WPC 5 2 BPZ Courier 10cpi3|w [Zx6X@8;X@HP LaserJet IIISiHPLASIII.PRSx  @HCNX@2A< ZLEV3|w HP LaserJet IIISiHPLASIII.PRSXj\  P6G;HCNXP X-#Xj\  P6G;[hXP#CG Times (Scalable)CG Times Bold (Scalable)CG Times Italic (Scalable)Courier 10cpi2/vspkYka8DocumentgDocument Style StyleXX` `  ` a4DocumentgDocument Style Style . a6DocumentgDocument Style Style GX  a5DocumentgDocument Style Style }X(# 2avt|a2DocumentgDocument Style Style<o   ?  A.  a7DocumentgDocument Style StyleyXX` ` (#` BibliogrphyBibliography:X (# a1Right ParRight-Aligned Paragraph Numbers:`S@ I.  X(# 2g  _  a2Right ParRight-Aligned Paragraph Numbers C @` A. ` ` (#` a3DocumentgDocument Style Style B b  ?  1.  a3Right ParRight-Aligned Paragraph Numbers L! ` ` @P 1. ` `  (# a4Right ParRight-Aligned Paragraph Numbers Uj` `  @ a. ` (# 2  X   a5Right ParRight-Aligned Paragraph Numbers _o` `  @h(1)  hh#(#h a6Right ParRight-Aligned Paragraph Numbersh` `  hh#@$(a) hh#((# a7Right ParRight-Aligned Paragraph NumberspfJ` `  hh#(@*i) (h-(# a8Right ParRight-Aligned Paragraph NumbersyW"3!` `  hh#(-@p/a) -pp2(#p 2  RTech InitInitialize Technical Style. k I. A. 1. a.(1)(a) i) a) 1 .1 .1 .1 .1 .1 .1 .1 Technicala1DocumentgDocument Style Style\s0  zN8F I. ׃  a5TechnicalTechnical Document Style)WD (1) . a6TechnicalTechnical Document Style)D (a) . 2 `a2TechnicalTechnical Document Style<6  ?  A.   a3TechnicalTechnical Document Style9Wg  2  1.   a4TechnicalTechnical Document Style8bv{ 2  a.   a1TechnicalTechnical Document StyleF!<  ?  I.   2=39a7TechnicalTechnical Document Style(@D i) . a8TechnicalTechnical Document Style(D a) . Doc InitInitialize Document Stylez   0*0*0*  I. A. 1. a.(1)(a) i) a) I. 1. A. a.(1)(a) i) a)DocumentgPleadingHeader for Numbered Pleading PaperE!n    X X` hp x (#%'0*,.8135@8:><q*"xxxxWWxxxWWkkxxx"(#I 1  Y#-XxPII.xBACKGROUND p>"(#I 3  YV%-XxPxA.X` ` Authority to Disclose and Withhold Competitively Sensitive Information ` p>"(#I 3  Y('-XxPx` ` 1. Freedom of Information Act p>"(#I 3  Y(-XxPx` ` 2. The Trade Secrets Act and Commission Authority to Disclose"(0*0*0*0*"  Y-Exemption 4 Records p>"(#I 9  Y-XxPxB.` ` Review of Commission's Policies Governing Disclosure p"(#F 17  Y-XxPx` ` 1. Commission Rules and Procedures p"(#F 17  Yv-XxPx` ` 2. General Policies Regarding Disclosure of Exemption 4 Records p"(#F 21  YH-XxPx` ` 3. The Protective Order Approach p"(#F 25  Y -XxPIII.xISSUES FOR COMMENT p"(#F 30  Y -XxPxA.` ` General Issues p"(#F 30  Y -XxPxB.` ` Model Protective Order p"(#F 36  Y-XxPxC.` ` Issues That Arise With Respect to Specific Types of FCC Proceedings p"(#F 38  Yb-XxPx` ` 1. Title III Licensing proceedings p"(#F 39  Y6-XxPx ` ` 2. Tariff proceedings p"(#F 42  Y -XxPx` ` 3. Rulemaking proceedings p"(#F 46  Y-XxPx` ` 4. Requests for Special Relief and Waivers p"(#F 48  Y-XxPx` ` 5. Formal Complaints p"(#F 49  Y-XxPx` ` 6. Audits p"(#F 51  YT-XxPx` ` 7. Surveys and Studies. p"(#F 53  Y&-XxPxD.` ` Scope of Materials Not Routinely Available for Public Inspection p"(#F 54  Y-XxPxE.X` ` Proposed Clarifications to Commission Rules ` p"(#F 60  Y -XxPIV.xINITIAL REGULATORY FLEXIBILITY ACT ANALYSIS p"(#F 62  Y"-XxPV.xPAPERWORK REDUCTION ACT p"(#F 70  Yn$-XxPVI.xPROCEDURAL PROVISIONS p"(#F 71  Y@&-XxPVII.xORDERING CLAUSES p"(#F 74 ")'0*((P("  X- I.xINTRODUCTION   Y- I. A. 1. a.(1)(a) i) a) I. 1 1. a.(1)(a) i) a)x1.` ` With this Notice of Inquiry and Notice of Proposed Rulemaking, we begin a proceeding to evaluate the Commission's practices and policies concerning the treatment of competitively sensitive information that has been provided to the Commission. Our objective is to develop a policy that will guide us in evaluating an increasing number of requests that the Commission afford confidential treatment to information that has been provided to us by regulated entities and others. The central issue that confronts us is how to avoid unnecessary competitive harm that could be caused by the disclosures of such information and still fulfill our regulatory duties in a manner that is efficient and fair to the parties and members of the public who have an interest in our proceedings. We seek to obtain a broad range of public comment on this question in order to ensure that our policies serve the public interest.  Y -x2.` ` We begin by discussing, below, the basic legal framework of the Commission's authority both to withhold and to disclose competitively sensitive information. We follow with a discussion of the Commission's current policies regarding disclosure of confidential data. We next address issues upon which we particularly request comment, including issues relating to particular types of proceedings, such as licensing, tariff, rulemaking, waiver, formal complaint, and audit proceedings. We also seek comment on the development of a "model" protective order that could be used in our proceedings. We seek comment on the scope of information that should not be routinely available for public inspection. Finally, we propose certain clarifying amendments to our confidentiality rules.  X- II.xBACKGROUND  Y-xA.` ` Authority to Disclose and Withhold Competitively Sensitive Information(#`  Y-  Y-x` ` 1. Freedom of Information Act  Ye-x3.` ` Under the Freedom of Information Act (FOIA),Ce[ Y-ԍx5 U.S.C.  552.C the Commission is required to disclose reasonably described agency records requested by any person, unless the records contain information that fits within one or more of the nine exemptions from disclosure  Y -provided in the Act.a y[ YJ!-ԍxSee 5 U.S.C.  552(b). The nine exemptions provided by FOIA are for: (i) classified national defense or foreign policy materials; (ii) internal agency rules and practices; (iii) information specifically exempted from disclosure by another statute; (iv) trade secrets and commercial or financial information obtained from any person and privileged or confidential; (v) certain interagency and intra-agency memorandums or letters; (vi) personnel, medical and similar files, disclosure of which would constitute a clearly unwarranted invasion of personal privacy; (vii) records compiled for law enforcement purposes; (viii) records of"&0*((&"  Y-financial institutions; and (ix) oil well data. 5 U.S.C.  552(b); see also 47 C.F.R.  0.457 (types of records not routinely available for public inspection under the FOIA regulations of the Commission).  The public right to examine nonexempt federal agency records is" M0*(("  Y-enforceable in federal district court.LM[ Y-ԍx5 U.S.C.  552(a)(4)(B).L If a record contains segregable information that is  Y-exempt from disclosure, the agency must still release the remainder of the record.t[ Y-ԍx47 U.S.C.  552(b); see also 47 C.F.R.  0.461(f)(5). t Even when particular information falls within the scope of a FOIA exemption, federal agencies  Y-generally are afforded the discretion to release the information on public interest grounds.[ Y -ԍxChrysler v. Brown, 441 U.S. 281, 29294 (1979). See also discussion of the Trade Secrets Act at paras. 916 below. Affected persons may request, however, that the government protect all or part of certain  Y-records containing confidential information from disclosure to other persons.xM [ Y-ԍxSee Chrysler v. Brown, 441 U.S. at 318. Executive Order No. 12,600 requires federal agencies to establish predisclosure procedures to allow submitters of certain information to object to its release. 3 C.F.R. 235 (1988). Section 0.459 of the Commission's rules, 47 C.F.R.  0.459, describes the procedures for requesting that  Y1-information be withheld from public inspection. This rule is further discussed at  para. 19 below.   Y_-x4.` ` For the purposes of this proceeding, the most important of the FOIA exemptions is commonly referred to Exemption 4. Exemption 4 provides that the government need not disclose "trade secrets and commercial or financial information obtained  Y -from a person and privileged or confidential."I [ YX-ԍx5 U.S.C.  552(b)(4).I In the context of the FOIA, a trade secret is  Y -defined as "a secret, commercially valuable plan, formula, process, or device that is used for the making, preparing, compounding, or processing of trade commodities and that can be  Y -said to be the end product of either innovation or substantial effort." >[ Y-ԍxPublic Citizen Health Research Group v. FDA, 704 F.2d 1280, 1288 (D.C. Cir.  Y -1983); see also AT&T Information Systems, Inc. v. GSA, 627 F.Supp. 1396, 1401 n.9 (D.D.C. 1986). The terms "commercial or financial information" are to be given their ordinary meaning for purposes of  Y -the FOIA.  [ Y%-ԍxPublic Citizen Health Research Group, 704 F.2d. at 1290; see also Landfair v. U.S.  Y&-Dep't of Army, 645 F.Supp. 325, 327 (D.D.C. 1986) (commercial and financial information can include business sales statistics, research data, technical designs, overhead and operating"&0*(( '"  Y-costs, and information on financial condition); International Satellite, Inc., 57 RR 2d 460 (1984) (information is commercial "if it relates to commerce" whether or not submitter is a  Yd-forprofit entity).ď " M 0*((j"Ԍ Y-ԙx5.` ` For many years, the applicable standard for whether commercial or financial  Y-information was "confidential" under Exemption 4 of FOIA was set forth in National Parks  Y-and Conservation Association v. Morton.V M[ Y-ԍx 498 F.2d 765 (D.C. Cir. 1974).V In National Parks, the Court set forth a two-part test, stating that "[c]ommercial or financial matter is 'confidential' . . . if disclosure of the information is likely . . . either . . . (1) to impair the Government's ability to obtain necessary information in the future; or (2) to cause substantial harm to the competitive  Yz-position of the person from whom the information was obtained." z[ Y) -ԍx498 F.2d at 770; see also, e.g., Arvig Telephone Co., 3 FCC Rcd 3723, 372324  Y-(Com. Car. Bur. 1988) (applying National Parks). While "conclusory and  Yc-generalized allegations" cannot support nondisclosure, neither is an elaborate economic  YL-analysis necessary to establish the likelihood of substantial competitive injury. L[ Y-ԍxPublic Citizen Health Research Group, 704 F.2d. at 1291; National Parks and  Y-Conservation Association v. Kleppe, 547 F.2d 673, 680-81 (D.C. Cir 1976).  Y -x6.` ` In Critical Mass Energy Project v. Nuclear Regulatory Commission,  : [ Y -ԍx975 F.2d 871 (D.C. Cir. 1992), cert. denied, __ U.S. __, 113 S.Ct. 1579 (1993). the court  Y -revisited the definition of "confidential" set forth in National Parks. The court did not  Y -abandon the definition of "confidential" presented in National Parks, but chose to limit that  Y -definition's application to situations where a party must submit information to a federal  Y -agency.f [ Yh-ԍXx975 F.2d at 879 (D.C. Cir. 1992).(#f In contrast, under Critical Mass, "financial or commercial information provided to the Government on a voluntary basis is 'confidential' for the purpose of Exemption 4 if it is of a kind that would customarily not be released to the public by the person from whom it  Y-was obtained.":[ Y-ԍxId.: Therefore, if commercial or financial information obtained from a person is submitted voluntarily and would not customarily be disclosed by the submitter, it is deemed  YY-confidential without requiring any examination of the competitive harm or governmental  YB-impairment portions of the National Parks test.BQ[ YD$-ԍxSee, e.g., Allnet Communication Services, Inc. v. F.C.C., 800 F.Supp. 984 (D.D.C.  Y/%-1992) (applying Critical Mass to request by Allnet for cost information submitted to the FCC  Y&-by other telecommunications companies in support of proposed changes in rates); see also  Y'-Lykes Bros. Steamship Co., Inc v. Pena, No. 922780, slip op. at 811 (D.D.C. Sept 9,"'0*((#'" 1992) (submission required from one seeking benefits of voluntary program is considered  Yy-mandatory for purposes of Critical Mass). "Bd0*(("Ԍ Y-ԙx7.` ` In addition to National Parks' wellknown, twoprong test, (i.e., protecting from mandatory disclosure information likely either (i) to impair the Government's ability to obtain necessary information in the future or (ii) to cause substantial harm to the competitive  Y-position of the submitter), National Parks also left open the possibility of a third prong that  Y-would protect other governmental interests, such as compliance and program effectiveness.Fd[ Y-ԍx498 F.2d at 770 n.17.F  Y-Critical Mass embraced the view that the governmental and private interests identified in  Y|-National Parks' twoprong test are not exclusiveA|[ YB -ԍx975 F.2d at 879.A and other cases have recognized that  Yg-Exemption 4 protects a governmental interest in the effectiveness of government programs.g[ Y-ԍxAllnet Communication Services, 800 F.Supp. at 990; see also 9 to 5 Organization for  Y-Women Office Workers v. Board of Governors of the Federal Reserve System, 721 F.2d 1, 10 (1st Cir. 1983) (test is whether disclosure of Exemption 4 material will harm an "identifiable private or governmental interest which the Congress sought to protect").  Y9-x8.` ` Finally, Exemption 4 protects commercial or financial information that is  Y" -"privileged." Because the language of Exemption 4 applies to trade secrets and commercial or financial information that are "privileged or confidential," some courts have suggested that  Y -information may be privileged for purposes of Exemption 4, even if it is not confidential. 6 [ Y-ԍxE.g., Washington Post Co. v. HHS, 690 F.2d 252, 267 n.50 (D.C. Cir. 1982). Other courts have recognized that Exemption 4 may incorporate certain privileges, while  Y -rejecting the claims of privilege specifically before them.N [ Y`-ԍxAnderson v. HHS, 907 F.2d 936, 945 (10th Cir. 1990) (recognizing that certain discovery privileges may constitute additional ground for nondisclosure under Exemption 4, but rejecting argument that trade secret for purposes of a state protective order is privileged for purposes of FOIA on the grounds that Exemption 4 sets the sole standard for determining  Y-what is a trade secret under that exemption); Sharyland Water Supply Corp. v. Block, 755 F.2d 397, 400 (5th Cir.) (recognizing that Exemption 4 extends to privileges created by Constitution, statute or common law, but declining to hold that Exemption 4 incorporates a  Y!-lenderborrower privilege), cert. denied, 471 U.S. 1137 (1985). x  Y-x` ` 2. The Trade Secrets Act and Commission Authority to Disclose  Y-Exemption 4 Records(#  YS- x9.` ` While FOIA Exemption 4 allows an agency to withhold business competitive"S0*(("  Y-information from public disclosure, the Trade Secrets ActE[ Yy-ԍx18 U.S.C.  1905.E acts as an affirmative restraint on an agency's ability to release such information. The Trade Secrets Act provides criminal and employment penalties for federal officers or employees who disclose trade secrets, except in certain circumstances. It states: XxWhoever, being an officer or employee of the United States or of any department or agency thereof, ... publishes, divulges, discloses, or makes known in any manner or  Y_-to any extent not authorized by law any information coming to him in the course of his employment or official duties ... [that] concerns or relates to the trade secrets,  Y3-processes, operations, style of work, or apparatus ... shall be fined not more than $1000, or imprisoned not more than one year, or both; and shall be removed from  Y -office or employment.V y[ Y/-ԍx18 U.S.C.  1905 (emphasis added).V(# Notably, the sanctions supplied by the Trade Secrets Act do not apply where disclosure is "authorized by law."  Y -x  Y-x 10.` ` In Chrysler Corp. v. Brown,K*[ Ym-ԍx441 U.S. 281 (1979).K the Supreme Court held that a violation of the Trade Secrets Act would not only be a criminal offense, but would also constitute an abuse of agency discretion redressible under the Administrative Procedure Act through what is  YO-commonly referred to as a "reverse FOIA" action.O Y-ԍxSee 441 U.S. at 318; see also Freedom Of Information Act Guide and Privacy Act  Y-Overview (U.S. Dep't of Justice, September 1995 ed.) at 159. Under the Administrative Procedure Act, a court may review agency action to determine if it is "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law." 5 U.S.C.  706(2)(A).  The Supreme Court there also discussed the relationship between the Trade Secrets Act and Exemption 4 as follows:  Y#- XxAlthough there is a theoretical possibility that material might be outside Exemption 4 yet within the substantive provisions of [the Trade Secrets Act]. . . that possibility is at most of limited practical significance in view of the similarity of language between  Y-Exemption 4 and the substantive provisions of [the Trade Secrets Act].HK [ Y"-ԍxId. at 319 n. 49.H (#  Y-x 11.` ` The United States Court of Appeals for the District of Columbia Circuit has described the relationship between the two statutes in more detail, holding that the Trade" 0*(("  Y-Secrets Act is "at least coextensive with" Exemption 4 of FOIA. [ Yy-ԍx CNA Fin. Corp. v. Donovan, 830 F.2d 1132, 115152 (D.C. Cir. 1987), cert.  Yd-denied, 485 U.S. 977 (1988). Thus, if information may be withheld under Exemption 4, the agency is barred from disclosing it by the terms of  Y-the Trade Secrets Act unless the disclosure is otherwise authorized by law.:f[ Y-ԍxId.: Conversely, to the extent the Trade Secrets Act is broader than Exemption 4 and information does not fall within the ambit of Exemption 4, FOIA itself would serve as the requisite authorization by  Y-law under the Trade Secrets Act to permit disclosure.J[ YW -ԍxId. at 1152 n. 139.J  Y_-x 12.` ` In Chrysler Corp., the Court also made clear that an administrative regulation has the force of law for purposes of serving as the requisite "authorization by law" under the Trade Secrets Act to permit disclosure if the regulation (i) is substantive in that it affects individual rights and obligations, (ii) is rooted in a grant of power by Congress and (iii) was promulgated in conformance with any procedural requirements established by Congress, such  Y -as those found in the Administrative Procedure Act.E [ Yk-ԍx441 U.S. at 301303.E Sections 0.457(d)(1) and 0.457(d)(2)(i) of the Commission's rules constitute the requisite legal authorization for disclosure of competitively sensitive information under the Trade Secrets Act. These rules permit disclosure of trade secrets and commercial or financial information upon a "persuasive  Y-showing" of the reasons in favor of the information's release.`}[ Y-ԍx47 C.F.R.  0.457(d)(1), 0.457(d)(2)(i).` x 13. In particular, Section 0.457(d)(1) provides that certain categories of materials listed therein, such as broadcasters' annual financial reports, are presumed not routinely available for public inspection and that "a persuasive showing as to the reasons for inspection" will be required for such material. Section 0.457(d)(2)(i) applies to materials not falling within the specific categories established by Section 0.457(d)(1) for which the Commission has granted a submitter's request that the information not be made routinely available. Section 0.457(d)(2)(i) thus provides that "[i]f it is shown in the request that the materials contain trade secrets or commercial, financial or technical data which would customarily be guarded from competitors, the materials will not be made routinely available for inspection; and a persuasive showing as to the reasons for inspection will be required in requests for inspection . . . ." x  YP-x 14.` ` Sections 0.457(d)(1) and 0.457(d)(2)(i) satisfy all three elements of the  Y9-Chrysler test because the rules: (i) are substantive in that they affect the public's right to access records and the confidentiality rights of those submitting information to the"$. 0*((K"  Y-Commission, (ii) are authorized by Section 4(j) of the Communications Act,E [ Yy-ԍx47 U.S.C.  4(j).E which provides that "[t]he Commission may conduct its proceedings in such manner as will best conduce to the proper dispatch of business and to the ends of justice," and (iii) were adopted according  Y-to the procedural requirements imposed on the FCC by Congress.d!zy[ Y-ԍxSections 0.457(d)(1) and (d)(2)(i) were promulgated by the FCC in 1967 as a reenactment of a rule initially adopted by the Commission in 1945 following notice and  Y-comment.  See Amendment of Part 0, Rules and Regulations to Implement P.L. 89487, 8 FCC 2d 908, 924 (1967); 10 Fed. Reg. 9718 (1945); 9 Fed Reg. 801 (1944) (notice of  Y -proposed rulemaking); see also Northern Television v. FCC, No. 79-3468, 1 Gov't Disclosure Serv (P-H) para. 80,124 (D.D.C. Apr. 18, 1980) (describing history of rule).d In Northern Television  Y-v. FCC,"[ Y-ԍxNo. 79-3468, 1 Gov't Disclosure Serv (P-H) para. 80,124 (D.D.C. Apr. 18, 1980). the court concluded that the Commission's disclosure of broadcasters' annual financial reports was authorized by Section 0.457(d)(1) and accordingly that release was  Yz-authorized by law and did not violate the Trade Secrets Act.#& zl [ Y-ԍxAlthough Northern Television applied to Section 0.457(d)(1) of our rules, Section 0.457(d)(2)(i) differs from Section 0.457(d)(1) only in that Section 0.457(d)(1) deals with categories of materials that are presumed not routinely available for public disclosure, while Section 0.457(d)(2) applies to materials not falling within those categories. Section  Y=-0.457(d)(2)(i) thus satisfies all the elements of the Chrysler test for precisely the same  Y(-reasons as the Northern Television  decision explains that Section 0.457(d)(1) meets the test.  Y-See generally, Petition of Public Utilities Commission, State of Hawaii, 10 FCC Rcd 2881, 2887 n.77 (Wireless Bur. 1995) (noting that Commission has authority to disclose Exemption  Y-4 materials under authority of both  0.457(d)(1) and  0.457(d)(2)), modified on other  Y-grounds, 10 FCC Rcd. 3984 (1995).  YL-x15.` ` As indicated above, the Commission's legal authority to adopt a rule that permits disclosure of materials covered by the Trade Secrets Act is grounded in Section 4(j)  Y -of the Communications Act.$ Z[ Y)-ԍx Section 4(j) of the Communications Act provides in relevant part: "[t]he Commission may conduct its proceedings in such manner as will best conduce to the proper dispatch of business and to the ends of justice. 47 U.S.C.  4(j). In Federal Communications Commission v. Schreiber,E% [ Y"-ԍx381 U.S. 279 (1965).E the Supreme Court expressly addressed the Commission's authority under that Section, noting: "Grants of agency authority comparable in scope to  4(j) [of the Communications Act] have been held to authorize public disclosure of information, or receipt of data in confidence, as the agency may determine to be proper upon a balancing of the public and private interests" %0*((k "  Y-involved."U&[ Yy-ԍx381 U.S. at 291-92 (notes omitted). U  Y-x16.` ` Other provisions of the Communications Act may also authorize the release of materials governed by the Trade Secrets Act in particular circumstances. For example,  Y-Section 220(f) of the Communications ActG'y[ Y-ԍx47 U.S.C.  220(f).G authorizes FCC employees, upon direction of the Commission, to disclose information gathered by the Commission while examining a carrier's books or accounts. As the Commission has written, "[Section 220(f)] is precisely the type of congressional authorization to disclose information which exempts disclosure from  YH-the strictures of the Trade Secrets Act." (H*[ Y# -ԍxAmendment of Part O of the Commission's Rules with Respect to Delegation of  Y-Authority to the Chief, Common Carrier Bureau, 104 F.C.C.2d 733, 737 (1986). x  Y -xB.` ` Review of Commission's Policies Governing Disclosure  Y -x` ` 1. Commission Rules and Procedures x  Y -x17.` ` The Commission adopted general rules to implement the provisions of the  Y -FOIA in 1967.) [ Y -ԍxAmendment of Part 0, Rules and Regulations, to Implement P.L. 89487, 8 FCC 2d  Y -908 (1967), codified as amended at 47 C.F.R.  0.4410.461. Although the rules have been amended several times, they generally track the statutory language of the FOIA. Section 0.457(d) of the Commission's Rules implements FOIA Exemption 4. Quoting Exemption 4, it provides that records not routinely available for public inspection include "[t]rade secrets and commercial or financial information  YK-obtained from any person and privileged or confidential."J*Kf [ Yb-ԍx47 C.F.R.  0.457(d). J Like the statute, the rule also states that under Exemption 4, "the Commission is authorized to withhold from public inspection materials which would be privileged . . . if retained by the person who submitted them." Finally, the rule permits the withholding of "materials which would not customarily be released to the public by [the person submitting them], whether or not such materials are  Y-protected from disclosure by a privilege."D+ [ Y"-ԍxId. ` ` D In implementing this rule, however, the Commission generally relies not upon the precise language of the rule, but upon the statutory  Y-language of Exception 4 and the general case law construing it, discussed above.F, [ Y%&-ԍxSee paras. 48 above.F  0 " {,0*(("Ԍ Y-x18.` ` Section 0.457 of the Commission's rules also provides that certain categories materials listed therein are deemed to be within Exemption 4 and therefore are "not routinely  Y-available for public inspection."A-1[ YK-ԍxThe materials presumed not routinely available for public inspection are: (i) financial reports submitted by licensees of broadcast stations pursuant to 47 C.F.R  1.611, (ii) applications for equipment authorizations (type acceptance, type approval, certification, or advance approval of subscription television systems), and materials relating to such applications, (iii) Schedules 2, 3, and 4 of financial reports submitted for cable television systems pursuant to 47 C.F.R.  76.403, (iv) annual fee computation forms submitted for cable television systems pursuant to 47 C.F.R.  76.406 and (v) certain materials submitted to the Commission prior to July 4, 1967 or with respect to equipment authorizations between July 4, 1967 and March 25, 1974. 47 C.F.R.  0.457.A As indicated above,P. [ YD -ԍxSee para. 13 above.P such Exemption 4 materials may not be disclosed by Commission employees unless an appropriate request for inspection is made and, after weighing the considerations favoring disclosure and nondisclosure, the  Y-Commission determines that a "persuasive showing" has been made to warrant disclosure.z/r [ Y-ԍx47 C.F.R.  0.451(b)(5), 0.457(d)(1); 0.457(d)(2)(i); 0.461(f)(4).z  Y_-x19.` ` Any person submitting information or materials to the Commission not falling  YH-within the specific categories set forth in Section 0.457 may also request on an ad hoc basis that such information not be made routinely available for public inspection under Exemption  Y -4.0_ # [ Y-ԍx47 C.F.R.  0.459(a). In the absence of a request that materials not be routinely available for public inspection, the Commission may, in the unusual instance, determine on its own motion that the materials should not be routinely available for public inspection. 47 C.F.R.  0.457(d)(2)(i). Ordinarily, however, in the absence of such a request, materials which are submitted to the Commission will be made available for inspection upon request pursuant to Section 0.461, even though some question may be present as to whether they contain trade secrets or like matter. 47 C.F.R.  0.457(d)(2)(i). Each such request must contain a statement of the reasons for withholding the materials  Y -from inspection and of the facts upon which those reasons are based.1 J[ Y -ԍx47 C.F.R.  0.459(b). Requests which comply with these requirements are acted on by the appropriate Bureau or Office Chief. 47 C.F.R.  0.459(d). A request that information not be made routinely available for public inspection will be granted if it presents by a preponderance of the evidence a case for non-disclosure consistent with the provisions " 10*((\ "Ԍ Y- of FOIA.2[ Yy-ԍx47 C.F.R.  0.459(d). Prior to a regulatory amendment in 1984, the Commission required clear and convincing evidence to justify release of materials not routinely available  YK-for public inspection. See Amendment of Commission's Rules Regarding Confidential  Y6-Treatment of Information Submitted to Commission, 98 FCC 2d 1, 35 (1984). If a request that materials not be routinely available for public inspection is granted, the material will be treated the same as those categories of information presumed not routinely available for public disclosure under Section 0.457(d) of the Commission's  Y-rules.J38[ Y -ԍx47 C.F.R.  0.459(h). J That is, any person wishing to inspect such materials must submit a request for  Y-inspection (i.e., a FOIA request) under Section 0.461:4[ Y> -ԍxId.: and a persuasive showing as to the  Y-reasons for inspection will be required.L5[ Y-ԍx47 C.F.R.  0.457(d)(1).L  Y_-x20.` ` The Commission's rules also contain procedures to protect the confidentiality of information until appeals procedures have been completed. Thus, if a request for confidentiality is denied, the person who submitted the request may, within 5 working days,  Y -file an application for review by the Commission.I6 M [ Y-ԍx47 C.F.R.  0.459(g).I If the application for review is denied, the person who submitted the request will be afforded 5 working days in which to seek a  Y -judicial stay of the ruling.:7 [ Y-ԍxId.: In the interim, the material will not be disclosed. Similar provisions govern in instances in which the records in question are the subject of a FOIA request. That is, even if the Commission determines that the information must be disclosed pursuant to FOIA, the information will not be disclosed until the person requesting  Y-confidentiality has had an opportunity to pursue administrative and judicial appeals.I8 [ Y-ԍx47 C.F.R.  0.461(h).I  Yb-x` ` 2. General Policies Regarding Disclosure of Exemption 4 Records  Y4-x21.` ` As indicated above, the Commission's rules provide for the disclosure of  Y-Exemption 4 material if a "persuasive showing is made."I9b[ Y0$-ԍxSee paras. 13, 18 above.I Consistent with the Supreme  Y-Court's decision in FCC v. Schreiber, discussed above, the rules also contemplate that the Commission will engage in a balancing of the public and private interests favoring disclosure" 90*(("  Y-and nondisclosure.O:[ Yy-ԍxSee 381 U.S. at 291292.O The Commission generally has exercised its discretion to release FOIA Exemption 4 information only in very limited circumstances such as where a party placed its financial condition at issue in a Commission proceeding or where the Commission  Y-has identified a compelling public interest in disclosure.;{[ Y-ԍxSee The Western Union Telegraph Company, 2 FCC Rcd 4485, 4487 (1987) (citing  Y-Kannapolis Television Co., 80 FCC 2d 307 (1980)).  Y-x22.` ` An example of a matter in which a party placed its financial condition at issue  Yv-in a Commission proceeding is Kannapolis Television Company.<v[ Y@ -ԍx80 F.C.C.2d 307 (1980); see also, e.g., Leflore Broadcasting Company, 36 FCC 2d 101, 103 (1972) (release of Annual Financial Reports authorized because "poor financial position" had been claimed). In that case, the Commission granted partial disclosure of the Annual Financial Reports filed by WCCBTV, Inc. WCCB had filed a petition to deny Kannapolis's applications for a construction permit and for subscription television authorization, claiming that grant of the applications would impair WCCB's ability to compete effectively and would also jeopardize WCCB's financial  Y -viability. Kannapolis sought access to certain Annual Financial Reports filed by WCCB so that it could assess WCCB's claims. The parties agreed, and the Commission found, pursuant to Commission precedent, that by placing its financial condition at issue, release of  Y -some of WCCB's financial reports was required.h= [ Y-ԍXx80 FCC 2d at 308309. (#h In determining which of the financial reports to release publicly, the Commission stated that it considered "the relevancy and materiality of the information sought and the inability to obtain the requested information  Y{-from other sources."P>{O [ Y{-ԍXxId. at 310.(#P  YM-x 23.` ` MCI Telecommunications CorporationN?M [ Y-ԍXx58 RR 2d 187 (1985). (#N illustrates a second type of circumstance under which discretionary release of competitively sensitive information has been permitted under the Commission's FOIA decisions, i.e., where a compelling public interest exists in disclosure. In that proceeding, MCI had requested access to certain agreements filed by AT&T and a number of regional bell holding companies relating to shared network facilities. Although the Commission found that the information contained in the agreements was exempt from mandatory disclosure under the FOIA because its release could have injured AT&T competitively, it found nonetheless that MCI had presented public interest concerns warranting release. MCI had argued that, through the subject agreements, AT&T had obtained facilities for transport of "accesslike" services at rates substantially" ?0*((" lower than those which MCI and other interexchange carriers could obtain under special access tariffs, and that such preferences called into question the reasonableness of AT&T's private line tariffs (which were based in part on rates paid for such "access like" services). The Commission concluded that MCI needed the information in order to press its claims in ongoing proceedings considering special access tariffs, and ordered release for this limited  Y-purpose.@ [ Y-ԍxId. at 189190;  see also Rogers Radiocall, 52 RR 2d 1373 (1982) (describing unappealed Common Carrier Bureau decision that release of estimation of customer levels in 35 cities in which AT&T subsidiary had applied to offer domestic cellular radio service would be in the public interest as deletion of this estimation would cause application to be deficient and withholding estimation would deprive commenters from evaluating this aspect  Y -of the application); National Exchange Carrier Assoc., Inc., 5 FCC Rcd 7184, 7185 (1990) (finding public interest in disclosure of audit report pertaining to adjustments by four Bell Operating Companies to the NECA common line pool where no information related to individual products or services and ratepayers had vital interest in outcome of show cause/forfeiture proceeding).  Yv-  Y_-x24.` ` Even where a party has placed its financial condition at issue or a compelling public interests exists to disclose   confidential information, however, the Commission does not  Y1-automatically authorize release of such information.A1 [ Y-ԍx Hubbard Broadcasting, Inc., 46 RR 2d 1261, 1264 (1979) (where released financial data already demonstrates losses, it is not necessary to disclose additional data to pinpoint  Yd-causes of losses); Newport TV Cable Co., Inc., 55 FCC 2d 805, 806 (1975) (where released balance sheets already demonstrate profits, it is not necessary to disclose additional data to prove profitability). In determining whether a public interest in the privacy of proprietary business data exists, the Commission has adhered to a policy whereby it "will not authorize the disclosure of confidential financial information on  Y -the mere chance that it might be helpful, but insists upon a showing that the information is a  Y -necessary link in a chain of evidence that will resolve a public interest issue."aB [ Y-ԍxClassical Radio for Connecticut, Inc., 69 FCC 2d 1517, 1520 n.4 (1978) (citing  Yx-Sioux Empire Broadcasting Company, 10 FCC 2d 132 (1967)); accord Cincinnati Bell  Yc-Telephone Co. Tariff. ("Cincinnati"), 10 FCC Rcd 10574 (Com. Car. Bur. 1995) (citing  YN -Classical Radio); see also Petition of Public Utility Commission, State of Hawaii, 10 FCC Rcd 2881, 2888 (Wireless Bur. 1995) (information must be directly relevant to a required  Y""-determination), modified on other grounds 10 FCC Rcd. 3984 (Wireless Bur. 1995);  Y #-American Telephone and Telegraph Co., 5 FCC Rcd 2464 (1990) (quoting Letter of Chief Common Carrier Bureau (Nov. 23, 1988) distinguishing between material of "critical significance" and data providing a "factual context" for the consideration of broad policy issues and concluding with respect to the latter the prospect of competitive harm likely to flow from release outweighs value of making information available).a In other" B0*((N " words, the Commission requires that "specific and concrete public benefits be reasonably  Y-anticipated before properly exempt information will be released on a discretionary basis."rC[ Yb-ԍXxThe Western Union Telegraph Co., 2 FCC Rcd at 4487.(#r  Y-x` ` 3. The Protective Order Approachpp  Y-  Y-x25.` ` In recent years, the Commission also has increasingly relied on special  Yv-remedies such as redaction,8Dv{[ Y -ԍxAllnet Communications Services, Inc., 8 FCC Rcd 5629, 5630 (1993) (withholding from public release some redacted material provided to the parties under a protective order, but releasing other redacted material that did not contain confidential information).8 aggregated data or summaries,XEv[ Y' -ԍxId. (finding certain averaged data not to be competitively sensitive); Bellsouth Corp., 8 FCC Rcd 8129, 8130 (1993) (releasing summary of audit findings despite claim of confidentiality since summary nature of information significantly diminished the likelihood of competitive harm).X and protective ordersF vn [ Y-ԍxSee, e.g., Cincinnati, 10 FCC Rcd 10574; Petition of Public Utilities Commission, State of Hawaii, for Authority to Extend its Rate Regulation of Commercial Mobile Radio  Yi-Services in the State of Hawaii ("Hawaii"), 10 FCC Rcd 2359 and 10 FCC Rcd 2881  YT-(Wireless Bur. 1995); In re Applications of Craig O. McCaw, Transferor, and American Telephone and Telegraph Company, Transferee, for Consent to the Transfer of Control of  Y(-McCaw Cellular Communications, Inc. and its Subsidiaries, 9 FCC Rcd 2610 (Com. Car.  Y-Bur. 1994); Commission Requirements for Cost Support Material to be Filed with Open  Y-Network Architecture Access Tariffs ("Open Network Architecture"), 7 FCC Rcd 1526 (Com.  Y-Car. Bur. 1992), aff'd, 9 FCC Rcd 180 (1993); Motorola Satellite Communications, Inc. Request for Pioneer's Preference to Establish a LowEarth Orbit Satellite System in the 1610 Y-1626.5 MHz Band ("Motorola"), 7 FCC Rcd 5062 (1992). to balance the interests in disclosure and the interests in preserving the confidentiality of competitively sensitive materials. In particular, the Commission has refined the manner in which it releases confidential information by relying more frequently on protective orders or agreements. Protective orders or agreements essentially require parties to whom confidential information is made available to limit the persons who will have access to the information and the purposes for which the information will be used.  Y -x26.` ` As two recent Bureau orders have recently noted with respect to competitively sensitive information: "even when information is critical to resolution of a public interest  Y-issue, the competitive threat posed by widespread disclosure under the FOIA may outweigh"IF0*(("  Y-the public benefit in disclosure."$G[ Yy-ԍxCincinnati, 10 FCC Rcd at 10575; Hawaii, 10 FCC Rcd at 2366; see also Open  Yd-Network Architecture, 7 FCC Rcd at 1533 (citing Penzoil Co. v. FPC, 534 F.2d 627, 63132  YO-(5th Cir. 1976), for the proposition that in considering discretionary disclosure of Exemption 4 material, agencies must consider whether less extensive disclosure may provide the public with adequate knowledge while protecting proprietary information).$ In such instances, disclosure under a protective order or agreement may serve the dual purpose of protecting competitively valuable information while  Y-still permitting limited disclosure for a specific public purpose.H![ Y -ԍXxCincinnati, 10 FCC Rcd at 10575; Hawaii, 10 FCC Rcd at 2366 (footnotes omitted).(#ƕ  Y-x27.` ` For example, in the context of the Shared Network Facilities Arrangement  Y-(SNFA) investigation, the Commission determined that inter-carrier SNFA contracts to which MCI sought access, although exempt from mandatory disclosure under FOIA Exemption 4, were relevant to MCI's claims that AT&T had obtained facilities for transport of "accesslike" services at rates substantially lower than those which MCI and other interexchange carriers, and that such preferences called into question the reasonableness of AT&T's private  Y -line tariffs.nI [ Y-ԍxMCI Telecommunications Corp., 58 RR 2d 187, 190 (1985).n The Commission therefore allowed MCI to have access to the documents, but  Y -it directed the Office of General Counsel to impose a protective order that would prevent MCI, the party seeking access to confidential SNFA materials, from revealing that  Y -information to third parties or using it for competitive purposes.:J [ Y -ԍxId.:  Y -x28.` ` Likewise, in proceedings to consider petitions by various states seeking to  Y-continue to regulate the intrastate rates of commercial mobile radio services, the Wireless Telecommunications Bureau found that certain carrier financial information submitted by California was sufficiently relevant to disposition of California's petition that it could not be excluded from consideration of the issues on the merits. The Bureau found that excluding the information would in effect deny California the opportunity to make the demonstration, required by Congress, that it should be allowed to regulate intrastate rates. The Bureau found that it was therefore desirable to allow the public to comment on the data. Unlimited  Y-disclosure was not appropriate, however, due to the potential for competitive injury. Accordingly, the Bureau ordered limited disclosure of the data, pursuant to a protective  Y-order.RK: [ Y#-ԍxHawaii, 10 FCC Rcd at 2367.R  Y-x29.` ` While protective orders permit the Commission to make confidential information available on a limited basis while minimizing the competitive harm that might  Ye-ensue from widespread disclosure, the Commission is mindful of the fact that extensive"e K0*(({" reliance on protective orders may also impose burdens on the public and the Commission. For example, the Commission's Office of Engineering and Technology stated that to reflexively grant limited disclosure of confidential information under protective orders as a  Y-"routine matter" in pioneer preference proceedingsL[ Y4-ԍxA pioneer's preference allows a party demonstrating that it has developed an innovative proposal leading to establishment of a spectrumbased service not currently provided, or substantial enhancement of an existing spectrumbased service, to be considered for a construction permit or license for the service free from any mutually exclusive  Y-applications. See 47 C.F.R.  1.402. "would result in significant new burdens  Y-upon our staff and delay completion of such proceedings . . . ."M[ Yt -ԍxMotorola Satellite Communications Inc., 7 FCC Rcd 5062, 5064 (1992) (quoting Letter of Thomas P Stanley, Chief Engineer (June 3, 1992)).  Xv- III.xISSUES FOR COMMENT   YH-xA.` ` General Issues  Y -x30.` ` The Commission's policies implementing its rules governing confidentiality affect both the competitive nature of the telecommunications industry and performance of the Commission's public responsibilities. As indicated in the preceding discussion, the Commission has long been sensitive to the concern that fulfillment of its regulatory responsibilities does not result in unnecessary disclosure of confidential information that places Commission regulatees at an unfair competitive disadvantage. In that respect, we recognize that the "private" interests of regulatees in ensuring their own competitive vitality  Yy-generally coincide with the public interest in promoting a robust and competitive telecommunications market. Further, allowing confidential submission increases the willingness of holders of confidential information to provide that information to the Commission and, even where submission is mandatory, often avoids the burden and delay of  Y-invoking such mandatory means.qN[ Y-ԍxSee, e.g., Probe Research, Inc., 50 RR 2d 351, 353 (1981).q For these reasons, the Commission's policy has been to avoid disclosures of confidential information except where necessary to the effective performance of its regulatory duties and to employ protective orders where appropriate.  Y-x31.` ` At the same time, allowing confidential submission necessarily decreases the amount of information publicly available to facilitate public participation in the regulatory process. Public participation in Commission proceedings cannot be effective unless meaningful information is made available to the interested persons. As noted, in recent years, the Commission also has relied more frequently on protective orders and agreements. Protective orders and agreements have the advantage of permitting the release albeit on a limited basis of more information than would be possible without them, given our obligations to protect trade secrets and commercial or financial information. On the other" n N0*((-" hand, protective orders are inconvenient and sometimes cumbersome and increase the administrative burdens on the Commission and those subject to them. In addition, protective orders may make it less likely that the Commission will receive a diversity of public comment on the protected materials. Given the Commission's obligation to balance these concerns, we therefore seek comment whether the Commission should adopt additional policies or rules governing the treatment of information submitted to the Commission in confidence.  YH-x32.` ` Specifically, we seek comment on the standard in the Commission's current rules that permits disclosure of trade secrets and confidential commercial or financial information upon a "persuasive showing" of the reasons in favor of the information's  Y -release.aO [ Y| -ԍxSee 47 C.F.R.  0.457(d)(1), (d)(2)(i).a We ask commenters to address whether this continues to be the appropriate standard or whether the Commission should adopt some other standard. Assuming we retain this standard, we seek comment on what should constitute a "persuasive showing" of the reasons in favor of the information's release. As discussed in more detail below, we also ask comment on standards that should apply in particular types of Commission proceedings. x  Yy-x 33.` ` We also seek comment on whether the Commission's current approach to the use of protective orders is the appropriate approach or whether the Commission should adopt some other approach. Advantages and disadvantages of the current approach should be discussed. We specifically request comment on any problems or burdens that commenters perceive with the current protective order approach and ways in which these problems or burdens might be minimized. Commenters should also address whether the Commission's willingness to release confidential information subject to a protective order reduces submitters willingness to voluntarily submit information to the Commission. And, we seek comment on whether the use of protective orders unduly interferes with the Commission's  Y-ability to obtain public comment or with the public's right to know what actions the Commission is taking and why it is taking them. x  Ye-x!34.` ` As a related matter, we note that a recent D.C. Circuit opinion suggests that  YN-the Commission may have the option of releasing all or part of an order under seal.|PN{[ Yz-ԍxSBC Communications, Inc. v. FCC, 56 F.3d 1484, 1492 (D.C. Cir. 1995).| We seek comment whether it is appropriate for the Commission to draft a decision that relies on  Y -confidential data (or data disclosed pursuant to protective order) without publicly revealing  Y -the information.PQ .[ Y#-ԍxSee also para. 41, below.P If the Commission determines that the data is necessary to support the order, should the Commission place the relevant order under seal or should the information lose protected status at this point? x"!Q0*((""Ԍx  Y-x"35.` ` Commenters also are invited to address and comment on any other issues relating to the Commission's policies and rules governing confidential treatment of information submitted to the Commission.  Y-xB.` ` Model Protective Order  Y_-x#36.` ` As discussed, release of confidential information under a protective order or agreement can often serve to resolve the conflict between safeguarding competitively sensitive information and allowing interested parties the opportunity to fully respond to assertions put forth by the submitter of confidential information. We seek comment as to whether it would be helpful for the Commission to develop a standard form protective order that could then be modified as appropriate to fit the circumstances of particular cases. We have supplied, as Appendix A to this Notice, a draft model protective order. We look forward to receiving comments on this draft order, and in particular what modifications need to be made to make it suitable to the varied types of Commission proceedings in which issues of confidentiality arise.  Yb-x$37.` ` We also seek comment on what procedures the Commission should use to resolve disputes about the issuance and content of protective orders and how to ensure compliance with them. We are especially interested in whether commenters believe that our rules should be amended to address such issues directly. x  Y-xC.` ` Issues That Arise With Respect to Specific Types of FCC Proceedings x` `  Y-x%38.` ` As indicated above, we also seek comment on whether different standards should apply for various categories of proceedings with respect to (i) what constitutes a "persuasive showing" of the reasons in favor of confidential information's release and (ii) what, if any, protective conditions we should place upon released material and whether this should vary depending on the nature of a proceeding. Specifically, we seek comment on whether the Commission should apply different disclosure policies to rulemakings, licensing proceedings, tariff proceedings and perhaps other categories of proceedings. For example, we seek comment on whether the Commission should require public disclosure of information without protective orders in some types of Commission proceedings even though that information is within FOIA Exemption 4. Specific issues that arise in connection with various types of proceedings are discussed below. In addition, we request comments on whether special disclosure policies should apply to other categories of proceedings, not specifically mentioned below, and, if so, what those procedures should be. x` `  Y#-x` ` 1. Title III Licensing proceedings  YS%-x&39.` ` Section 309 of the Communications Act provides that the Commission must  Y<&-allow at least 30 days following issuance of a public notice of certain radio license"<&Q0*((`'"  Y-applications for interested parties to file petitions to deny an application.OR[ Yy-ԍx47 U.S.C.  309(b), (d)(1).O Section 309 thus contemplates that interested members of the public will have a full opportunity to challenge the grant of license applications. In addition, relevant case law indicates generally that petitioners to deny must be afforded access to all information submitted by licensees that bear  Y-upon their applications.bS9y[ Y-ԍxSee, e.g., Bilingual Bicultural Coalition on Mass Media, Inc. v. FCC, 595 F.2d 621, 634 (D.C. Cir. 1978) (en banc) (although Commission need not allow discovery on EEO claim in license renewal case, the full report of the Commission's investigation, including all evidence it receives, must be placed in the public record, and a stated reasonable time  Yt -allowed for response by petitioners); see also Amendment of Subpart H, Part 1 of the Commission's Rules and Regulations Concerning Ex Parte Communications and Presentations  YH -in Commission Proceedings, 2 FCC Rcd 6053, 6054 (1987) (applicability of ex parte rules to information submitted in connection with Commission investigation of license applications),  Y-amended, 3 FCC Rcd 3995 (1988).b  Y-  Yv-x'40.` ` We seek comment on whether the fact that the statutory scheme expressly contemplates public participation in Title III license application proceedings makes it inappropriate to withhold information filed in such proceedings from routine public disclosure. In this regard, we note that Commission rules currently specify that broadcast  Y -and other Title III license applications are routinely available for public inspection.[T z [ YE-ԍxSee 47 C.F.R.  0.453, 0.455.[ Nevertheless, applicants do sometimes request confidential treatment pursuant to Section 0.459 of our rules for information submitted with their applications in both contested and uncontested application proceedings. In light of the special issues regarding public participation that arise in Section 309 proceedings, we therefore seek comment on whether our general policy should be to discourage submission of confidential information in the application context but still to leave the Commission some discretion to use protective orders where it seems warranted. Or, is it appropriate to adopt a general policy with regard to licensing proceedings, permitting disclosure of trade secrets and commercial or financial information only pursuant to protective orders?  Y-x(41.` ` If the Commission were to adopt a policy favoring the use of protective orders in licensing proceedings, we assume that petitioners would be given an opportunity to  Y-supplement their petitions to deny after reviewing the protected material. We also seek comment on whether members of the public should be afforded access to such protected material (pursuant to protective orders) in order to enable them to determine whether they wish to file petitions to deny. Would such policies tend to unduly delay Commission action"- T0*(("  Y-on license applications?U[ Yy-ԍxSee generally Motorola Satellite Communications, Inc. Request for Pioneer's  Yd-Preference to Establish a LowEarth Orbit Satellite System in the 16101626.5 MHz Band, 7 FCC Rcd 5062, 5064 n.7 (1992) (noting that OET had declined to grant confidentiality requests and to issue protective orders as a routine matter in pioneer preference proceedings because use of protective orders tends to delay completion of proceedings) We also seek comment on whether it is ever appropriate to withhold from release entirely some Exemption 4 information, as has sometimes been done  Y-in the context of licensing proceedingsxV![ Y -ԍxSee e.g., Application of Mobile Communications Holdings, Inc. for Authority to  Y -Construct the ELLIPSO Elliptical Orbit Mobile Satellite System, 10 FCC Rcd 1547, 1548 (Int'l Bur. 1994) (declining to release, even under protective order, detailed cost and pricing information of applicant for a license).x and if so what standard should be used. Finally, we seek comment on whether different policies apply to different categories of material. For example, commenters should address whether our policy would be to use protective orders in licensing proceedings only in instances in which the material in question satisfies the trade secrets or "substantial competitive harm" prongs of Exemption 4 and to require public disclosure in all other cases in which the Exemption is invoked.  Y1-x ` ` 2. Tariff proceedings  Y -  Y -x)42.` ` Section 203 of the Communications Act requires that common carriers file and maintain tariffs with the Commission. Section 204 gives the Commission the authority to review tariffs for lawfulness, which involves, among other things, a determination of whether  Y -the tariff is just and reasonable pursuant to Section 201(b) and is not unjustly discriminatory pursuant to Section 202 of the Act. The Commission has adopted rules specifying what support materials carriers must file to enable it to carry out its tariff review authority. Section 61.38 of the Commission's rules requires that a dominant carrier filing a letter of transmittal proposing to change its rates, offer a new service or change the terms and  Y6-conditions under which an existing service is offered must include certain cost support data.FW6 [ Yx-ԍx47 C.F.R.  61.38.F  Y-Section 61.49 of the Commission's rules contains a list of the support information that must  Y-be filed by carriers subject to price cap regulation.FXB [ Y!-ԍx47 C.F.R.  61.49.F Pursuant to Section 0.455(b)(11) of the  Y-Commission's rules, cost support data are routinely available for public inspection.QY [ Y$-ԍx47 C.F.R.  0.455(b)(11).Q  Y- "Y0*(("Ԍ Y-x*43.` ` The Commission has generally made tariff support material publicly  Y-available.Z[ Yy-ԍ xCincinnati, 10 FCC Rcd at 10575 (citing Classical Radio for Connecticut, Inc., 69 FCC 2d 1517, 1520 n. 4 (1978)). It has departed from this policy only in a few limited circumstances, for example, to protect thirdparty vendor data where the data were made available subject to a  Y-protective agreement.[ {[ Y-ԍ See paras. 2728, above; Letter from Kathleen M.H. Wallman to Jonathan E. Canis,  Y-et al., FOIA Control Nos. 94310, 325, 328, 9 FCC Rcd 6495 (1994) (denying unrestricted access to cost support data filed in connection with virtual collocation tariff, but allowing  Y -access pursuant to protective order), application for review pending; see also Cincinnati, 10 FCC Rcd at 10575 (restating adherence to history of allowing open tariff proceedings, but allowing protection where cost data disaggregated and with potential of revealing market  Yc -plans and positions in access services market);  MCI Telecommunications Corporation, 58  YN -RR 2d 187, 190 (1985) (allowing MCI access under protective agreement to certain agreements filed by AT&T where MCI argued that, through the agreements, AT&T had obtained facilities for transport of "accesslike" services at rates substantially lower than those which MCI and other interexchange carriers could obtain under special access tariffs, and that such preferences called into question the reasonableness of AT&T's private line  Y-tariffs). ` `  Recently, a number of carriers have filed requests for confidential  Y-treatment of their cost support data with their tariff transmittals. \ [ Yu-ԍ See Ameritech Transmittal No. 863, filed February 10, 1995; Southwestern Bell Telephone Company Transmittal No. 2470, filed June 16, 1995; Southwestern Bell Telephone Company Transmittal No. 2438, filed March 10, 1995.  This presents a number of problems during the tariff review process. The maximum period for tariff review is defined by statute. Specifically, the tariff review process is initiated by the filing of a letter of transmittal by a carrier proposing a change to the carrier's tariff. The Commission's rules afford interested parties an opportunity to file an opposition to the transmittal, which may  Y1-take the form of a petition to reject and/or to suspend and investigate.F]1[ Y-ԍx47 C.F.R.  1.773.F The filing carrier  Y -may file a reply.:^ V[ Y!-ԍxId.: Under the Communications Act, the Commission has a maximum of one  Y -hundred and twenty days to determine the lawfulness of the tariff transmittal.q_ [ Y!-ԍx See 47 U.S.C. 203(b)(2); 47 C.F.R. 61.58(a)(2). q The tariff goes into effect on its effective date unless the Commission issues an order rejecting or  Y -suspending and investigating the tariff.D` [ YB%-ԍx47 U.S.C.  204.D Section 402(b) of the Telecommunications Act of 1996 provides that, effective one year after enactment, a local exchange carrier may file charges, classifications, regulations or practices on a streamlined basis, which shall be" m`0*((y" effective 7 days (in the case of a reduction in rates) or 15 days (in the case of an increase in rates) after the date on which they are filed unless the Commission takes action before the end of the period.  Y-x+44.` ` A request for confidential treatment may not be resolved within the 120 day statutory time frame established for the tariff review process under current law, especially if a ruling is appealed. A request for confidentiality is unlikely to be resolved under the 7 or 15 day time frame that is to become effective for streamlined local exchange carrier filings under the Telecommunications Act of 1996. We therefore seek comment on how to resolve a request for confidentiality made in the context of the tariff review process. One possibility that takes account of the statutory time frame for the tariff review process is to require that carriers file any confidential information first, independent of the filing of the tariff transmittal. Under this alternative, the tariff filing could not be made until the request for confidentiality was resolved. Commenters should also address whether we should continue to make exceptions to the Commission's rule requiring such data to be made publicly available. In this regard, we seek comment on how petitioners will be able to formulate meaningful objections to the proposed tariff rates, terms and conditions, often a critical part of the tariff review process, if they are unable to review all support material prior to the date that petitions are due. One possible solution is to develop a generic protective agreement that parties can use to protect the information during the tariff review process.  Y-x,45.` ` Commenters also should address whether different disclosure policies should apply to different phases of the tariff review process. Specifically, should different disclosure policies be applied to the tariff review and tariff investigation stages? Actions denying petitions to suspend or reject tariffs, thereby allowing a tariff to go into effect, are considered nonfinal, non-judicially reviewable actions because a party can seek further redress by filing a formal complaint pursuant to Section 208 of the Act. In contrast, a tariff set for investigation is assigned a docket number and a pleading cycle is established providing for direct cases, comments and replies. At the conclusion of the investigation, the Commission issues an order which is subject to judicial review. Therefore since decisions to allow tariffs to go into effect are nonreviewable, nonfinal orders, should the Commission's policies focus on the need for disclosure to petitioners (whether or not pursuant to protective orders) primarily in instances in which a particular tariff has been set for investigation? x  Y- x` ` 3. Rulemaking proceedings  Y -x-46.` ` Section 553(b) of the Administrative Procedure Actda [ Y?#-ԍXx5 U.S.C.  551 et seq.(#d (APA) generally requires notice and an opportunity to comment before promulgation of a final agency rule. Specifically, the APA requires that a rulemaking notice include, among other things, "either  Y#-the terms or substance of the proposed rule or a description of the subjects and issues"#{a0*(($"  Y-involved."Nb[ Yy-ԍXx5 U.S.C.  553(b).(#N Further, after the required rulemaking notice has been provided, the agency "shall give interested persons an opportunity to participate in the rule making through submission of written data, views, or arguments" and "after consideration of the relevant matter presented, the agency shall incorporate in the rules adopted a concise general  Y-statement of their basis and purpose."Ncy[ Y-ԍXx5 U.S.C.  553(c).(#N  Yv-x.47.` ` An agency's decision to withhold information in the context of a rulemaking can have a significant impact on whether meaningful notice and opportunity to comment on the bases of an agency's decision have been given. In addition, issues arise to the extent that  Y1-an agency relies on information that has not been made available to commenters.dg1*[ Y -ԍxAbbot Laboratories v. Young, 691 F.Supp. 462, 467 (D.D.C. 1988) (one purpose of the requirement that agencies disclose the documents it deems relevant to a proceeding is to ensure that interested parties have a meaningful opportunity to participate in the proceeding),  Y-remanded on other grounds, 920 F.2d 984 (D.C. Cir. 1990), cert. denied, 502 U.S. 819  Y-(1991); see also e.,g., Petition of Public Utilities Commission, State of Hawaii, for Authority to Extend its Rate Regulation of Commercial Mobile Radio Services in the State of Hawaii  Y-("Hawaii"), 10 FCC Rcd 2881, 2884 (Wireless Bur. 1995). For these reasons, the Commission generally has not afforded confidential treatment to material submitted in rulemakings, although it has on rare occasions utilized protective orders or  Y -agreements in the context of rulemakings. For example, in the Review of Prime Time Access  Y -Rule, the Commission allowed the examination, but not the copying of data based on  Y -Arbitron ratings reports and NAB/BCFM financial reports.e Y [ Y-ԍxSee Letter from Independent Television to Roy Stewart, MM Docket 94123, March 28, 1995. Rulemakings also may create special problems for use of protective orders, however, because a large number of commenters may be involved. On the other hand, a blanket refusal to apply protective orders in the context of rulemakings might cause the Commission to have access to less information than if it used protective orders. We seek comment on these issues as well as the general issue of whether it is ever appropriate to withhold competitively sensitive information filed in rulemaking proceedings from routine public disclosure. We note that the Commission has the option of refusing to consider information in a rulemaking that is submitted along with a request for confidentiality.  Y-x` ` 4. Requests for Special Relief and Waivers  Y-x/48.` ` Parties affected by our rules have the right to seek special relief from the rules' scope or waiver of these rules. In certain cases, parties may base their request for relief uponor otherwise put into issueinformation that is confidential. This information" e0*((|" may include financial information explaining cash flow, profitability, or bankruptcy  Y-problems, or corporate or partnership structure designed to demonstrate insulation from control or interest. For example, in various cable television special relief proceedings, a party may seek relief based on severe financial difficulties, or upon corporate or partnership  Y-structure and insulation from control.f[ Y-ԍxSee generally 47 C.F.R.  76.7(a) (cable petitions for special relief). Likewise, for example, a party may ask the Commission's Office of Engineering and Technology ("OET") to waive a technical standard applicable to industrial, scientific or medical equipment and submit commercially sensitive  Y_-information about the design of or marketing plans for the equipment in support of the  YH-request.fgH{[ Yt -ԍxSee generally 47 U.S.C.  18.101 18.31.f We seek comment on whether and under what circumstances it is appropriate to withhold information filed in such proceedings from routine public disclosure, particularly when the information is potentially decisional to a point placed in issue by the party seeking to withhold such information and may have precedential value for future cases.  Y -#Xj\  P6G;[hXP#x` ` 5. Formal Complaints  Y -x049.` ` Section 208 of the Communications Act permits any party to bring before the Commission a complaint against a common carrier for acts or omissions in violation of either  Yy-the Act or a Commission rule or order.>hy.[ YX-ԍ 47 U.S.C.  208.> Our rules, in turn, establish both informal and  Yb-formal procedures for handling such complaints.ib[ Y-ԍ 47 C.F.R.  1.711 et seq. An informal complaint may be lodged simply by forwarding to the Commission a brief letter explaining the dispute between a complainant and the carrier. Formal complaints, however, are intended to provide an alternative to litigation in federal district court and are subject to various substantive and procedural requirements. 47 C.F.R.  1.7201.735.  Confidentiality issues frequently arise in  YK-formal complaint proceedings, especially in connection with discovery. Parties often use protective agreements to ensure the confidentiality of materials provided pursuant to discovery, and, in 1993, we amended our formal complaint regulations to include limitations on the manner in which an opposing party may use, duplicate, and disseminate materials that  Y-are obtained through discovery and deemed proprietary by the submitter.j6 [ Y!-ԍ 47 C.F.R.  1.731; see Amendment of Rules Governing Procedures to Be Followed  Y"-When Formal Complaints Are Filed Against Common Carriers, 8 FCC Rcd 2614, 262122 (1993). While discovered materials are not routinely filed with the Commission, parties may be directed to submit particular documents that the staff determines to be decisionally significant. In addition, parties may describe or include excerpts of materials that are subject to protective agreements in briefs or other pleadings filed in formal complaint cases. Thus, even when"j0*((" opposing parties agree that particular materials should be protected from disclosure, the Commission must sometimes confront the difficulty of resolving a dispute in which significant portions of a lengthy and complicated record are subject to a protective agreement and a request for confidential treatment under Section 0.459.  Y-x150.` ` We ask commenters to consider the most effective means of balancing our sometimes conflicting obligations to ensure protection of proprietary business data, to prevent undue delay in resolving formal complaints, and to produce decisions that adequately explain, by reference to a specific record, the basis for our disposition of a complaint. For instance, in some cases, a factually and legally sound decision cannot be drafted without referring to information subject to a claim of confidentiality. The particular information deemed by the staff as necessary for resolution may be only a small portion of voluminous materials that are subject to a protective order and provided to the Commission in confidence. Thus, considerable time might be necessary for the staff to examine all materials subject to claims of confidentiality and rule on those claims. If the staff were to rule on the confidentiality of only the particular information determined to be decisionally significant, however, this ruling might prematurely indicate to the parties the staff's recommendation for Commission or Bureau disposition of the complaint. In either instance, the complaint process could be delayed by administrative and judicial appeals of a confidentiality ruling. We ask commenters to consider whether any such delays and burden on Commission resources could  Y4-or should be mitigated by issuing parts of adjudicatory decisions that rely on confidential information under seal. We seek comment on whether such a procedure would serve the public interest, given that complaint cases although adjudications of disputes between particular parties may result in rulings that indirectly, through the establishment of precedent, determine the legality of the practices of nonparties. We welcome suggestions as to how we can preserve the broad utility of the formal complaint process to elucidate the Commission's judgments regarding carrier conduct without either compromising sensitive business data or miring complaint proceedings in protracted peripheral disputes involving confidentiality. x  YN-x` ` 6. Audits  Y -x251.` ` The Commission has a statutory right of access to all accounts, records and memoranda, including all documents, papers, and correspondence kept or required to be kept  Y-by common carriers.Gk[ Yk!-ԍx47 U.S.C.  220(c).G The detailed financial and commercial information inspected during an audit is generally sensitive in nature and is not customarily released to the public. This  Y -fact is highlighted by section 220(f) of the Communications Act,Hl y[ Y$-ԍx 47 U.S.C.  220(f).H which expressly prohibits" *l0*((!"  Y-the release of information gathered during an audit absent a Commission or court order.Im [ Yy-ԍxSection 220(f) does not, however, constitute authority to withhold information that is required to be disclosed under the FOIA, since Section 220(f) does not satisfy the requirements of Exemption 3 of the FOIA, 5 U.S.C.  552(b)(3). Exemption 3 provides that material need not be released where it is "specifically exempted from disclosure by statute . . . provided that such statute (A) requires that matters be withheld from the public in such a manner as to leave no discretion on the issue, or (B) establishes particular criteria for withholding or refers to particular types of matters to be withheld." The Commission has also made clear that the Bureaus and Offices who may be custodians of such audit records have the authority to disclose such information where the information is required to be  Y -disclosed under the provisions of the FOIA. Amendment of Part 0 of the Commission's Rules  Y -with Respect to Delegation of Authority to Chief, Common Carrier Bureau, 104 FCC 2d 733, 737 (1986).I The Commission has held that the public disclosure of data gathered in an audit is likely to impair its future ability to obtain such data because while the Commission could rely on  Y-compulsory measures to obtain the desired materials, such measures would involve  Y-significant expense and delay.%n| [ Y-ԍxJ. David Stoner,  5 FCC Rcd 6458, 6459 (1990); Martha H. Platt, 5 FCC Rcd 5742,  Y-5743 (1990); Scott J Rafferty, 5 FCC Rcd 4138, 4138 (1990); Western Union Telegraph Co., 2 FCC Rcd 4485, 4486 (1987). In addition, the Commission has recognized that Commissiongenerated audit reports are intraagency memoranda that are exempt from  Y}-disclosure under Exemption 5 of FOIA, 5 U.S.C.  552(b)(5). J. David Stoner,  5 FCC Rcd at 6460.% The Commission has also recognized in this regard that although the information gathering process that takes place during an audit begins with a general inquiry that presents an opportunity for a very selective response by the carrier, carriers have been very cooperative, not only permitting examination of company records,  YH-but also allowing employee interviews and preparing new documents.\oH[ Y-ԍxJ. David Stoner,  5 FCC Rcd at 6459. \ The Commission  Y1-has also recognized that if audit materials were routinely disclosed, it would be likely that voluntary assistance in providing information would diminish, especially since the audits do  Y -not present the expectation of a governmentbestowed benefit on the carrier.:p w[ Y+ -ԍxId.:  Y -x352.` ` The Commission has departed from its general policy and publicly released audit reports only in extraordinary circumstances when (i) the summary nature of the data  Y -contained in a particular report is not likely to cause the providing carrier substantial competitive injury, (ii) the release of the summary data and information is not likely to impair our ability to obtain information in future audits and (iii) overriding public interest"y*p0*((,"  Y-concerns favor release of the report.#q[ Yy-ԍxBell Telephone Operating Companies, FCC 94418 (released Oct. 17, 1995); see also,  Yd-e.g., Bell Communications Research, Inc, 7 FCC Rcd 891 (1992); BellSouth Corp., 8 FCC Rcd 8129, 8130 (1990).# In the past, we have normally allowed submitters to request confidentiality for such data and have dealt with such requests on a casebycase  Y-basis, consistent with the applicable standards in FOIA.rO[ Y-ԍxE.g., Bell Communications Research, Inc, 7 FCC Rcd 891 (1992); BellSouth Corp., 8 FCC Rcd 8129, 8130 (1990). We seek comment on whether we should continue to follow this policy and on whether and in what circumstances information gathered during an audit should be released even under a protective order.  Yv-x` ` 7. Surveys and Studies.  YH-x453.` ` The Commission has authority to conduct studies and surveys needed to fulfill its regulatory functions. The precise authority for such studies may come directly from  Y -Congresss [ Y-ԍ#Xj\  P6G;[hXP#xSee, e.g., 47 U.S.C.  543(k) (requiring survey of prices between competitive and  Y-noncompetitive cable television systems).#x6X@`7wX@# or pursuant to the Commission's authority to inquire into matters within its  Y -jurisdiction.Ut [ Y;-ԍxSee, e.g., 47 U.S.C.  403.U Unlike information submitted in support of a specific regulatory action involving the submitting entity, surveys may request information from a broad category of regulated entities who are only submitting data because they were selected as part of a survey sample. Because these studies may involve the submission of information deemed competitively sensitive by responding entities, we seek comment on standards that should be applied to protect the confidentiality of information submitted in this context. We also seek comment regarding the treatment of such information when the information is used ultimately in the development of Commission rules or policies.  Y4-xD.` ` Scope of Materials Not Routinely Available for Public Inspection  x554. The need for and burdens associated with protective orders are necessarily affected by the amount of information eligible for protected status. Accordingly, we seek comment on several issues raised by our current rules on materials not routinely available for public release. x  Y-x655.` ` Categories of Materials that are not Routinely Available for Public Inspection. Section 0.457(d) of our rules contains a list of categories of materials that are not routinely available for public inspection and as such do not require a request for such treatment under Section 0.459. To the extent it is possible to define broad categories of information that should not be routinely available for public inspection, we can reduce administrative burdens"7: t0*((L" on the Commission and submitters. On the other hand, overinclusive categories would not be consistent with the presumption FOIA creates in favor of disclosure. We seek comment whether the current list of materials that are not routinely available for public inspection is appropriate or whether the list ought to be expanded or contracted.  Y-x756.` ` Substantiating Confidentiality Claims. Section 0.461(a) of the Commission's confidentiality regulations provides that a person submitting information or materials to the Commission may request that the information not be made routinely available to the public. Section 0.461(b) requires that each such request contain a statement of the reasons for withholding the materials from inspection and of the facts upon which those reasons are based. Because the Commission sometimes receives frivolous or unsubstantiated requests for confidentiality, we seek comment on whether the Commission should establish a policy or rule specifying more explicitly types of information that should be provided to comply with Section 0.461(b).  Y -x857.` ` Information that the submitter could be required to provide to substantiate requests for confidentiality might include: Xx(#  Yb-Xx(1)X` ` What portion of the information the submitter believes is entitled to confidential treatment;(#`  Y-x(2)` ` The length of time for which confidential treatment is desired;(#`  Y-x(3)` ` Measures taken by the business to prevent undesired disclosure to others;(#`  Y-x(4)` ` The extent to which the information has already been disclosed to others; (#` x  Y-Xx(5)X` ` Specific information showing the degree to which the information concerns a service that is subject to competition; and (#`  YN-Xx(6)X` ` Specific information concerning why disclosure would result in substantial harmful effects to the business' competitive position. (#`  Y -x958.` ` Establishing a policy specifying what types of information should be provided to comply with Section 0.461(b) might be beneficial for several reasons. First, it would enable the Commission to deal in a more efficient fashion with requests that materials not be made routinely available to the public and with requests to release materials not made routinely available to the public. For example, even though our rules provide for seeking  Y"-confidential treatment for only portions of documents when other portions of documents are  Y#-nonconfidential,Iu#[ Y%-ԍx47 C.F.R.  0.459(a).I submitters frequently assert an entire submission as confidential, even though many documents are not composed entirely of confidential business information. "h$yu0*((%" When the Commission is dealing with masses of data from multiple submitters, uncertainty as to what specific confidentiality claims are being asserted can be a significant barrier to efficient action. In addition, a policy specifying what types of information should be provided to comply with Section 0.461(b) might help reduce those confidentiality claims made as a matter of course and induce submitters to be more selective in their confidentiality claims. We seek comment on these benefits and on whether more precise substantiation requirements might burden a submitter's assertion of a claim for information which is truly entitled to confidential treatment. We also seek comment on what measures might be appropriate to deter frivolous requests for confidential treatment.  Y -x:59.` ` Aggregated or Sanitized Information. The Commission sometimes finds it beneficial to disclose to the public non-confidential information derived from data supplied by businesses and claimed as confidential. Such releases might take the form of industry-wide data aggregated into a non-confidential figure, or sanitized documents where all information that could identify the submitters has been removed. We seek comment on procedures the Commission could use to ensure that the portions of the sanitized or aggregated documents which are disclosed do not contain information claimed as confidential and whether the rules should be amended to incorporate such procedures.  YK-  xE.` ` Proposed Clarifications to Commission Rules  (#`  Y-x;60.` ` Any person submitting information or materials to the Commission that do not  Y-fall within the specific categories of information not subject to routine disclosureSv[ Y-ԍxSee 47 C.F.R.  0.457(d).S may also  Y-request, on an ad hoc basis, that such information not be made routinely available for public  Y-inspection under Exemption 4.Iw{[ Y-ԍx47 C.F.R.  0.459(a).I The Commission is considering amending Section 0.459 of its rules to make express in the rules an existing practice whereby the Commission sometimes defers acting on a request for confidentiality if no request for inspection has been made. This practice conserves Commission resources because Exemption 4 determinations are often complex and require substantial Commission analysis. In such instances, the party submitting the information for which confidentiality is claimed is not harmed because the information is not available for public inspection pending Commission action on the confidentiality request. Likewise, the public is not harmed, because, under the FOIA, the Commission would be required to rule on any request that the information be disclosed. We seek comment on codifying this practice of deferring action on requests for confidentiality in the absence of a FOIA or other request for the information.  Y -x<61.` ` The Commission also proposes a clarifying amendment to the title of Section 0.457(d) of its rules to better describe the Section's contents. The amended title would read: "Certain trade secrets and commercial or financial information obtained from any person and"",w0*((#" privileged or confidentialcategories of materials not routinely available for public inspection." x  X- IV.XxINITIAL REGULATORY FLEXIBILITY ACT ANALYSIS  (# x  Y-x=62.` `  Pursuant to Section 603 of the Regulatory Flexibility Act, the Commission has prepared the following initial regulatory flexibility analysis (IRFA) of the expected impact of these proposed policies and rules on small entities. Written public comments are requested on the IRFA. These comments must be filed in accordance with the same filing deadlines as  Y1-comments on the rest of the Notice, but they must have a separate and distinct heading designating them as responses to the regulatory flexibility analysis. The Secretary shall cause  Y -a copy of the Notice, including the initial regulatory flexibility analysis, to be sent to the Chief Counsel for Advocacy of the Small Business Administration in accordance with Section 603(a) of the Regulatory Flexibility Act, Pub. L. No. 96354, 94 Stat. 1164, 5 U.S.C.  Y -Section 601 et seq. (1981).  Y-x>63.` ` Reason for action. The Communications Act of 1934 and the Commission's rules require the Commission to balance various factors in determining whether and under what conditions to withhold or to disclose competitively sensitive information that has been submitted to the Commission and that is not required to be publicly disclosed under the  Y4-Freedom of Information Act. This Notice proposes to examine the Commission's regulations and policies to determine whether the Commission should modify its existing disclosure policies and rules.  Y-x?64.` ` Objectives. To implement the Communications Act of 1934 and the Freedom of Information Act and to develop a policy that will guide the Commission in evaluating the increasing number of requests that it afford confidential treatment to information that has been provided to it by regulated entities and others.  Ye-x@65.` ` Legal Basis. Action as proposed for this rulemaking is contained in Sections 4(i), 4(j), 303(r) and 403 of the Communications Act of 1934, as amended.  Y -xA66.` ` Description, potential impact and number of small entities affected. The Commission's policies and rules regarding the disclosure of confidential commercial and financial information affects small entities that are regulated by the Commission and small entities that participate in Commission proceedings.  Y!-xB67.` ` Reporting, record keeping and other compliance requirements. None.  Y#-xC68.` ` Federal rules which overlap, duplicate or conflict with this rule. None.  YQ%-xD69.` ` Any significant alternatives minimizing impact on small entities and consistent  Y:&-with stated objectives. None. x"#'w0*((P("Ԍ Y- V.XxPAPERWORK REDUCTION ACT (#  Y-xE70.` ` The requirements proposed herein have been analyzed with respect to the Paperwork Reduction Act of 1995 and found to impose no new or modified information collection requirement on the public. x  Xw- VI.xPROCEDURAL PROVISIONS @  YI-xF71.` ` This Notice of Inquiry and Notice of Proposed Rulemaking is issued pursuant to authority contained in Sections 4(i), 4(j), 303(r) and 403 of the Communications Act of  Y -1934, as amended, 47 U.S.C. 154(i), 154(j), 303(r) and 403. Pursuant to applicable procedures set forth in Sections 1.415, 1.419 and 1.430 of the Commission's Rules, 47 C.F.R.  1.415, 1.419 and 1.430, interested parties may file comments on or before 60 days following publication in Federal Register and reply comments on or before 90 days  Y -following publication in Federal Register. To file formally in this proceeding, participants must file an original and four copies of all comments, reply comments and supporting comments. If participants want each Commissioner to receive a personal copy of their comments, an original plus ten copies must be filed. Comments and reply comments should be sent to the Office of the Secretary, Federal Communications Commission, Washington, D.C. 20554. Comments and reply comments will be available for public inspection during regular business hours in the FCC Reference Center (Room 239) of the Federal Communications Commission, 1919 M Street, N.W., Washington, D.C. 20554.  Y-xG72.` ` Ex parte Rules NonRestricted Proceeding. This is a nonrestricted notice  Y-and comment rulemaking proceeding. Ex parte presentations are permitted, except during the Sunshine Agenda period, provided that they are disclosed as provided in Commission  Y-rules. See generally 47 C.F.R. Sections 1.1202, 1.1203, and 1.1206(a). x  Y-xH73.` ` Further information on this proceeding may be obtained by contacting Joel Kaufman in the Office of General Counsel at (202) 418-1720. x  X:- VII.xORDERING CLAUSES xI74. IT IS ORDERED that, pursuant to Sections 4(i), 4(j), 303(r) and 403 of the Communications Act of 1934, 47 U.S.C.  154 (i), 154 (j), 303(r) and 403, NOTICE IS HEREBY GIVEN of proposed amendments to Part 0, in accordance with the proposals and discussions, in this Notice of Proposed Rulemaking, and that COMMENT IS SOUGHT regarding such proposals, discussion, and statement of issues. "" w0*((#" x` ` J1.  Y-xJ75. IT IS FURTHER ORDERED that, the Secretary shall send a copy of this Notice of Proposed Rulemaking, including the Initial Regulatory Flexibility Analysis, to the Chief Counsel for Advocacy of the Small Business Administration in accordance with paragraph 603(a) of the Regulatory Flexibility Act. Pub. L. No. 96354, 94 Stat. 1164, 5 U.S.C.   Y-601 et seq. (1981). x x` `  hhFEDERAL COMMUNICATIONS COMMISSION x` `  hhWilliam F. Caton x` `  hhActing Secretary x" !w0*(( " x X-o APPENDIX A: MODEL PROTECTIVE ORDER AND DECLARATION T  X-T 2( Before the  Federal Communications Commission Washington, D.C. 20554 Yv-TP In the Matter of  Y - [Name of Proceeding]) Docket No.    X -  PROTECTIVE ORDER ă xThis Protective Order is a device to facilitate and expedite the review of documents containing trade secrets and commercial or financial information obtained from a person and privileged or confidential. It reflects the manner in which "Confidential Information," as that term is defined herein, is to be treated. The Order is not intended to constitute a resolution of the merits concerning whether any Confidential Information would be released publicly by the Commission upon a proper request under the Freedom of Information Act or otherwise.  Y-x1.` ` For purposes of this Order, "Confidential Information" shall in the first instance mean either (i) information submitted to the Commission by the Submitting Party that has been so designated by the Submitting Party and which the Submitting Party has determined in good faith constitutes trade secrets and commercial or financial information which is privileged or confidential within the meaning of Exemption 4 of the Freedom of Information Act, 5 U.S.C.  552(b)(4) or (ii) information submitted to the Commission by the Submitting Party that has been so designated by the Submitting Party and which the Submitting Party has determined in good faith falls within the terms of [cite Commission order designating items for treatment as Confidential Information]. Confidential Information shall be deemed to include additional copies of and information derived from Confidential Information.  Y -x2.` ` The Commission may sua sponte or upon petition determine that all or part of the information claimed as "Confidential Information" is not entitled to such treatment.  Y#-x3.` ` Confidential Information submitted to the Commission shall bear on the front page in bold print, "CONTAINS PRIVILEGED AND CONFIDENTIAL INFORMATION DO NOT RELEASE." Confidential Information shall be segregated by the Submitting Party from all nonconfidential information submitted to the Commission. To the extent a document contains both Confidential Information and nonconfidential information, the"%'"w0*((P(" submitting party shall designate the specific portions of the document claimed to contain Confidential Information and shall, where feasible, also submit a redacted version not containing Confidential Information.  Y-x4.` ` The Secretary of the Commission or other Commission staff to whom Confidential Information is submitted shall place the Confidential Information in a nonpublic file. In the event that any person requests that Confidential Information be released publicly, the Commission will treat the request pursuant to 47 C.F.R.  0.461.  Y1-x5.` ` Confidential Information shall only be made available to Commission staff, Commission consultants and to counsel to the Reviewing Parties or if a Reviewing Party has no counsel to a person designated by the Reviewing Party. Reviewing Party shall mean a party to a Commission proceeding or any person or entity filing a pleading in a Commission proceeding. Before counsel to a Reviewing Party or such other designated person may obtain access to Confidential Information, counsel or such other designated person must execute the attached Declaration.  Yy-x6.` ` Counsel to a Reviewing Party or such other person designated pursuant to Paragraph 5 may disclose Confidential Information to other Authorized Representatives to whom disclosure is permitted under the terms of paragraph 7 of this Protective Order only after advising such Authorized Representatives of the terms and obligations of the Order. In addition, before Authorized Representatives may obtain access to Confidential Information, Authorized Representatives must execute the attached Declaration. x  Y-x7.` ` Authorized Representatives shall be limited to:  Y- x` ` a.X Counsel for the Reviewing Parties to this proceeding including inhouse counsel actively engaged in the conduct of this proceeding and their associated attorneys, paralegals, clerical staff and other employees, to the extent reasonably necessary to render professional services in this proceeding, provided that such persons are not representing or advising or otherwise assisting . . .;(#  Y -x` ` b. Specified persons, including employees of the Reviewing Parties, requested by counsel to furnish technical or other expert advice or service, or otherwise engaged to prepare material for the express purpose of formulating filings in this proceeding except that disclosure to persons in a position to use this information for competitive commercial or business purposes shall require the approval of the Commission; or(#  YQ%-x` ` c. Any person designated by the Commission in the public interest, upon such terms as the Commission may deem proper.(# "#'#w0*((P("Ԍ Y-x8.` ` Confidential Information shall be maintained by a Submitting Party for inspection at least the two locations, at least one of which shall be in Washington, D.C. Inspection shall be carried out by Authorized Representatives by appointment during normal business hours. The Submitting Party shall provide copies of the Confidential Material to Authorized Representatives upon request and may charge a reasonable copying fee not to exceed twenty five cents per page. x  Y_-x9.` ` Authorized Representatives may make additional copies of Confidential Information but only to the extent required and solely for the preparation and use in this proceeding, and provided further that the original copy and all other copies of the Confidential Information shall remain in the care and control of Authorized Representatives at all times and shall not pass to any other persons except as provided herein.  Y -x10.` ` Counsel for Reviewing Parties shall provide to the Submitting Party and the Commission with a copy of the attached Declaration for each Authorized Representative within five (5) business days after the attached Declaration is executed, or by any other deadline prescribed by the Commission.  Yb-x11.` ` Confidential Information shall not be used by any person granted access under this Protective Order for any purpose other than for use in this proceeding (including any subsequent administrative or judicial review), shall not be used for competitive business purposes, and shall not be disclosed except in accordance with this Order. This shall not preclude the use of any material or information that is in the public domain or has been developed independently by any other person who has not had access to the Confidential Information nor otherwise learned of its contents.  Y-x12.` ` Reviewing Parties may, in any pleadings that they file in this proceeding, reference the Confidential Information, but only if they comply with the following procedures:  YN-x` ` a. Any portions of the pleadings that contain or disclose Confidential Information must be physically segregated from the remainder of the pleadings;(#  Y-Xx` ` b. The portions containing or disclosing Confidential Information must be covered by a separate letter referencing this Protective Order; (#  Y!-x` ` c. Each page of any Party's filing that contains or discloses Confidential Information subject to this Order must be clearly marked: "Confidential Information included pursuant to Protective Order, [cite proceeding];" and(#  Y:&-x` ` d. The confidential portion(s) of the pleading shall be served upon the Secretary of the Commission, the Submitting Party, and those"#'$w0*((P(" Reviewing Parties that have signed the attached Declaration. Such confidential portions shall be served under seal, and shall not be placed in the Commission's Public File unless the Commission directs otherwise (with notice to the Submitting Party and an opportunity to comment on such proposed disclosure). A Reviewing Party filing a pleading containing Confidential Information shall also file a redacted copy of the pleading containing no Confidential Information, which copy shall be placed in the Commission's public files. Reviewing Parties may provide courtesy copies of pleadings containing Confidential Information to Commission staff.(#  Y -x13.` ` Should a Reviewing Party that has properly obtained access to Confidential Information under this Protective Order violate any of its terms, it shall immediately convey that fact to the Commission and to the Submitting Party. Further, should such violation consist of improper disclosure of Confidential Information, the violating party shall take all necessary steps to remedy the improper disclosure. The Commission retains its full authority to fashion appropriate sanctions for violations of this Protective Order, including but not limited to denial of further access to Confidential Information in this proceeding.  YK-x14.` ` Within two weeks after final resolution of this proceeding (which includes any administrative or judicial appeals), Authorized Representatives of Reviewing Parties shall destroy all Confidential Information as well as all copies and derivative materials made, and shall certify that no material whatsoever derived from such Confidential Information has been retained by any person having access thereto, except that counsel to a Reviewing Party may retain two copies of pleadings submitted on behalf of the Reviewing Party.  Y-x15.` ` Disclosure of Confidential Information as provided herein shall not be deemed a waiver by the Submitting Party of any privilege or entitlement to confidential treatment of such Confidential Information. Reviewing Parties, by viewing these materials: (a) agree not to assert any such waiver; (b) agree not to use information derived from any confidential materials to seek disclosure in any other proceeding; and (c) agree that accidental disclosure of privileged information shall not be deemed a waiver of the privilege.  Y -x16.` ` The entry of this Protective Order is without prejudice to the rights of the Submitting Party to apply for additional or different protection where it is deemed necessary or to the rights of Reviewing Parties to request further or renewed disclosure of Confidential Information. Moreover, it in no way precludes the Commission from disclosing any Confidential Information where it determines the public interest so requires.  Y#-x17.` ` This Protective Order is issued pursuant to Section 4(i) of the Communications Act as amended, 47 U.S.C.  154(i) and 47 C.F.R.  0.457(d).  Y:&-x18.` ` As used in this Order, the term "Commission" shall also include any arm of the Commission acting pursuant to delegated authority."#'%w0*((P("Ԍx$DECLARATION #[Cite Proceeding] TP I, ______________________________, hereby declare under penalty of perjury that I have read the foregoing Protective Order that has been entered by the Commission in this proceeding, and that I agree that I will be bound by its terms pertaining to the treatment of Confidential Information submitted by parties to this proceeding. I understand that the Confidential Information shall not be disclosed to anyone except in accordance with the terms of the Protective Order and shall be used only for purposes of the proceedings in this matter. I acknowledge that a violation of the Protective Order is a violation of an order of the Federal Communications Commission. x` `  hh(signed) _______________________________ x` `  hh(printed name) __________________________ x` `  hh(title) _________________________________ x` `  hh(affiliation) _____________________________ x` `  hh(address) _______________________________ x` `  hh _______________________________  YK-x` `  hh(phone) ________________________________ 0  Y4-x` `  hh(date) _________________________________