FCC Regulations that apply to Interconnected VoIP Providers

Companies that provide a service that: (1) enables real-time, two-way voice communications; (2) requires a broadband connection from the user’s location; (3) requires Internet protocol-compatible customer premises equipment (CPE) [Broadly speaking CPE is any equipment located on a customer’s premises to originate, route, or terminate communications.  The equipment can be provided by yourself or by the customer.]; and (4) permits users general to receive calls that originate on the public switched telephone network and terminate calls to the public switched telephone network.

If this is you then you are an Interconnected VoIP Provider. Congratulations. There are some FCC regulations you need to know about and follow along with required filings and fees. A small subset of these also apply to Non-Interconnected VoIP Providers and the category of what applies to them is slowly expanding.  However, this blog is only aimed at Interconnected VoIP Providers.

How is it that the FCC has the ability to regulate Interconnected VoIP? Through ancillary jurisdiction under the Communications Act of 1934. The FCC does not have explicit authority to regulate certain matters but they claim authority by stating the regulation at issue will “encourage broadband investment and deployment.” The explanation used in the regulations applied to Interconnected VoIP Providers looks like this.

The [INSERT WHAT FCC WANTS TO IMPLEMENT] may spur consumer demand for interconnected VoIP services, in turn driving demand for broadband connections, and consequently encouraging more broadband investment and deployment consistent with the goals of section 706.187. Thus, pursuant to our ancillary jurisdiction, we extend the [INSERT WHAT FCC WANTS TO IMPLEMENT] obligations to providers of interconnected VoIP services.

I don’t make the rules, I just follow them. With that understanding, we’ll take a look at the FCC Regulations you need to follow.

 CPNI (Customer Proprietary Network Information)

CPNI is basically any information appearing on an Interconnected VoIP customer’s invoice which does not appear in a phone directory. The full definition is as follows.

“(A) information that relates to the quantity, technical configuration, type, destination, location, and amount of use of a telecommunications service subscribed to by any customer of a telecommunications carrier, and that is made available to the carrier by the customer solely by virtue of the carrier-customer relationship; and (B) information contained in the bills pertaining to telephone exchange service or telephone toll service received by a customer of a carrier. Practically speaking, CPNI includes information such as the phone numbers called by a consumer; the frequency, duration, and timing of such calls; and any services purchased by the consumer, such as call waiting. CPNI therefore includes some highly-sensitive personal information.”

Prior to disclosing CPNI on a customer initiated phone call, barring certain exceptions such as if the customer discloses the CPNI first, you must ask the customer for their password. If the customer does not have a password you must have them set one up using a series of security questions that do not rely on biographical information.  You do not need to ask for the password in email exchanges if you are emailing the address of record for the customer or if you called the customer at the phone number of record or if the customer was able to provide the CPNI in response to you asking questions designed to draw out the CPNI.

Other steps you must take pertaining to CPNI include having a written CPNI policy and filing an annual CPNI certification with the FCC annually on March 1st.

You can find the full CPNI rules here .

Additional definitions from the CPNI rules can be found in the Communications Act of 1934 amended April 24, 2013.

911 Compliance

You must provide 911 service to customers. Customers may not opt out of 911 service.

You must obtain affirmative acknowledgement from customers that they understand the limitations of Interconnected VoIP services compared to traditional 911 service.  For example, warning that an Internet outage may impact ability to dial 911. The affirmative acknowledgement can be obtained by including the limitations language in your contracts or acceptable use policies and obtaining click acceptance or signatures on those.

For hardware used in conjunction with Interconnected VoIP service you must provide labels to customers warning them of circumstances in which the service may be limited or unavailable.  Prior to activating a new customer’s service you must obtain the physical location at which the service will be used in order to provide this to emergency service personnel if necessary. You must also provide easy ways for the customer to update their physical location with you. The industry standard is to provide an online form the customer may use to update their location.

More about E911 regulations as applied to Interconnected VoIP providers can be found here.

CVAA (21st Century Communications and Video Accessibility Act)

This is intended to increase access to communications services by persons with disabilities.  Accessibility features that can be incorporated into the design of products/services with very little or no difficulty or expense should be included.  The standard as to what is practical to incorporate is a “readily achievable standard” based on the company’s resources and budget.  Individuals with disabilities must be consulted by the manufacturer to determine what features could be incorporated and records substantiating this consultation, what accessibility features are incorporated into products/services, and compatibility of products/services with peripheral devices (ex. with hearing aids) or specialized CPE used by customers with disabilities must be retained.

A CVAA Compliance Certificate must be filed annually by the manufacturer every April 1st.

The CVAA also requires that Interconnected VoIP Providers contribute to the TRS (Telecommunications Relay Service) fund. The TRS fund is used to support communications services for persons with hearing or speech disabilities. More information about CVAA can be found here and here.   Information about the TRS fund can be found in the second paragraph of this link.

CALEA (Communications Assistance for Law Enforcement Act)

This requires that manufacturers with equipment or services that provide a customer with ability to originate, terminate, or direct communications be able to isolate and enable the government to intercept the wire or electronic communications, isolate and enable the government to access certain call identifying information reasonably available to the carrier, deliver intercepted communications and deliver call-identifying information to the government. This must only be done in response to a court order or other lawful authorization and in a manner that protects the privacy and security of communications and call identifying information which not authorized to be intercepted.

However, the act does not authorize any law enforcement agency or officer to require any specific design or system configuration to achieve this or allow them to prohibit the adoption of any equipment, service, or feature. The intercept requirement does not apply to information services and the carrier is not responsible for decrypting or ensuring the government’s ability to decrypt any communication encrypted by a customer, unless the encryption was provided by the carrier and the carrier possesses the information necessary to decrypt the communication. More about CALEA can be found here .

Domestic 214 license– If you provide interstate telecommunications services you automatically have this. The only time you need to file is if you plan to discontinue, reduce, or impair an existing domestic telecommunications service due to a merger or acquisition. This would result in a 214 discontinuance application. Information about the 214 can be found here.

International 214 license– At the moment VoIP is a gray area here and so the FCC does not enforce it against Interconnected VoIP Providers. However, the FCC continually expands what they regulate and this gray area could become black and white in the near future.  It is a one time filing that never expires and odes not add to reporting obligations. More information about the International 214 can be found here.

Additional Filings Required of Interconnected VoIP Providers

Form 499Q– This is filed in February, May, August and November every year and details quarterly projected revenue with payment made on a monthly basis.  Information about the 499Q can be found here .

Form 499A- This is filed on April 1st of every year. This reports historical annual revenue and is a true up of the 499Qs. Information about the 499A can be found here .

Form 477– This is filed on March 1 and September 1 every year. It is used to collect data about broadband and voice connections for census purposes. Information about the 477 can be found here .

Form 502 (Numbering Resource Utilization/forecast aka NRUF)- This is filed on February 1 and August 1 of every year.  You must file if you have received numbers from NANPA, a Pooling Administrator or another telecommunications carrier. Subscriber toll free numbers should not be reported. Information about the Form 502 NRUF can be found here.

Form 159- This is the FCC remittance form that accompanies payment of the annual regulatory fees due the FCC.  Payment for all annual regulatory fees must be received by September 13. The form 159 can be found here .

Telecom taxes

Providing Interconnected VoIP services comes with a host of telecom taxes. They vary by state and it is very difficult to figure this out on your own, even if you are a CPA. For the love of all that is holy talk to a telecom tax attorney to make sure you are set up to properly calculate these taxes.


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