe issued a Further Notice of Proposed Rulemaking (FNPRM) that requested additional comment  Xv- x-on the issue of what entity should administer the toll free database.-v_ {O- xԍ Toll Free Service Access Codes, CC Docket No. 95155, Second Report and Order and Further Notice of  {O-Proposed Rulemaking (rel. April 11, 1997) (Toll Free Second Report and Order). We sought this additional  xcomment on what entity should administer the toll free database, in light of section 251(e)(1),  xbecause the 1996 Act opens all telecommunications markets to competition. As noted earlier,  xBellcore, which owns the current toll free database administrator, has been owned by the RBOCs  xwhich we stated, as a matter of first impression, would appear to be a discrete industry  X- xsegment..$_ {O - xԍ Toll Free Second Report and Order at para. 101. Comments in response to the Further Notice of Proposed  {Of -Rulemaking were received on May 22, 1997, and reply comments were received on June 23, 1997.  The Commission tentatively concluded that, given DSMI's current ties to the RBOCs,  xDSMI's continuation as the toll free database administrator would violate section 251(e)(1) of the  X - xlAct.4/ _ {O-ԍ  Id.4 Also noting that the RBOCs have entered into an agreement to sell Bellcore, the  xCommission sought comment on the effect of the agreement upon who should administer the  X; - xdatabase.30; _ {O-ԍ Id.3 Although we sought comment on other issues relating to administration of the toll  X - x\free database,1 _ yOm- xKԍ We also sought comment on the NANC's role in determining what entity should assume the responsibility  {O5- xof toll free database administration. Toll Free Second Report and Order at para. 101. In addition, the Commission  xinquired whether the toll free database administrator should be the same entity that ultimately is chosen as the NANP  xadministrator or the administrator for local number portability, or whether another administrator should be chosen  {O- x,for the toll free database. Id. We also sought comment on what effect the selection of a new administrator for the  {OY- xtoll free database would have on the Commission's conclusion in the 800 Proceeding Order that, under the RBOC  x-plans for providing SMS access, the SMS access is a Title II common carrier service that must be provided under  {O- xhtariff. See Provision of Access for 800 Service, Order, 8 FCC Rcd 1423 (1993) (800 Proceeding Order). We sought  x;comment on whether access to the database should still be provided pursuant to tariff if there is a new administrator  {O}- xxof the database and, if so, what party or entity should file the tariff. Toll Free Second Report and Order at para. 104.  in this order, we focus only on the specific question of what entity should  xMadminister the database. We will address the remaining issues in a subsequent order in CC Docket No. 95155. xB. Positions of the Parties x  XF- xd101. In the first set of comments on the issue of toll free database administration,  x@filed before passage of the 1996 Act and the agreement for the sale of Bellcore, some"#31,>(>(II "  X- xKcommenters expressed support for DSMI's continuation as the toll free database administrator.2_ {Oy- xwԍ See AirTouch comments at 17, reply comments at 12; Ameritech comments at 37, reply comments at 910; Telephone Express comments at 2; Telco Planning comments at 6.  x]Others stated that toll free number administration should be assumed by a neutral entity  X- xunaffiliated with any industry segment.E3X"_ yO- xԍ Allnet comments at 11; AT&T comments at 1719, reply comments at 4; TRA comments at 21; CompTel  xcomments at 15; MFS comments at 10; Sprint comments at 2224, reply comments at 17; LDDS comments at 9, reply comments at 6; MCI reply comments at 10.E Some supported having the NANC consider the issue  X- xzof what entity should administer the toll free database,Y4B_ {O -ԍ See generally comments of AT&T and Unitel.Y while others stated that the entity  Xt- xjselected as NANPA should assume responsibility for toll free number administration.<5t_ yO -ԍ MFS comments at 10.< Some  xof the Bell Operating Companies argued that the real issue is whether the Commission's order  xin CC Docket No. 8610 should be modified to remove the requirement that the Regional Bell  xOperating Companies manage the SMS/800 database. These RBOCs stated that DSMI is simply  xan agent of the RBOCs and that replacing DSMI will not remove the RBOCs from toll free  X-database administration.{6\d _ {O- xiԍ See SWB comments at 1920, reply comments at 9. See also comments of U S WEST at 2728; NYNEX  xxcomments at 10. Other RBOCs, however, do not oppose the RBOCs turning over SMS/800 functions to another  {Ol-entity. See Bell Atlantic comments at 10; BellSouth comments at 18.{  X - xe102. In their joint comments on the FNPRM, the RBOCs and Bellcore ("the  xRBOCs") assert that section 251(e)(1) does not require that DSMI or any of the database  X; - x-subcontractors be displaced.@7; _ yOt-ԍ RBOCs comments at 3. @ The RBOCs state that access to the SMS/800 system is provided  xZpursuant to a nondiscriminatory tariff that allows RespOrgs to reserve toll free numbers on a first X - xcome, firstserved basis.8 _ yO-ԍ A RespOrg is the entity responsible for managing a toll free subscriber's record in the toll free database. According to the RBOCs, this ensures that toll free numbers are  X - xallocated in a nondiscriminatory and equitable manner, as required by section 251(e).=9 _ yO+-ԍ RBOCs comments at 3.= The  xRBOCs assert that DSMI simply manages the toll free system, a "largely ministerial" task that  X- xdoes not involve allocating toll free numbers.8:8_ {Ou"-ԍ Id. at 4.8 Therefore, the RBOCs argue, no change in the  Xi- xjcurrent provision of the SMS/800 system is required.2;i_ {O$-ԍ Id.2 The RBOCs contend that no party has  x/alleged specific acts of discrimination by the RBOCs or Bellcore in connection with the 800  xLdatabase, and further state that the commenters in CC Docket No. 95155 have not alleged that"#4\;,>(>(II"  X- x<there has been partiality in the administration of SMS/800 access.:<_ {Oy-ԍ Id. at 45.: The RBOCs argue that none  xiof the database subcontractors actually reserve, allocate, or disseminate specific toll free numbers  xZfrom the SMS/800 database. The RespOrgs themselves undertake that task, because by selecting  xa number from the pool of unreserved numbers, each RespOrg is able automatically to reserve  Xt- xa number for its customer.8=tZ_ {O-ԍ Id. at 5.8 The subcontractors maintain the SMS/800 system, and keep track  xof which numbers have been reserved and which are available. They, however, are unable to  X.-dispense toll free numbers, and thus cannot favor one RespOrg over another.8>._ {O -ԍ Id. at 6.8  X- axf103. The RBOCs state that even if DSMI or Bellcore performed some de minimis  xaspects of toll free number administration, Bellcore (including DSMI) has entered into an  xLagreement to be purchased by Science Applications International Corporation, Inc. (SAIC), an  X - xentity unaffiliated with any segment of the industry.:? ~_ {O-ԍ Id. at 67.: According to the RBOCs, the sale is  xexpected to be final in the fall of 1997, before the Commission could select a vendor to replace  X; - xDSMI.8@; _ {O-ԍ Id. at 7.8 The RBOCs assert that the sale will make DSMI an "impartial entity." Rather than  xhastily discharging DSMI to achieve impartiality, the BOCs argue, the Commission can achieve  xthe same results by awaiting the consummation of the sale. The RBOCs urge the Commission  x/to postpone any decision relating to administration of the SMS/800 system until the sale is  X-finalized.3A_ {O-ԍ Id. 3  Xi- ~xg104. AT&T states that any toll free administrator that is affiliated or in a contractual  x[relationship with Bellcore would be exposed to conflicts of interest because of the competition  X#- xbetween the RBOCs and the carriers that use SMS.<B#4 _ yO-ԍ AT&T comments at 2.< AT&T agrees that, given its current ties  x.to the RBOCs, DSMI's continuation as the toll free administrator, pending the sale of Bellcore,  xis inconsistent with section 251(e) of the Act. There are other considerations, however, that, in  X- xAT&T's view, militate against making any immediate changes.:C _ {O/"-ԍ Id. at 23.: AT&T states that, once the  x=RBOCs divest Bellcore, DSMI would qualify as a neutral third party and could continue as the  Xt- xtoll free administrator.8DtV _ {O{%-ԍ Id. at 3.8 This fact, however, does not mean that others should not be permitted  xkto do so, AT&T argues. AT&T asserts that the SMS/800 database administrator ultimately  x/should be selected through a competitive bidding process similar to that used to select the".5D,>(>(II"  X- xKNANPA and the LNPAs.:E_ {Oy-ԍ Id. at 34.: According to AT&T, despite DSMI's present RBOC affiliation, other  xcrucial number administration tasks facing the industry counsel against opening the SMS/800  xdatabase administration issue at this time. AT&T suggests that there is no imminent need to  xdisplace DSMI as the database administrator, as long as Bellcore is divested by the end of 1997.  xNonetheless, AT&T asserts, the Commission should charge an industry committee, such as the  xNANC, with determining the procedures that in the longterm will be used to select a "followon"  X.-administrator.8F.Z_ {O9 -ԍ Id. at 4.8  X- xh105. AT&T states that the duties of the SMS/800 database administrator should not  xbe united with the NANPA or the LNPAs, although a single vendor could assume each of those  X- xydistinct administrative functions.8G_ {O?-ԍ Id. at 5.8 According to AT&T, the SMS/800 database administrator  xshould be distinct from other numbering administrators because the former administrator's duties  xjrequire capabilities that administration of the other services does not, and toll free numbers are  X9 - x<governed by administrative rules that do not apply to other services.qH9 ~_ {Oh-ԍ Id. See also Sprint comments at 23; RBOCs reply comments at 45.q Moreover, the SMS/800  xydatabase has been operational for years, while the number portability databases have yet to be  X -implemented.3I _ {O-ԍ Id. 3  X- axi106. According to Sprint, any effort to ensure neutrality of the toll free database  x-administrator should also focus on the entity providing direction to the administrator and making  Xg- xstrategic decisions about matters such as enhancements to the toll free database.>Jg_ yO-ԍ Sprint comments at 1.> Sprint does  xnot object to allowing DSMI to continue as the toll free database administrator, at least until a  X!- xpermanent number administrator is chosen.3K!2 _ {O-ԍ Id. 3 Sprint asserts, however, that to ensure neutrality  x<in toll free administration, the current SMS Management Team (SMT), a group composed entirely  xLof RBOC representatives, should be replaced with a Board of Directors with balanced industry  xrepresentation to oversee the administrator's operations and to provide overall management of the  X- xtoll free database.:L _ {O #-ԍ Id. at 12.: Sprint states that DSMI's performance has been satisfactory. Given the  xtime, training, and expense associated with choosing an interim administrator, DSMI should not  XO-be replaced unless and until a new permanent administrator is chosen.2MOV _ {OV&-ԍ Id.2 x",6M,>(>(II"Ԍ X- xj107.  Sprint states that it does not object to referring the selection of a permanent  X- xtoll free database administrator to the NANC.8N_ {OV-ԍ Id. at 3.8 In Sprint's view, the administrator should have  xyoverall operational responsibility for the database, file the SMS tariff, prepare and file whatever  xtoll free usage reports the Commission requires, and assess and collect the fees associated with  xuse of the database. The administrator should not be responsible for network planning of future  xtoll free codes, which is more appropriately handled by an industry forum such as the INC or the  X.-ICCF.3O.Z_ {O9 -ԍ Id. 3  X- xk108. The BOCs oppose AT&T's proposal that the NANC develop procedures for  X- xselecting future SMS/800 database administrators.CP_ yOb -ԍ RBOCs reply comments at 3.C The BOCs state that selection of the toll free  xadministrator is currently performed by the SMT, which has demonstrated that it can select a  X - xdatabase overseer that will treat all sectors of the industry fairly.8Q |_ {O-ԍ Id. at 4.8 In the BOCs' view, the  xCommission should grant the SMT the discretion to select the database administrator. Since the  xSMT also administers the SMS/800 database access tariff, the BOCs argue, the Commission will  xbe able to police against possible discrimination in administration of the database through its  X -normal tariffing procedures.2R _ {O-ԍ Id.2<<, xC. Discussion  Xg- Txl109. We conclude that, as presently structured, toll free number database  xadministration is inconsistent with section 251(e)(1) of the Communications Act, as amended.  xxThere is not an adequate record, however, upon which to determine what entity should administer  x>the toll free database. Parties asserting that DSMI should no longer administer the toll free  xdatabase do not suggest what entity should assume the functions. At least one commenter states  xthat DSMI will be neutral after Bellcore is sold, but also asserts that a toll free database  X- xadministrator should be chosen through a competitive bidding process.?S_ yO-ԍ AT&T comments at 34. ? We direct the NANC  xto examine the issue of toll free number administration and make a recommendation to the  xlCommission regarding what entity would be an appropriate administrator for the toll free  xdatabase. The NANC is free to use a competitive bidding process, similar to those the NANC  xused in developing its recommendations for the NANPA and the LNPAs, if it determines that  xsuch a process is necessary in this context. We request that the NANC make a recommendation to the Commission within 120 days of the effective date of this Order.  X-  X}-V.xCONCLUSION "}70 S,>(>(II"Ԍ X- ԙxm110.  We conclude that the public interest will be served by our naming Lockheed  xas the NANPA and NECA as the B&C Agent. Neutral and impartial administration of the  x\numbering resource is critical to the development of competition in the telecommunications  xkmarket. The record in this proceeding demonstrates that Lockheed and NECA can meet the  xrequirement of neutrality for the purposes of NANP administration and billing and collection for  xNANPA. Further, the record indicates that each can perform its respective functions effectively.  xWe affirm the NANC's recommendation, subject to the conditions outlined above, and name  xLockheed as the new NANPA and NECA as the NANPA B&C Agent. We conclude that, as  xpresently structured, toll free number database administration is inconsistent with section  x251(e)(1) of the Communications Act, as amended, and direct the NANC to recommend an entity  x.to assume the duties of toll free number administration within 120 days of the effective date of this order.  X9 - VI. PROCEDURAL MATTERS  X -xA.44FINAL REGULATORY FLEXIBILITY ANALYSIS  X- ~xn111. As required by the Regulatory Flexibility Act (RFA),BT_" {O&- x"4` hp x (#X` hp x (#%'0*,.8135@8:(>(II;"  xrecommend an impartial NANP administrator is consistent with Congress' directive in section  x251(e)(1) of the Communications Act of 1934, as amended by the Telecommunications Act of  x1996, than an impartial numbering administrator be named to make telecommunications numbering available on an equitable basis.  XQ- xp113. This Third Report and Order establishes Lockheed Martin IMS as the NANPA  xand CO Code Administrator; selects NECA as the B&C Agent for NANP administration, and adopts the proposed NANPA rules to be codified at 47 C.F.R. section 52.7, et seq.  X- ~xq114. The rules constitute a minimal set of mandatory requirements and are designed  xto give the industry flexibility to perform number administration in a manner that ensures that  xthe industry's needs for numbering resources are met. Additionally, the NANPA and, to the  xextent applicable, the B&C Agent, shall follow the guidelines developed by the INC and other  xindustry groups pertaining to administration and assignment of numbering resources. If there is  x a dispute regarding the application of a particular guideline, or if the industry cannot reach  xconsensus regarding what guidelines are appropriate or necessary in a given context, the  xCommission will address the dispute, either initially or after receiving a recommendation from  xthe NANC, and will codify formal regulations if necessary. Parties with disputes or questions  xregarding industry guidelines, or proposed changes to industry guidelines, are encouraged to first seek assistance from the NANC.  X#- Analysis of Significant Issues Raised in Response to the Certification: x  X- %xr115. In the NANP NPRM, the Commission certified that the rules it proposed to  xadopt in this proceeding would not have a significant economic impact on a substantial number  xof small entities because "while the rules proposed in this proceeding would apply to telephone  xcommunications corporations of all sizes that are now assigned telephone numbers or that may  x in the future seek such assignments, the impact on small business entities served by these  xcorporations and on small telecommunications companies is not likely to be significant." No  x comments were submitted in response to the certification. However, we have, on our own  X-motion, reconsidered our certification in the NANP NPRM and decided to undertake a FRFA. x  X- Description and Estimate of the Number of Small Entities Affected by this  X`-Third Report and Order :  X-xs116. For the purposes of this Order, the RFA defines a "small business" to be the same as a "small business concern" under the Small Business Act, 15 U.S.C. section 632, unless the Commission has developed one or more definitions that are appropriate to its  X!-activities.OXe!_" {O*$- x"4` hp x (#X` hp x (#%'0*,.8135@8:(>(IIF#"  X-any additional criteria established by the Small Business Administration (SBA).UYe_" {Oy- x"4` hp x (#X` hp x (#%'0*,.8135@8:(>(IIx"Ԍ X-xv119. Wireline Carriers and Service Providers. SBA has developed a definition of small entities for telephone communications companies other than radiotelephone (wireless) companies. The Census Bureau reports that, there were 2,321 such telephone companies in  X-operation for at least one year at the end of 1992.^_ {O-4` hp x (#X` hp x (#%'0*,.8135@8:(>(IIZ" than 1,347 small incumbent LECs that may be affected by the decisions and rules adopted in  X-this Third Report and Order. Xx(#  X- Description of Projected Reporting, Recordkeeping and Other Compliance  Xv-Requirements:  X0-xy122. Reporting. The reporting requirements established in the NANPA rules to be codified at 47 C.F.R.  52.7 are directed exclusively to the NANPA and the B&C Agent. These rules provide that the NANPA and the B&C Agent shall conduct their operations with  X-oversight from the Commission, with recommendations from the NANC.b_ {O@ -4` hp x (#X` hp x (#%'0*,.8135@8:(>(IId" requirements do not require additional reporting of data from the telephone service providers industry. The NANPA and the B&C Agent shall develop and implement an internal, documented performance monitoring system and shall provide such performance review on request of the Commission on at least an annual basis. The indirect effect of requiring periodic, annual and audit reports from the NANPA and the B&C Agent on small business entities creates a positive benefit as it ensures fairness and neutrality in the management of numbering resources.  X-x{124. Other Compliance Requirements. None.  X- x|125. Report to Congress: The Commission shall send a copy of this FRFA,  X -along with this Third Report and Order, in a report to be sent to Congress pursuant to the  X^ -Small Business Regulatory Enforcement Fairness Act of 1996, see 5 U.S.C.  801(a)(1)(A).  X= -A copy of this FRFA will also be published in the Federal Register, see 5 U.S.C.  604(b), and will be sent to the Chief, Counsel for Advocacy of the Small Business Administration. x  X - VII.xORDERING CLAUSES  X-x}126. Accordingly, pursuant to sections 1, 4(i), and 251 of the Communications Act of 1934, as amended, 47 U.S.C.  151, 154(i), and 251, IT IS ORDERED that this THIRD REPORT AND ORDER in CC Docket No. 92237 is hereby ADOPTED.  X-x~127. IT IS FURTHER ORDERED that, pursuant to sections 1, 4(i), and 251 of the Communications Act of 1934, as amended, 47 U.S.C.  151, 154(i), and 251, IT IS ORDERED that this THIRD REPORT AND ORDER in CC Docket No. 95155 is hereby ADOPTED.  XU-x128. IT IS FURTHER ORDERED that the North American Numbering Council shall recommend to the Commission an entity to assume the duties of toll free number database administration by no later than 120 days after the effective date of this Third Report and Order in CC Docket No. 95155.  X-x129. IT IS FURTHER ORDERED that all policies, rules, and requirements set  X-forth herein are effective 30 days after publication of this order in the Federal Register. "`=m,>(>(II"Ԍ X-x130. IT IS FURTHER ORDERED that, pursuant to section 5(c)(1) of the Communications Act of 1934, as amended, 47 U.S.C.  155(c)(1), authority is delegated to the Chief, Common Carrier Bureau, to conduct review of any recommendation of the North American Numbering Council on a dispute pertaining to numbering administration or the obtaining of numbers for the provision of telecommunications services.  X.-x131. IT IS FURTHER ORDERED that the Commissions Office of the  X -Managing Director (OMD) SHALL SEND a copy of this Third Report and Order, including the Final Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the Small Business Administration. x44  <<FEDERAL COMMUNICATIONS COMMISSION x44  <<William F. Caton x44  <<Acting Secretary x44  Xi-